Corporate Free Speech: New rules proposed

by Blair Latoff
US Chamber of Commerce

Brad Smith, a professor at Capital University Law School and chairman of the Center for Competitive Politics, wrote a very revealing op-ed in the Wall Street Journal that draws the connection between opponents of corporate free speech and organized labor. Smith’s column focuses on an organization called the Center for Political Accountability (CPA), led by Bruce Freed, a former Democratic congressional staffer. CPA and the Zicklin Center for Business Ethics at the Wharton School at the University of Pennsylvania recently released its “CPA-Zicklin Index” of companies’ compliance with “best practices” for corporate political spending. In this case, “best practices” are deemed those that discourage engagement in the political process because such activity could damage a company’s brand or shareholder value.

So who’s really behind this effort? Mr. Smith pulls back the curtain:

Mr. Freed’s co-authors on the CPA-Zicklin Index—all now affiliated with CPA—are a former analyst for the Service Employees International Union (SEIU), a writer who also works for the George Soros-funded Justice at Stake (a group critical of business efforts to promote state-level tort reform), and a former general counsel to the Democratic National Committee. CPA’s chief financial officer was formerly Maryland coordinator for John Kerry’s presidential campaign. CPA’s funding comes almost entirely from the same liberal foundations that have long funded “campaign-finance reform” groups such as Public Citizen and Common Cause that opposed the Citizens United ruling, though not from any concern for the best interest of the business community.

Mr. Smith also exposes the hidden agendas of “social investor” funds, most notably Walden Asset Management, that are backing CPA’s efforts:

Walden Asset Management, meanwhile, has long worked with the American Federation of State, County and Municipal Employees (AFSCME) and the SEIU to file shareholder resolutions. It has demanded that executive compensation be tied to “social criteria” and that companies adopt International Labor Organization standards. In 2010, it sent a letter to corporate executives—co-signed by CPA’s Mr. Freed—urging them to cease support for the U.S. Chamber of Commerce and the National Association of Manufacturers because it disagreed with those organizations on environmental issues.

In short, while purporting to be looking out for business interests, CPA and its allies appear more interested in a partisan political agenda and unilateral political disarmament by the business community. Citizens United did not, after all, apply only to business corporations, but also to unions and advocacy corporations such as environmentalist and anti-trade groups. Their spending will remain unabated after corporate America adopts Mr. Freed’s “best practices.” It is as if a GOP operative were to announce “best spending practices” for labor unions. Who would take that seriously?

You can read the entire column here.

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