Obama vs. K St. intensifies

The White House has started a war of words with a trade association
representing the U.S. subsidiaries of foreign-owned companies over new
campaign finance reform  legislation.

Norm Eisen, ethics counsel to President Barack Obama, said in a blog post Monday that lobbyists linked to foreign corporations are pushing “to protect their newfound power to influence American elections” under Citizens United vs. Federal Election Commission. The recent Supreme Court ruling removed limits on union and corporate campaign spending.

{mosads}Eisen did not name the group but linked to a Wall Street Journal article that describes a campaign against the legislation led by the Organization for International Investment (OFII), which represents U.S. subsidiaries of foreign-owned firms.

Nancy McLernon, president and CEO of OFII, countered that her group is “protecting equal rights” and is “ensuring that these companies are seen as bringing true value to the U.S. economy.”

Taking on K Street directly is not new for the administration. Last year, the president and senior aides criticized the U.S. Chamber of Commerce for paying for alleged deceptive television ads opposing a proposed consumer financial protection agency, a key part of Obama’s Wall Street reform.

Now, as the White House pushes for campaign-finance law changes that would reduce the impact of the recent Supreme Court decision, it is turning its attention to foreign-owned companies.

“As a result of this decision, American corporations owned in whole or in part by foreign companies — and even by foreign governments — are no longer restricted from making expenditures to elect or defeat federal candidates,” Eisen wrote Monday.

McLernon is lobbying against any new campaign finance restrictions passed by Congress that single out U.S. subsidiaries of foreign-owned corporations.

“We need to be very careful [in] how we define ‘foreign’ and what safeguards are put in place,” McLernon said. “We want to make sure that U.S. subsidiaries of companies headquartered abroad are not treated any differently from any U.S. company by campaign finance reform legislation.”

OFII represents about 160 foreign-owned companies that have operations based in the United States, including BP, Nokia and Siemens. The group spent close to $1.6 million on lobbying last year, according to disclosure records.

While the Supreme Court ruling did not change the part of campaign finance law that bans foreign citizens from contributing to or directing campaign spending, it removed restrictions on spending by corporations and unions, specifically allowing them to dip into their general treasury funds without limits and to expressly advocate for or against a candidate.

By allowing more corporate spending, U.S. subsidiaries of foreign-owned firms could engage in the political process as much as their Americancounterparts.

Eisen has been working with aides to Sen. Charles Schumer (D-N.Y.) and Rep. Chris Van Hollen (D-Md.) to craft the legislative response to the Supreme Court decision. Tamping down on foreign influence in U.S. elections will be a key goal of the bill.

The White House wants to go further by changing lobbying law to reduce the sway of special interests. In his blog post, Eisen mentions wanting to “close the loophole that allows foreign agent lobbyists to avoid full disclosure of their activities.”

A White House official said that the administration is in favor of lobbyists for foreign-owned companies who have registered under the Lobbying Disclosure Act (LDA) being required to proceed under the Foreign Agents Registration Act (FARA) instead.

{mosads}“The president has long been on public record in favor of this. We think it is sound public policy,” the official said.As a U.S. senator, Obama backed legislation in 2008 upping disclosure requirements for FARA. The law oversees lobbying and advocacy of those representing foreign governments and political parties.

The bill would have required foreign agents to report contacts they have with U.S. government officials outside of America as well as force foreign-owned companies to register their lobbyists as foreign agents and not under the LDA, as they do now.

McLernon’s trade group also happened to oppose the legislation, saying at the time that it would discriminate against U.S. subsidiaries of foreign companies.