April 21, 2011 12:18PM

Citizens United and Rule by Decree

The Obama Administration seeks to mandate disclosure of campaign spending by government contractors. They wish to do so by an executive order. The draft of the order may be found here.

The draft order presents one procedural and several substantive issues.

The procedural question concerns consent. Congress and the Federal Election Commission have refused to enact versions of the proposed mandate. The President proposes to do by fiat what Congress refused to do and the FEC has refused to do in implementing Citizens United.

The President claims his authority to issue the mandate from the Constitution and the Federal Property and Administrative Services Act. Yet he cites no specific part of either the Constitution or that law so citizens are left to guess why the president has such power. Such general gestures toward authority indicate the President assumes his authority to do this should not be controversial.

Appeals to efficiency aside, the President relies on the traditional justifications for campaign finance regulations to support this mandate: disclosure will prevent corruption and the appearance of corruption.

Some of parts of the executive order are confusing to me, at least. The order compels disclosure of campaign contributions by government contractors and their officers. The latter are already disclosed by law. Does this second disclosure offer an administrative or political advantage? Contributions by a contracting business are already illegal so mandating their disclosure makes no sense.

The order also requires contractors and their officers to disclose political spending of the sort at issue in the Citizens United case. In other words, this order responds to Citizens United. An earlier response, the DISCLOSE Act, did not pass Congress. The DISCLOSE Act sought to prohibit independent expenditures by government contractors. This executive order seeks to mandate its disclosure. Progress, of a sort.

But maybe not. One cost of disclosure may be political attacks on a government contractor and its officers. Expecting such attacks, contractors may either refrain from political speech or avoid competing for government business. The latter path would raise taxes (less competition for government services means more spending and thus, more taxes, all things considered). A government regulation that convinces people to avoid political speech casts a chill on First Amendment rights. It is a reason to invalidate a government rule including an executive order.

Citizens United said independent spending cannot corrupt government. Accordingly, the government can only compel disclosure of independent spending to educate voters who are said to use such information as a shortcut to evaluate the positions of a candidate. Are voters actually likely to seek out such information about the officers of a government contractor?

The executive order seems concerned more with corruption, the possibility that contractors will exchange contributions or political spending for government contracts. But the Court has denied that independent expenditures can corrupt. So the order would seem to require disclosure of spending that is already disclosed and disclosure of spending that cannot be constitutionally required.

Campaign finance regulations are mostly about seeking a political advantage. The politics of this order are transparent. Last year several people argued that most major corporations do business with the United States. Hence, the DISCLOSE Act prohibited independent expenditures by government contractors to overturn Citizens United without direct confronting the Court. This executive order seeks a different path to the same end. The administration hopes that disclosure of spending will raises the costs of participating enough that many businesses will stay clear of the 2012 election. If not, disclosure might “encourage” contractors to give to the Obama campaign if everyone expects the President to win re‐​election.

In many ways, the presidential fiat should be the most troubling aspect of all this. The President is legislating here contrary to Article I of the Constitution which vests the legislative authority in Congress. The rule of law fits uneasily with rule by decree.

See also this comment on the order by Hans von Spakovsky. Sen. Mitch McConnell denounces the proposed order. Will that be enough to shoot down this trial balloon?