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Dark Money Is on the Supreme Court’s Docket

  • January 19, 2021

A new Supreme Court case is calling into question the sincerity of corporate America’s reckoning with political giving. Many companies and trade groups say they are re-evaluating political donations after the riot in the Capitol, demanding accountability for lawmakers who challenged the electoral count. But in a matter accepted for review by the high court a few days after the mayhem, some of those organizations had argued for a constitutional right to anonymous charitable donations, a position that would make accountability more difficult. (It’s known as “dark money.”)

The case “nominally involves a tiny technical question” about the tax disclosures of charities’ major donors in California, wrote Senator Sheldon Whitehouse, Democrat of Rhode Island, in the National Law Journal. But it “could lock in dark money influence as a constitutional right,” he added, and it comes as “the country faces a dark-money crisis as anonymous influence spreads malicious disinformation and corrupts and disrupts our politics.” More than 20 “friends of the court briefs” supporting donor anonymity were filed, including from business groups.

The petitioner says anonymity protects “dissident beliefs.” The Americans for Prosperity Foundation is a Koch-affiliated nonprofit, prohibited from political activities, that describes itself as a “charity that fund-raises nationwide and educates the public about free-market solutions.” It is related to Americans for Prosperity, a Koch-affiliated political advocacy group. In its petition to the court, the nonprofit notes that “the general public, including protesters, does not differentiate” between the two. The nonprofit unsuccessfully challenged California’s rule on disclosure. (The Supreme Court has not yet set a date for argument.)

  • The National Association of Manufacturers took a swift, strong stand against challenges to the election result after the Capitol riot. In its brief last year urging review of this case, it said that requiring donor disclosures would “chill speech, association and donor contributions, in violation of the First Amendment.” The disclosure requirements “threaten to stifle robust political debate,” it said, and “without anonymity, speakers face boycotts, harassment and even threats of violence.”

  • The Chamber of Commerce, which vowed to curb donations to lawmakers who challenged the vote count, expressed “a strong interest in this important case.” It argued in its brief that “many donors to nonprofits prefer to remain anonymous for a variety of reasons, including to protect themselves from being targeted by extremists who hold different views, to avoid further requests for solicitations, or simply because they do not wish to publicize their charitable good deeds.”

Why worry? Anonymity obscures corporate influence in politics, which is already difficult to quantify. And some charitable giving goes to lobbyists, think tanks, nonprofits and players in the “marketplace of ideas,” argue the businesswoman Katherine Gehl and the Harvard professor Michael Porter in “The Politics Industry.” These groups engage in “shadow lobbying” on behalf of special interests, partly fueled by the untraceable money at the center of the court case.

The Paycheck Protection Program kicks into high gear. The federal small-business relief program reopens to all lenders today, after smaller banks were given access to the initiative last week. Companies can apply for a second loan, but there are tighter restrictions, including proof of at least a 25 percent decline in revenue any quarter last year.

Article source: https://www.nytimes.com/2021/01/19/business/dealbook/supreme-court-dark-money.html

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