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Bills
| 3.23.22

Should Corporations be Banned From Having Political Action Committees (PACs)? (H.R. 5129)

Do you support or oppose this bill?

What is H.R. 5129?

(Updated February 8, 2022)

This bill — the Ban Corporate PACs Act — would amend campaign finance laws to prohibit for-profit corporations from sponsoring, operating, or funding a separate segregated fund (commonly known as a political action committee, or PAC). It would also dissolve existing corporate PACs a year after this bill’s enactment.

Argument in favor

Corporate PACs allow corporations to use money to buy influence in the American electoral system. This fundamentally skews politicians’ priorities, incentivizing them to put corporate interests ahead of those of the country and their constituents. Banning corporate PACs is an important step towards reclaiming the American political system for the people, rather than corporations and the ultra-wealthy.

Argument opposed

Corporate PAC money is arguably one of the cleanest forms of PAC money in politics, given how heavily regulated corporate PAC contributions are & they’re a relative drop in the bucket compared to other contributions. Corporations have the First Amendment right to engage in politics, and it’s important to ensure that they’re able to support the candidates that share their views, just like individual citizens would do through their votes at the ballot box.

Impact

Voters; elections; money in U.S. elections; corporations; corporate PACs; political campaigns; and political campaigns’ receipt of money from corporate PACs.

Cost of H.R. 5129

A CBO cost estimate is unavailable.

Additional Info

In-Depth: Sponsoring Rep. Max Rose (D-NY) — who calls corporate political action committees (PACs) “legalized bribery” that shouldn’t have a place in American politics — introduced this bill to ban corporate PACs: 

“Corporate PACs flood [Washington, D.C.] with contributions, but it’s not the American people’s priorities they have in mind—it’s their own bottom lines. That’s wrong and at the root of Washington corruption. That’s why we must send a clear, unmistakable message to the American people that we are here to fight for them and only them—not the special interests and corporate PACs.”

In a November 15, 2019 interview, he singled out Senate Majority Leader Mitch McConnell (R-KY) for accepting corporate PAC money: 

“Mitch McConnell has never met a corporate PAC, federal lobbyist, dark money outfit that he doesn’t immediately fall in love with. He is not a supporter of the swamp, Mitch McConnell is the swamp.”

Original cosponsor Rep. Antonio Delgado (D-NY) says: 

“Our democracy is supposed to be for the people, not the special interests. I joined my colleagues to help introduce the Ban Corporate PACs Act to even the playing field for the American people and make sure their voices are heard in Washington. This legislation takes important steps to ban dark money and ensure representatives are beholden to those they represent—not anyone else.”

End Citizens United supports this bill. Tiffany Muller, president of End Citizens United Action Fund, says: 

“By supporting bold anti-corruption and government reform bills, Rep. Delgado continues to deliver on promises he made to voters in 2018. Helping to introduce the Ban Corporate PACs Act is a continuation of his commitment to making government work for people, not corporate special interests. The bill is aimed at ending the dominance of corporations in Congress so that progress can be made on issues important to everyday Americans.”

Senate Majority Leader Mitch McConnell (R-KY) has been a staunch opponent of campaign finance reform for decades. He argues that enacting any sort of limits on campaign spending amounts to infringing on Constitutionally-protected free speech.

David Rehr, director of the Center for Civic Engagement at George Mason University and a former lobbyist who has run PACs in the past, argues that the current focus on corporate PAC money is a PR gambit for Democrats, rather than an indication of a real issue with corporate PAC money. He argues that “all the candidates are making a calculation. Is the value of the corporate money I’m going to receive greater than the value of the votes and support I receive from people who are distasteful of corporate PACs?”

Rehr points out that trade groups, labor unions, nonprofits, and other associations can also have PACs — but people aren’t suspicious of these organizations’ PACs in the same way that they are of corporate PACs. He argues that the heightened suspicion of corporate PACs is unfounded, and that corporate PAC money is “probably the cleanest money in politics today, the way it is regulated, and the limits that are put on it.”

Joseph Albanese, a research fellow at the Institute for Free Speech, adds that criticism of corporate PACs “represents cynical symbolism” that doesn’t directly affect the campaign finance system. He argues that criticism of corporate PACs perpetuates ignorance about political participation that “undermines our national discourse and subtly degrades support for First Amendment rights.”

This legislation has four Democratic cosponsors.


Of Note: Corporate PACs are often established and funded by corporations to influence policy. Often, corporate PACs are controlled by corporate lobbyists and expressly make contributions to forward business interests. 

After the decision, the Center for Responsive Politics (CRP) reports that outside organizations (non-party groups) spent about $310 million on the 2010 midterm elections. In the 2018 midterm elections, outside groups spent over a billion dollars, according to the CRP. For comparison, outside groups spent about $27.6 million in the 2002 election cycle and about $69.6 million in the 2006 election cycle.

A growing number of candidates for office and members of Congress — particularly Democrats — have sworn off donations from corporate or business-related PACs, as they blame them for the rising influence of money in politics. Rep. Rose and original cosponsor Rep. Josh Harder (D-CA), along with nearly 200 other House candidates, refused to take corporate PAC money during their 2018 campaigns.

Several 2020 Democratic presidential candidates, including Sen. Elizabeth Warren (D-MA), former Rep. Tulsi Gabbard (D-HI), and Julian Castro, have also committed to rejecting corporate PAC money to some degree. However, Brendan Glavin, senior data analyst at the Campaign Finance Institute, points out that corporate PAC money doesn’t mean much for a presidential campaign’s bottom line. He observes, “Historically, presidential campaigns are about individual contributions. Corporate PAC money has not been a factor in presidential fundraising.” In the 2016 election, Hillary Clinton raised about $250,000 from corporate PACs, which represented less than 0.5% of the money she raised. Similarly, for Donald Trump, corporate PAC money accounted for only about $26,000 (about 0.01%) of his total fundraising.

While Democrats are beginning to eschew corporate PAC money, Republicans continue to welcome corporate PAC donations. The CRP reports that 41 of the 50 House candidates who received the most corporate PAC money in the 2018 midterm cycle were Republicans.


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / vladans)