Source: USA TODAY
WASHINGTON — Liberal activists pledged Monday to lobby the Securities and Exchange Commission to reconsider its move dropping corporate political disclosure from the agency’s priority list.
The agency has eliminated political disclosure from its list of regulatory priorities for early 2014, a potential setback for campaign-watchdog groups looking for ways to force some of the anonymous money in elections into public view. The measure had been on the SEC’s 2013 list of possible rule-making.
While the agency had not formally started writing any rules requiring public companies to disclose their political spending, the issue has attracted significant attention. It drew more than 650,000 written comments, most of them positive, along with strong rebukes from the U.S. Chamber of Commerce and other trade groups, who argued the push was intended to silence of voice of business in politics.
Commission officials have not discussed why the item was removed. Several other 2013 issues have been dropped from next year’s priority list, and the SEC’s action does not preclude the agency from working on the issue in the future.
In a statement, SEC spokesman John Nester said the “list represents our best estimate of what will be ready for the commission’s consideration by fall of 2014.”
However, activists on both sides of the issue said the SEC’s move signaled public disclosure had been placed on the back burner, perhaps permanently.
“We are pretty appalled by this and demand an explanation,” said Lisa Gilbert of liberal-leaning Public Citizen, part of the Corporate Reform Coalition, a group of more than 80 organizations and state officials working on political disclosure. “We will continue to apply as much pressure as we can.”
The Center for Competitive Politics, which opposes limits on campaign spending, praised the decision.
“We applaud the SEC for refusing to allow itself to be dragged into regulating political speech in pursuit of a partisan agenda,” Bradley Smith, the center’s president, said in a statement. “The SEC can now return its focus to protecting investors and regulating capital markets.”
The SEC’s shift comes amid intense debate about the role of anonymous money in politics, following the Supreme Court’s 2010 Citizens United decision allowing unlimited corporate and union spending on activity that calls for the election or defeat of political candidates. Last week, the Treasury Department and the IRS announced they would start crafting rules to clamp down on the explosion of tax-exempt groups that are active in politics but don’t disclose the sources of their funds.
The campaign for the SEC to get involved in political disclosure began in 2011 when a group of law professors filed a petition with the agency asking it to consider the move. This year, liberal campaign-finance activists stepped up pressure on the agency to act when former federal prosecutor Mary Jo White became chairwoman of the commission, bringing to three the number of Democratic appointees on the five-member panel.
The issue’s removal from the agenda demonstrates that White “has a very narrow view of investor protection and corporate governance,” said Bruce Freed, president of the Center for Political Accountability. His investor watchdog group and its partners have worked with 118 companies to disclose political spending.
White has not said much publicly about the political-disclosure measure, but during an October speech, she expressed concern about using the SEC’s powers to write disclosure rules designed to bring “societal pressure” on corporations.
Some congressional Democrats, including Massachusetts Sen. Elizabeth Warren, have pushed legislation calling for more disclosure of corporate political spending.
However, top House Republicans, including Financial Services Committee Chairman Jeb Hensarling, R-Texas, have asked the agency why it was weighing the political-disclosure measure when it had yet to complete rules on other priorities, including the 2012 JOBS Act, which aims to make it easier for small start-ups to attract investors.