White House abandons push for federal contractors to disclose political giving

The Obama administration has all but abandoned its push to require federal contractors to disclose their political donations.

A year ago, the White House composed a draft executive order that would have forced potential government contractors to reveal their political spending as a condition of submitting bids. But roughly 12 months later, no final order has been issued, and supporters and critics alike say they've seen no signs such a change is forthcoming.

ADVERTISEMENT
"The executive order can potentially come back after the 2012 elections," said Craig Holman, lobbyist for Public Citizen, a government watchdog group that has been urging the greater transparency. "But I don't consider it still being contemplated [now]."

Holman said Obama sent clear signals the issue has been pushed to the backburner in January when the president declined to pitch it in his State of the Union address.

"Obama neglected to even mention it," Holman said with disappointment. "I consider it not to be even on the agenda."

That doesn’t mean campaign finance won’t be a high-profile issue this election year.

Democrats in both chambers have introduced legislation on campaign spending that’s broader than the administration's draft executive order. The Disclose Act — sponsored by Rep. Chris Van Hollen (D-Md.) and Sen. Sheldon Whitehouse (D-R.I.) — would force corporations, including government contractors, to reveal all political contributions above $10,000 and take public credit for the political ads they sponsor.

Backed by Obama, the bills are designed to nibble away at the Supreme Court's 2010 Citizens United decision, which cleared the way for unlimited, often anonymous campaign spending by corporations, unions and other well-heeled interests.

The Senate is considering a vote on the Whitehouse bill as early as May, Holman said, while Van Hollen might circulate a discharge petition in a stab at forcing a floor vote in the House, his office confirmed Friday. Both efforts would likely fail in the face of GOP opposition, but Democrats are hoping the heightened attention will portray Republicans as hypocrites for supporting the idea of greater transparency but not the legislation that would bring it about.

Republicans aren't shying away from the issue, either. Rep. Tom Cole (R-Okla.) —who championed a successful amendment to last year's omnibus that bars funding for contractor disclosure — is hoping to extend that prohibition in this year's appropriations process, his office said this week.

With Republicans largely united against more campaign disclosure rules, some Democrats are urging Obama to sidestep Congress and adopt the contractor order unilaterally.

"Any time is the right time for the president to sign an executive order to bring disclosure and transparency to those who do business with the federal government," Rep. Anna Eshoo (D-Calif.) said Friday through a spokesman. "Get your pen out, Mr. President."

White House spokesman Eric Schultz declined to comment on the draft proposal, saying, “We’re not going to publicly speculate on future executive orders." 

"But broadly speaking," Schultz said in an email, "the president is committed to improving our federal contracting system, making it more transparent and more accountable. 

"He believes that American taxpayers deserve that, and that is why he has asked Congress to pass a full disclosure law,” Schultz added.

Leaked last April, the administration's draft order would have required contractors vying for federal projects to disclose any contributions to candidates, parties or third-party political groups exceeding $5,000 in the two years prior to submitting the bid. The rule would have applied to both companies and the individuals running them.

Supporters, including most Democrats and campaign finance reformers, say the move would discourage companies from showering federal contract dollars back onto the same policymakers who pick the winning bids, thereby checking temptations of favoritism — and the appearance of it.

But the draft sparked an outcry from GOP leaders, who argued the disclosure would undermine the bidding process by stirring doubts about whether contracts were awarded based on merit, rather than political affiliation.

Behind House Majority Whip Kevin McCarthy (R-Calif.), a group of GOP leaders wrote to Obama last May warning that "the net effect" of the rule "would be stifled political speech," as contractors shied away from political donations "to protect their livelihoods.”

Even a few leading Democrats objected to the draft order. House Minority Whip Steny Hoyer (D-Md.), for instance, said contracts should be awarded only "on the merits of the contractor’s application and bid and capabilities."

“There are some serious questions as to what implications there are if somehow we consider political contributions in the context of awarding contracts,” Hoyer, a strong supporter of the Disclose Act, said last May. “I’m not in agreement with the administration on that issue.”

Holman said campaign finance reformers sought to eliminate those concerns by urging the White House to alter its proposal by requiring disclosure from existing contractors, but not those bidding for future contracts.

"It would have avoided that entire controversy about political favoritism," Holman said, adding that Obama missed “a huge opportunity” to make a political statement in an election year when political spending will reach well into the billions. 

"In my mind," Holman said, "it was not too politically difficult."