Some Republican bloggers have circulated what seems to be a complete dud of a story about foreigners donating discretely to the Obama campaign using credit cards. Yesterday, Josh Israel demolished what was left of the pseudo-scandal. There's actually a more significant loophole that should give anyone pause.
Foreign corporations can in fact influence American democracy in pernicious ways. For instance, how can Saudi Arabia and other oil-rich countries keep us dependent on fossil fuels? Well, thanks in part to the Citizens United decision, a new loophole allows foreign corporations to spend unlimited, undisclosed amounts on American elections.
Saudi-funded groups have run ads against Senator Claire McCaskill, a Democrat in Missouri, as well as in support of Tommy Thompson, a Republican in Wisconsin. But in both cases, they've been able to conceal the spending behind a wall of secrecy, and under the banner of groups with "American" in the name.
The American Chemistry Council used its 501(c)(6) fund rather than its PAC, so it does not have to disclose where it got that money. The council has also used its 501(c)(6) to air ads in support of Senator Joe Manchin (D-WV) and other pro-chemical industry politicians of both parties.
Where does the Chemistry Council's general treasury, otherwise known as its 501(c)(6), receive its funds? Well, according to its website, the largest foreign chemical companies in the world -- Saudi Arabia's state-owned SABIC, the Chinese-owned Sinopec corporation and Japan's Mitsubishi Chemical Corporation -- are dues-paying members, alongside American giants like DuPont and Dow Chemical.
The American Petroleum Institute also used its foreign-funded 501(c)(6) to air its own ads against senators like McCaskill.
In some rare cases, subsidiaries of foreign-owned corporations have decided to skip the trade association route and spend disclosed dollars on US elections. Recently, OdysseyRe, a subsidiary of a Canadian financial services company, gave $1 million to the pro-Romney Super PAC. As I reported earlier this year, 7-Eleven Corporation, which is owned by a Japanese holding company, gave to a Super PAC supporting Senator Dick Lugar (R-IN) during his primary.
When the next Congress is gaveled in this January, a good number of lawmakers will owe their seats to groups financed in part by foreign-owned corporations. In the case of the American Chemistry Council and American Petroleum Institute, two Saudi-funded pro-oil lobbies active in the election, that could have wide ranging ramifications for our energy security.
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