Mercury News - California could be model for 'super PAC' disclosure

Rep. Eshoo recently spoke to Josh Richman, political writer for the Bay Area News Group and Mercury News, about her efforts to increase transparency and disclosure in our campaign finance system.  An excerpt from the article is below:

Faster than a speeding regulator, more powerful than a traditional campaign -- look, up on your television screen: It's a bird, it's a plane, it's ... super PAC!

With no regulatory kryptonite to slow it down, the super PAC celebrates its second birthday Saturday, the same day as South Carolina's presidential primary. And, my, how it has grown: The U.S. Supreme Court in 2009 sired a phenomenon that's altering 2012's electoral landscape, borne on a wave of often-anonymous cash that's dwarfing candidates' own spending while becoming a punch line for late-night comedians.

Yet super PACs aren't new to California. We call them by a less sexy name -- "independent expenditure committees." And we've had them for decades.

Rep. Anna Eshoo, D-Palo Alto, said she often cites California's Proposition 23 when trying to persuade Congress and the White House to enact reforms. The unsuccessful November 2010 measure, which would have rolled back the state's greenhouse-gas emissions law, was bankrolled mainly by oil companies -- a fact most Californians learned because it had to be included in the initiative's ads.

"Disclosure is extraordinarily powerful because it puts the average person in the driver's seat," Eshoo said. Voters know "who is involved and what their purpose may be."

Or at least they may have a chance of seeing the wave of money coming.

National super PACs now need to include only their own names in their ads, but Eshoo wants the president to lean on the FEC and Federal Communications Commission to interpret existing law so super PACs must "disclose meaningful information about who's really paying to run ads on our public airwaves."

Even so, some donors could remain invisible. Many super PACs are affiliated with nonprofits organized under Section 501(c)4 of the Internal Revenue Code, which can take unlimited contributions without disclosing the donors. The nonprofits then give money to the super PACs -- a scheme critics flatly call money laundering.

These nonprofits can take part in elections so long as that's not their primary purpose. But although some of these groups clearly exist mainly for electioneering, the IRS isn't doing much to police them. Eshoo and others want a crackdown on those groups that are "flagrantly violating the tax codes since their purpose is entirely political and not promoting 'social welfare' as the law requires."

Eshoo has led dozens of House of Representatives members in urging Obama to issue an executive order so that all companies doing business with the government must disclose their political spending. And she's among five Bay Area co-sponsors of a bill to force all public companies to file quarterly reports of political spending with the Securities and Exchange Commission, in addition to letting shareholders vote annually on such spending.

To read the full article, please click here.