[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]



 
   FIRST AMENDMENT AND CAMPAIGN FINANCE REFORM AFTER CITIZENS UNITED

=======================================================================



                                HEARING

                               BEFORE THE

                   SUBCOMMITTEE ON THE CONSTITUTION, 
                   CIVIL RIGHTS, AND CIVIL LIBERTIES

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                            FEBRUARY 3, 2010

                               __________

                           Serial No. 111-71

                               __________

         Printed for the use of the Committee on the Judiciary


      Available via the World Wide Web: http://judiciary.house.gov



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                       COMMITTEE ON THE JUDICIARY

                 JOHN CONYERS, Jr., Michigan, Chairman
HOWARD L. BERMAN, California         LAMAR SMITH, Texas
RICK BOUCHER, Virginia               F. JAMES SENSENBRENNER, Jr., 
JERROLD NADLER, New York                 Wisconsin
ROBERT C. ``BOBBY'' SCOTT, Virginia  HOWARD COBLE, North Carolina
MELVIN L. WATT, North Carolina       ELTON GALLEGLY, California
ZOE LOFGREN, California              BOB GOODLATTE, Virginia
SHEILA JACKSON LEE, Texas            DANIEL E. LUNGREN, California
MAXINE WATERS, California            DARRELL E. ISSA, California
WILLIAM D. DELAHUNT, Massachusetts   J. RANDY FORBES, Virginia
STEVE COHEN, Tennessee               STEVE KING, Iowa
HENRY C. ``HANK'' JOHNSON, Jr.,      TRENT FRANKS, Arizona
  Georgia                            LOUIE GOHMERT, Texas
PEDRO PIERLUISI, Puerto Rico         JIM JORDAN, Ohio
MIKE QUIGLEY, Illinois               TED POE, Texas
JUDY CHU, California                 JASON CHAFFETZ, Utah
LUIS V. GUTIERREZ, Illinois          TOM ROONEY, Florida
TAMMY BALDWIN, Wisconsin             GREGG HARPER, Mississippi
CHARLES A. GONZALEZ, Texas
ANTHONY D. WEINER, New York
ADAM B. SCHIFF, California
LINDA T. SANCHEZ, California
DEBBIE WASSERMAN SCHULTZ, Florida
DANIEL MAFFEI, New York
[Vacant]

       Perry Apelbaum, Majority Staff Director and Chief Counsel
      Sean McLaughlin, Minority Chief of Staff and General Counsel
                                 ------                                

  Subcommittee on the Constitution, Civil Rights, and Civil Liberties

                   JERROLD NADLER, New York, Chairman

MELVIN L. WATT, North Carolina       F. JAMES SENSENBRENNER, Jr., 
ROBERT C. ``BOBBY'' SCOTT, Virginia  Wisconsin
WILLIAM D. DELAHUNT, Massachusetts   TOM ROONEY, Florida
HENRY C. ``HANK'' JOHNSON, Jr.,      STEVE KING, Iowa
  Georgia                            TRENT FRANKS, Arizona
TAMMY BALDWIN, Wisconsin             LOUIE GOHMERT, Texas
JOHN CONYERS, Jr., Michigan          JIM JORDAN, Ohio
STEVE COHEN, Tennessee
SHEILA JACKSON LEE, Texas
JUDY CHU, California

                     David Lachmann, Chief of Staff

                    Paul B. Taylor, Minority Counsel


                            C O N T E N T S

                              ----------                              

                            FEBRUARY 3, 2010

                                                                   Page

                           OPENING STATEMENTS

The Honorable Jerrold Nadler, a Representative in Congress from 
  the State of New York, and Chairman, Subcommittee on the 
  Constitution, Civil Rights, and Civil Liberties................     1
The Honorable F. James Sensenbrenner, Jr., a Representative in 
  Congress from the State of Wisconsin, and Ranking Member, 
  Subcommittee on the Constitution, Civil Rights, and Civil 
  Liberties......................................................     3
The Honorable Lamar Smith., a Representative in Congress from the 
  State of Texas, and Ranking Member, Committee on the Judiciary.     4
The Honorable Steve King, a Representative in Congress from the 
  State of Iowa, and Member, Subcommittee on the Constitution, 
  Civil Rights, and Civil Liberties..............................     6
The Honorable Mel Watt, a Representative in Congress from the 
  State of North Carolina, and Member, Subcommittee on the 
  Constitution, Civil Rights, and Civil Liberties................     6

                               WITNESSES

Mr. Laurence H. Tribe, Carl M. Loeb University Professor, Harvard 
  Law School, Cambridge, MA
  Oral Testimony.................................................     9
  Prepared Statement.............................................    12
Ms. Monica Y. Youn, Counsel and Director of the Campaign Finance 
  Reform Project, Brennan Center for Justice, New York University 
  School of Law, New York, NY
  Oral Testimony.................................................    28
  Prepared Statement.............................................    31
Mr. Sean D. Parnell, President, Center for Competitive Politics, 
  Alexandria, VA
  Oral Testimony.................................................    48
  Prepared Statement.............................................    50
Mr. Donald J. Simon, Partner, Sonosky, Chambers, Sachse, Endreson 
  & Perry, LLP, Washington, DC
  Oral Testimony.................................................    70
  Prepared Statement.............................................    73

                                APPENDIX

Material Submitted for the Hearing Record........................   111


   FIRST AMENDMENT AND CAMPAIGN FINANCE REFORM AFTER CITIZENS UNITED

                              ----------                              


                      WEDNESDAY, FEBRUARY 3, 2010

              House of Representatives,    
              Subcommittee on the Constitution,    
                 Civil Rights, and Civil Liberties,
                                Committee on the Judiciary,
                                                    Washington, DC.

    The Subcommittee met, pursuant to notice, at 10:08 a.m., in 
room 2141, Rayburn House Office Building, the Honorable Jerrold 
Nadler (Chairman of the Subcommittee) presiding.
    Present: Representatives Nadler, Watt, Scott, Delahunt, 
Johnson, Baldwin, Cohen, Jackson Lee, Sensenbrenner, King, 
Jordan, and Gohmert.
    Also present: Representative Smith, ex officio.
    Staff present: (Majority) David Lachmann, Subcommittee 
Chief of Staff; Elizabeth Kendall, Counsel; and Paul Taylor, 
Minority Counsel.
    Mr. Nadler. Good morning. This hearing of the Subcommittee 
on the Constitution, Civil Rights, and Civil Liberties will 
come to order.
    I will start by recognizing myself for an opening 
statement.
    Today's hearing examines the Supreme Court's recent 
decision in the case of Citizens United v. FEC. It is a case 
which poses a great threat to the integrity of our democratic 
system.
    The subcommittee will examine the Court's reasoning, the 
scope of the decision, its likely impact and what options 
Congress may have at its disposal remaining to deal with the 
problems we are likely to encounter now that the Court has 
declared open season on democracy.
    One of the things that strikes me, and I am sure that my 
colleagues on the other side of the aisle who are constantly 
assailing judicial activism will agree, is the extent to which 
an extraordinarily activist Court reached out to issue this 
decision.
    The justices answered a question they weren't asked in 
order to overturn a century of precedent which they had 
reaffirmed only recently. The only real change has been one of 
Court membership.
    The Court sought to decide the case on the broadest 
constitutional grounds when it could easily have resolved the 
question on much narrower grounds.
    Finally, the Court substituted its judgment of what 
constitutes corruption in politics for that of the 
democratically representatives in the Congress and in most of 
the State legislatures who have actually participated in the 
process and who understand firsthand the corrosive effect of 
money in politics. The absence of Justice O'Connor, the only 
former legislator on the Court, may have made a real difference 
in this case.
    Chief Justice Roberts' concurrence in particular was a 
virtual manifesto for the judicial activists looking to 
overturn--looking for an excuse to overturn longstanding 
precedent even when those precedents weren't properly before 
the Court.
    It can be considered a warning shot and it bodes ill for 
the future and certainly ill for stare decisis in the future. 
His opinion hardly reads like the words of an umpire who is 
simply following precedent in deciding cases as narrowly as 
possible.
    In fact, it certainly doesn't sound like the man who 
presented himself to the Senate at his confirmation hearings. 
In fact, it certainly raises questions as to the truthfulness 
of his testimony at the confirmation hearings.
    Justice Stevens stated the basic issue clearly in his 
dissent, ``The conceit that corporations must be treated 
identically to natural persons in the political sphere is not 
only inaccurate but also inadequate to justify the Court's 
disposition of this case.
    ``In the context of election to public office, the 
distinction between corporate and human speakers is 
significant. Although they may make enormous contributions to 
our society, corporations are not actually members of it. They 
cannot vote or run for office. Because they may be managed and 
controlled by non-residents, their interests may conflict in 
fundamental respects with the interests of eligible voters.
    ``The financial resources, legal structure and instrumental 
orientation of corporations raises legitimate concerns about 
their role in the electoral process. Lawmakers have a 
compelling constitutional basis, if not a democratic--if not 
also a democratic duty, to take measures designed to guard 
against the potentially deleterious effects of corporate 
spending in local and national races.''
    I would even wonder, in light of the majority's finding 
that a corporation and a natural person are the same, et 
cetera, what this means for our antitrust law.
    Is it against the Constitution for Congress to decree, for 
example, that corporations may be too big, that they must be 
broken up under certain circumstances, without having found 
them guilty of serious felonies?
    We couldn't impose a death penalty on an individual just 
because we didn't like his or her influence. Are we now going 
to face that with corporations? That is the implication.
    Former Justice O'Connor discussed the threat to the 
integrity of the judiciary in a recent speech at Georgetown 
University Law Center. She said, ``This rising judicial 
campaigning makes last week's opinion in Citizens United a 
problem for an independent judiciary. No State can possibly 
benefit from having that much money injected into a political 
campaign.'' And she was, of course, referring specifically to a 
judicial political campaign.
    So now that corporations, including those controlled by 
foreign interests, have the same rights as any voter, what is 
in store for our democracy? What other rights will the Court 
confer on corporations? Perhaps one day we will have Exxon as a 
colleague here in Congress. Many would say we already do.
    And what can Congress, within the bounds set by the Court, 
still do to control the influence of the monied aristocracy in 
our political process?
    I look forward to the testimony of our witnesses on this 
very important issue, and I yield back the balance of my time.
    The Chair now recognizes the distinguished Ranking Member 
for 5 minutes for an opening statement.
    Mr. Sensenbrenner. Thank you very much, Mr. Chairman.
    Guess what? I don't agree with his analysis at all. And 
prior to the----
    Mr. Nadler. Right. Yes.
    Mr. Sensenbrenner [continuing]. Prior to the Supreme 
Court's decision in Citizens United v. FEC, Federal law 
prohibited corporations and unions from using their general 
treasury funds to make independent expenditures for speech 
expressly advocating the election or defeat of a candidate for 
Federal office.
    Those formerly illegal electioneering communications were 
defined as any broadcast, cable or satellite communication that 
refers to a clearly identified candidate for Federal office and 
is made within 30 days of a primary or 60 days of a general 
election.
    The Supreme Court concluded that these laws constituted an 
outright ban on speech backed by criminal sanctions and in 
clear violation of the First Amendment.
    In particular, the Court stated that under that 
unconstitutional law, the following acts would be felonies: The 
Sierra Club runs an ad within the crucial phase of 60 days 
before the general election that exhorts the public to 
disapprove of a congressman who favors logging in national 
forests; the National Rifle Association publishes a book urging 
the public to vote for the challenger because the incumbent 
U.S. senator supports a handgun ban; and the American Civil 
Liberties Union creates a Web site telling the public to vote 
for a presidential candidate in light of that candidate's 
defense of free speech.
    The Court concluded that these prohibitions are classic 
examples of censorship and appropriately struck down the law. 
Now we are going to hear about all sorts of attempts to 
undercut the Supreme Court's ruling by statute.
    But the Supreme Court in its decision made clear that any 
alternative regulations that produced a chilling effect on free 
speech would also be unconstitutional, including any 
alternative that requires lengthy legal proceedings to 
determine what sort of speech a corporation can or cannot 
engage in during Federal elections.
    As the majority wrote, ``It is well known that the public 
begins to concentrate on elections only in the weeks 
immediately before they are held. There are short time frames 
in which a speech can have influence. The speaker's ability to 
engage in political speech that could have the chance of 
persuading voters is stifled if the speaker must first commence 
a protracted lawsuit. By the time the lawsuit concludes, the 
election will be over and the litigants in most cases will have 
neither the incentive nor perhaps the resources to carry on.''
    So in expressing its appropriate concern for alternative 
regulations that would chill free speech, the Court has already 
gone a long way toward pouring cold water on a lot of proposals 
made by opponents of the decision to further limit free speech.
    The hysterical cries in some quarters, maybe here today, 
regarding the Supreme Court's decision are in stark contrast to 
the everyday unconstitutional--uncontroversial, I am sorry, 
democratic elections that have been held in 26 States 
representing 60 percent of the Nation's populations that 
already allow corporate independent expenditures in State 
elections.
    The result will be no different when the same rules are 
applied that were already applied in 26 States in their State 
elections when they are applied to Federal elections.
    The Citizens United case has also caused some opponents of 
the decision to focus their attention on another piece of 
Federal legislation called the Fair Elections Now Act, which 
would use tax dollars to fund congressional campaigns in what 
amounts to a hundreds of millions of dollars taxpayer bailout 
of politicians.
    This solution to what opponents call the problem of free 
speech is a red herring, since corporations will still be able 
to make independent expenditures regardless of how their 
candidates fund their campaigns.
    This would also make the White House red-faced, as 
President Obama became the first presidential candidate in 
history to forego public financing in the general election 
because he expected he could raise millions more without it, 
and did.
    With those concerns in mind, I look forward to hearing from 
all of our witnesses today and yield back the balance of my 
time.
    Mr. Nadler. I thank the gentleman.
    In the interest of proceeding to our witnesses and mindful 
of our busy schedules, I normally ask that other Members submit 
their statements for the record.
    I understand that a number of Members have asked that they 
be able to deliver an opening statement, and I will recognize 
them as they seek recognition, but first I will recognize the 
distinguished Ranking Member of the full Committee, Mr. Smith.
    Mr. Smith. Thank you, Mr. Chairman, for recognizing me.
    In 2002, Congress passed Federal campaign finance 
restrictions that I, along with most Republicans, opposed 
because we felt they were unconstitutional.
    That legislation limited how much money corporations, 
nonprofits and unions could spend on television ads that 
support or oppose a Federal candidate 30 days before a primary 
election and 60 days before a general election.
    Corporations, nonprofits and unions are simply collections 
of individuals who have pooled their financial resources to 
pursue common goals. The law Congress passed severely limited 
these groups' ability to voice their political opinions.
    Last month the Supreme Court held that the political speech 
restrictions in that law are unconstitutional under the First 
Amendment.
    As the Court stated, political speech is ``indispensable to 
decision-making in a democracy,'' regardless of whether the 
speech comes from an individual or from a corporation. In other 
words, free speech is free regardless of whether it is 
exercised by one person or collectively by 100 people.
    The law the Supreme Court struck down also exempted media 
corporations from those restrictions. This gives the national 
media's well established bias free reign during elections while 
muzzling the voices of many citizens.
    The national media largely criticized the Supreme Court's 
ruling. The New York Times called it disastrous and the 
Washington Post called it dangerous.
    An exception was my hometown newspaper, the San Antonio 
Express-News, which pointed out the unfairness of campaign 
finance laws restricting the free speech of all organizations 
except the media.
    As the Express-News stated, while the media could make 
endorsements right up to the day of an election, all other 
organizations were restricted in their opinions. As the 
editorial explained, it makes no sense to restrict speech prior 
to an election, arguably the period when the exercise of 
political speech is most important.
    The national media should acknowledge that free speech is 
free regardless of whether it is exercised by newspaper 
editorial boards or by everyday Americans.
    As the Supreme Court determined, the views expressed by 
media corporations often ``have little or no correlation to the 
public support'' of those views. As such, other corporations 
should be treated no differently than media corporations.
    Finally, some opponents of the Supreme Court's decision in 
support of free speech, including the President, claim the 
decision would open the floodgates to foreign influence in 
American elections. Not true, as someone said recently.
    The Supreme Court's decision actually kept in place current 
laws that prohibit foreign corporations from influencing 
American elections.
    Under current law, a foreign national may not directly or 
indirectly contribute to a candidate or party or pay for a 
broadcast, cable or satellite communication that refers to a 
Federal candidate before an election.
    Current Federal Elections Commission regulations, untouched 
by the Citizens United case, also provide that a foreign 
national may not direct, control or indirectly participate in 
the decision-making process of any corporation, labor union or 
political committee in its election-related activities. 
Obviously, the floodgates to foreign influence can't be opened 
if the dam is still in place.
    The Supreme Court's decision rightly restores to Americans 
the right to voice their opinions during an election and sends 
a strong message to future congresses that attempt to limit 
free speech. I hope this Congress hears that message loud and 
clear before considering President Obama's call to reinstate 
unconstitutional restrictions on free speech.
    Mr. Chairman, on the way to yielding back, let me say I am 
trying to get to the House floor, so I will miss at least part 
of the witnesses' testimony, and that I regret. And I will 
yield back.
    Mr. Nadler. I thank the gentleman.
    Does any other Member seek recognition?
    The gentleman from Iowa?
    Mr. King. Thank you, Mr. Chairman. And I will make this 
just a brief statement. I echo the statement made by the 
Ranking Member of the full Committee and the Ranking Member of 
the Constitution Subcommittee.
    I would make this point, that I think was the most 
important point, which is we have gone along since 2002 without 
hearing a complaint that, at least I recall from the Democrat 
side of the aisle, about the corporate speech of the major news 
media.
    And the major news media in this country has actively been 
seeking to influence elections. I can recall a newspaper that 
was very involved in a presidential race in Iowa, and when I 
looked at the returns county by county, and it looked like it 
reflected the distribution of that newspaper almost exactly.
    And when I wrote a letter to the editor and said, ``This is 
the result of what you have been doing by your partisan and 
unobjective approach,'' the editor's response to me was, ``I 
hope so. It was my intent to influence the election.''
    And I think we all have some kind of experience in that 
fashion. It is hard to convince the American people, Mr. 
Chairman, that the news media has not been involved in seeking 
to influence elections most aggressively.
    And so I do not understand the aversion to allowing 
corporate speech in a broader category than those people that 
have full access to the news media and can spend their dollars 
more effectively than perhaps any other corporate structure.
    And in addition, I would point out that I think there is 
something we might get to see here that is a difference. I 
don't think it is going to be a dramatic change with the 
Supreme Court decision that immediately makes a shift.
    But when I start thinking about corporations that have 
taken positions supporting legislation that is anathema to 
their corporate interests, and I wonder why--and it is because 
they are trying to mitigate the legislative damage that might 
be brought upon them.
    And the cap and trade legislation is a--I think an 
excellent case in point where the balanced scales of all of 
those entities that were against it began to be convinced that 
something was going to pass, so they lobbied for their carve-
outs, and slowly a cap and trade bill passed the House of 
Representatives.
    And I believe that, on balance, it is against the interests 
in this country, and we have that disagreement, Mr. Chairman. 
But my point is corporations now under this decision, Citizens 
United, may be more bold in their involvement.
    They may decide they want to engage in this speech within 
that 60-day window more aggressively, and perhaps that will be 
a way that legislation that I believe is bad for America is 
prevented from coming to passage.
    So it is going to be a very interesting hearing. I 
appreciate you holding this. I appreciate being recognized. And 
I yield back the balance of my time.
    Mr. Nadler. I thank the gentleman.
    I now yield--I now recognize, rather, the gentleman from 
South--North Carolina.
    Mr. Watt. Thank you. Thank you for elevating me back to 
North Carolina. Don't say South Carolina.
    Let me thank the Chair for holding the hearing first, and I 
am looking forward to the witnesses' testimony. I have not read 
the case, and I come down kind of between the Ranking Member 
and the Chair in my initial reactions to this.
    I have a lot of ambivalence on this issue. Some of you have 
heard me say on prior occasions that I learned more about the 
First Amendment and free speech in one experience than I 
learned from my constitutional law classes in law school when 
my senior law partner sent me to a county to represent some 
Native Americans who had been demonstrating with tomahawks and 
other native paraphernalia.
    And I got there and, of course, they had been arrested for 
various things--resisting arrest, parading without a permit, 
this and that. And I got there and found that what they were 
demonstrating about was that they didn't want to go to school 
with black kids.
    And so I rushed back several counties over to my law office 
and confronted my senior law partner about why he would send 
me, an African American, to represent the Native Americans who 
were demonstrating against going to school with black kids, and 
he looked at me without even hesitation and said, ``Don't you 
believe in the First Amendment?''
    I think I learned something there that kind of permeated 
the law firm that I came out of, that even when you disagree 
with what people are saying, you have to tolerate it and shore 
yourself up and keep moving if you really believe in free 
speech.
    And I guess it was out of that experience that our law firm 
went on to represent the Ku Klux Klan in several demonstration 
cases, even though we were vigorously opposed to everything 
they stood for.
    So I take the First Amendment and free speech very 
seriously, but I do want to make three quick points about this 
argument. First of all, I think it is a mistake for any of us 
to treat this as a partisan divide. It is not a partisan issue.
    You know, sometimes this Democratic President may benefit 
from it. Sometimes prior Republican Presidents may have 
benefitted from it. So you know, speech is not Republican or 
Democratic. It is speech. It is First Amendment right. And we 
need to keep the partisan rhetoric out of this discussion. I 
think that is a serious mistake that some of my colleagues are 
making.
    Second, I am concerned that while I am a strong, strong 
believer in free speech and the First Amendment, that the 
courts--or the Supreme Court seems to have equated speech and 
money as if they were one and the same. Speech is one thing. 
Money, just because you have it, doesn't necessarily give you 
any greater free speech rights.
    Next, I am concerned that the Supreme Court seems to define 
the rights of corporations as being identical to the rights of 
individuals. And I would like to hear the panel's evaluation of 
that issue.
    And finally, I have some very serious concerns that the 
Court has engaged systematically on taking over prerogatives 
that the legislative branch should be able to exercise, and 
that these people who say that they don't believe in 
legislating from the bench have been the ones who seem to be 
most guilty of doing exactly that.
    I can't even remember, Mr. Chairman, how I voted on McCain-
Feingold, to be honest with you. I haven't gone back to check. 
Remember, I had some serious reservations about it, about the 
free speech aspect of it, and I may have resolved those 
concerns to vote for it.
    Mr. Nadler. I think you may have voted for McCain and 
against Feingold, or maybe the other way around. [Laughter.]
    Mr. Watt. Might have been. But I don't know that that is 
the issue. I think this is a serious issue, and we need to 
treat it so, and that is why I came today, to listen to this 
outstanding panel. Maybe I will have a more fixed opinion by 
the end of the day about where I come down on this very 
delicate issue.
    But maybe that sounds like I am somewhere between the 
Chairman and the Ranking Member, who seem to be--seem to have 
pretty vigorous opinions, opposite sides. So I am here to 
listen, and I appreciate the Chairman indulging me.
    Mr. Nadler. Thank you.
    Does anyone else seek recognition? Very good.
    Without objection, all Members will have 5 legislative days 
to submit opening statements for inclusion in the record.
    Without objection, the Chair will be authorized to declare 
a recess of the hearing at any time, although I do not intend 
to call a recess unless we are interrupted by a vote.
    We will now turn to our panel of witnesses. As we ask 
questions of our witnesses, the Chair will recognize Members in 
the order of their seniority on the subcommittee, alternating 
between majority and minority, provided that the Member is 
present when his or her turn arrives.
    Members who are not present when their turns begin will be 
recognized after the other Members have had the opportunity to 
ask their questions.
    The Chair reserves the right to accommodate a Member who is 
unavoidably late or only able to be with us for a short time.
    Our first witness is Professor Laurence Tribe, who is the 
Carl M. Loeb University Professor at Harvard Law School, where 
he has taught since 1968. He has argued numerous times before 
the Supreme Court, where he also served as a law clerk to 
Justice Potter Stewart.
    He received an A.B. summa cum laude from Harvard College 
and a J.D. magna cum laude from Harvard Law School.
    Monica Youn--and I hope I am pronouncing that correctly--
Monica Youn is the director of the Campaign Finance Reform and 
Money in Politics Project of the Brennan Center for Justice. 
She served as counsel of record for the center's Supreme Court 
amicus brief in Citizens United v. FEC.
    Prior to joining the Brennan Center, she worked in private 
practice and also served as a law clerk to Judge John T. 
Noonan, Jr. in the United States Court of Appeals for the Ninth 
Circuit. Ms. Youn received her J.D. from Yale Law School, her 
master in philosophy from Oxford University, where she was a 
Rhodes Scholar, and her B.A. from Princeton University.
    Sean Parnell is president of the Center for Competitive 
Politics. Previously, Mr. Parnell was vice president for 
external affairs at the Heartland Institute in Chicago.
    Prior to joining Heartland, he worked on political 
campaigns in Iowa, managed a successful congressional campaign, 
and served as finance director for a U.S. Senate race. Mr. 
Parnell received a degree in economics from Drake University.
    Don Simon is counsel to Democracy 21. He is currently a 
partner at the firm of Sonosky Chambers Sachse Endreson & 
Perry, LLP where he specializes in litigation and 
administrative law.
    From 1995 to 2000 Mr. Simon served as executive vice 
president and general counsel of Common Cause. In that 
capacity, he directed the legislative and legal programs for 
the reform organization. Mr. Simon received his B.A. magna cum 
laude in 1975 from Harvard College and his J.D. cum laude from 
Harvard Law School in 1978.
    I am pleased to welcome all of you. Your written statements 
in their entirety will be made part of the record. I would ask 
each of you to summarize your testimony in 5 minutes or less, 
although I am a little loose with the gavel on time.
    To help you stay within that time, there is a timing light 
at your table. When 1 minute remains, the light will switch 
from green to yellow and then red when the 5 minutes are up.
    Before we begin, it is customary for the Committee to swear 
in its witnesses.
    [Witnesses sworn.]
    Mr. Nadler. Let the record reflect the witnesses answered 
in the affirmative.
    You may be seated.
    I now recognize Professor Tribe for an opening statement.

    TESTIMONY OF LAURENCE H. TRIBE, CARL M. LOEB UNIVERSITY 
          PROFESSOR, HARVARD LAW SCHOOL, CAMBRIDGE, MA

    Mr. Tribe. Thank you. Chairman Nadler, Members of the 
Committee, I am honored by your invitation that I testify this 
morning.
    And with my prepared statement entered into the record, I 
will just touch briefly on where I believe the Court went 
wrong, why it matters, what Congress should do about it and why 
Congress needs to act quickly.
    Where did the Court go wrong? In my view, the majority and 
concurring opinions are no match for Justice Stevens' 90-page 
dissent. He shows convincingly, even to someone who is a strong 
free speech believer, as I am, that the majority reached far 
beyond the issues actually presented, failed to justify tossing 
aside decades of precedent, and profoundly distorted both the 
original meaning and the evolving understanding of free speech.
    Why does it matter? When ideological groups or corporate 
PACs collect and spend the money of those who want to support 
or oppose particular candidates--examples like the Sierra Club 
or the NRA or other PACs--corporations can focus hundreds of 
thousands of dollars on campaign ads, and that is exactly as I 
believe it should be, if that is how people want to spend their 
money on politics. That is how much--what they want to spend.
    But when entire corporate treasuries become available for 
electioneering, even though the shareholders who own that money 
never entrusted it to management to use in that way, the amount 
that can be used to drown out individual voices artificially 
multiplies exponentially, given the trillions of dollars in 
corporate profits that suddenly become available.
    A company like Exxon Mobil just needs to threaten that it 
will spend whatever it takes to defeat a candidate who fails to 
toe the line, and it can greatly improve the odds of getting 
its way.
    Indeed, just the perception that that is going on breeds a 
degree of cynicism and distrust that can kill meaningful 
political participation and endanger viable self-government.
    What should Congress do about it? First, I think Congress 
should start by guarding American elections from direct or 
indirect manipulation by foreign entities and foreign funding.
    The majority in Citizens United emphasized that it didn't 
have that case before it. But of course, that didn't stop it 
from reaching out to decide lots of questions it didn't have 
before it.
    The fact that it carefully tiptoed up to the water's edge 
and not beyond I think is a strong signal that the majority 
agreed with the Stevens dissent that the tradition of guarding 
against foreign influence in American politics would trump the 
majority's abstract theory that the identity of who is speaking 
or bankrolling speech makes no First Amendment difference. But 
the existing restrictions on foreign influence are riddled with 
loopholes and need to be tightened.
    Second, I think Congress should enact legislation giving 
States permission to do what would otherwise violate the 
commerce clause--namely, protect their own State elections from 
manipulation by businesses and dollars from other States. That 
is something that many of the 39 States that elect their judges 
might well want to do.
    Third, acting again under its commerce power, Congress 
should protect corporations--let me repeat that, protect 
corporations--doing business with government from being 
pressured to pay if they are going to play. It should do that 
by prohibiting such companies from spending money in connection 
with candidate elections.
    Nearly 75 percent of the 100 largest publicly traded firms 
are Federal contractors. But there is no need for Congress to 
limit its protection of unfettered commerce to the Federal 
level because you do not need the Federal spending power to 
justify such a law.
    It can be justified the way the Supreme Court has justified 
Hatch Act and other protections for employees whose employers 
or unions might otherwise pressure them into supporting causes 
that they do not endorse.
    Fourth, I think Congress should give more meaningful 
protection to those who buy shares in for-profit companies or 
funds not in order to influence elections but in order to earn 
a profit. The Citizens United majority insisted that the 
procedures of corporate democracy could do the job. But the 
dissent showed how inadequate those procedures are at present.
    The majority said fine but ``the remedy is to consider and 
explore other regulatory mechanisms.'' I think Congress should 
take the Court up on its invitation and should adopt reforms 
requiring shareholder pre-approval for campaign expenditures by 
for-profit business corporations and by making it easier for 
dissenting shareholders to sue for corporate waste. My prepared 
statement spells that out in more detail.
    Fifth, to protect both shareholders and voters, the 
disclaimer and disclosure requirements that the Court upheld 8-
1 in Citizens United have to be tightened so that money cannot 
be funneled through shells with innocuous names like Citizens 
for Good Health and Clean Energy when the real source is 
Novartis or Mobil Oil.
    And the CEOs of for-profit corporations that bankroll 
either positive or negative ads should have to own up to their 
responsibility under oath and certify on camera the business 
purposes of their political expenditures.
    I see the light is on, but if I could go on for a few 
seconds, I would appreciate it, Mr. Chairman.
    Sixth, even after Citizens United, the law bars corporate 
contributions to candidates and electioneering expenses that 
are coordinated with their campaigns. But the rules defining 
coordination are hopelessly fuzzy and loophole-ridden.
    So a lot of de facto contributions can sneak under the wire 
as if they were independent. Waiting until the FEC acts is like 
waiting for Godot. Congress needs to codify the rules itself.
    Seventh, public financing needs to be explored, things like 
the Fair Elections Now Act, but that is a far reach in terms of 
ever ultimately solving the problem, and we can't afford to 
wait.
    That is the key point I want to leave with you. Why do we 
need to act now? The reason is that unless Congress adopts 
reforms like these before the November elections, large 
business interests, including those indirectly funded from 
overseas, may give us a Congress pre-selected with a view to 
opposing these various reforms, and then it will be too late to 
do what is needed to hold back the potentially distorting 
corporate flood.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Tribe follows:]
                Prepared Statement of Laurence H. Tribe


































                               __________

    Mr. Nadler. I thank you.
    Ms. Youn, you are recognized.

   TESTIMONY OF MONICA Y. YOUN, COUNSEL AND DIRECTOR OF THE 
 CAMPAIGN FINANCE REFORM PROJECT, BRENNAN CENTER FOR JUSTICE, 
        NEW YORK UNIVERSITY SCHOOL OF LAW, NEW YORK, NY

    Ms. Youn. Thank you for inviting me to testify today.
    As we all know, Congress is debating a range of policy 
proposals to mitigate the disastrous potential consequences of 
Citizens United. These proposals, particularly public 
financing, voter registration modernization, disclosure and 
shareholder protection, are discussed at greater length in my 
written testimony.
    And I agree with Professor Tribe that it is crucial that 
Congress act, and act quickly. But whatever legislation 
Congress ends up adopting, this we know for sure--the new 
reforms may be on a collision course with the present majority 
of the Supreme Court.
    In the meantime, challenges to other Federal and State 
campaign finance reforms, including public financing, 
disclosure laws, PAC requirements and soft money restrictions, 
are on a fast track to the Supreme Court as well, brought to 
you by many of the same lawyers that brought Citizens United.
    In defending these reforms, then, and in enacting new ones, 
it is crucial that we push back against the faulty factual 
assumptions upon which the Citizens United majority based its 
decisions.
    These five justices were in such a hurry to strike down 60 
years of campaign finance safeguards that they couldn't even 
wait for a factual record to be developed. But by rushing to 
judgment, these five justices based their decision on nothing 
more than their own gut instincts about how politics actually 
works.
    These instincts turned out to be, at best, extremely naive, 
as Senator John McCain put it; at worst, dangerous; and at 
root, just plain wrong.
    This Committee can play a crucial role in setting the 
record straight by convening hearings that develop the factual 
record to provide a reality check for the current Supreme Court 
majority. I want to focus my testimony today on three of these 
faulty assumptions.
    First, the Court assumes that limits on corporate political 
spending exist because incumbent politicians wish to silence 
their most effective opposition. In fact, Justice Kennedy goes 
even farther, stating that these laws violate the First 
Amendment because the government has ``muffled the voices of 
corporations in politics.''
    I defy anyone watching the debates in Congress regarding 
the banks, health care and climate change to say with a 
straight face that corporations have been unable to express 
their point of view on these matters either to Members of 
Congress or to the public at large.
    What corporations have not been able to do up until this 
point is to buy an election, to bring their treasury funds 
directly to bear in our most sacred of democratic institutions.
    Second, the Court assumes that shareholders have oversight 
over political spending by corporate managers and that 
disclosure laws ensure that voters know who is paying for our 
politics.
    Once again, this assumption is faulty. First, as a recent 
Brennan Center report points out, Federal law does not 
currently require corporate political spending to be disclosed 
either to shareholders or to corporate boards.
    Similarly, voters can't detect corporate political activity 
since, as Professor Tribe pointed out just now, corporations 
commonly mask their corporate spending behind misleadingly 
named euphemisms. In most of the cases, by the time these 
groups are unmasked, the election is already over.
    But disclosure alone is not an adequate safeguard of our 
democracy. If you fear burglars, you don't stop locking your 
doors just because you have invested in a security camera. By 
the time the damage is detected, it is far too late.
    Finally and most disturbingly, the Court assumes that 
unlimited corporate spending poses no threat of corruption. The 
Court seems woefully ignorant of the countless examples of 
influence peddling resulting from corporate independent 
expenditures.
    But you know, this woeful ignorance is not without limit. 
For example, in the Caperton case, faced with the ugly truth of 
what corruption looks like in practice, the Court blinked. It 
pulled back.
    Justice Kennedy there voted with the four pro-reform 
justices rather than with the Roberts bloc because he was 
unable to deny, faced with the facts, the reality of political 
corruption, at least in judicial campaigns.
    By building a strong factual record on this and other 
issues, the Committee can ensure that this Supreme Court base 
future decisions in the area of money and politics, on facts 
rather than fiction.
    Thank you for inviting me to testify.
    [The prepared statement of Ms. Youn follows:]
                  Prepared Statement of Monica Y. Youn


































                               __________

    Mr. Nadler. I thank you.
    Mr. Parnell is recognized.

TESTIMONY OF SEAN D. PARNELL, PRESIDENT, CENTER FOR COMPETITIVE 
                    POLITICS, ALEXANDRIA, VA

    Mr. Parnell. Thank you, Chairman Nadler, Ranking Member 
Sensenbrenner, Members of the Subcommittee. Thank you for 
inviting me to testify today.
    To begin, I would like to address the issue of so-called 
unlimited corporate spending. A review of recent political 
spending in other areas by incorporated entities shows that the 
lack of statutory limits on spending has not led to 
corporations emptying their treasuries in support of political 
agendas.
    For example, in the 2002 election cycle, the Republican and 
Democratic Parties raised approximately $300 million combined 
in soft money from businesses, unions and other organizations 
during a period when after-tax corporate profits totaled over 
$1 trillion.
    Corporations also failed to avail themselves of their 
amassed wealth in the 2004 election cycle when so-called 527 
groups spent approximately $612 million in connection with all 
elections. Most of the 527 funding in 2004 came from 
individuals, ideologically oriented and issue-driven groups, 
and unions.
    Looking only at Exxon Mobil, which appears to be the 
popular villain of the day, lobbying expenditures in 2008 
totaled roughly $29 million, while they earned over $45 billion 
in profits that year.
    And finally, an internal memo regarding Exxon Mobil's 
giving to public policy groups in 2002 States that they gave 
only $5.1 million to such groups. In 2002 Exxon Mobil had 
annual profits of approximately $11.46 billion.
    Simply put, in the past, business corporations, unions and 
ideologically oriented groups have had ample opportunities to 
pour unlimited amounts of money into the American political 
system through soft money, 527 groups, lobbying and public 
policy groups and have shown very little interest in putting 
more than a tiny fraction of their resources into these 
efforts.
    While the Citizens United decision does not pose nearly the 
threat to America's political system as detractors claim, there 
may, in fact, be some legislation that ought to be considered 
in light of this ruling.
    When considering policy responses, however, it is important 
to note that there are some things which it is clear that 
Congress simply cannot do in light of the Citizens United 
decision and other rulings on campaign finance and the First 
Amendment.
    Among the options that are unlikely to be permitted by the 
courts would be any sort of tax levied on the exercise of the 
constitutional right, as proposed in H.R. 4431, or the 
enactment of legislation that would simply restore pre-Citizens 
United status quo through the back door, such as H.R. 4435, a 
bill that would apparently forbid publicly traded company from 
being listed on stock exchanges if they engage in independent 
expenditures.
    Another consideration to keep in mind is the Supreme 
Court's admonishment that ``the First Amendment stands against 
attempts to disfavor certain subjects or viewpoints or to 
distinguish among different speakers which may be a means to 
control content. There is no basis for the proposition that in 
the political speech context the government may impose 
restrictions on certain disfavored speakers.''
    This strongly suggests that the courts are likely to be 
skeptical of laws and regulations that impose burdens only on 
some disfavored incorporated entities while leaving other 
favored speakers free of similar burdens.
    For example, laws that require for-profit corporations to 
seek shareholder approval for expenditures, such as H.R.s 4487 
and 4537, might be struck down in court because no similar 
requirement is imposed on unions or other nonprofits.
    The pre-Citizens United status quo may be gone, but there 
are several policy changes that Congress should consider, 
including eliminating the limit on coordinated expenditures 
between parties and candidates and raising contribution limits 
for individuals, parties and PACs to fully account for 
inflation since they were first imposed in 1974.
    We at the center believe these measures would be consistent 
with the First Amendment and are actually likely to draw money 
out of the newly permitted world of relatively unregulated 
corporate express advocacy and into the more heavily regulated 
sphere of candidates, parties and PACs.
    I have attached to my submitted testimony a document 
entitled ``After Citizens United: A Moderate, Modern Agenda for 
Campaign Finance Reform'' that provides additional information 
on these suggestions and others.
    Finally, I want to make one comment that was not made at 
the Senate hearings yesterday and has not been raised by 
anybody here so far. And that is the subject of book banning.
    The United States Supreme Court, when they first heard oral 
arguments in Citizens United, was presented by the deputy 
solicitor general of the United States with the argument that 
under campaign finance regulations it was permitted for the 
government to ban books.
    That is, I would hope, a matter of some interest to the 
Subcommittee on the Constitution, Civil Rights and Civil 
Liberties.
    It is speculation on my part, but it is my belief, when 
people ask why did the United States Supreme Court potentially 
reach for this decision when it was not presented initially 
with questions of whether it should overturn Austin v. 
Michigan--but it is my own speculation that the United States 
Supreme Court, when informed by the deputy solicitor general of 
the United States that, yes, the Federal Government could under 
campaign finance regulations ban books--that the Supreme Court 
simply decided, ``If you believe that you have the authority to 
ban books, we really need to revisit exactly what authority it 
is that you believe allows you to ban books.''
    I would be happy to talk about this or anything else during 
the question-and-answer period or at any other time. Thank you.
    [The prepared statement of Mr. Parnell follows:]
                 Prepared Statement of Sean D. Parnell




















                               ATTACHMENT






















                               __________

    Mr. Nadler. I thank the gentleman.
    Mr. Simon?

   TESTIMONY OF DONALD J. SIMON, PARTNER, SONOSKY, CHAMBERS, 
         SACHSE, ENDRESON & PERRY, LLP, WASHINGTON, DC

    Mr. Simon. Thank you, Mr. Chairman, Members of the 
Subcommittee. I appreciate the opportunity to testify this 
morning.
    The Citizens United decision represents an enormous 
transfer of power, political power in our country, from 
citizens to corporations. Until 2 weeks ago, the financing of 
Federal elections had been limited by law to individuals and to 
groups of individuals functioning through political committees.
    Corporations had been prohibited from using their corporate 
wealth to influence Federal campaigns, a policy that dates back 
to 1907 when Congress first banned corporations from directly 
or indirectly making contributions in Federal elections.
    But now, corporate wealth accumulated in the economic 
marketplace can be brought to bear directly and without 
limitation on political campaigns. This will have a major 
negative effect on the conduct of Federal, State and judicial 
elections throughout the country.
    An avalanche of independent spending by one or more 
corporations or trade associations, particularly in the form of 
negative attack ads, and particularly at the end of a campaign, 
could make it virtually impossible for the candidate to respond 
and could easily have a decisive impact on the outcome of the 
election.
    Even the threat of such spending is in itself likely to 
distort the legislative process. Members of Congress will, in 
effect, have a Sword of Damocles hanging over their heads.
    Any wrong vote by a Member on an issue of importance to a 
corporation or trade association could trigger a multi-million-
dollar campaign to defeat the Member. And every Member will be 
forced, as a practical matter, to consider this consequence in 
deciding how to vote on legislation.
    Now, some have argued that corporations will not take 
advantage of this new opportunity, that the Supreme Court's 
decision is really no big deal. These words are comforting, but 
logic and history suggests otherwise.
    During the 1990's, when corporations were able to make soft 
money donations to the political parties for use in Federal 
elections, they did so in the tens and hundreds of millions of 
dollars in each election cycle, until the soft money system was 
shut down in 2002.
    The fact that corporate America had trillion-dollar profits 
and could have spent even more hardly means that the huge sums 
they did spend showed a lack of corporate interest in 
exploiting opportunities to use their wealth to buy access and 
influence.
    Given the ongoing legislative agendas that corporations 
have here in Congress, and given the huge financial stakes they 
have in these issues, there is little reason to think companies 
will not accept the court's invitation to mount campaigns 
directly for and against candidates.
    Serious students of Congress agree with this view. Former 
Republican senator Chuck Hagel, for instance, said before the 
decision was issued that allowing corporate spending would be 
an astounding blow against good government and responsible 
government.
    Longtime Washington observer Norm Ornstein wrote in Roll 
Call last week, ``It is not even the money that might be spent. 
It is the threat of spending that will alter many equations on 
Capitol Hill. The impact often will be felt at the margin 
behind closed doors but with huge effects on policy.''
    Now, it is certainly true that some companies may not want 
their names associated with campaign spending. But they may not 
be at all constrained from making expenditures indirectly and 
secretly by giving corporate funds to third-party groups such 
as the Chamber of Commerce, trade associations or other 
intermediaries which then spend the money.
    These expenditures will be made in the name of the 
intermediary but designed to further the political interests of 
the corporate donors who are the true sources of the funds.
    It is essential for Congress to move swiftly to enact 
legislation to mitigate the damage done by the decision. The 
organizing principle should be to advance legislation that 
directly responds to the impact of this decision and that can 
be enacted in time to take effect for the 2010 congressional 
elections.
    With this in mind, Congress should focus on enacting new 
disclosure rules that would require full disclosure of 
expenditures, including disclosures of transfers of funds used 
to make such expenditures; enacting corporate governance 
provisions that would grant shareholders a voice in the 
political spending done by their corporations; strengthening 
existing pay-to-play rules to prohibit government contractors 
from using corporate funds to make independent expenditures; 
strengthening existing coordination standards to ensure that 
independent spending by a corporation is truly independent of 
any candidate or party and not coordinated in a de facto 
fashion; addressing the problem created by Citizens United 
which allows a domestic corporation owned or controlled by a 
foreign national to spend money to influence Federal elections.
    Now, let me just take a minute on that. It is true that 
foreign corporations are still banned by Section 441(e) from 
making campaign expenditures. But domestic corporations owned 
or controlled by a foreign corporation or, indeed, by a foreign 
government are not covered by Section 441(e) and now are no 
longer subject to a general corporate ban.
    So these domestic subsidiaries are free to spend money. 
Although an FEC regulation does address this situation, it does 
so, I believe, inadequately, and existing protections should be 
strengthened and made a matter of statutory law.
    Finally, reforming the existing lowest unit rate 
requirements in order to provide better access to low-cost TV 
to candidates and parties so they have the resources to respond 
to corporate spending.
    Now, let me just say that this agenda, I think, is notable 
in its modesty. Each of these reforms I think is fully 
consistent with the majority opinion in Citizens United and 
most of them, indeed, are invited by the majority opinion.
    Final word is that there is one more thing Congress should 
do, which is to resist any call to raise contribution limits or 
to repeal the soft money rules. To use Citizens United as an 
excuse to revive the soft money system is nothing less than an 
argument that one means of corruption justifies the 
introduction of another means of corruption. Adding to a 
problem is no way to solve it.
    Thank you very much.
    [The prepared statement of Mr. Simon follows:]
                 Prepared Statement of Donald J. Simon



































                               __________
    Mr. Nadler. I thank you.
    We will begin the questioning by recognizing myself.
    Professor Tribe, let me ask you a number of questions. 
Let's talk about disclosure, first of all. Let's say that 
Exxon--we will use them as our bogeyman today for no particular 
reason except that they are well known and large--let's say 
that Exxon wants to contribute a lot of money to a given 
candidate and wants to do it through the Citizens for a Clean 
Environment, which they invented.
    Now, we could, obviously, require that an ad run by such a 
group, if it were completely funded by Exxon, say this ad is 
funded by Exxon, could we not?
    Mr. Tribe. Yes, certainly----
    Mr. Nadler. Now, let's assume----
    Mr. Tribe [continuing]. You could say that.
    Mr. Nadler [continuing]. Thank you. But let's assume that 
Exxon got together with 20 other corporations to provide the 
financing for Citizens for a Clean Environment. Could we 
require that they list all their contributors or their five 
largest contributors in this 30-second ad?
    Mr. Tribe. I think it is purely a prudential and not a 
constitutional matter. That is, in the markup of such a bill, 
you would have thresholds, and you would certainly indicate 
that any corporation above a certain size that had contributed 
more than a stated percentage of----
    Mr. Nadler. Okay, thank you.
    Mr. Tribe [continuing]. The cost has to be disclosed.
    Mr. Nadler. Now, you mentioned pay or play, and you 
mentioned the Hatch Act. Do you think it would be 
constitutional with this Supreme Court majority for us to say 
that any corporation that does business with the Federal 
Government cannot use its corporate treasury to fund campaign 
ads?
    Mr. Tribe. I believe that would be permissible under the 
rationale of this opinion because the Court is talking about 
the rights of corporations, and one could protect those rights 
by shielding them from being pressured to pay to play.
    Mr. Nadler. And the same thing with protecting 
shareholders--could we require that before the corporate 
treasury is used to do campaign ads that they must get the 
written permission of 5 percent of the shareholders?
    Mr. Tribe. I think you could certainly require that as to 
for-profit business corporations where there is reason to think 
that people invest either directly or through intermediaries 
not for ideological reasons. I don't think you could do that 
with respect to corporations which are essentially ideological 
groups and happen----
    Mr. Nadler. But the for-profit----
    Mr. Tribe [continuing]. To be in corporate form.
    Mr. Nadler [continuing]. Do you think we could require that 
they get the permission on--to engage in a campaign by a 
specified percentage of the shareholders?
    Mr. Tribe. I believe you could.
    Mr. Nadler. Thank you. Let me turn to foreign control, 
foreign subsidiaries. Now, a number of the princes of Saudi 
Arabia have recently said publicly that their number one danger 
to their kingdom is that America might become energy 
independent, and that would be a terrible danger to them 
because we wouldn't buy their oil, and they are right, I think. 
And I hope we do that.
    Now, they have a motive, therefore, to influence our 
politics to see that we don't become energy independent, and 
they have a lot of money. Could we require that no corporation 
with more than, say, 5 percent ownership of non-American 
citizens can use its corporate treasury?
    Mr. Tribe. I believe, though the majority opinion carefully 
doesn't address that--it simply says that there are certain 
limits on foreign entities--I believe that there would be five 
votes at least to uphold such a requirement. I can elaborate if 
you want to know what my thought process is, but----
    Mr. Nadler. Well, let----
    Mr. Tribe [continuing]. That is my conclusion.
    Mr. Nadler [continuing]. We will talk later to elaborate, 
but not in this 5 minutes.
    So controlled by foreign nationals, owned or controlled--we 
know they don't have to own 50 percent of shares in a company 
to have effective control, nor does it have to be a domestic 
subsidiary. It could be an American company with X percent of 
foreign control, and it is effective control.
    Mr. Tribe. Right. There are lots of ways that foreigners 
could control and influence the American electoral process, and 
any----
    Mr. Nadler. Let me----
    Mr. Tribe [continuing]. Reasonable way of excluding that--
--
    Mr. Nadler [continuing]. Let me ask one other question, and 
then I will get to a different witness. The Court seemed to 
say--and I read the opinions last night. The Court seemed to 
say very--that a corporation essentially is identical to a 
natural person.
    Now, we don't treat corporations identically to natural 
persons. If natural persons commit felonies, we put them in 
jail. When we put them in jail they are deprived of their civil 
rights--the right to vote. The courts have held that people in 
prison have--lose a lot of their First Amendment rights.
    Could we constitutionally do the same thing to a 
corporation if we found it guilty of an election law violation 
and sentence it to do no business for 5 years, or sentence it 
to speak not at all for 3 years?
    Mr. Tribe. Perhaps. I think it would depend on the design 
of the law. But obviously, the equation of corporations with 
individuals is only partly metaphoric. That is, as you pointed 
out in your opening statement, you can break up a corporation 
if it gets too big to fail. You can't break up a person if 
that----
    Mr. Nadler. Well, I am beginning to--I am beginning to 
wonder if the Court is going to tell us we can't break up a 
corporation unless we convict it of a capital crime.
    Mr. Tribe. Well, I suppose that is right. The death penalty 
is a separate controversy, of course.
    Mr. Nadler. Yes.
    Mr. Parnell, let me ask you the following. This is an 
actual case that occurred in New York a number of years ago. 
How would you deal with it? How do you think we can 
constitutionally deal with it?
    The town or city--there is a town of Poughkeepsie and a 
city of Poughkeepsie; I forget which it was. It is a small city 
in New York.
    People typically spend $4,000 or $5,000--or at least this 
was true 20 years ago when what I am about to say occurred. 
People would typically spend $4,000 or $5,000 at the outside to 
be elected to the, I think, nine-or ten-member city council at 
the time.
    A very large company wanted to build a mall in the--
somewhere in Poughkeepsie, and the then-Democratically 
controlled city council for some reason didn't want them to do 
that, so they refused to let--to give them permission to build 
the mall.
    The local Republicans were in favor of the mall, basically, 
and so in the next election the local Republicans did what they 
normally did, spent $4,000 or $5,000 apiece to run for office, 
but this company came in and spent $20 million on an 
independent campaign expenditure, completely bowled over the 
local Republicans, who had no control of what was going on, 
made all sorts of allegations against the other people, made 
all sorts of claims on behalf of the Republicans, who had 
nothing to say about the matter and repudiated it afterwards, 
said, ``I didn't mean that. I didn't say that.''
    Be that as it may, the Republicans got elected. As they had 
said they would do, they approved the mall. The company then 
started building. Eventually the mall was built. All of this 
came out in public. The local electorate got infuriated. They 
couldn't punish the company, so they punished the local 
Republicans, who were really not at fault at all.
    But the mall got built, and the local democratic procedure, 
the--of everybody was completely overturned by some company 
coming in and spending--I forget how many millions of dollars 
in a campaign that normally wouldn't have totaled, for all 
people involved, $20,000, $30,000, and just completely 
overwhelmed the local system.
    How do we protect against the use of corporate assets to 
completely stifle a democratic procedure in a case like that, 
given this decision?
    Mr. Parnell. Well, I think I would disagree with one of the 
fundamental premises of your statement there, which is that the 
democratic procedure was somehow thwarted or overturned, 
because the voters of those towns--they were the ones that----
    Mr. Nadler. One town.
    Mr. Parnell. I am sorry?
    Mr. Nadler. One town.
    Mr. Parnell. Oh, I am sorry, one town. They were the ones 
who had to listen to this million dollars, $500,000, 20--
whatever amount of money was spent--they were the ones that had 
to listen to the arguments made in those campaign ads or 
mailers, or whatever it was, and ultimately decide, ``Do I 
believe this? Do I agree with this? Does this make sense to me? 
Or do I not?''
    Mr. Nadler. So in other words, someone has a corporate 
interest to build a mall.
    Mr. Parnell. Right.
    Mr. Nadler. They come in and spend $20 million, or $5 
million, or whatever it was, never mentioning the mall, saying 
that the local councilmen on the other side were terrible for 
some extraneous reason having nothing to do with the mall. They 
get the people they like elected, although they liked them only 
on one thing, the mall. The mall gets built.
    As soon as the electorate finds out what happened, they get 
infuriated, do what they can, throw out the hapless 
beneficiaries of this corporate spending. But the town never 
got a fair hearing on the mall.
    Mr. Parnell. I, again, don't know that I would agree with 
your description. I mean, there are always factors that come 
into elections for city council or any other. You have 
endorsements by organizations. You have media coverage.
    Mr. Nadler. Okay. So you think that what happened there is 
okay and we shouldn't be concerned about something like that 
being replicated.
    Mr. Parnell. I think that what you--if you want to be 
concerned about anything, I would be concerned about an 
electorate that maybe was not paying attention or discerning 
enough to be able to say, ``These allegations----
    Mr. Nadler. Okay.
    Mr. Parnell [continuing]. Are not worth considering in my 
voting process.'' I mean, ultimately, voters are sovereign. 
They are responsible for----
    Mr. Nadler. But they are sovereign--and you believe that 
this kind of overwhelming thing doesn't defeat the sovereignty 
of the voters. Okay, that is a philosophical distinction--
difference. Thank you very much.
    I will now recognize the distinguished Ranking Member of 
the Subcommittee, the gentleman from Wisconsin.
    Mr. Sensenbrenner. Well, thank you very much.
    Listening to the Democratic witnesses today, I get the 
impression that they think the sky is falling. And I don't 
think the sky is falling, but I think that the Citizens United 
case is a natural progression to what has happened over the 
last 35 or 40 years on the whole issue of campaign finance.
    You know, let me say that every time Congress and the Court 
has tightened the screws relative to campaign finance, 
something has happened where there is more money that has been 
gone off the books and away from the direct control of 
candidates and the direct responsibility of candidates.
    And let me give you a historical progression. In 1972 there 
was a man that gave several million dollars to Nixon's 
campaign. Nixon disgraced the presidency. The Watergate 
Congress passed a campaign finance bill that limited 
contributions. And what did we get? We got PACs, political 
action committees.
    In 1976 the Supreme Court decided the Buckley case. And the 
Buckley case essentially said that Congress and the States 
could regulate candidates but could not regulate individuals 
and equated the spending of money to influence campaigns as 
something that was protected by the First Amendment. Shortly 
afterwards, we ended up getting soft money as a result of that.
    The McCain-Feingold bill attempted to get rid of soft 
money, which was money not given for candidate advocacy but 
given to parties for party-building activities like voter 
registration, absentee ballots, get out the vote drives and 
stuff like that. So McCain-Feingold made that illegal, and we 
had more and more money go off the books for the so-called 
independent expenditures.
    And now the chickens have come home to roost as a result of 
all of these decisions that have been made either legislatively 
or judicially with the Citizens United case.
    Now, you know, maybe, you know, I am a little bit, you 
know, over reactive as the Democratic witnesses are on this. 
But I have always believed that we don't need a First Amendment 
to protect politically correct speech. The reason the First 
Amendment was passed by the first Congress was to protect 
politically incorrect speech.
    And the three Democratic witnesses, I think, have 
accurately zeroed in on speech that is politically incorrect 
which the Court has said is protected by the First Amendment. 
And they kind of sent the message that no matter how hard we 
try with the statute to correct the Citizens United speech--or 
Citizens United decision, we are--that also is going to meet a 
similar fate as a result of this Supreme Court majority.
    Now, that being said, you know, let me ask the three 
Democratic witnesses, should we try to amend the statute to try 
to deal with this, as each of you have said in a little bit 
different way, which will result in litigation and perhaps the 
same result? Or should we deal with this issue by a 
constitutional amendment, as Senator Kerry and Committee 
Chairman Conyers have recognized and have introduced?
    And I would just like to ask a yes or no answer, beginning 
with you, Professor Tribe.
    Mr. Tribe. If the only word I can use is yes or no, it 
would be no. But if I may ask, as a matter of personal 
privilege, to address the question of whether we are 
``Democratic witnesses,'' I very much agree with Congressman 
Watt that this is not and should not be a partisan issue.
    I know it was the majority that called us here, but I have, 
for example----
    Mr. Sensenbrenner. Well, I am running out of time. Mr. 
Parnell was invited by me.
    Yes or no, Ms. Youn?
    Ms. Youn. I would have to say no. I would say let's push 
back against the First Amendment which, until last month, did 
not permit this distortion of our democracy.
    Mr. Sensenbrenner. Okay.
    Mr. Simon?
    Mr. Simon. I don't support a constitutional amendment as 
the remedy for this decision.
    Mr. Sensenbrenner. Well, I am glad you said--all three of 
you have said that, because if we have a constitutional 
amendment that would mean that Congress would be amending the 
Bill of Rights for the first time in history, and that opens up 
a very disturbing Pandora's Box, and I would not support a 
constitutional amendment.
    Going to the next step, if we want to have political 
responsibility consistent with the First Amendment, what about 
getting rid of all of these restrictions and instead have a 
Federal law that channels all of the money through candidate 
committees, where the candidate is responsible for the source 
of the financing, the amounts of the financing and how that 
money is expended, but also have a law that requires that all 
of this information be placed on the Internet before the money 
hits the candidate's bank account?
    Wouldn't that be the way to very clearly constitutionally 
deal with this issue in a way that does not raise any First 
Amendment questions either as a result of the Citizens United 
decision or as a result of any of the previous decisions the 
Court has made?
    Let's start with you, Mr. Parnell, since you were off the 
hook on the last question.
    Mr. Parnell. Thank you, Congressman. Obviously, yes, I 
believe that--well, actually, I need to kind of separate. You 
have two different statements in there.
    The idea of simply allowing people to contribute to 
candidates that they support, they believe in, without limits, 
without restrictions--that is certainly what we believe the 
First Amendment protects, and so we would be all in favor of 
the general proposal as outlined by you.
    One thing, though--and I may have misunderstood what you 
were saying--you said channeling all of the money through 
candidates, and that would, if I am understanding you 
correctly, exclude still independent groups--the National Rifle 
Association, Exxon Mobile, the United Auto Workers.
    Mr. Sensenbrenner. Well, the point that I want to make is 
that if any of us up here on the dais accepts a million dollars 
from Exxon Mobil and discloses that prior to the money hitting 
our bank account, I think we all would have a very tough time 
persuading voters to vote for us when the election comes.
    Mr. Parnell. Yes. Yes. I just wanted to make the point that 
I was a little unsure of what you were saying in terms of 
independent spending and whether independent spending would 
still be allowed under the statute that you proposed. And 
obviously, we are very keen----
    Mr. Sensenbrenner. I don't think we can prohibit it.
    Mr. Parnell. Exactly. I just----
    Mr. Sensenbrenner. Yeah.
    Mr. Parnell [continuing]. Wanted to make sure that----
    Mr. Sensenbrenner. And that was not Citizens United. That 
was Buckley.
    Mr. Parnell. That was Buckley, exactly.
    Mr. Sensenbrenner. Okay.
    Mr. Parnell. One of the things that has kind of gotten lost 
here in talking about precedents being overturned is that 
Austin v. Michigan was, in fact, a rejection of a part of 
Buckley that ruled that independent expenditures are not 
corrupting. They cannot be corrupting.
    And so to the extent that the argument is being made that 
the Supreme Court went way out on a limb here in rejecting 
precedent, all they did was actually bring back the original 
1976 precedent, which I think everybody in the world of 
campaign finance understands is the guiding precedent in the 
world of campaign finance.
    Mr. Sensenbrenner. Thank you.
    I yield back the balance of my time.
    Mr. Nadler. I thank you, and--I thank the gentleman.
    And I will now recognize the gentleman from North Carolina 
for 5 minutes.
    Mr. Watt. Thank you, Mr. Chairman.
    If it is any consolation to Mr. Sensenbrenner, I want to 
assure him that I don't support a constitutional amendment to 
address this issue either, not that that matters, I am sure.
    I actually have two questions that I--maybe will convert 
this from somewhat of an esoteric discussion that sometimes 
constituents can't understand to a real-life situation. And I 
am going to tie the two questions together because I think they 
are related.
    First of all, my first question is do corporations have the 
same rights under our Constitution as individuals, and second, 
to, related to that, find out what--whether there are any 
limitations left after this Supreme Court decision on what a 
corporation can do either as an independent uncoordinated 
expenditure or what--whatever, by postulating this example, 
which I think my constituents will understand very well.
    I come from Charlotte. That is the largest center of my--in 
my congressional district, happens to be the--at least up until 
the banking and economic meltdown, the second largest financial 
center next to Wall Street. I had more financial interests in 
my congressional district than any other Member of Congress 
other than Carolyn Maloney.
    I am on the Financial Services Committee, and we have had a 
number of very, very difficult issues both before the financial 
meltdown and since the financial meltdown in which the banking 
and financial services industry--I won't call particular names, 
but everybody in my congressional district will understand who 
I am talking about--were not all that happy with where I come 
down on a lot of these issues--predatory lending.
    I was out there very much aggressively in the front of 
consumer financial protection agency. I am a strong advocate of 
finding some solution to this whole too-big-to-fail issue where 
there are entities in my congressional district that everybody 
acknowledges under the old criteria have been too big to fail.
    Now, the question I want to pose is would there be any 
limits if one or more of those financial entities in my 
congressional district--would there be any limits left in--
after the Supreme Court's decision on what they could do if 
they really decided they want to just get rid of this person in 
Congress?
    That seems to me to convert this from a constitutional 
theoretical discussion into a real-life potential, although I 
am not anticipating that any of them are going to do that.
    I just want to know what the limitations are left and 
whether there is any way that we can constitutionally 
reconstruct those limitations as Congress that the Supreme 
Court as currently constituted might uphold.
    I will stop and listen to Professor Tribe and right on down 
the line, to the extent we have time. Yes.
    Mr. Tribe. Congressman Watt, I think it is a very realistic 
example, obviously. It is what is real. And the fact is that 
after this decision, the limits that are left on what they can 
do are rather paltry.
    They can't directly contribute. They can't tell you, 
``Congressman Watt, we will give you $100,000, a million 
dollars, if you back off in terms of a predatory lending or too 
big to fail or a consumer protection agency.'' But there are no 
limits on what they can independently spend getting you 
defeated or your opponent elected.
    But that doesn't mean that Congress can't do something 
between now and November to reinstate limits. That is, these 
are not ideological groups. They have ideologies, but they are 
not like the National Rifle Association or the Massachusetts 
Council----
    Mr. Nadler. Would the gentleman yield for a moment?
    Mr. Watt. I am happy to yield.
    Mr. Nadler. Thank you. Just on that point, would it be 
legal under this decision for some corporation to say to a 
congressman, ``I have $10 million to spend for you or against 
you depending how you vote on this bill,'' or would that be 
bribery?
    Mr. Tribe. Unfortunately, it is legal. But what we could do 
is say that since these are not----
    Mr. Nadler. I thank the gentleman.
    Mr. Tribe [continuing]. Ideological groups, they are 
business groups, what they are trying to do is deploy their 
shareholders' money, money that isn't theirs, money they 
haven't given--been given specific permission to spend this 
way, on political causes.
    And therefore, solutions that focus on corporate democracy, 
corporate governance, as well as solutions that focus on 
disclosure, could at least reinstate not in full the limits 
that existed before Citizens United, the Citizens United, but 
they could restrict the degree to which the corporations that 
you are talking about could flood the market.
    Ms. Youn. I wanted to respond first to your first question 
about whether corporations are, indeed, identical to people. 
Corporate spending of the kind at issue in Citizens United is 
regulated as a commonplace matter by this Congress all the 
time.
    Corporations really do differ in that regard from 
individuals. A corporation cannot spend its money in violation 
of the business judgment rule. I don't have to subscribe to 
such a rule in my personal spending.
    I am allowed to waste as much of my money as I want to on 
anything I want to. A corporation is not entitled to waste 
corporate assets. Corporate spending is regulated all the time, 
and it has never been considered a problem for the First 
Amendment.
    But secondly, I wanted to respond to your very pressing 
question, because these are exactly what we believe the stakes 
to be in this decision. Prior to this decision, if a 
corporation wanted to come after you or after any swing vote on 
a matter--you know, on a matter of great policy urgency, you 
know, they had two primary options.
    They could lobby, or they could ask their--you know, they 
could ask people to contribute to their PAC, subject to 
contribution limits. They could also engage in some limited 
electioneering-type activity.
    But what this allows them to do is to use every dollar in 
their treasuries to come after you or any other swing voter 
directly, to use every dollar to try to get--you know, to try 
to take you out.
    And they don't have to do so based on your support of, for 
example, the--you know, a consumer financial protection agency. 
They can do so based on whatever smear they feel like is the 
best expenditure of a $100 million advertising campaign.
    Mr. Parnell. Congressman, I think $100 million against you 
might be a bit of overkill. I don't think you need to worry 
about that sort of expenditures.
    No, there are no limits on how much a corporation or a 
union or an advocacy group can spend attempting to either 
bolster your campaign or oppose it. I would like to talk about 
two limits that do exist, however. And these are limits on you.
    And this is a limit on how much you are able to coordinate 
with your party, who presumably would like to see you continue 
in office. Right now, there is a very limited amount of money 
that you are able to coordinate with them.
    I would think that it might be beneficial, if you are the 
target of a large expenditure aimed at unseating you--I would 
think it might be beneficial for you to be able to have 
unlimited coordinated expenditure with your political party 
which, after all, exists in part to help you get elected.
    And then of course, there is also the contribution limits 
that remain on you and were not fully indexed for inflation 
from the 1974 limits that really limit your ability to raise 
funds in order to get--communicate with the voters on why you 
should, in fact, retain your office.
    Mr. Watt. I am not real anxious to raise those limits, I 
would have to tell you. I think that would be--who was it that 
made that point? I am sorry, I wasn't supposed to interrupt.
    Go ahead, Mr. Simon. My time is way over--expired, but----
    Mr. Simon. I will be brief. We have heard the Chairman's 
scenario about what happens at--or has happened at a local 
level with corporate spending, and your hypothetical of what 
can happen at the Federal level.
    And I think, unfortunately, this--both are correct. Both 
are a vision of the world we are now in, and I think that is 
why it is so disturbing.
    In addition to what Professor Tribe suggested in terms of 
disclosure remedies, which I think are very important, and 
corporate governance remedies, which may be some way to get a 
handle on this, I think there are no--there is no way to impose 
a direct limit on independent spending by a corporation.
    In your particular hypothetical, however, if the----
    Mr. Watt. Why not, if a corporation is not the equivalent 
of an individual?
    Mr. Simon. Well----
    Mr. Watt. I just don't understand that.
    Mr. Simon [continuing]. Because five justices of the 
Supreme Court have said that Congress lacks that power at this 
point. I mean, that is the harm caused by the majority opinion.
    Let me just add, though, in your particular hypothetical, 
if the financial institutions you are talking about are 
recipients, say, of TARP money or Federal bailout money, there 
may be a way on a sort of pay-to-play theory to pose limits on 
independent spending, because I think Federal contractors, 
recipients of large Federal funding, do offer an opportunity 
for congressional action.
    Mr. Nadler. I thank the gentleman.
    Before recognizing the gentleman from Iowa, I would just 
point out factually to Mr. Parnell that the law was changed a 
number of years ago. The campaign contribution limits were 
raised since 1974, and they have been indexed to inflation. In 
fact, there is a cost-of-living increase now in the law.
    The gentleman from Iowa is recognized.
    Mr. King. Thank you, Mr. Chairman.
    I am not aware that that is the case for PAC contributions, 
but individuals? Would that be a clarification? Yes.
    And I would turn my first attention to Professor Tribe.
    And I appreciate all the witnesses being here today, and it 
is a civic service you are all providing.
    And you referenced in your opening statement, Professor, 
about Justice Stevens' dissent, which I have to confess I have 
not read. But I would ask if you could, in a succinct way, 
address anything he might have written in his dissent that 
actually focuses on the constitutional question rather than 
anything that might be broader.
    I have heard a lot about the implications of the decision, 
not very much about the dissent on whether the majority's 
opinion was grounded in the Constitution. So what was his 
argument?
    Mr. Tribe. Well, Representative King, it--I couldn't do 
justice to all of his 90 pages, and it would take up more than 
your 5 minutes. But his argument was entirely about the 
Constitution.
    That is, he did rhetorically say that he feared the 
consequences for democracy, but he went back to the founding, 
talked about the concept--how shocked the founders would be if 
they thought--if someone suggested that corporations in general 
had the same rights as individuals.
    Indeed, the equation of money with speech is a rather 
modern innovation. Used to be that money talks was kind of a 
metaphor and an insult, but it now has become the Constitution 
of the United States.
    And that really begins with decisions like Buckley. It was 
not part of the founding. So he says if you are a genuine 
originalist, he explains in very great historical detail--which 
Justice Scalia tries in his concurring opinion to answer but in 
my view not very successfully, though, believe it or not, I 
very often agree with Justice Scalia on First Amendment 
matters.
    He tries to show, Justice Stevens does, that at the 
founding no one would have thought that corporations in general 
have the same rights as people, especially in the electoral 
area. That is, there was a voter-focused concept at the 
founding.
    Voting was basic, although it wasn't extended, as we all 
know, tragically, to the entire electorate. And the idea that 
entities that couldn't vote, like foreign corporations, could 
influence American elections would have been anathema.
    And then he proceeds with the jurisdictional and 
jurisprudential development of the law and really takes apart 
in a way that would be an instructive sort of lesson for law 
students every argument in the majority.
    The majority's response is at a very abstract level. The 
majority says, ``We have long had a principle that someone's 
identity is irrelevant to the value of his speech.'' And then 
he refers to a case, First National Bank of Boston v. Bellotti.
    Now, that is a case with which I agree. But the difference 
there is that the State of Massachusetts tried to engage in 
controlling politically incorrect speech. That is, they 
basically----
    Mr. King. If I could interrupt for a moment, please, 
Professor, and if I could go back to the point about----
    Mr. Tribe. Sure.
    Mr. King [continuing].--Justice Stevens, did he write about 
or consider the requirements in our past history of ownership 
of property as a condition to the right to vote? Was that 
considered in the decision?
    Mr. Tribe. I don't think that there is a reference to it, 
except that there is a footnote that talks about how the right 
to vote has been broadened by the poll tax amendment.
    Mr. King. Okay. Well, thank you. I think that lays a little 
bit of the background, and I just wanted some of that into the 
record.
    And then, I just recall, Ms. Youn, when you talked about 
the--actually, I think you said, ``I defy anyone to take the 
statement that corporations have been unable to express their 
point of view.''
    And in keeping with my opening remarks--and I expressed 
that they are constrained from expressing their point of view, 
and as I operate inside this political bubble that we are in, I 
see them continually constrained from expressing their point of 
view.
    And I think they are intimidated from expressing their 
point of view for fear they will be punished. In fact, in a--
and this just comes across my mind--an Energy and Commerce 
markup of that bill that I mentioned, the cap and trade bill, 
one of the most stellar witnesses who testified most vigorously 
against cap and trade before he walked out of the room was 
handed a letter that his corporation would be investigated.
    And so that was a complete open and blatant example of 
intimidation of a corporation. The rest of the--many of the 
other corporations--I can't speak for all of them--were 
constrained in their testimony because they feared they would 
be investigated. This corporation was handed the letter as the 
star witness walked out of the chamber.
    So I think they have been constrained. I think they have 
been unable to express their point of view out of fear that--as 
you referenced, interest for their shareholders and their 
assets.
    And so I make the argument back to you and give you an 
opportunity to rebut my argument.
    Mr. Tribe. Are you directing that----
    Mr. King. To Ms. Youn, please.
    Mr. Tribe. Okay.
    Mr. King. Thank you, Professor.
    Ms. Youn. I don't know the circumstances of the exact 
investigation that you reference. I would say that 
investigation that is solely done to harass a corporation or an 
individual for its viewpoint is intensely problematic.
    But what I would say is that it is important to distinguish 
in these instances between intimidation for whatever reason and 
government censorship.
    For example, I might be intimidated from, you know, 
expressing my views on--I don't know--politics in a variety of 
fora. I might fear that someone would come up with a rejoinder. 
But that is not the same thing as censorship.
    Mr. King. Well, thank you. And then I would turn to Mr. 
Parnell.
    And I will make this statement. I am a person who comes at 
this thing from a constitutional perspective, and our hearing 
here is about how do we shape legislation that will not be 
overturned by the Court by their view of constitutional 
perspective.
    But I am not hearing argument about what the Constitution 
actually allows, and it does go back, in my view, just simply 
to the definition of what is a person, what is an entity, how 
is your voice heard. There are a lot of different ways to 
analyze that.
    And I would make, again, the point that I want to see free 
enterprise of speech the same way I want to see free enterprise 
economically. And this Nation is founded on free enterprise 
capitalism.
    And some of those freedoms are rooted back in the First 
Amendment and that ability for that free speech. And as you 
heard my remarks on--in the beginning, Mr. Parnell, about how 
corporations are intimidated from actually the full-throated 
voice in the political arena.
    And I had some reservations, too, because I often sit in a 
meeting and--or I will hear legislation here, and they will 
say, ``I just want to level the playing field.'' But generally, 
that means that it wants to be tilted a little bit in favor of 
the advocate for changing the angle of the playing field.
    And I understand that this path that has been directed and 
opened up is fraught with peril. But freedom is always fraught 
with peril, and I would ask if you could speak to that issue 
from your perspective.
    Mr. Parnell. Sure. I mean, obviously, I largely agree with 
the sentiments that you expressed. You know, talking about 
intimidation of corporations--and certainly, unions get 
intimidated. Activists get intimidated.
    I note that Congressman Cohen is here. He is the sponsor, I 
believe, of an anti-SLAPP law that my organization recently 
signed on that is designed to prevent people from filing 
lawsuits against people with the aim of silencing their voices 
and prohibiting them from participating in politics.
    The political process is messy and chaotic, and I am not 
telling you anything that you don't know, that you have to deal 
with people who criticize you and who don't particularly think 
you are doing a good job in office, and it takes money to 
criticize you. It also takes money to praise you. It takes 
money for you to explain to the voters why they should vote for 
you.
    My group starts with the premise that Congress shall make 
no law, and that kind of settles a lot of these questions for 
us, and I think that that maybe ties in with your perspective 
on this. You know, I don't really know that I have a lot to add 
to that.
    Mr. King. Well----
    Mr. Nadler. The gentleman----
    Mr. King [continuing]. Thank you, and I--as watching my 
time conclude, I will restrain my concluding statement and 
yield back to the Chairman.
    Mr. Nadler. I thank the gentleman.
    The gentleman from Virginia is recognized.
    Mr. Scott. Thank you, Mr. Chairman.
    Mr. Chairman, I think this whole thing started when we 
tried to regulate issue ads. We had always regulated express 
advocacy, where you are telling somebody who to vote for and 
who to vote against, but had given a pretty much free pass on 
issue ads, where you can talk about an issue and then tell the 
public to call them and tell them to stop voting that way, or 
tell them to vote this way or that way.
    The issue ads became ``sham'' issue ads because although it 
said it was really advocacy, and that line was in a fairly 
bizarre place, but the only thing worse than where the line was 
was anywhere else you tried to put it. And so we were kind of 
stuck in that place.
    I guess we tried to do that with McCain-Feingold, and what 
the Supreme Court apparently did is just wipe out the whole 
matrix. It said, ``Issue ad, express ad, well, you can do 
anything you want anyway.''
    Is there any way that we can get back to pre-McCain-
Feingold where we could at least put some limit on express 
advocacy and give free speech to issue advocacy?
    Mr. Tribe. Congressman Scott, I think the answer is no. You 
can improve disclosure, corporate governance, try to restrict 
pay to play, which really could take care of a lot of problems, 
because a lot of these companies are on the receiving end of 
government contracts, government bailouts.
    But even if someone says, quite up front, vote for or 
against Congressman Scott, vote for his opponent, that is 
clearly something that, if it is independent, they could spend 
all the money in their general treasury on after this decision.
    And since I am not in favor of a constitutional amendment, 
and the Court has the last word on the meaning of the First 
Amendment, that is going to stay, and you have to operate 
within that framework.
    You know, the Court--I think Justice Jackson once said--is 
not infallible because it is final. That is, it has the last 
word, but that doesn't make it infallible. Nonetheless, that is 
what we have to work with.
    Mr. Scott. Is there any way--you could put limits on what 
someone can contribute to an individual. Is there no limit on 
what individuals and now corporations can spend independently?
    Mr. Parnell?
    Mr. Parnell. Congressman, no, there are no limits that 
are--based on what an individual or a corporation can spend 
independently.
    Buckley v. Valeo--the Court ruled that individuals could 
not be restrained in any way in their ability to spend 
unlimited sums. And now, obviously, in Citizens United that has 
been extended to the incorporated entities.
    Mr. Scott. Could we do anything under a public financing 
matrix that could limit anyone, or are we still stuck with the 
candidates limited by public financing and everybody else 
spending unlimited amounts?
    Ms. Youn. The voluntary restrictions that candidates accept 
when they enter into a public financing system would allow 
their spending and potentially their acceptance of beneficial 
independent expenditures to be regulated.
    But the Court's current ruling does not permit independent 
expenditures outside that arena to be restricted.
    Mr. Scott. Wait a minute. You mean coordinated independent 
expenditures. If you have a totally uncoordinated independent 
expenditure, could a public financing matrix limit that 
expenditure if it is not coordinated?
    Ms. Youn. It couldn't limit that expenditure, no. But what 
it could do----
    Mr. Scott. So you might find yourself in a situation where 
the candidate is locked into an agreement to spend so much and 
then, out of the blue, is overwhelmed and limited and 
defenseless against express advocacy ads taking over the 
campaign.
    Mr. Simon. Congressman, if I might answer that, heretofore 
public financing systems have in that situation either lifted 
the spending limit imposed on the opt-in candidate 
participating in public financing or given additional public 
funds to the opt-in candidate in order to address unlimited 
outside spending.
    Unfortunately, there is a trend in a couple of lower court 
provisions that have invalidated those kinds of remedies for 
opt-in candidates which is, I think, a controversial reading of 
a different Supreme Court decision a couple of years ago in 
Davis v. FEC.
    So I think that particular issue you are pointing to is a 
matter of unsettled law at the moment.
    Mr. Scott. Thank you, Mr. Chairman.
    Mr. Nadler. Thank you.
    The gentleman from Texas is recognized.
    Mr. Gohmert. Thank you, Mr. Chairman.
    And do appreciate the point of view of all the witnesses.
    And in hearing the discussion earlier about corporate 
America and making it sound as if Republicans believed that 
corporations were too big to fail, I would point out to my 
friends that on the TARP bailout there were twice as many 
Democrats that voted to protect these groups that were too big 
to fail as there were Republicans, and that the reports 
indicate that the contributions from Wall Street executives to 
the Democratic Party is consistent with what was contributed to 
President Obama, and that is 4-1 contributed to Democrats and 
President Obama over Republican candidates--that of the Wall 
Street executives.
    Some of us wanted to see AIG go to bankruptcy, and those 
parts that were productive and were making a profit be broken 
up so we didn't have to worry about too big to fail in the 
future.
    And I am not nearly as concerned as some of our witnesses 
about corporations being able to make contributions and 
actually toward commercials, toward advertising, because what 
we have seen is corporations are probably the most easily 
intimidated group of persons, as they are defined, in America. 
It doesn't take much of a boycott to seem to set them on a 
different course.
    So it seems to me that the most important thing that we 
should never get away from--and I know this has been mentioned, 
but it is transparency. And I would love to co-sponsor any kind 
of legislation that required greater transparency.
    And I would be open to anything you might suggest in the 
way of laws to control foreign contributions toward 
manipulation of our elections.
    I don't know whether you would want to put a limit, say, at 
5 percent--no greater than 5 percent ownership of a corporation 
by foreign entities, and what kind of disclosures might be most 
helpful in getting to transparency, because I don't mind 
corporate persons buying advertising, but I sure do want to 
know who owns that corporation and make sure that it is not a 
significant amount of foreign ownership trying to manipulate 
our U.S. elections.
    So as you have time to think in the days ahead, I would 
love to hear from you on any thoughts you might have. If you 
have some today, I am glad to hear that, too.
    Mr. Tribe. Congressman Gohmert, I certainly agree with you 
that transparency is extremely important. And in my prepared 
statement, I tried to suggest how the disclosure requirements 
should be tightened.
    But I think the Chairman's example of the company that was 
really interested in having that mall built, and it was willing 
to spend millions of dollars to completely swamp the amounts 
that were otherwise spent--that is a good example of how 
transparency alone won't solve the problem.
    Everyone knew which companies were putting that money in. 
The fact is that those companies could not constitutionally be 
required to disclose all of their motives. They came in and had 
ads that didn't say anything about the mall one way or the 
other.
    And that is why other forms of protection--I mean, a lot of 
people who invested in those companies that wanted to build the 
mall didn't put their money there because of that alone. They--
--
    Mr. Gohmert. And I can understand that example, and I see 
my time is going to an end. But I would also point to you 
numerous times when, you know, as we have seen repeatedly, 
Americans love an underdog. And if it looks like the big guy is 
whipping up on the little guy, they seem to flock to the little 
guy.
    If one party ends up having the White House and both 
houses, then people start being bothered by--like that. They 
like what the founders did, and that is contention. That is a 
little bit of gridlock so government doesn't run out and make 
too many laws to take away their liberties.
    And I would also mention, when we talk about government 
intimidation, how about--and I hope my friend as Chairman of 
the Crime Committee--he and I are working on over-
criminalization.
    I see this morning a story that the IRS has put out--posted 
a solicitation for 60 new Remington model 870 Police 12 gauge 
pump shotguns, and maybe we need a hearing to see what the IRS 
wants to do with those 60--because that sounds intimidating to 
me. I don't know, maybe----
    Mr. Tribe. I think it would intimidate not only a 
corporation, but it would scare me.
    Mr. Gohmert. Well, thank you.
    But I appreciate the time, Mr. Chairman.
    Mr. Nadler. I thank the gentleman.
    I will now recognize the gentleman from Massachusetts.
    Mr. Delahunt. On this issue, I heard the Ranking Member of 
the full Committee talk about the issue of foreign corporations 
or foreign influence.
    You know, my understanding of the financial markets is that 
American domestically-domiciled corporations are open to have 
their shares traded on the financial markets. Am I correct in 
that rather----
    Mr. Tribe. Certainly.
    Mr. Delahunt. You know, one could develop scenarios where 
simply because an American corporation was incorporated in the 
State of Delaware, for example--might very well have a 
significant share of its stock held by foreigners.
    One can even speculate that national corporations, whether 
they be state-owned oil companies or state-owned enterprises, 
could, in fact, have substantial holdings in American 
corporations.
    Does that present a problem to any of you?
    Mr. Tribe. I think it is a terrible problem, Congressman 
Delahunt. That is, if you believe, as the founders did, that 
one of the dangers America faces is the danger that nations and 
their residents that are not necessarily friendly to us will be 
able, behind the scenes, to manipulate American elections.
    Current law is not structured adequately to protect against 
that. Even a wholly-owned domestic corporation with Saudi 
Arabia or some other country pulling the financial strings is 
liberated by this decision to powerfully affect the outcome of 
State, local and Federal elections.
    And the only way to deal with that--and it is important 
that it be dealt with quickly--is to tighten dramatically the 
restrictions on foreign influence on American elections. That 
is where I think Congress ought to start, because I believe 
there would be wide consensus on the virtue of doing that. That 
is not a Democratic or a Republican issue.
    We have always said that politics stops at the water's 
edge. That usually means that when people go abroad we are one 
Nation indivisible. But here, I think it should work the other 
way, that we really don't want other nations directly or 
indirectly to be pulling the strings in American elections. And 
the law should be tightened to deal with that.
    Mr. Delahunt. You know, when I hear the statement made by 
my good friend from Texas that, you know, there--or at least 
the inference that I drew from his observation was that we 
don't have to be concerned about it because our laws are on the 
books.
    But that seems--if I can finish, Mr. Parnell----
    Mr. Parnell. I am sorry, I thought you were wrapping up.
    Mr. Delahunt. Oh, no. No.
    Mr. Parnell. Okay.
    Mr. Delahunt. I am not wrapping up yet. But I will let you 
know when I wrap up.
    But my point is that there is a concern that I have about 
foreigners, foreign corporations. In some cases I don't know 
who owns what anymore in this global economy. We talk about the 
global economy, and we don't know who owns what.
    You know, we talk about Exxon Mobil. Who are the 
shareholders of Exxon Mobil? Are there relationships between 
State oil companies elsewhere and subsidiaries, therefore, Ms. 
Youn?
    Ms. Youn. Well, I mean, that is exactly one of the issues. 
I mean, China Telecom America is a U.S. corporation that is 
incorporated in Delaware. China Construction America is 
incorporated in Delaware. Two----
    Mr. Delahunt. Now, China Telcom--is that a state-owned--
Chinese Communist state-owned entity?
    Ms. Youn. I don't have that information. But I think that 
the----
    Mr. Delahunt. So we don't know.
    Ms. Youn. I don't know. But the foreign-owned corporations' 
problem is only, I think, a subset of the bigger problem where, 
if a corporation is to buy an election out from under us, we 
the voters don't have anyone we can hold accountable, like in 
the Poughkeepsie example. There is no one we can vote out in 
that----
    Mr. Delahunt. Right, but my point is--and I understand the 
larger issue, but my point is we hear a lot here in Congress 
and obviously in the media about terrorists and terrorism.
    You know, one can conjure up a conspiracy, if you will, 
that there is a cabal out there that is purchasing X number of 
shares of an American corporation that will exercise influence 
not in the best interests of the United States, necessarily.
    And I think we all know that, you know, shareholders do 
have some influence occasionally but, you know, maybe there is 
a director that is susceptible to certain influence. I know 
this sounds like a Ludlum novel, but a lot of what I hear today 
sounds like a Ludlum novel.
    I mean, I think we have got to be concerned about the 
possibility of individuals or corporations or adversaries who 
are hostile to the United States and to our interests and who 
might very well be advocates for acts of terrorism against the 
United States to be influencing our elections.
    And I have now wrapped up. And with that, I yield back.
    Mr. Nadler. I thank the gentleman.
    I now recognize the gentleman from Georgia for 5 minutes.
    And we have a series of five votes which will probably take 
about 45 minutes. Maybe we can wrap up in time.
    Mr. Johnson. Thank you, Mr. Chairman.
    Mr. Parnell, can you tell us who the Center for Competitive 
Politics is?
    Mr. Parnell. Sure. The Center for Competitive Politics was 
founded by former FEC commissioner Bradley Smith in 2005. Our 
mission is to focus on promoting and protecting the First 
Amendment political rights of speech, assembly and petition----
    Mr. Johnson. Where do you get your funding from?
    Mr. Parnell. We get our funding from American citizens who 
share our perspective on the First Amendment.
    Mr. Johnson. How do you market to them, through what 
vehicles?
    Mr. Parnell. Sure. We find individuals who we believe share 
our perspective on campaign finance, and we ask them to 
contribute. It is probably not that much of a different process 
from what you go through when you are raising money.
    Mr. Johnson. Well, let me ask you this. Isn't it true that 
your firm--you are the president--Center for Competitive 
Politics--isn't it a fact that you also accept contributions 
from corporations?
    Mr. Parnell. I would accept contributions from 
corporations, but I----
    Mr. Johnson. But do you?
    Mr. Parnell [continuing]. Have not yet received any, at 
least not----
    Mr. Johnson. Have you ever received in connection with the 
Center for Competitive Politics a contribution from 
corporations?
    Mr. Parnell. In 2008 I received one contribution that 
amounted to about 1 percent of our total receipts. And in 2007 
I received another corporate contribution that also amounted to 
about 1 percent of our receipts.
    Mr. Johnson. Well, now, you don't have to make any kind of 
public disclosure of who you receive money from, is that 
correct?
    Mr. Parnell. I am sorry, the question was did I oppose----
    Mr. Johnson. No, no. You don't have to disclose to the 
public who your corporations or who your contributors are.
    Mr. Parnell. That is correct. All (c)(3) organizations--
well, most (c)(3) organizations do not have to disclose their 
donors. There are some circumstances under which some donations 
are disclosed.
    Mr. Johnson. Now, it seems a little suspicious to me that 
on the eve of this hearing you would then be announced as the 
Republican witness. How long ago did you agree to testify in 
front of this panel in a private way with your Republican 
friends?
    Mr. Parnell. I was asked last week.
    Mr. Johnson. And any particular reason why you did not want 
that information to get out until yesterday?
    Mr. Parnell. I was asked by the minority not to preempt the 
Committee's announcement that I would be testifying. My 
understanding is that it is kind of considered bad form to 
announce that you are testifying before the Committee has 
officially invited you----
    Mr. Johnson. Okay.
    Mr. Parnell [continuing]. To testify.
    Mr. Johnson. All right. Well, and the Committee in this 
sense would be the minority party, the Republicans. They would 
be the ones that would extend the invitation to you, correct?
    Mr. Parnell. Officially, the letter I received was from 
Chairman Nadler. But yes, it was through Chairman 
Sensenbrenner's staff or the Committee minority party staff 
that I was invited.
    Mr. Johnson. Well, now, let me ask you this question. You 
are not here to support the notion that corporations should 
have a right to actually vote in the United States political 
arena.
    Mr. Parnell. Certainly not.
    Mr. Johnson. And so they are a little different than 
individuals, persons, here in America, live human beings 
registered to vote, correct?
    Mr. Parnell. Of course they are.
    Mr. Johnson. And now, I am wondering whether or not this 
ruling in Citizens United has adversely impacted the ability of 
the average American walking the streets, blood flowing through 
their veins and through their heart and everything and, you 
know, breathing the air--that we are trying to get cleaned up, 
by the way--against the insidious advertising budgets of 
corporations like Exxon--$45 billion dollar a year profit.
    But do you think that our--don't you think--let me ask it 
like that--that the citizens' right to control what goes on in 
the political arena--their right to vote--is adversely impacted 
by this decision in Citizens United?
    And also, I want to get into your explanation for why you 
thought--or your speculation as to why you think the United 
States Supreme Court would stoop to this level of judicial 
activism and also this legislating from the bench argument, 
those two arguments being used against Democratic nominees for 
judgeships, Federal judgeships.
    Mr. Nadler. The gentleman's time has expired.
    The witness may answer briefly.
    Mr. Parnell. Okay. I will try. The first thing to remember 
about corporations, whether they are unions, whether they are 
for-profit corporations, or whether it is the National Rifle 
Association, is they are associations of individuals gathered 
together for a particular purpose--perhaps collective 
bargaining, perhaps to make a profit.
    So no, I don't believe that the rights of average citizens 
are, you know, diminished by this because average citizens are 
union members. They are stockholders. They are members of NARAL 
Pro-Choice America. They are members of the Sierra Club.
    What this decision does is it allows those associated 
entities to speak on behalf of, in a more effective manner, you 
know, what citizens could do by themselves.
    Mr. Nadler. Thank you. The gentleman's time has expired.
    I now recognize the gentlelady from Wisconsin.
    Ms. Baldwin. Thank you, Mr. Chairman.
    I know in thinking about the impact of this case, a lot of 
us, since we have all stood for election and do every 2 years, 
think about it in the context of congressional races. But I am 
very, very intrigued about the impact this could have on 
judicial races.
    I know, Professor Tribe, you referenced that in your 
opening statement. My home State of Wisconsin has seen in the 
last couple of election cycles some of the nastiest and most 
partisan judicial races for our State supreme court in a long 
time. And also, there is--clearly, we have local judgeship 
elections in the State of Wisconsin also.
    In your testimony, Professor Tribe, you said 39 States have 
judicial elections. I think it is 21 that have supreme court 
judge--they are elected by the voters.
    I wonder if you could speak in a little more detail about 
the impact that you believe Citizens United may have on 
judicial races.
    Mr. Tribe. Certainly, Representative Baldwin. I think that 
Citizens United, by extension of its reasoning, prevents States 
from imposing flat prohibitions on business for-profit 
corporations' independent expenditures in State and local 
elections, including judicial elections.
    Now, some of those States already failed to have limits, 
but they were considering imposing them in light of the 
experiences in Wisconsin, in Minnesota, in Michigan, in some 
other States.
    But this pours cold water on those direct efforts, which is 
why in my testimony I suggested one possibility for States, and 
that is at least trying to prevent out-of-state interests from 
influencing the outcome of those elections, something that you 
couldn't do because of the commerce clause without Congress 
giving permission.
    It is sort of like the situation in the health insurance 
industry where I think the permission that States were given to 
build a wall proved to be a terrible idea, and one of the 
things that I guess you all are considering now is changing the 
antitrust exemption.
    But one area where it might make sense to take advantage of 
the ability of States to ensure that foreigners, as it were--
and Justice Stevens pointed out that vis-a-vis your State of 
Wisconsin the citizens of other States may be foreigners--that 
they are not allowed to influence outcomes.
    But one other thing that I think this decision does, by 
signaling the danger of virtually unlimited independent 
corporate expenditures--and some of them, until we tighten the 
coordination rules, may not be all that independent.
    But one thing it does is highlight the necessity to 
seriously consider what Justice O'Connor has made really a 
crusade, in which I am going to be helping her in every way I 
can, for States to consider whether they should go to a 
different way of selecting judges, perhaps merit selection 
followed by retention elections, because the importance of 
preserving an independent State judiciary is extremely crucial 
to the rule of law in this country, as I am sure you know.
    And I think this decision may give an impetus to that 
movement, because even if you do all the things that I have 
recommended in terms of transparency, corporate governance, the 
exclusion of outsiders, the exclusion of pay to play--even if 
you do all of that, this decision still leaves a margin of 
corporate influence that you might want to try to restrict by 
not having elections for judges.
    Ms. Youn. What the----
    Ms. Baldwin. Ms. Youn? Yes.
    Ms. Youn [contiinuing]. What the Wisconsin example really 
brings home as well is the extent to which the deregulatory 
push by the Roberts Court is taking options off the table for 
State government.
    Wisconsin, in response to this massive corruption scandal, 
recently passed a judicial public financing system. That 
judicial public financing system is now being constitutionally 
attacked by the same groups that brought the Citizens United 
challenge.
    And you know, the degree to which a State can act to keep 
even its judiciary clean is being radically constricted.
    Mr. Parnell. If I could, I want to take exception to 
something that Ms. Youn said where she described the scandal or 
corruption in Wisconsin. I don't regard people speaking up, 
saying, ``This is a terrible candidate,'' or, ``This is a great 
candidate,'' as corruption.
    It may be in some minds unwelcome, or unpleasant, or false, 
even, but I would really hesitate before describing free speech 
in the context of a political campaign as somehow being 
corrupting.
    And real quickly, if I could----
    Ms. Baldwin. Well, no, actually, I am running out of time 
to ask my final question, but----
    Mr. Nadler. I am sorry, the gentlelady's time has expired.
    Ms. Baldwin. Oh.
    Mr. Nadler. We have 18 seconds to go on the vote on the 
floor.
    The gentlelady from Texas has agreed to 1 minute so we 
could wrap the hearing up and not ask the witnesses to stay for 
an hour of votes on the floor.
    Gentlelady from Texas is recognized for 1 minute.
    Ms. Jackson Lee. Thank you, Mr. Chairman.
    Professor Tribe, my son went to Harvard, and I am going to 
try and be bionic in my words and point to you. Judge Alito 
was, seemingly was very unhappy with the President's comments 
during the State of the Union.
    My question to you is--we have to live with the First 
Amendment. My question to you is how badly will this skew not 
only the First Amendment and one's right to stand on a 
position, but what legislative fix would you say this Congress 
needs to look at again?
    Mr. Tribe. It seems to me, without taking too much of your 
time, that there are several things that you should look at--
limiting foreign influence; limiting influence of out-of-State 
corporations in State elections; limiting pay to play by 
enacting rules that tell companies that are contracting with 
State, local or Federal Government or receiving Federal money 
that one condition of that is that they not engage in 
electioneering, which in turn could expose them to all kinds of 
pressures; looking at better disclosure rules so that 
disclosure is required not only of the identity of the group 
that puts the ad but where their money is coming from; tighter 
anti-coordination rules; and finally, protections for genuine 
shareholder democracy by requiring shareholder approval.
    Those are things I think you can look at, and I don't think 
that Justice Alito's statement or mouthing of the words that I 
am sure he didn't expect to be on camera, that ``you are not 
correct,'' really should be seen as negative. On the contrary, 
that gives us an insight.
    What that means is that he probably would support 
restrictions on foreign corporate intrusion into elections, 
because that is what he was reacting to.
    Mr. Nadler. I thank the gentleman.
    I thank the lady for----
    Ms. Jackson Lee. Thank you.
    Mr. Nadler. We thank the lady for cooperating.
    Without objection, all Members have 5 legislative days to 
submit to the Chair additional written questions for the 
witnesses which we will forward and ask the witnesses to 
respond as promptly as they can so that their answers may be 
made part of the record.
    Without objection, all Members will have 5 legislative days 
to submit any additional materials for inclusion in the record.
    We thank the witnesses.
    And the hearing is adjourned.
    [Whereupon, at 12:08 p.m., the subcommittee was adjourned.]
                            A P P E N D I X

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