If we are going to treat all corporations the same under Citizens United, nonprofit corporations deserve a seat at the table.
A few weeks ago I received a breathless email (if such things exist) crowing that California had become the sixth state to pass a law demanding a constitutional amendment to overturn the 2010 Citizen’s United Supreme Court decision on political campaign spending by corporations. Great! I thought: now all we need is two-thirds approval in both the House and Senate, then ratification by thirty-two more states, assuming the six stay on board. Good luck with that.
Then I thought about Citizens United in a new way.
Recently, Bloomberg columnist Michael Kinsley wrote in the Los Angeles Times that, like it or lump it, the Citizens United decision won’t be overturned anytime soon. Any loose ends in that floorboard of hope were nailed down in June when the court reversed the Montana Supreme Court decision limiting corporate political donations in that state.
Kinsley argued that, just as Chief Justice Roberts did in the Affordable Care Act decision, the Citizens United decision was based on sound principles of law even if many don’t agree with the result. The Citizens United decision not only made corporations people when it came to elections, it fixed some flaws in the now-overturned McCain-Feingold Act that favored media companies.
Rights for some or rights for all?
In defending Citizens United, Kinsley stated that “a right granted to one company should be granted to all.”
Though eloquently stated and logical, sadly the Citizens United decision does not insure that rights granted to one company are granted to all. Not by a long shot. Two years after the Citizens United decision was handed down, there are still more than a million corporations that are prohibited from participating in our country’s political process. These are America’s 501(c)(3) nonprofit corporations.
Koch Industries can spend as much as it wants in state and national elections; the Girl Scouts can’t spend a dime. The Montana copper bosses can throw money at candidates like drunken sailors on shore leave; if Montana Public Radio makes a single contribution, it will be fined and stripped of its tax-exempt status—the death pill for most nonprofits.
Just how serious is the IRS about keeping nonprofits out of the political arena? Here it is in their own words: “Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or opposition to) any candidate for elective public office…violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.” About the only thing they didn’t mention was the blindfold and the firing squad.
Nonprofit corporations aren’t people like for-profit corporations are
Apparently the IRS has a real jones against nonprofits being full citizens. It’s hard to figure out why. (Ironically, Citizen’s United is actually a nonprofit corporation, but a 501(c)(4), which means that contributions to it are not tax-deductible, as if the Koch brothers gave a damn).
Some will argue that nonprofit organizations receive government-subsidized charitable contributions, and therefore should be treated differently. But the timber industry is subsidized; the coal industry ditto and so are most energy companies. So why are Weyerhaeuser and Con Agra protected under Citizens United and Big Brothers/Big Sisters not? Where is the fairness? Where is the logic?
I’m not a big fan of the Citizens United Supreme Court decision. But at least we should agree that what is sauce for the goose should be sauce for the gander. If we are going to treat all corporations the same, let’s really treat all corporations the same. Nonprofit corporations deserve a seat at the table.
About the Author
Jack Shakely is president emeritus of the California Community Foundation and a senior fellow at the Center on Philanthropy and Public Policy at the University of Southern California. Prior to this, he was publisher of Foundation News for the Council on Foundations. And before that he served in the Peace Corps in Costa Rica and was an officer in the U.S. Army. If you're thinking, "He's done everything but write a book" — well, he's done that, too. In fact, he's authored two novels: The Confederate War Bonnet and POWs at Chigger Lake, the former of which won an Independent Publishers Award in 2009.
Articles on Blue Avocado do not provide legal representation or legal advice and should not be used as a substitute for advice or legal counsel. Blue Avocado provides space for the nonprofit sector to express new ideas. Views represented in Blue Avocado do not necessarily express the opinion of the publication or its publisher.