Lawmakers in at least four states are considering a back-door way to dampen corporate political spending: Require shareholders to approve it.
State legislators in Maine, Maryland, New York and New Jersey have introduced bills that demand that a majority of shareholders approve corporate gifts to political committees or candidates.
Maryland’s bill is set to get a hearing from lawmakers this week. And more legislative buzz may be coming: The sponsor of the Maryland bill said he’s heard from about a dozen legislators from different states who are interested in the idea.
Supporters see the bills as a way to limit the influence of the landmark 2010 Supreme Court decision in Citizens United v. Federal Election Commission, which ruled corporations had a right to spend unlimited amounts of money calling for the election or defeat of candidates. The decision affected laws in about half the states.
Companies with deep pockets are now seen as major players in elections at all levels. Top-spending business and trade groups gave more than $48 million to races for state-level candidates in 2014, and more than $211 million to state-level ballot measure campaigns, according to two recent Center for Public Integrity analyses.
“The whole thesis of Citizens United is that the companies are just speaking for the shareholders,” said state Sen. Jamie Raskin, a Democrat who is sponsoring the bill in Maryland. “If this is going to be anything more than a cynical fiction, then state legislatures need to act to make it real.”
Raskin’s bill would require corporations to get shareholders’ approval for an annual political budget and a slate of candidates or committees the money would support. It would only apply to businesses incorporated in Maryland.
The Maryland Chamber of Commerce calls the idea impractical.
“The bill creates an unworkable scenario for corporations, to be forced to poll their shareholders when they want to make a decision like this,” said Matthew Palmer, senior vice president of government affairs for the chamber.
Raskin said he believes the idea behind his bill is gaining steam after The Washington Post and The Nation published columns he wrote supporting it, and after Congress failed to pass a constitutional amendment meant to overturn Citizens United last fall. About a dozen legislators in other parts of the U.S. contacted him since the articles were published in October, he said, hoping to draft similar bills.
Maine Rep. Deane Rykerson, a Democrat, is among the imitators. His bill is modeled on Raskin’s. “This is not really a total rejection of Citizens United, but it’s a step on the way, temporarily anyway,” he said.
Rykerson’s bill would go one step further than Maryland’s — it would require corporations to give dissenting shareholders a pro-rated rebate for any political spending they don’t support.