Justice, the S.E.C., and Corporate Political Donations

Our post-2008 financial crisis world features constant debates about the proper relationship between the economy (specifically private or share-holder owned enterprises) and the government (and precisely, the regulative role it plays). In most circles, this struggle pits heavily free market proponents and highly “capitalist” advocates against regulation-minded bureaucrats and politicians seeking to reign in practices deemed harmful.

As Christians, our approach to such issues ought to be distinctive—grounded in principles of justice, rather than mere pleas for economic growth or repercussions for corporate excess. Central to the approach that many Christians take is the idea of structural pluralism, a concept that affirms the important roles that the various institutions and “spheres” of our society (the state, education, economy, church, etc.) play in directing and shaping the lives of individuals and the community.

Public justice demands that the government maintain the boundaries between these various institutions: thus, the state works to ensure that one sphere or institution does not assume or invade the rightful prerogative of another, in the interest of maintaining a pluralistic society and allowing individuals to develop in accordance with God’s design for them.

The Securities and Exchange Commission’s upcoming decision on disclosure requirements for corporate political donations provides a practical example of this principle in practice. The decision sets two fundamental institutions of our lives—the state and business—against one another. In considering the requirement of donation disclosure, the state is assuming its rightful role in policing the boundaries between institutions by requiring transparency in business’ attempt to influence the state. Such disclosure, in theory, prohibits corruption and severe distortions to politics due to the influence of wealth, the primary good that corporations wield.

This oversight and accountability remains crucial to maintaining structural pluralism. Further, it is a practical necessity in the U.S., where the Supreme Court has permitted corporations to exercise free speech rights in elections through campaign spending, a right corporations employ via the extensive wealth they command. In this same case of Citizens United v. Federal Electoral Commission, the Supreme Court also affirmed, “the Government may regulate corporate political speech through disclaimer and disclosure requirements.” In doing so, the Supreme Court declared that while corporations can state their opinion about politics, their spending in doing so is subject to accountability and transparency—namely, “disclosure [that] permits citizens and shareholders to react to the speech of corporate entities in a proper way.”

The Court thus established that such requirements, enforced by the state, represent the appropriate response to the issue of corporate political spending. On the one hand, it protects free speech rights; on the other, it provides options for the state to ensure accountability.  In issuing such requirements, the S.E.C. would seek to abide by this precedent, and ensure that the Court’s decision does not result in a violation of public justice through one sphere’s usurpation of another.

Finally, given the public outcry for such disclosure, the state would act not on behalf of the limited interest of corporations, but rather for the good of the community as a whole by taking a step towards discouraging corruption and motivating accountability. A S.E.C. decision requiring disclosures would therefore strengthen a common good demanded by all people—an accountable and transparent government.

Public justice, then, supports such disclosures. Rooted in legal jurisprudence, these corporate regulations would serve to maintain institutional rights in our society while balancing the interests of the community at large. Christians would do well to remember these normative principles of justice when approaching such issues of regulation, for they ought to guide our approaches and considerations of the interactions between the state and business.

-Aaron Korthuis currently works for the Association for a More Just Society in Honduras on issues of citizen security. He graduated from Whitworth University in 2012, and will begin his legal studies at Yale Law School in the fall of 2014.