Watchdog groups cheered a federal court ruling earlier this year aimed at revealing the secret donors behind many political interest groups, calling it a bold step in favor of disclosure.
But the U.S. Chamber of Commerce, which plans to spend more than $50 million during the 2012 election cycle, said this week that it has a simple strategy for getting around the ruling: By changing the focus of its ads to specifically support or oppose candidates, it will not have to disclose any of its donors.
The announcement marks a sharp escalation in the battle between corporate interests and pro-disclosure groups who have been trying with limited success to force corporations and business groups to reveal more details about their political spending.
The move also means that the chamber is poised to become more directly involved in specific congressional races by explicitly telling people how they should vote. It’s a notable shift in strategy for the nation’s largest business lobby, which has long characterized itself as focusing primarily on policy rather than politics.
“We will have a vigorous, unchanged election program,” chamber President Tom Donohue told reporters Monday, adding that the push for disclosure is “all about intimidation. They want to intimidate people from participating.”
Rep. Chris Van Hollen (D-Md.), who brought the lawsuit that led to the ruling, said “It’s extraordinary what lengths these groups will go to in order to hide the sources of their funding. They’re going to twist themselves into knots to prevent voters from knowing who’s financing their ads.”
The focus of the dispute is political advertising run by nonprofit organizations that are not required to reveal their funding sources publicly. Most of the advertising aired in connection with the 2012 general election campaign has come from such non-disclosing groups, suggesting that much of the political spending over the next six months will come from sources invisible to the public.
But in March, U.S. District Judge Amy Berman Jackson ruled that the Federal Election Commission had overstepped its authority by allowing groups that run so-called “issue ads” to withhold the names of those funding the spots. An appellate court panel bolstered the decision this month by refusing to block it while the issue is litigated.
To advocates, the decision means that groups that normally don’t reveal their funding sources will have to do so if they run issue ads before the election.
But chamber officials think they they can avoid disclosure merely by changing the nature of their ads from “electioneering communications” — which focus on general issues — to “independent expenditures,” which explicitly urge viewers to vote for or against a particular candidate.
Jackson’s ruling revolved around the former and made no mention of the latter, leading the chamber and other groups to believe they can safely ignore it.
During a Monday breakfast sponsored by the Christian Science Monitor, Donohue said that the chamber “will get done what we need to get done” in its political program.
“We’re not going to pull back from anything we’re doing; it’s full steam ahead,” said R. Bruce Josten, the chamber’s vice president. “The only thing that may switch is you’re forced to express advocacy using the magic words ‘vote for,’ ‘vote against,’ as opposed to highlighting a given member’s legislative record.”
The chamber and its allies also say they will continue to fight the Jackson ruling in the courts, while campaign-finance watchdogs plan to press organizations to comply with the decision.
Democracy 21 President Fred Wertheimer, a veteran campaign-finance activist, says the chamber’s shift in ad strategy shows that the group has never been as apolitical as it claimed. In addition, he argues, the chamber risks angering some of its corporate patrons by becoming directly involved in federal races.
Many publicly traded companies have become skittish in recent months about attachments to controversial political issues. The American Legislative Exchange Council, a lobbying group that concentrates on state issues, has lost numerous corporate members in recent weeks because of a boycott over its support for “stand-your-ground” gun legislation and other initiatives. (Kaplan, an education company owned by The Washington Post Co., is a former member of ALEC.)
“It unmasks what a complete charade the chamber’s claims have been — that they only run issue ads and don’t engage in campaign activity,” Wertheimer said. “Corporations have been able to say that their money is just going to promote business policy when it’s spent by the chamber. That cover is gone now for these public corporations.”
Staff writer Tom Hamburger contributed to this report. For previous Influence Industry columns, go to washingtonpost.com/fedpage.