Mike Kueber's Blog

February 28, 2011

Sunday book review #16 – Dirty Sexy Politics by Meghan McCain

Filed under: Book reviews — Mike Kueber @ 4:34 am
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No, the title of this book isn’t what attracted me to it.  Rather, it was seeing Meghan interviewed three times on the Imus in the Morning talk show.  As Imus observed more than once, Meghan is bright, interesting, and personable.  That same person comes through in this book.  It’s been a long time since I have read a book so easily readable.

The title of this book has virtually nothing to do with the book; rather it was merely a slick artifice designed to buy some attention and sell some books.  Apparently the title was derived from a Barry Goldwater quote – “Sex and politics are a lot alike.  You don’t have to be good at them to enjoy them.”

The book chronicles Meghan’s time spent with her dad’s 2008 presidential campaign, which Meghan joined right after graduating from Coumbia in NYC.  The book starts with Meghan worrying that her dad was going to pick Mitt Romney for his running mate.  She had been rooting for the selection of family friend Joe Lieberman and was worried about how her free-spirited personality and liberal use of the f-bomb would mesh with the straight-laced Mormon family.  She quickly learned, however, that meshing with the Mormons would have been easy compared to dealing with the prima donna Palin.

Although Meghan comes across as frank and critical, she isn’t catty.  She is struck by Palin’s beauty and charisma, and likes how Palin stands up to bad-guy Steve Schmidt, the Nazi-like campaign manager.  But Meghan also admits being a bit resentful that Palin attracts so much publicity and seems to have her own agenda.

Regarding Meghan’s role in the campaign, she acknowledges that there was a conflict between (a) the way she was raised (to be independent and to speak her mind freely) and (b) the proper way to conduct herself during a campaign (to be a wallflower).  If she had been more mature at the time, she might have been able to recognize and deal with this conflict instead of continually fighting to be herself.  But being herself caused the campaign managers eventually to decide that she was more trouble than she was worth, and they reassigned her from the main campaign to a secondary campaign that traveled by bus to low-visibility events. 

In addition to attending the low-visibility events, Meghan published a campaign blog with the help of two assistants – a photographer and a videographer.  Eventually, it received more than 10,000 hits a day.  Although that number sounds astronomical to me, she says that it is dwarfed by other popular political blogs.     

Reading this book is like spending some time with a refreshing person.  But is also gives an interesting perspective on the 2008 presidential campaign.  Don’t expect to read anything complicated (Reaganesque) about her relationship with her parents.  She obviously thinks they walk on water.  Her loyalty to her dad is such that she has never forgiven George W. Bush for the dirty tactics that earned him a primary victory over her dad in the 2000 South Carolina primary.  And this loyalty seems to have caused her to be mildly negative about Mitt Romney and Mike Huckabee, as well as Laura and Jena Bush.

I detected one significant inconsistency in Meghan’s stated philosophy.  She started the book by saying that she joined the campaign when it was broke, and they took her on board only if she paid her own way – “To bankroll myself and the blog, I used the money that my grandfather had left me, even if, by the end, I had spent every dime.  It was a better education than graduate school and more worthwhile to me than opening a boutique.”  Then she ended the book by noting – “I had been raised to speak my mind freely and be independent.  If there was one thing that my dad wanted for me – and all of his kids – it was to be strong, think for ourselves, and support ourselves.  We were never supposed to rely on government or family money or a trust fund to take care of us.  We were supposed to work, make a life for ourselves, and find a way to make things better around us.”  This is one case where consistency is the hobgoblin of small minds.     

Meghan concludes by taking the Republican Party to task for abandoning the conservative principles of Barry Goldwater and Ronald Reagan.  She thinks the party should expand its tent by welcoming social liberals like her.  I agree.

February 27, 2011

Warren Buffett’s annual letter to his shareholders

Filed under: Business — Mike Kueber @ 4:09 am
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Earlier this week, Warren Buffett issued his annual letter to his stockholders.  Even before I invested in Berkshire Hathaway, I looked forward to this annual letter.  Despite his brilliance, Warren has an exceptional talent for communicating at a level that can be understood by normal people.  The 2010 letter doesn’t disappoint, although it doesn’t seem as full of folksy wit as his typical letter.  Examples of that wit in the current letter:

  • What companies do with their retained earnings.  “The difference in outcome can be huge. A dollar of then-value in the hands of Sears Roebuck’s or Montgomery Ward’s CEOs in the late 1960s had a far different destiny than did a dollar entrusted to Sam Walton.…”
  • Future plans for Berkshire. ” We will need both good performance from our current businesses and more major acquisitions. We’re prepared. Our elephant gun has been reloaded, and my trigger finger is itchy.”
  • Proactive management.  “There are managers to whom I have not talked in the last year, while there is one with whom I talk almost daily. Our trust is in people rather than process.  Our ‘hire well, manage little’ code suits both them and me.
  • Frugality.  “At Berkshire’s World Headquarters our annual rent is $270,212. Moreover, the home-office investment in furniture, art, Coke dispenser, lunch room, high-tech equipment – you name it – totals $301,363. As long as Charlie and I treat your money as if it were our own.”
  • Home ownership.  “Home ownership makes sense for most Americans, particularly at today’s lower prices and bargain interest rates. All things considered, the third best investment I ever made was the purchase of my home, though I would have made far more money had I instead rented and used the purchase money to buy stocks. (The two best investments were wedding rings.) For the $31,500 I paid for our house, my family and I gained 52 years of terrific memories with more to come.  But a house can be a nightmare if the buyer’s eyes are bigger than his wallet and if a lender – often protected by a government guarantee – facilitates his fantasy. Our country’s social goal should not be to put families into the house of their dreams, but rather to put them into a house they can afford.”
  • Leverage.  “When leverage works, it magnifies your gains. Your spouse thinks you’re clever, and your neighbors get envious. But leverage is addictive. Once having profited from its wonders, very few people retreat to more conservative practices. And as we all learned in third grade – and some relearned in 2008 – any series of positive numbers, however impressive the numbers may be, evaporates when multiplied by a single zero. History tells us that leverage all too often produces zeroes, even when it is employed by very smart people.”
  • Credit.  “Borrowers then learn that credit is like oxygen. When either is abundant, its presence goes unnoticed.  When either is missing, that’s all that is noticed. Even a short absence of credit can bring a company to its knees.  In September 2008, in fact, its overnight disappearance in many sectors of the economy came dangerously close to bringing our entire country to its knees.”

Warren’s letter announced that the annual meeting will be held on April 30 this year.  I planned to go last year, and even obtained credentials, but at the last minute I decided that it was not worth driving 1000 miles.  I’m inclined to go again, but we’ll see.  Last year I even submitted questions that might be posed to the Sage from Omaha, and I’ve already started thinking about questions this year.  So far:

  • “Ben Graham mentored you; you don’t seem to be mentoring anyone.”

Warren is quite bullish on America and the market, and his purchase in 2010 of Burlington Northern Santa Fe railroad reflected that.  But he doesn’t address the fact that, although Berkshire has gained 32.8% the last two years, it has underperformed the S&P 500 by 8.9%.  Other than 1967-68, which were his third and fourth years in the business, when he underperformed the market by 11.9%, Warren has never had a worse two-year streak.  Too bad that’s how long I have owned Berkshire stock.

I have a friend who owns a couple of Berkshire A shares ($125k each), and he is worried that Warren is past his prime.  Warren says that his objective is to outperform the S&P index – perhaps not always in good years, but definitely in the bad years.  Further, he says the Berkshire companies will not manipulate number for short-term impressions.  I’m satisfied with that.

February 26, 2011

Jeremy Bernard – the fundraising social secretary for President Obama

The San Antonio Express-News reported on its front page today that the White House announced its third social secretary in two years.   The announcement wouldn’t have been on the front page except that the new secretary is a San Antonio native – Jeremy Bernard.  The announcement was also newsworthy because, as the article noted, Jeremy will be the first man and the first openly gay person to serve in the position, which is essentially the White House’s party planner.  (You may recall that Obama’s first social secretary was replaced after a publicity-hound couple crashed a White House party on her watch.)

The Express-News provided scant information about Jeremy Bernard other than noting that he attended the Texas Military Institute in Alamo Heights and his brother Michael is the current city attorney.  Plus:

  • A prominent California fundraiser for Obama’s 2008 presidential campaign who served eight years on the Democratic National Committee, Bernard has served on the board of gay-rights groups including the Gay & Lesbian Victory Fund.”

When I read that someone is a fundraiser, I think of that as a part-time job and wonder what their real job is.  So I decided to google Jeremy Bernard to learn if he was a part of the Alamo Heights aristocracy or did he have a real job.

After reading several articles on the appointment that provided no employment history, I finally stumbled across an apparent treasure trove of information in the actual White House announcement.  Its concluding paragraph read as follows:

  • A native of San Antonio, Texas, Bernard currently serves as Senior Advisor to the Ambassador at the U.S. Embassy of Paris.  He served as the White House Liaison to the National Endowment for the Humanities from 2008 to 2010.  Previously, Bernard was a California Finance Consultant for the Obama for American campaign.  He was a Principal of B&G Associates from 2007 to 2009, Vice-President of Mapleton Investments from 1999 to 2006 and Director of Government Affairs of Falcon Cable TV from 1996 to 2006.  Appointed by President Clinton, Bernard served on the President’s Advisory Committee on the Arts for the John F. Kennedy Center for the Performing Arts and was a member of the Democratic National Committee from 2001 to 2009.  He previously served as a board member of A.N.G.L.E. (Access Now for Gay & Lesbian Equality) and the National Gay & Lesbian Victory Fund.  He was also a member of the Los Angeles County Sheriff’s LGBT Advisory Committee, the Los Angeles Police LGBT Advisory Committee and the Los Angeles Mayor’s LGBT Advisory Committee.”

The paragraph included a lot of stuff, but the only apparent full-time job was as a principal in B&G Associates from 2007-2009.  What was B&G Associates? 

According to a lengthy profile in LAWeekly, B&G Associates was a business formed by Bernard and his gay partner that raised money in Southern California (primarily from entertainment and gay circles) for their selected candidates.  Fundraising was not a past-time for these guys; it was full-time.  When Obama won his election, both guys went to Washington with him, although they have now apparently broken up.

I encourage you to read the 2008 article in the LAWeekly.  It reveals the importance of raising money in presidential politics and the power granted to those who can raise the money.  

P.S., although the article doesn’t mention where Bernard went to college or how he got into this line of work, it does note that his dad Herschel was a fundraiser for the Kennedy boys back in the day.  Seems the apple doesn’t fall far from the tree.

Saturday Night at the Movies #5 – Atlas Shrugged (starring Obama & Daniels)

On April 15, the movie that we’ve been waiting for for decades premieres – Atlas Shrugged, part one.  Check out the movie trailer.   

The idea of breaking the novel into three parts is a good one.  There is simply too much in the book for one movie, and each part can easily stand on its own.  Unfortunately, the hero of the book – John Galt – does not play an important role in part one, but as I noted in an earlier blog, I think the part-one hero – Hank Reardon – is more heroic than John Galt.  In that blog entry, I compared Hank Reardon to Casablanca’s Rick Blaine, while John Galt is more like Casablanca’s Victor Laszlo.

Depending on your perspective, John Galt and Hank Reardon are the heroes or villains of Atlas Shrugged because they are capitalists who are interested only in making money and have no interest in altruism.  Similarly, Wesley Mouch can be either your hero or villain in Atlas Shrugged because he is a public servant who believes that capitalists should be forced to take into account the common good.

Earlier today, while reading an article about Governor Mitch Daniels in The Weekly Standard, I noticed in the concluding paragraphs of the lengthy article the Governor took issue with an Obama statement about altruism that sounded like Galt/Reardon taking on Wesley Mouch in Atlas Shrugged:

As our dinner wound down—I insisted on paying the bill, he offered to split it—he said he was going to give a commencement address the coming weekend, at Franklin College, south of Indianapolis. It had been inspired partly by the theme of “public service” struck by Obama’s recent commencement addresses, in which the president discouraged the pursuit of mere material gain in favor of nonprofit and government work.

“That strikes me as exactly the wrong message to send to young people,” Daniels said. “He’s got it completely wrong. Government service—nonprofits—all that’s fine and necessary. But the host can only stand so many parasites.” 

He stopped himself and glanced at my open notebook. 

“Maybe that’s too harsh,” he went on. “But someone’s got to say to these kids, There’s nothing wrong with going into business. It’s not selfish. It’s good. Build a business, create jobs for people, create wealth for people. It helps people. And that’s what we’re supposed to do, isn’t it.”

The troopers pulled the Sequoia up to the door of the restaurant, and Daniels left me with what he said was one of his favorite quotations. 

I remember it from a book by Bruce Catton,” he said. “It’s a Union general commenting on Ulysses S. Grant. He said, ‘There was no nonsense, no sentiment; only a plain businessman of the republic, there for the one single purpose of getting that command across the river.’ 

“I like that. I like that a lot.”

As David Brooks said in a recent column, an Obama-Daniels match-up for the presidency could be a great and clarifying debate.

February 25, 2011

David Brooks and the Mitch Daniels bandwagon

Filed under: People,Politics,Uncategorized — Mike Kueber @ 8:34 pm
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Just as I was penning a blog entry in support of Mitch Daniels, the NYTimes’ David Brooks was writing a column that did the same thing.      His column is ironically titled, “Run Mitch, Run.”  The title is ironic because on October 19, 2006 Brooks wrote a column titled, “Run, Barack, Run.”  We all know how that turned out.

My blog entry relied heavily on a column by Joe Klein in Time magazine.  Brooks’ column on Mitch Daniels covers much of the same territory as Klein’s.  According to Brooks, Daniels believes that America’s runaway debt is the greatest moral challenge of our time, but Daniels also believes that creating opportunity for the disadvantaged is a major governmental objective – “Our first thought is always for those on life’s first rung, and how we might increase their chances of climbing.”

It’s interesting how similar the columns are.  Even though one columnist is a liberal and the other a conservative, they both read this guy the same way.

Mitch Daniels and the Bennett Test

Joe Klein writes a column for Time magazine.  Although I rarely agree with him, I agreed with his endorsement this week of the Bennett Test, which was developed by William Bennett, America’s education secretary under Ronald Reagan, to assist voters to detect (and reject) pandering politicians.   The Test is simple:

  • If a candidate tells you only things you want to hear, if he asks nothing of you, then give him nothing in return, certainly not your vote, because he is not telling you the truth.”

According to Klein, only a handful of presidential candidates in the last ten elections have satisfied the Test – John Anderson in 1980, Bruce Babbitt in 1988, Bill Clinton in 1992, and Ron Paul in 2008.  The purpose of his column this week was to anoint another – Indiana governor Mitch Daniels. 

Prior to reading the column, I knew nothing about Daniels, which suggests he is not a glory hound.  That’s a good thing.  Klein reports that when Daniels spoke at this year’s Conservative Political Action Conference, he refused to “throw red meat” and instead warned that deficit-cutting would be difficult – neither the military nor the elderly would be spared.  This candor and the absence of demagoguery qualified Daniels under the Bennett Test.

While I am similarly impressed with any candidate who qualifies under the Bennett Test, I was even more impressed with Daniels’ substantive positions as described by Klein:

  • He was unrelenting in his attack on the liberal welfare state, but he did it substantively.
  • By calling out his own party’s nasty caucus and making a plea for a bigger Republican tent: “We need people who never tune in to Rush or Glenn or Laura or Sean.”
  • “Our main task is not to see that people of great wealth add to it but that those without much money have a greater chance to earn some.”
  • He posits the federal deficit as an overwhelming “red menace.” 

Klein agree with Daniels on the first three positions, but opines that the “red menace” is not as serious as “the hollowing out of the American middle class, of American industrial capacity; the lassitude in our education system; the greed and laziness that are our affluenza hangover.”

I agree with Daniels on all four positions, especially that the deficit is the dominant issue of the day.  Furthermore, I suggest to Klein that the third dot point – affording opportunity to those without much money – will do much to address the problems that Klein wants to address – i.e., the disappearing middle class, the decline of education, and laziness.

Klein concludes by noting that any candidate who shows intellectual honesty is doomed to irrelevance.  Let’s hope not.

Money in politics – Rahm Emanuel

This week, Time magazine did a profile on Rahm Emanuel, the erstwhile White House chief of staff who was running for the mayor of Chicago.  Emanuel has a reputation as an abrasive, hard-charging politician (called Rahmbo), and the article described those characteristics, although Rahm is working hard to keep his volcanic personality under control during the campaign.  The article was a revelation, however, concerning Rahm’s facility with campaign money.  With his current campaign for mayor, he has raised more money – almost $12 million in three months, with 40 paid staffers – than his five opponents combined.  But the most interesting fact is that he (like Obama) has been a money man from the very beginning:

  • Born into an affluent, connected family, he graduated from Sarah Lawrence College and in 1989 he became the “chief fundraiser for Richard Daily’s first winning mayoral bid.”
  • In 1991, he was one of Bill Clinton’s first hires and “proved a prodigious fundraiser.”
  • After six years as a Clinton advisor, there were “two-plus lucrative years in investment banking, in which he impressed many with his contacts, judgment, and capacity for work,” earning more than $18 million.
  • After winning election to Rod Blagojevich’s vacated seat, “Emanuel took on what he calls ‘a job no one wanted,’ he says, as chairman of the Democratic Congressional Campaign Committee, where he was praised for selecting mostly moderate candidates and shepherding the party’s 31-seat gain in 2006.”

Since the publication of the Time magazine profile, Rahm Emanuel won the Chicago election with almost 55% of the vote, thus avoiding a runoff. 

I am, however, encouraged with his platform.  Like Chris Christie in New Jersey, Emanuel has concluded that he needs to take on public-union pensions and teacher accountability.  Sounds like someone who is thinking long-term success instead of short-term popularity.

February 24, 2011

Guns rights under the Second Amendment

Dallas Green, the famous baseball manager whose nine-year-old granddaughter was killed in the recent Tucson shooting, gave his first public comments on the shooting as he attended the opening of the baseball Cardinal’s spring training.  Green said that he was a sportsman who loved guns and hunting, but he didn’t need a 30-shot clip to hunt.  Obviously, he was referring to the clip used by the Tucson gunman to kill the Green girl.

Green’s comment reveals a common misunderstanding about the Second Amendment and an American’s right to bear arms.  After years of debate, this right was finally clarified recently by two Supreme Court decisions.  The first decision – District of Columbia v. Heller (2008) – held that the federal government must recognize that right to bear arms applied to all Americans, not just members of a militia.  The second decision – McDonald v. City of Chicago (2010), held that the Heller holding applied to state laws, too. 

Although many defenders of the right to bear arms focus on the tradition of hunting in America, the Supreme Court in McDonald focused on an American’s right to self-defense:

  • Our decision in Heller points unmistakably to the answer. Self-defense is a basic right, recognized by many legal systems from ancient times to the present day, and in Heller, we held that individual self-defense is ‘the central component’ of the Second Amendment right.  Explaining that ‘the need for defense of self, family, and property is most acute’ in the home, we found that this right applies to handguns because they are ‘the most preferred firearm in the nation to keep and use for protection of one’s home and family.’  (‘[T]he American people have considered the handgun to be the quintessential self-defense weapon’). Thus, we concluded, citizens must be permitted ‘to use [handguns] for the core lawful purpose of self-defense.’”

This misunderstanding of the Second Amendment is not limited to Dallas Green.  This week’s issue of Time magazine included “10 Questions” to NYC mayor Michael Bloomberg.  In response to a gun-control question, Bloomberg said:

  • Guns kill people.  I’m not opposed to the Second Amendment.  I’m not opposed to hunters.  I don’t understand why we have to sell magazines with 33 bullets.  If it takes you 33 bullets to kill a deer, you’re not a sportsman.  And armor-piercing bullets – the last time I saw a deer with a bulletproof vest was a long time ago.  Guns are the biggest killers in the county, and it’s an easy problem to solve if we had the courage to [do so].”

Michael Bloomberg, Dallas Green, and others need to shift their mindset.  The Supreme Court has declared that Americans have a right to defend themselves with arms.  The recent decisions held that handguns in the home were reasonable.  Questions about clips and rifles, as well as handguns outside the home, are unresolved.  The questions don’t turn on whether the arms are needed for hunting; they turn on whether the arms are reasonable for an Americans who desire to defend themselves.

Obama abandons the Defense of Marriage Act

The Defense of Marriage Act (DOMA) was abandoned yesterday by the Obama administration.  Obama’s attorney general Eric Holder announced that he and Obama had concluded the law was unconstitutional because it discriminated against homosexuals without a compelling reason.   

DOMA, which was enacted in 1996 by a bipartisan majority in Congress and a Democratic president, contains two principal provisions:

  1. Grants each state the authority to deny full faith & credit to same-sex marriages granted in other states.
  2. Declares that the federal government will only recognize those marriages between a man and a woman.

Both provisions are being challenged constitutionally in a large number of courts, but yesterday’s decision by the Obama administration applies only to the second provision.  Although the administration reaffirmed that it opposes same-sex marriage and instead favors civil unions, a judicial abrogation of the second provision would likely call into question numerous other laws dealing with employment and family recognition. 

Interestingly, some states-rights conservatives agree that DOMA is unconstitutional.  In their view, each state has the right to define marriage, and the federal government must accept whatever definition a state makes.  That makes sense to me, but that is not the rationale for Obama abandoning DOMA.  Obama is abandoning DOMA because, in his opinion, homosexuals historically have been subjected to significant discrimination, and therefore they are entitled to a heightened level of equal protection under the 14th Amendment.  According to Holder: 

  • After careful consideration, including a review of my recommendation, the President has concluded that given a number of factors, including a documented history of discrimination, classifications based on sexual orientation should be subject to a more heightened standard of scrutiny.   The President has also concluded that Section 3 of DOMA, as applied to legally married same-sex couples, fails to meet that standard and is therefore unconstitutional.”

Although the announcement by Holder doesn’t describe the equal-protection standards by which laws are scrutinized, there are three of them:

  1. Rational-basis scrutiny – a law is presumed constitutional is there is a rational basis for it.
  2. Intermediate scrutiny – a law (usually relating to gender or some rights under the First Amendment) must further an important government interest in a way that is substantially related to that interest.  
  3. Strict scrutiny – laws that affect fundamental rights or suspect classes must be narrowly tailored and least restrictive means to further a compelling governmental interest.

Historically, federal courts that have considered the question have concluded that classifications based on sexual orientation are subject only to rational basis review.  Holder’s announcement obviously disagrees with that conclusion, but it fails to state whether sexual orientation deserves intermediate or strict scrutiny.  Based on what I have read elsewhere, Holder and Obama have concluded that sexual orientation deserves intermediate scrutiny. 

I agree that homosexuals have been subjected to significant discrimination, and therefore rational-basis scrutiny is inadequate, and the intermediate level of protection seems to be appropriate.  This requires the government to show that the law or policy being challenged furthers an important government interest in a way that is substantially related to that interest.

Unlike the Obama administration, I think the government has a fighting chance of prevailing on that issue.  In that event, the eventual correction to this problematic provision in DOMA will need to be made by Congress, but unfortunately, that won’t happen as long as Republicans control the House.  However, if Republicans continue discriminating against homosexuals, their control of the House may not be long.

Citizens United – the Supreme Court decision

In a recent blog entry about the anti-union movement in Wisconsin, I made a glib comment about the merits of a Supreme Court decision – Citizens United v. Federal Election Commission, 130 S.Ct. 876 (2010) – that I hadn’t read.  Fortunately, an anonymous reader called me to task for that glibness, and as penance I decided to read the decision. 

Citizens United (Citizens) is a non-profit corporation with an annual budget of $12 million.  Although most of its money comes from individuals, a small portion of it comes from for-profit corporations.  In January 2008, Citizens released an anti-Clinton movie titled Hillary: The Movie.  Because of Citizens’ concerns that the Bipartisan Campaign Reform Act of 2002 (BCRA) prohibited it from marketing the movie (and paying cable companies to make it available to free), Citizens sued the FEC to have the BCRA declared a violation of its constitutional right to free speech.

The BCRA, which was enacted in 2002, is also known as the McCain-Feingold law.  Among other things, it prohibited corporations and unions from making expenditures for speech defined as “electioneering communication” – “any broadcast, cable, or satellite communication… that refers to a clearly identified candidate for Federal office,” and is made within 30 days of a primary or election.  This limitation on electioneering communications was upheld in a 2003 Supreme Court decision (McConnell v. FEC) that relied on a 1990 Supreme Court decision, Austin v. Michigan Chamber of CommerceAustin had held that political speech may be banned based on the speaker’s corporate identity. In 2010 Citizens asked the Court to reconsider the Austin decision, and it did, with five justices ultimately agreeing to reverse the decision.  “The government may regulate corporate political speech through disclaimer and disclosure requirements, but it may not suppress the speech altogether.” 

My glib comment in an earlier blog was:

  • When I campaigned for Congress, I was asked about Citizens United and I indicated that I supported it.  It makes perfect sense that political speech by rich people should be constitutionally protected, so why make a distinction for corporations?  As George Will suggested decades ago – don’t limit the speech, just require full disclosure of who is paying for the speech.  Then let the voters decide.  I realize that many think my view is impractical and Pollyannaish – that American voters aren’t capable of avoiding manipulation by slick marketing – but I believe we can rise to the occasion.

Despite the glibness of the comment, it does contain two important concepts:

  1. Why make a distinction for corporations?  According to the Citizens decision, there is no good reason to make a distinction – “Corporations and other associations, like individuals, contribute to the discussion, debate, and the dissemination of information and ideas that the First Amendment seeks to foster. [We] rejected the argument that political speech of corporations or other associations should be treated differently under the First Amendment simply because such associations are not natural persons.
  2. American voters will be duped by slick corporate ads.  The 1990 Austin decision was based on the government’s interest in preventing “the corrosive and distorting effects of immense aggregations of wealth that are accumulated with the help of the corporate form and that have little or no correlation to the public’s support for the corporation’s political ideas.”  In the 2010 Citizens decision, the Supreme Court rejected that basis and declared – “The right of citizens to inquire, to hear, to speak, and to use information to reach consensus is a precondition to enlightened self-government and a necessary means to protect it…. When Government seeks to use its full power, including the criminal law, to command where a person may get his or her information or what distrusted source he or she may not hear, it uses censorship to control thought.  This is unlawful.  The First Amendment confirms the freedom to think for ourselves.”

The majority decision for Citizens was written by Justice Kennedy and joined by Scalia, Thomas, Alito, and Roberts.  The dissent, which was written by Stevens and joined by Sotomayor, Breyer, and Ginsberg, warned that the majority decision, “threatens to undermine the integrity of elected institutions across the Nation. The path it has taken to reach its outcome will, I fear, do damage to this institution.”  It concluded by noting:

  • At bottom, the Court’s opinion is thus a rejection of the common sense of the American people, who have recognized a need to prevent corporations from undermining self-government since the founding, and who have fought against the distinctive corrupting potential of corporate electioneering since the days of Theodore Roosevelt. It is a strange time to repudiate that common sense. While American democracy is imperfect, few outside the majority of this Court would have thought its flaws included a dearth of corporate money in politics.”

President Obama was so upset with the decision that he referred to it unfavorably in his weekly radio address (“this ruling strikes at our democracy itself” and “I can’t think of anything more devastating to the public interest.”) and in his State of the Union address (“Last week, the Supreme Court reversed a century of law to open the floodgates for special interests — including foreign corporations — to spend without limit in our elections. Well I don’t think American elections should be bankrolled by America’s most powerful interests, or worse, by foreign entities.”)

Well, I think our democracy and our Democrats will survive the involvement of corporations and unions in elections.  As I said in my earlier blog entry, American voters will rise to the occasion.

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