Secret Money Suppresses the Political Power of Everyday People, Especially in Communities of Color

By Abi Velasco, Racial Equity Policy Associate

In 2010, the U.S. Supreme Court opened the floodgates for corporations to influence local, state, and federal elections when it decided in Citizens United v. Federal Election Commission that it was, as we explained in a Public Citizen retrospective of the decision, “unconstitutional to prohibit corporations and unions from engaging directly in elections.” As a result, “outside groups [were able] to accept unlimited contributions to influence elections.“ From 2010-2020, because of the precedent set in the Citizens United decision, 25 ultra-wealthy and politically well-connected people poured $1.4 billion into so-called super PACs, which are political committees that can raise funds without a legal limit on donation size. Not only has the unlimited campaign spending since Citizens United further corrupted our democracy by giving wealthy campaign contributors an outsized voice in elections, but it has also been used to influence the outcome of elections by playing a role in suppressing the voting power of Black and Brown communities and influencing the policy debate on several “hot button” social issues.

 “Poison Pill” Riders Harm Society by Stopping Secret Money Reforms

Every year, conservative lawmakers attempt to attach unpopular and harmful poison pill policy riders to appropriations bills. Poison pill riders are pieces of policy that are attached to budget-related legislation that are completely unrelated to the underlying bill and would not be able to pass through the regular legislative process. Lawmakers often do this as a handout to big corporations in order to pass policies they know are not popular with the public. Public Citizen and our allies in the Clean Budget Coalition have built a strong campaign to fight toxic poison pill riders including those that attack important progressive priorities like reproductive health and the environment.

Moreover, Public Citizen is fighting back against three poison pill riders that block progress on reforms that would lessen the power of secret money to influence policy agendas that harm society—and, in particular, harm Black and Brown communities. The first poison pill rider shields publicly traded companies from being required to disclose their political spending to their shareholders. While the Supreme Court has allowed unlimited spending, investors should have a right to know what issues and candidates a company is funding with their money. Another rider keeps the government from forcing contractors to disclose their political spending. The final rider prohibits the Treasury Department from clarifying what kind of electoral work 501(c)(4) organizations can and cannot do. A (c)(4) is a “social welfare,” nonprofit organization. Failure to clarify what (c)(4) organizations can and cannot do as nonprofits allows wealthy donors to funnel money through these secret money organizations with little oversight or consequence from federal regulators. These three riders keep company shareholders and, more importantly, the people, in the dark about just how much corporations are spending to influence elections and how they might be pushing a political agenda that goes against the social and economic interests of everyday people.

Voters are aware of and worried about the power of secret money in society and its role in fueling political corruption. The University of Maryland conducted a study in 2018 that showed that the overwhelming majority of Republicans and Democrats want to limit the influence of big donors over lawmakers. In a 2019 poll commissioned by End Citizens United, 75 percent of voters said that “ending the culture of corruption in Washington” by tackling the issue of special interest money was very important. As we fight to reinstate limits on campaign contributions, there should be a baseline requirement about who receives this money and what issue it is being spent to support.

Secret Money Blocks Progressive Policies

Some companies already voluntarily disclose their political spending due to internal pressure to do or because shareholders force them to do so. Public Citizen’s recent report on corporate political spending shows that many businesses, such as AT&T, Walmart, and Raytheon, and business or trade associations, have funded the campaigns of Republican state lawmakers who are pushing about 250 voter disenfranchisement bills. These bills include policies that would shorten early voting periods, prohibit voting on Sundays (which put an end to the popular “souls to the polls” programs that are used to galvanize Black voters), prohibit mail-in voting, and criminalize providing food or water for voters waiting in long lines. Civil rights experts largely agree that these types of policies would disproportionately impact voters of color.

In one heinous example, a recent Public Citizen analysis uncovered that the Walt Disney Company gave more than $200,000 to Florida Republicans who sabotaged an important voting rights ballot initiative. In 2018, Florida voters overwhelming passed an amendment to restore the right to vote for 1.4 million formerly incarcerated people. Black Americans are overrepresented in this population – they are incarcerated at five times the rate of white Americans. Disney funded 96% of the Republican Florida lawmakers who implemented a modern day poll tax by requiring formerly incarcerated people to pay their court fees and fines before they could vote. Facing discrimination in employment that makes it difficult to find employment, coupled with exorbitantly high court fees, means that most formerly incarcerated people cannot pay these fees and still cannot vote. While Disney may not have a direct stake in voter suppression efforts, Republican lawmakers who pass voter suppression bills and received funding from Disney are likely to also push for policies that would lower taxes that Disney pays on video streaming services in Florida. In effect, Disney is participating in voting suppression efforts simply because it wants to maximize its profits.

Voting rights legislation is not the only issue corrupted by corporate political spending. A 2015 Demos report found that government contractors actively opposed initiatives that would have strengthened the economic security of everyday people and protected the most vulnerable. The report found that government contractors opposed attempts to raise the minimum wage in order to keep paying their workforce low wages and keep their profits high. For example, government contractors in the private, for-profit prison industry spent millions lobbying against policies that aim to reverse the disproportionate impact of the prison-industrial complex on Black Americans, particularly Black men. And this is just the tip of the iceberg in understanding how government contractors engage in political spending. By keeping the majority of their political spending secret, they are able to make huge profits from the public’s money while fighting against policies that would create better outcomes for people of color.

It’s critical that Congress act to remove the riders that are blocking reforms that would rein-in corporate political spending that has not only advanced attempts to suppress the vote, but also prevented advancing progressive policies. In a time where consumers are demanding corporations take actions to further racial justice, the government, customers, and shareholders should know where corporations conduct political activity and if their political donations match their promises to promote racial equity. In October 2021, after intense lobbying by the Clean Budget Coalition, Senate Democrats removed several poison pill riders from nine funding bills, including the three described above that fuel political corruption. However, budget negotiations continue in the Senate, and Republican lawmakers want to keep these harmful riders on the books. Public Citizen and 92 other labor, scientific, consumer, research, faith, civil rights, health, environment, and business groups urge lawmakers to remain firm on the removal of these riders and deliver a 2022 federal budget that center the needs of the people.

Poison pill riders are a danger to democracy and to achieving true equality in society for Black and Brown people. Public Citizen will continue to work hard to remove poison pill riders from bills that fund our government. You can take action to ensure that Congress passes an appropriations bill that enables these changes to be signed into law.