Foreign Corporations

Foreign interests should not be able to influence our political system by pouring money into Massachusetts elections.

The integrity of our elections is essential to the health of our democracy.

Even in these divided times, Americans can agree that foreign interests should not be able to influence our political system by pouring money into elections. Under current law, foreign governments and citizens (except lawful permanent residents) are forbidden from spending money in state elections.

Yet a gap in the law allows foreign money to enter our politics through political spending by corporations. Legislation in Massachusetts would close that loophole.

The Supreme Court’s 2010 decision Citizens United v. FEC opened the door for corporations donate freely to American campaigns. This means that for-profit corporations under foreign control or influence can spend unlimited money in our elections. For example, a corporation organized under the Massachusetts law might have many (or only) foreign nationals as shareholders, but as a corporation it can spend unlimited money to influence our electoral process.

It’s a loophole that is easily exploited, and it needs to be closed now.

Here in Massachusetts, we can act by passing legislation that protects our elections from political spending by companies under foreign influence. Here’s how the proposed law works: if a single foreign shareholder owns more than 5% of a company’s shares, it cannot spend money to influence Massachusetts elections. Five percent is the threshold at which a single shareholder must be disclosed to the Securities and Exchange Commission and is considered a significant influence in the corporation’s decision-making. Furthermore, any company with over 20% total foreign ownership is also considered foreign-influenced. These measures will ensure that the financing of our state elections are protected from foreign corporate manipulation.

Beyond the practical effect of curtailing corporate spending in elections, this prohibition is fully constitutional and would expose the contradictions in Citizens United that can help catalyze the legal argument to overturn it.

A successful democratic self-government requires that elections be decided by those who live there and whose day-to-day lives will be shaped by the outcome. Here in Massachusetts, the Birthplace of the American Revolution, we should act now to protect our own state’s democracy and lead the way to fortifying America’s system of free and fair elections.

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