House Democrats are scrambling over how to handle legislation forcing companies to hold a shareholder vote to approve annual corporate political spending.
The bill is backed by Rep. Michael Capuano (D-Mass.), who would like it added to campaign finance reform legislation Democrats are moving through the House in response to the Supreme Court’s Citizens United ruling, which removed restrictions on corporate and union political spending.
Capuano’s bill was introduced in March, and watchdog groups were disappointed it was not included in the campaign finance bill.
Castle and Rep. Chris Van Hollen (D-Md.) didn’t talk about whether to include the Capuano bill in their discussions on the campaign finance legislation, according to Castle and Doug Thornell, a spokesman for Van Hollen.
But Van Hollen did ask Rep. Barney Frank (D-Mass.), the chairman of the House Financial Services Committee, to pull back on a planned markup of Capuano’s bill earlier this year, according to Frank and Thornell.
Frank is a listed co-sponsor of the Capuano bill, along with 42 others.
Asked if he planned to mark up Capuano’s bill once the Disclose Act passes, Frank said, “We’ll see.”
Van Hollen spokesman Doug Thornell said Van Hollen asked Frank to hold off when he heard GOP members wanted more time to review Capuano’s bill.
“Van Hollen heard that some House Republicans on the committee needed more time to review the Shareholder Protection bill. He asked Chairman Frank to give them additional time and Mr. Frank agreed,” Thornell said.
Now Van Hollen is suggesting there are other options to dealing with the Capuano bill.
Thornell said that Van Hollen supports Capuano’s legislation and that it could be considered as an amendment to the Disclose Act on the floor. Thornell also said it could come up for a vote after the Disclose Act passes.
The Capuano bill would require corporations to describe their planned political expenditures for the forthcoming fiscal year to shareholders, who would then vote to approve the proposed budget.
Capuano, who said he would try to add his legislation to the campaign finance reform bill, said his legislation would give more control to people over how their money is spent and establish more accountability for corporate political spending.
“It’s about empowering shareholders,” Capuano said. “The people whose money it is should have a say on how and where that money is spent. In the case of a corporation, that’s the shareholders.”
Castle, who is also a member of the Financial Services panel, said he would “almost certainly” back away from the Disclose Act if it were added to that legislation.
“I think the federal government needs to stay out of corporate governance,” Castle said.
The Delaware lawmaker said adding Capuano’s bill to the Disclose Act would “muddy up” the campaign finance bill, which he believes is a much smaller piece of legislation and not the broad expansion of government that Capuano’s bill would create.
The Disclose Act’s only other Republican co-sponsor, Rep. Walter Jones (R-N.C.), said he hadn’t heard of Capuano’s bill. “Conceptually, I find that interesting, but I have not had a chance to look at the bill,” Jones said.
Several public interest organizations are lobbying for a House vote on Capuano’s bill either at the same time or soon after the Disclose Act is voted on by lawmakers.
“We are planning on getting the Shareholder Protection Act to a vote on the House floor simultaneously with the Disclose Act, subject to a standalone vote,” said Craig Holman, government-affairs lobbyist for Public Citizen.
He said he expects both bills will win approval and move to the Senate.
Business associations will likely come out in force against Capuano’s bill, however. The legislation does not impose a vote on union members on union political spending.
Tom Quaadman of the U.S. Chamber of Commerce said the legislation is a “wolf in sheep’s clothing” and could lead to every board decision being second-guessed, causing “gridlock.”
Castle said the Disclose Act alone could end up with more GOP support in the House than just Jones and himself. Once lawmakers who oppose the bill get a chance to look at its language, he expects more Republicans will vote for it.
“I think there will be more Republican votes than there are now. I don’t expect it to be a big number,” Castle said.