Congress, not Court, Opened Big-money Floodgate

For liberals/progressives, the U.S. Supreme Court's Citizens United decision is the devil incarnate. Articles and letters litter these pages erroneously claiming that the court's 2010 decision "allowed unlimited money to flow to super PACs."

But that is not what Citizens United held. Nor is it what Citizens United was all about. It is a pathetic mischaracterization by people who either haven't bothered to read the case or, if they had, were clueless as to what they were reading. Justice John Paul Steven's dissenting opinion (in which all four liberals concurred) made this unmistakably clear.

"The real issue in this case concerns how ... (Citizens United) may finance its electioneering. Citizens United is a wealthy nonprofit corporation (not a PAC) that (also) runs a political action committee (PAC) with millions of dollars in assets. Under the Bipartisan Campaign Reform Act of 2002 (BCRA), it could have used (the PAC's assets) to televise and promote 'Hillary: The Movie' wherever and whenever it wanted to. It also could have spent unrestricted sums to broadcast Hillary at any time other than the 30 days before the ... primary election. ... All that the parties dispute is whether Citizens United had a right to use the funds in its general treasury to pay for broadcasts during the 30-day period."

Justice Steven's remarks make crystal clear that Citizens United was not about allowing unlimited money to flow to super PACS. It was about allowing ordinary corporations that were not political action committees to use "funds from the general treasury," to engage in political speech without pre-approval from the Federal Election Commission or any other government entity right up to the election.

The Citizens United corporation (not a PAC) sued to void the ban on "independent expenditures" by the corporation saying it violated the First Amendment.

In January 2008, Citizens United released "Hillary: The Movie," a 90-minute documentary about then-Sen. Hillary Clinton, a 2008 Democrat presidential primary candidate. It depicts interviews with political commentators and other persons, most quite critical of Sen. Clinton. It was released in theaters and on DVD, but Citizens United wanted to make it available through video-on-demand within the 30-day time period prohibited by FEC rules made pursuant to campaign reform law.

At trial, the U.S. District Court had found "there is no reasonable interpretation of Hillary other than as an appeal to vote against Senator Clinton." It was "susceptible of no other interpretation than to inform the United States would be a dangerous place in a President Hillary Clinton world, and that viewers should vote against her."

Again in the words of dissenting Justice Stevens, "Under the Bipartisan Campaign Reform Act of 2002, (Citizens United) could have used (its PACs assets) to televise and promote Hillary ... wherever and whenever it wanted to. As such it was the BCRA itself -- and not the Supreme Court -- that allowed PACs to spend 'wherever and whenever it wanted to' except during the 30 days before the election. Citizen United simply gave corporations that were not PACS the same rights as BCRA gave corporations that were PACs, as well as striking down the '30 day period' prohibition."

To repeat, Citizens United was about allowing a corporation, not a PAC, to engage in political speech at any time without government pre-approval.

What liberals have made no effort to understand is that while PAC corporations and media corporations were allowed to "speak" by BCRA, business corporations and unions were prohibited from speaking (from making expenditures for "electioneering communication" or for speech "expressly advocating the election or defeat of a candidate") at any time. The Supreme Court simply held that business corporations, and unions, have the same political rights under the First Amendment as corporate PACs.

The court noted that media corporations (radio, TV and cable) have "immense aggregations of wealth," accumulated "with the help of the corporate form." The court's holding gives non-media corporations the same right of free speech as media corporations. In doing so, the court noted the perversity if BCRA:

"The law before us is an outright ban, backed by criminal sanctions. Section 441b makes it a felony for all corporations -- including nonprofit advocacy corporations -- either to expressly advocate the election or defeat of candidates or to broadcast electioneering communications within 30 days of a primary election and 60 days of a general election."

Thus, the following acts would all be felonies under that section: 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 website telling the public to vote for a presidential candidate in light of that candidate's defense of free speech. These prohibitions are classic examples of censorship."

Yet at the same time, BRCA permitted PACs, non-corporate billionaires, and corporate mega-media conglomerates to do the same.

The bottom line of the court's analysis is this: The First Amendment "'has its fullest and most urgent application' to speech uttered during a campaign for political office. ...

"Discussion of public issues and debate on the qualifications of candidates are integral to the operation of the system of government established by our Constitution."

In a country where special interest groups can use their wealth and speak on behalf of candidates who promise to pass laws to ameliorate perceived "corporate excesses," corporations must be able to speak to defend themselves, and to oppose candidates and legislation that they see as destructive of their interests and the public interest. If the President can vilify corporations, the First Amendment " requires that they have an equal right to vilify him.


Posted Online:  April 22, 2014, 11:00 pm - Quad-Cities Online
by John Donald O'Shea

Copyright 2014
John Donald O'Shea

How Much is Enough to Keep our Nation Safe?

It is a sad fact of history that the only thing worse than spending too much on a nation's armed forces, is spending too little. Excess spending wastes the nation's scarce resources. Inadequate spending can waste the whole nation.

In the 11-year period from 1930 through 1940, the U.S. spent $19.9 billion on our military and naval establishments, or about $1.8 billion per year. That averages to about 11.5 percent of the nation's total spending for each of those 11 years.

That level of spending was not sufficient to keep Japan from attacking us at Pearl Harbor in December 1941, or to prevent Germany from declaring war on us a few days thereafter.

Many in Japan felt that Japan could defeat America. Other Japanese felt they could, but only if they could defeat us in a short war; if they could break our will to fight further. That was the gamble behind Pearl Harbor -- beat America before it could bring its industrial might to bear.

In the days before World War II, those in charge of military and naval planning for the "great powers" realized that it took significant time for a nation to gear itself up to a "war-footing." Winston Churchill in "The Gathering Storm" spelled it out:

"... [M]unition production on a nation-wide plan is a four year task. The first year yields nothing; the second very little; the third a lot, and the fourth a flood. Hitler's Germany in this period was already in its third or fourth year of intense preparation under conditions ... which were almost the same as war. Britain, on the other hand, had only been moving on a non-emergency basis, with a weaker impulse, and on a far smaller scale. In 1938/38 British military expenditures of all kinds reached 304,000,000 pounds, and the German was at least 1,500,000,000 pounds."

In 1938, the British pound was equal to 3.223 American dollars. Accordingly, at a time America was spending $1.7 billion on its military establish, Germany was spending $4.8 billion. Had Germany won the Battle of Britain (July 10-Oct. 31, 1940) -- and it was a close run thing -- Germany may well have won the war before America was even in it. Had Britain fallen, the entire German war machine could have focused on the USSR. Had Britain surrendered, the U.S. would have had no England from which to launch the Normandy invasion.

Admittedly, things are different today. Today a nuclear war can be won or lost in a matter of hours. But because nobody had nuclear weapons in 1941, America had four years to convert its vast industrial base to a war-footing. Then, all those economies achieved from 1930 through 1940 were wiped out in a blizzard of war spending.

In 1941, the U.S. spent $7.2 billion or 30 percent of total spending on its military. In 1941, $27.1 billion or 59 percent. In 1942, $70.4 billion or 78 percent. In 1944, $86.1 billion or 78 percent and in 1945, $93.7 billion or 79 percent. During that five-year period, the U.S. spent $284.5 -- 14.3 times as much as it spent in the 11-year period during the1930s!

The question is, had the U.S. spent $5 billion per year from 1930 through 1940 (which included Depression years), would Germany and Japan have dared to go to war with U.S.? Rather than spending $55 billion over that 11-year period, we economized" The result was WWII. Had we spent $5 billion per year over the 16-year period beginning in 1930, we would have spent $80 billion on our defense. Instead, we spent $305 billion and sacrificed 418,500 American lives. Indeed, had we spent $10 billion a year over the 16 year period, it would have cost only $160 billion and probably no American lives. Germany and Japan would have realized it was suicidal to make war on our country.

Winston Churchill wrote his six-volume history of WWII so democracies would not repeat the follies that led to WWII.

"It is my purpose, as one who lived and acted in these days, first to show how easily the tragedy of the Second World War could have been prevented; how the malice of the wicked was reinforced by the weakness of the virtuous; how the structure and habits of democratic states, unless they are welded in larger organism, lack those elements of persistence and conviction which can alone give security to humble masses; how, even in matters of self preservation, no policy is pursued even ten or fifteen years at a time. We shall see how the counsels of prudence and restraint may become the prime agents of mortal danger; how the middle course adopted from desires of safety and a quiet life may be found to lead direct to the bull's eye of disaster. We shall see how absolute is the need of a broad path of international action pursued by many states in common across the years, irrespective of the ebb and low of national politics." -- Churchill's "The Gathering Storm"

The only foreign policy that makes sense is for America to be so strong that all potential enemies realize that war with America means their destruction. Anything less bids fair to embroil us in mortal conflict. In 2013, the U. S. spent $819.5 on our national defense. That is 13 percent of our entire national spending. But excluding $161 billion for personnel pay and housing, the U.S is spending 10.4 percent on national defense; 11.5 percent wasn't sufficient to keep us out of WWII.

Will 10.4 percent be enough? That is the question.

Posted Online:  April 10, 2014, 11:00 pm - Quad-Cities Online
by John Donald O'Shea

Copyright 2014
John Donald O'Shea

College Athletes? NLRB to the Rescue??

Northwestern University has just been advised by Peter Ohr, regional director of the National Labor Relations Board that its football players are "employees" first and "students second."

According to ESPN, "If (Ohr's) decision is upheld, it will give players at private universities a voice in the management of their lives as athletes and students. It will qualify players for workers' compensation benefits for injuries that occur during their playing careers, benefits that will cover them well into their futures. Instead of coaches issuing schedules and setting rules for their private lives, the players and their union will bargain for their working conditions in the same way NFL and MLB players bargain for benefits. And, although the Northwestern players say they are not interested in payments for their efforts, the formation of a players' union will open the way to salaries for athletes in football and men's basketball."

Mr. Ohr's opinion focused on the number of hours Northwestern players allegedly devoted to football and to the control coaches have over their lives. But while Northwestern players play football, they also graduate.

At the Division I level, the football Graduation Success Rate, admittedly, varies from university to university. But it simply is untrue to say -- at least for universities like Northwestern, Notre Dame and Stanford -- that "the student-athlete is a cherished, long standing American myth, which retains a modicum of validity only at non-scholarship colleges." It is also a canard to make a blanket statement that at the Division 1 level, athletes are treated like chopped-meat.

Northwestern's NCAA Football Student Graduation Rate was a best in the nation 97 percent. It was followed by Rice at 95 percent, Notre Dame and Boston College at 94 percent, Air Force and Stanford at 93 percent, Duke at 92 percent and Boise State at 91 percent. And at Northwestern, Notre Dame and Stanford, the football players take the same classes as the rest of the student body. There are no "special" courses for "jocks." To minimize their student-status is to falsely denigrate their success.

But scholarship football players are only a part of the story. Notre Dame, for example, has 22 men's and women's sports that show up in the NCAA's Student-Athlete Graduation Rate Survey. In 20 of its 22 programs, Notre Dame graduated 100 percent of its student-athletes. Indeed, the NCAA's figures released on Oct. 24, 2013, show that all 11 Irish women's programs posted a GSR of 100 percent -- basketball, cross country/track, fencing, golf, lacrosse, rowing, soccer, softball, swimming/diving, tennis and volleyball.

Among Notre Dame's men's sports, baseball, basketball, cross country/track, fencing, golf, hockey, soccer, swimming/diving and tennis achieved 100 percent GSR scores. Men's lacrosse scored 96 percent and football 94 percent.

The cost of going to the colleges listed here isn't cheap. Northwestern's 2013-14 tuition, fees, room and board were $57,108. Notre Dame's were $57,117; a full, one-year athletic scholarship to either institution is worth just under $60,000. Moreover, the football players and other scholarship athletes get first-rate educations. And when a player gets hurt at Northwestern or Notre Dame, they don't lose their scholarship; moreover, they get the best medical care available. And of course, they are coached-up to play at the highest level, which for at least a few leads to a lucrative pro career.

So, would your son do better if instead of taking an athletic-scholarship to play football at Northwestern, he opted to play minor league baseball? Hardly. A first-year player in the Rookie League earns $1,150 per month; $1,300 at Low A; $1,500 at high A. Additionally, they get a $20 per day meal allowance during the season while on the road. Therefore, a rookie-level minor leaguer earns about $10,500 per year.

A full-time minimum wage worker earns about $20,000 per year and pays taxes. A football player at Northwestern earns $60,000 per year, plays and gets coached-up in the game he loves, and gets the best education in the world while his tuition and books are tax-free income.

For the Reporting Year Sept. 1, 2012-Aug. 31, 2013, Northwestern's Total Football Revenues were $30,143,982; expenses were $21,722,796. On its face, Northwestern appears to have made big profit of $8,421,186 from its football program. Its men's basketball team also generated a profit of $6,667,910. But those were the only profitable sports programs.

Women's basketball, fencing and field hockey, lacrosse, softball, track-field-cross-country and volleyball, as well as men's baseball and wrestling, and men's and women's golf, soccer, swimming and diving and tennis were big losers. The combined net loss for those sports was (revenues of $1,972,700 less expenses of $16,275,194) was $14,302,494.

The bottom line is that Northwestern's profits from football and men's basketball finance the other male and all women's sports.

Mr. Ohr looks at the more than $8.4 million generated by the football program and sees money that could be used to pay the football players and afford them other benefits. His ruling, however, ignores the fact that the university's football (and men's basketball) earnings fund the whole Northwestern sports program. Without football and men's basketball revenues, women's sports and other men's sports cease to exist, unless the university chooses to fund them with tuition or other resources

ESPN notes, "The decision in the Northwestern case affects only private universities. Any attempt by players to form a union at ... Ohio State, or Nebraska, would be governed by the specific state's laws on unions of public employees (teachers, firefighters, police)."

Can the NCAA live with a scheme where private universities can award incoming football player a $60,000 scholarship plus a $250,000 signing bonus and a salary, while state universities are limited to giving only a scholarship worth about $60K? Will private universities find themselves expelled from the NCAA if they do?

Once players unionize and bargain for "compensation," won't that compensation become taxable just like other "bargained-for income?" What about union dues?

The issues I raise are only the first of the unintended consequences -- one of which might well be a strike in lieu of the football season or the national championship game.

Posted Online:  April 5, 2014, 11:00 pm - Quad-Cities Online
by John Donald O'Shea

Copyright 2014
John Donald O'Shea