Securities and Exchange Commission Chair Mary Jo White will face questions from the House financial services committee on Wednesday, November 18, 2015. An Obama appointee, she’s nevertheless drawn sharp criticism from Democrats as well as Republicans. Public Citizen also challenges her stewardship. Here are questions we hope committee members will ask. We also take the liberty of proposing an ideal answer, and then the answer that we expect.
Banker pay: Dangerous pay structures helped cause the Wall Street bubble that burst in 2008. Congress approved a law requiring you to reform those structures and set a deadline: May 2011. When will you propose a good rule?
Ideal answer: There’s no excuse for taking more than five years on this. We’ve completed more complicated rules (including multi-agency rules) in less time. I’ve directed my staff to bring a proposal before commission vote by December.
Expected answer: This is a multi-agency rule that requires a great deal of cooperation. I assure you, we are working diligently. But I can’t give you any date because these are all difficult issues.
Political spending: More than 1.2 million investors have petitioned the SEC to draft rules requiring firms to disclose all their political spending. What is the timeline for moving forward on the rulemaking?
Ideal answer: While this is a political hot potato, shareholders deserve to know where corporations spend their money, especially if it involves public policy which could have a reputational impact on their invested monies.
Events following the Supreme Court’s ruling in Citizens United v. Federal Election Commission have not played out as Justice Anthony Kennedy, the decision’s author, expected.
Disastrously, Citizens United has unleashed unlimited corporate political spending into our elections.
Justice Kennedy, in writing the decision, presumed that this unlimited corporate spending would occur transparently, and that shareholders and the public would be able to hold corporations accountable for any attempt they might make to sway elections.
Here’s what Justice Kennedy wrote:
With the advent of the Internet, prompt disclosure of expenditures can provide shareholders and citizens with the information needed to hold corporations and elected officials accountable for their positions and supporters
Recently, Justice Kennedy expressed frustration that disclosure “is not working the way that it should” despite the fact that, in his words, we “live in this cyber age” where a “report can be done in 24 hours.”
For the past several years, Public Citizen along with allies in the Corporate Reform Coalition have worked to fulfill Kennedy’s promise of disclosure by calling on the U.S. Securities and Exchange Commission to require publicly traded corporations to disclose their political spending. Additionally, we’ve supported shareholder efforts among the filed hundreds of resolutions filed in order to call on corporations like Chevron, Target, Google and Bank of America to disclose their political spending.
Now we’ve opened a new front in the battle for transparency. We’re calling on the Vanguard Group, the largest manager of retirement savings in the U.S., to combat the corrosion of our democracy.
In the aftermath of the U.S. Supreme Court’s appalling Citizens United ruling, Corporate America’s attempts to exert undue influence and block reform efforts in the U.S. Congress are nothing new.
A new report offers fresh evidence that Big Business has its sights set on our justice system too. State Supreme Court elections are the prime targets for corporate interests’ effort to control state benches. The motive: stack the courts with “business-friendly” judges. The implications are hard to overstate and deeply scary.
The report, Bankrolling the Bench: The New Politics of Judicial Elections 2013-14, was produced by three nonpartisan organizations: Justice at Stake, the Brennan Center for Justice, and the National Institute on Money in State Politics.
The following letter to the editor from Lisa Gilbert, director of Public Citizen’s Congress Watch division, was published in today’s issue of The New York Times.
To the Editor:
The Internal Revenue Service is working on important changes to the tax code to redefine political activity for nonprofits (“The I.R.S. Gives Up on ‘Dark Money,’ ” editorial, July 26). If these rules are done right, they will prevent corporations and the wealthy from using nonprofits to game the system to secretly influence elections, as well as give legitimate nonprofits increased understanding of what is allowable.
The Republican Party’s demonization of the agency and continuing engagement with the conspiracy theory of politically motivated targeting gave the I.R.S. little breathing room to carry out new rules in time for the 2016 elections.
We are on the brink of another election that is sure to be the target of millions in anonymous big money funneled through nonprofits, which will again make the point that these rules are needed. After more than 18 months of reworking a proposal for new rules, we look forward to the I.R.S.’s release of its newest draft.
By Andrew Gibson
This Saturday, our nation celebrates the 239th anniversary of the signing of the Declaration of Independence. This day should be used to reflect on the ideals and principles upon which this country was founded so as to remind us of the work still to be done in order to achieve goals enshrined in that all-important document.
The Declaration of Independence affirms America’s self-governance. It states that “governments […] derive[e] their just powers from the consent of the governed,” and that all are treated equal under the law. As Public Citizen strives to ensure that all citizens are represented in the halls of power, our members and supporters should keep the founders’ philosophy in mind as we celebrate America’s birthday with our family and friends.