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On that other Supreme Court decision this week (concerning corporate political speech)

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James R. Copland

While everyone has understandably been focused on the Supreme Court's decision on the constitutionality of the 2010 Patient Protection and Affordable Care Act, as well as its decision overturning in part and upholding in part Arizona's controversial immigration law, SB 1070, it's worth drawing attention to the Court's short per curium decision in American Tradition Partnership v. Bullock overturning the Montana Supreme Court's decision upholding a state-law ban on independent political expenditures by corporations. In essence, the Court said, "We meant what we said in Citizens United."

Of course, most companies won't be making direct independent political expenditures but rather participating in the political process the way they have historically, i.e., through lobbying, PAC donations, and trade associations. These historic mechanisms, as demonstrated powerfully in Rob Shapiro and Doug Dowson's new Manhattan Institute report, Corporate Political Speech: Why the New Critics Are Wrong, have generally increased share value, the claims of certain shareholder activists notwithstanding. That's doubtless why, despite the efforts of those like Bruce Freed at the Center for Political Accountability, shareholders on the whole have been rejecting shareholder proposals seeking limits or greater disclosure of corporate political spending or lobbying.

As of today, among the Fortune 200 companies in our Proxy Monitor database, shareholder proposals concerning corporate political spending or lobbying have received the support of only 17.8 percent of shareholders in 2012, down from 23.0 percent in 2011. Looking solely at the political spending proposal being pushed by Freed and the CPA, only 22.7 percent of Fortune 200 shareholders have backed the proposal in 2012, down from 26.6 percent in 2011.

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Manhattan Institute


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