‘Corporate-Free Elections Act’ Gets Shelved by Assembly Elections Committee

A half-baked, complicated bill aiming to take all corporate money out of California political campaign contributions failed to pass out of the Assembly Elections Committee Thursday. But what was so interesting was that Assemblyman Marc Berman, Chairman of the Committee on Elections, gave a real dressing down to the bill’s author, freshman Assemblyman Alex Lee (D-San Jose).

It doesn’t happen often enough.

According to Assemblyman Lee, this is the purpose of Assembly Bill 20:

“What this bill aims to accomplish is not a radical idea – 22 States and the Federal Government have successfully enacted similar measures that prohibit business entities from directly financing a candidate’s election for public office. Passing AB 20 will bring us in conformity with the Federal government. Many other States have pushed similar reforms through their Legislatures to restore the public’s faith in democracy and addresses the systemic and perceived influence of corporate special interests over everyday people.”

“It is past time to rectify the undue influence that corporations have had in our democracy since the Supreme Court’s disastrous 2010 ruling on Citizens United v. FEC. With deepening income inequality and wealthy people afforded more political influence, we must commit to our values that every person has an equal voice in the political process and reaffirm a representative democracy for the people, not corporate executives and the rich.”

At the heart of the issue, according to Assemblyman Berman is that the actual bill language “falls woefully short from supporters’ claims of what this bill will accomplish.”

Berman said he instructed Freshman Assemblyman Lee back in November, before Lee was even sworn in, to read the committee analysis from the last legislative session, when Assemblyman Evan Low (D-Campbell) authored a similar bill to take corporate contributions out of politics.

“You did not do this,”Berman said. Instead, Berman said Lee added a “findings and declarations” section that describes the problem. “And you bemoan the fact that hundreds of millions of dollars were spent in 2020 ballot initiatives – your bill does nothing — absolutely nothing — to restrict corporate spending in ballot initiatives.”

The bill analysis explains: “in this bill specifies that ‘corporations contribute hundreds of millions of dollars to campaigns for state and local offices across California,’ and notes as an example that ‘in 2020 it was found that more than $785 million was spent to influence voters on ballot measures alone, with millions more spent on individual races.’ These findings, however, may provide an inaccurate picture of the likely effects of this bill, and of the extent of contributions from business entities to candidates for elective office in California.”

Berman noted that the language Lee uses in his bill is very different from the 22 other states which have enacted similar measures. “Using the term ‘business entity’ as your bill does creates a loophole so big an armored truck could drive through.” In effect, AB 20 would actually prohibit businesses from donating directly to political candidates.

Several of the Elections Committee expressed their own concerns including that unless the campaign contribution playing field is leveled at the same time for all potential contributors, AB 20 only creates an imbalance.

“While this bill prohibits business entities from making contributions to candidates for elective office, it does not specify whether such entities are permitted to make contributions to political action committees (PACs) that contribute to candidates,” bill analysis explains. “If business entities are permitted to make such contributions, would the PAC be required to deposit contributions from business entities into a separate account with the funds in that account unavailable for making contributions to candidates?”

The bill prohibits “business entities” from making political contributions, but it does not prohibit labor unions from doing the same. Assemblyman Lee’s claim that there is “over-bloated spending in elections, is dubious without addressing all spending, including labor unions’ “over-bloated spending” in AB 20.

The bill was not even voted on. Assemblyman Berman told Assemblyman Lee to spend some time speaking to experts if he plans to consider bringing the bill back next legislative session.

Assemblyman Alex Lee is a bit of a celebrity in the California Legislature as he is the youngest elected Assembly member in 80 years. He worked in the district office of Assemblyman Evan Low (D-Campbell) prior to running for Assembly.

“Alex Lee (李天明) is the State Assemblymember representing the 25th District,” Lee’s bio on his campaign website says. “Prior to his election in 2020, he served as a Legislative Policy Advisor in the California State Senate and Assembly.”

“Alex is a progressive Democrat who serves on the Assembly Committees on Budget, Education, Privacy & Consumer Protections, and Transportation.”

“Alex made history in 2020 as the first Gen Z, youngest Asian American, and first bisexual state legislator in California history.” Many news articles after his election focused on his age; Alex Lee is 25. “The Generation Z Democrat from San Jose is 25 years old, lives with his mom and, up until recently, was working part time for an app-based delivery service to make ends meet during his campaign,” the Los Angeles Times reported.