Obama's Enemies List of Contractors' Donations

With this the final week in the White House for President Obama’s Counsel Bob Bauer, the Democratic Party’s top campaign finance lawyer, the question remains whether the President will sign the draft Executive Order (EO) on disclosure of political contributions by government contractors that was revealed two months ago.  There is no question that Bauer’s advice on this issue must have been crucial to Obama’s consideration of this EO.  If, as expected, Obama eventually signs it, he will have created the perfect vehicle for rewarding political allies and punishing enemies who bid on government contracts.  Of course, the White House denies that is the purpose.  It’s all in the interests of “transparency and accountability,” it claims.

But government contracts by law are awarded to the lowest qualified bidder.  Government contractors are already forbidden from making political contributions during the negotiation and performance of a contact.  Moreover, corporations are banned from making any direct political contributions to candidates.  So why would it be of any interest to federal contracting officials who review bids to know the personal political contribution history of a prospective contractor’s officers, directors, affiliates and subsidiaries?

The draft EO also would require contractors to disclose any donations they make to third party, independent organizations “with the intention or reasonable expectation” that the funds will used to make “independent expenditures or electioneering communications.”  Again, why would federal contracting officials need to know—before they make a decision on which bid to accept for a government contract—if a prospective government contractor (or its employees) have donated any money to organizations such as the National Rifle Association or the Sierra Club?

The answer is pretty obvious to everyone from the U.S. Chamber of Commerce to Republican leaders.  Minority Leader Mitch McConnell (R.-Ky.), Sen. Susan Collins (R.-Maine) and 25 other GOP senators made their concerns known to President Obama in an April 26 letter.  It pointedly observes that, rather than advancing “the goal of keeping politics out of the contacting process, the draft EO would make political considerations a part of every federal contract offer.”  McConnell and Collins have introduced legislation to prohibit federal agencies from collecting such information (S 1100).

On May 6, House Majority Leader Eric Cantor (R.-Va.), Rep. Kevin McCarthy (R.-Calif.) and other House Republicans sent a similar letter to the President, calling his draft EO “a blatant attempt to intimidate, and potentially silence, certain speakers who are engaged in their constitutionally protected right to free speech.”  The House has already adopted amendments to the authorization bills for defense and homeland security prohibiting the collection of such information, and Sen. Collins successfully attached a similar amendment to the defense bill in the Senate.

While the EO says it is intended to keep “political activity or political favoritism” out of the contracting process, it would instead feed “the notion that the granting or the denial of an award may have been based on whether the administration viewed the applicant as a political supporter or a political enemy, further driving the cynicism Americans have in their government,” the House Republicans’ letter says.  Even Minority Whip Steny Hoyer (D.-Md.) came out in opposition, saying he is “not in agreement with the administration.”  But 25 other Democrats, including Jesse Jackson Jr., urged the President on June 2 to “finalize” the EO—they don’t seem to fear injecting politics into the government procurement process.

This EO seems intended to serve the same purpose as the DISCLOSE Act—to stifle “political speech, as potential and current federal contractors decide to limit their political speech in order to protect their livelihoods,”  as the GOP letter puts it.  That was the intent of Sen. Chuck Schumer (D.-N.Y.), a main sponsor of DISCLOSE, who freely admitted the measure was meant to deter the political speech of organizations and companies that he did not like.  Of course, the draft EO would not apply to liberal organizations that get federal grants, such as Planned Parenthood, or to public sector unions that garner huge amounts of federal funds on behalf of their members.

This is just the latest abuse of the First Amendment by this administration.  The Securities and Exchange Commission has already issued a new order barring political contributions by certain investment advisers, despite the fact that it is the Federal Election Commission (FEC) that has jurisdiction over enforcement of federal campaign disclosure laws. 

Democratic commissioners at the FEC also tried to implement portions of the DISCLOSE Act, but were thwarted by the three Republican commissioners who refused to approve a regulation not authorized by the law.  In other words, when the administration failed to convince Congress to pass the DISCLOSE Act, it tried to implement it via regulatory decree.  That’s an evasion and rejection of our democratic process.

Then there is Rep. Chris Van Hollen (D.-Md.), another co-sponsor of the DISCLOSE Act, who seems to be trying to assume the role of censor-in-chief previously played by former Sen. Russ Feingold (co-sponsor of the 2002 McCain-Feingold law).  Van Hollen filed a lawsuit against the FEC claiming that a regulation issued after the Supreme Court’s decision in Wisconsin Right to Life was not “strict” enough.  Van Hollen wants to use the courts to do what he couldn’t do in the Senate—implement more burdensome and restrictive disclosure requirements.

With the proposed Executive Order now before him, President Obama is poised to create a state-of-the-art “enemies list”—a corporate roster his political managers in federal agencies can use to decide who is “qualified” to receive billions of dollars in lucrative government contracts.