In the News
Chronicle of Philanthropy: Nonprofits and Foundations Likely to Come Under Fire as Senate Committee Explores ‘Dark Money’ in Politics
By Dan Parks
The Senate Finance subcommittee on Taxation and IRS Oversight offers no description of [Wednesday’s] hearing beyond the title “Laws and Enforcement Governing the Political Activities of Tax Exempt Entities.” Even the witnesses who will testify are uncertain of its focus. It appears likely that subcommittee chairman Sheldon Whitehouse wants to raise concerns about “dark money” flowing through 501(c)(4) nonprofits, but Republicans plan to widen the scope of the hearing to highlight what they see as illegal political activities by 501(c)(3) charities and foundations…
Brad Smith, founder of the Institute for Free Speech, who will testify at the hearing at the invitation of Republicans, said he felt that Democrats were exaggerating the problems posed by dark money flowing to political-action committees while ignoring the fact that many 501(c)(3) charities engage in a wide variety of activities that can influence elections or policy. For example, charities are allowed to do voter-registration drives that target certain areas, do a limited amount of lobbying, and do advocacy work to raise the profile of certain issues they care about, Smith said.
“I’m very cynical about the hearing because I view the hearing as somewhat cynical,” Smith said.
New from the Institute for Free Speech
By Luke Wachob
What is the Biden administration thinking?
Creating a “Disinformation Governance Board”? Bad idea. Placing it inside the Department of Homeland Security? Bad idea. Choosing a leader who seems like they were designed in a lab to irritate anyone to the right of The New York Times editorial board? Probably, a very bad idea.
The feds can’t be surprised when Americans react with skepticism to a government campaign to counter “disinformation” about politically sensitive topics. The potential for abuse and propagandizing are obvious. And yet, it appears no steps were taken to try to assuage the inevitable concerns of critics. The rollout of the Disinformation Governance Board makes it look like everything you would fear it to be.
Any government body dedicated to combatting “disinformation” will set off alarm bells, of course. Even if undertaken with the best of intentions, such an initiative chills criticism of government and builds momentum for restricting free speech. For this reason, almost any effort by government to police truth in politics verges on an abuse of power.
To the extent there is a role for government agencies to play, it is in warning citizens about specific cases of foreign propaganda. The board’s rollout gives little confidence it will stay focused on that limited mission. It also appears wholly unconcerned with answering citizens’ well-founded fears about how such a board could chill or restrict political speech.
Reason (Volokh Conspiracy): Precedent Supporting Constitutionality of Florida Legislature’s Dissolving Disney Special Government District
By Eugene Volokh
As I suggested Friday and yesterday, Supreme Court precedent is unclear on whether Florida’s dissolving the special government district that Florida had created for Disney in the 1960s violates the First Amendment…
Lawyer Adam Schulman, however, points out that the precedent in the Eleventh Circuit—the federal appellate court in charge of, among other things, Florida cases—is very much against any First Amendment challenge.
By Susannah Luthi
A federal judge on Friday gave the green light for an independent journalist’s lawsuit against Twitter to proceed — a blow to the social media giant, which had tried to get the case dismissed.
But U.S. District Judge William Alsup dismissed the free speech claims made by independent journalist Alex Berenson, citing Twitter’s federal protections under Section 230 of the U.S. Communications Decency Act.
The case won’t challenge Big Tech’s Section 230 shields, but it could still test Twitter’s power to banish users from the site as Elon Musk moves to take over the company following his $44 billion purchase.
By Thomas Claburn
The US Ninth Circuit Court of Appeals on Wednesday affirmed the 2019 conviction and sentencing of Carsten Igor Rosenow for sexually exploiting children in the Philippines – and, in the process, the court may have blown a huge hole in internet privacy law.
The court appears to have given US government agents its blessing to copy anyone’s internet account data without reasonable suspicion of wrongdoing – despite the Fourth Amendment’s protection against unreasonable searches and seizures. UC Berkeley School of Law professor Orin Kerr noted the decision with dismay.
“Holy crap: Although it was barely mentioned in the briefing, the CA9 just held in a single sentence, in a precedential opinion, that internet content preservation isn’t a seizure,” he wrote in a Twitter post. “And TOS [Terms of Service] eliminate all internet privacy.”
By Lachlan Markay
The Federal Election Commission has unanimously rejected allegations that a network of progressive news sites had operated as a de facto Democratic political outfit, Axios has learned.
Why it matters: The decision reaffirms that even biased or ideologically driven news reporting can’t be regulated as “political” activity.
Inside the FEC, there’s debate about going even further.
At least one commissioner wants to expand allowances for political media to include digital communications not generally thought of as traditional news reporting.
Wall Street Journal: Disney’s Clash With Florida Has CEOs on Alert
By Chip Cutter and Emily Glazer
In private meetings and coaching sessions over the past few weeks, top business leaders have been asking a version of the same question: How can we avoid becoming the next Walt Disney Co.? …
At many companies, vocal employees have in recent years pushed bosses to take public stands on social and political issues. Florida’s pushback against Disney has raised the stakes.
“The No. 1 concern CEOs have is, ‘When should I speak out on public issues?’ ” said Bill George, former chairman and CEO of Medtronic PLC and now a senior fellow at Harvard Business School. “As one CEO said to me, ‘I want to speak out on social issues, but I don’t want to get involved in politics.’ Which I said under my breath, ‘That’s not possible.’”
By Ed Rensi
The shareholder effort is the first action taken by a new coalition that I lead called the Boardroom Initiative. Its goal is to empower shareholders and all stakeholders to fight back against the destructive agenda of woke capitalism. Its overriding message to company executives is to stay out of politics that don’t directly impact their bottom lines…
Wading into such divisive political waters alienates roughly half of companies’ customers, reducing shareholder value and depressing savings accounts like 401(k)s.
By Bruce Freed
Today’s crisis of democracy poses fundamental questions for company engagement in the political process. Is a commitment to democratic institutions a priority for companies, or is it superseded by bottom line or political access concerns? What type of political environment enables companies to grow and the country to prosper? How does the attack on democracy affect companies, and what risks does it pose? How should companies respond?
These are questions with which public companies have seldom grappled. Today, they are at the forefront of national debate. The risks are real and not easily ignored. The Center for Political Accountability took the first comprehensive look at these challenges facing public companies in its new Practical Stake report on corporations, political spending and democracy. Here are the key points:
By Jason Lange
The two-day poll completed on Thursday showed that 62% of Americans – including 68% of Democrats and 55% of Republicans – said they were less likely to back a candidate who supports going after companies for their views.
Candidates and Campaigns
By David Weigel
The voice was coming from an ad, one of the very first from Protect Our Future, a PAC funded by cryptocurrency billionaire Sam Bankman-Fried. In the weeks since it ran, the PAC has poured roughly $7 million into the race, another new PAC was founded to help elect Flynn to Congress, and the House Democrats’ own super PAC, to the horror of the other Democrats running in this new seat, had endorsed Flynn, a 35-year lawyer and policy analyst with no political experience.
The relentless spending has transformed the May 17 Democratic primary for Oregon’s 6th Congressional District into one of the most expensive races in the country — not what Democrats expected when they drew the lines…
“This election is a referendum on our democracy, our values, and whether or not this district can be bought,” said Matt West, a scientist running for the seat, at a candidate forum last week.
“Nobody really knows who’s funding this,” said state Rep. Andrea Salinas (D), who picked up endorsements from Gov. Kate Brown, Planned Parenthood, and a number of labor unions before the heavy spending started boosting Flynn. “Nobody really knows what their motivation is.” …
None of the Democrats running for the new seat expected this, and none built their campaigns expecting millions of dollars to flow to someone they’d never heard of.