When businesses back candidates, the customers won't all be happy
When the U.S. Supreme Court issued its ruling on Citizens United vs. Federal Elections Commission in January, it was widely understood to be a big deal. Both those who praised the decision and those who condemned it predicted a reshaping of political campaigns in America.
In layperson's terms, the ruling means that organizations (like corporations and unions) have the same freedom to spend money to support political candidates that individuals have under the First Amendment. So to the extent that organizational involvement in politics has been indirect in the past, the decision clearly created a new standard: Organizations can play in full-court political action.
In the months since the decision came down, courtside chatter has speculated whether Minnesota organizations would get involved -- and, if so, to what extent. Well, it is only July and we haven't even hit our first primary election, but the early results are in: Organizations will play. Well-informed estimates scope the stockpiles of funds to be spent in support of candidates as at least $5 million in Minnesota this year, including organizations all along the political spectrum.
What has been much less debated, at least out in the open: Should these organizations jump in where the Supreme Court has allowed them to go?
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The argument for a union or a business trade organization is relatively straightforward: The Citizens United ruling gives them an additional new tool to wield on behalf of their members, whose stance on various political issues or candidates is likely already known -- and likely relatively consistent. Such organizations have a history of endorsing candidates and funding causes, under previous campaign rules. So upping the ante by also directly funding a particular candidate's campaign seems a potent sweetener that will enhance the relevance of those organizations in the eyes of their membership. The challenge lies in finding the money to pay for it, without cutting other services that the members might actually value more highly.
For corporations, the analysis is more problematic. The "stakeholders" of most corporations are not likely to have well-aligned views on political issues. In an ongoing way, corporations balance the often-competing interests or priorities of customers, shareholders, employees, vendors and neighbors. And the more public the company, the more challenging the balancing act can become.
Do these stakeholders all view economic issues the same way? How about social issues? Importantly, do they see the role of a corporation as "citizen" the same way? Not in my experience -- and there is the rub.
The past practice of engaging in politics via political action committees (PACs) -- campaign funds to which employees of a corporation could voluntarily contribute -- avoided the trap of putting a corporation's political priorities explicitly out for review. But in the new world, post-Citizens United, there is no place to hide. Full-court play puts it all out there: A corporation's political contributions will be public information, available on the Internet along with almost limitless information about the candidates they fund.
And it should be expected that campaigns will display the same intense competitiveness in this new political competition -- they will aggressively promote their friends and aggressively denigrate their opponents. The stakes are high for everyone involved.
As a result, it seems to me there are at least a couple of important considerations for organizations to contemplate before they step into the new rules of full-court political engagement.
The first consideration is history, and a goal of "no surprises": an organization's past connections to a candidate, to causes and issues associated with a candidate, and to people associated with the candidate, cannot be a surprise. Fair or unfair, the public gives no latitude to an organization that does not acknowledge -- or does not understand -- the relevance of its own history.
The second consideration is the definition of a "corporate" political view. PACs have the benefit of donor designation, or a board empowered to distribute its campaign contributions. Under the new rules, "the corporation" makes political contributions to candidates "it" supports -- and while the amounts being spent may not be significant from the corporate donor's point of view, they are large enough to cast real shadows on the political playing surface.
Over time, I would expect the corporations that play will either develop transparency in this decision process (as they have with PACs), or make provisions to weather the storms that occur when they can't align the priorities of all their stakeholders.
Time will tell which organizations adapt well to the new rules, and which choose to play at all. Time will also tell whether the new rules provide any reason to hope for a higher quality political discourse -- which is what the game really needs.
Kathy Tunheim is CEO of Tunheim Partners, Inc., a Minnesota-based communications agency, and president of IPREX, a global public relations consultancy in 85 markets worldwide.