An effort to legislatively overthrow a recent U.S. Supreme Court ruling on corporate free speech has been opposed by MSCI, which has joined a broad coalition of associations opposed to the bill.

Popularly known as the Schumer-Van Hollen bill (after Democratic prime sponsors Senator Charles Schumer of New York and Chris Van Hollen of Maryland, the bill (H.R. 5175/S. 3295) would sharply limit the ability of companies to make political contributions and to support policy advocacy campaigns. Among those banned by the bill from involvement in issue advocacy would be government contractors, companies that receive TARP funds, companies with as little as 20% foreign ownership. At the same time, however, the bill places no limits on contributions by labor unions and others.

MSCI joined a coalition organized by the U.S. Chamber of Commerce to oppose the legislation, which is a clear violation of Constitutional free speech guarantees, which were recently reaffirmed by the U.S. Supreme Court as applicable to corporations. The bill also undercuts the ability of trade associations to educate their members about public policy issues.

Schumer has repeatedly said that the bill is a response to the Supreme Court ruling and is focused on the 2010 elections. “If we don’t act quickly, the court’s ruling will have an immediate and disastrous impact on the 2010 elections,” he said.

Despite its flaws, House Democrats have rounded up nearly 100 sponsors for the legislation. The full name of the bill is the “Democracy is Strengthened by Casting Light on Spending in Elections” – or “DISCLOSE” – Act. “It is not an exaggeration to say that this bill is designed to muzzle business,” said Jade West, senior vice president of the National Association of Wholesaler-Distributors (NAW).

June 23, 2010 Letter Opposing DISCLOSE Act from 305 Associations (PDF)

Jade West Letter (PDF)

Schumer Van Hollen Talking Points (PDF)

U.S. Chamber of Commerce Analysis (PDF)

The Influence Industry: Disclose Act could deter involvement in elections, Washington Post, 5/13/10