California May Limit Political Spending by Foreign-Influenced Companies

By Michael Sozan in American Progress:

Dear Assembly Member Lee:

On behalf of the Center for American Progress, I write in strong support of A.B. 1819, the Stop Foreign Influence in California Elections Act, of which we are a proud “co-sponsor.” If enacted, this people-powered legislation will help stop political spending by foreign entities—including foreign investors who own appreciable levels of stock in U.S. corporations—thereby protecting California’s right to self-government.

I am a senior fellow at the Center for American Progress. Based in Washington, D.C., CAP is an independent, nonpartisan policy institute dedicated to improving the lives of all Americans through bold, progressive policies. My democracy reform work at CAP has involved research in the area of preventing election-related spending by foreign-influenced U.S. corporations. My publications include a report and fact sheet analyzing this policy, with the report republished in the Harvard Law School Forum on Corporate Governance.¹ These publications may be useful as the Legislature considers the pending legislation.

After reviewing this legislation, I conclude that it would provide an important tool to protect California’s elections and ballot initiatives from foreign influence and reduce the outsize role that corporate money plays in the outcomes of the state’s elections and ballot initiatives. This bold bill would strengthen the right of California’s residents to determine the political and economic future of their state and help ensure that lawmakers are accountable to voters instead of to foreign-influenced corporations. This legislation is particularly timely given that foreign investors now own approximately 40 percent of U.S. corporate equity, compared with just 4 percent of U.S. equity in 1986.²

Read the full article here.