After last minute amendments on Wednesday that delayed a vote, SB2471 goes before the full Legislature on Friday, May 8. I've opined on the topic based on the language of the bill and the things legislators have said in defense of it. Here is a straight interview with one of its champions, bill co-sponsor Hawai‘i state Sen. Jarrett Keohokalole, lightly edited for readability and to cut out general chit chat.
I've reached out as well to House Rep. Scot Matayoshi, who took a leading role in that chamber in advancing the bill, and state Sen. Karl Rhoads, who introduced it in the first place.
What about the bill is important to you?
I fundamentally don't like the premise of the Citizens United [U.S. Supreme Court] decision. I mean, there's a long justification for it in the decision and in a long line of cases around it. But I just disagree with the premise, and I think we have the people on our side. I mean, this thing has polled for 16 years pretty consistently at 80% opposition, and that's across parties.
For sure, there are Republicans who don't like [Citizens United] ...
Like, 75% of Republicans. So just fundamentally, corporations are people for a lot of, I think, functional reasons, but this is one of the areas where passing those human rights over to entities that do not exist in reality are problematic, and so that's why there's been a big fight about it for a long time.
One of the things that stood out for me in the bill is the exception for my own industry. How would you defend making a distinction between a corporate-owned newspaper endorsing a candidate and some other kind of corporation endorsing or opposing a candidate?
The press is specifically enumerated in the Constitution. The freedom for corporations to be granted specific rights is not. Corporations are not specifically identified in the way the press is. That's probably an arguable position.
Locally, there's been allusions in testimony, like [Rep. Della Au] Belatti's [House floor] speech, for example, to dark money being spent in Hawai‘i. Are there specific examples that come to mind for you of dark money, like, who spent it? How much did they spend? What were they trying to do in Hawai‘i?
Not off the top of my head. Super PACs are not prohibited in this bill, because we can't prohibit the existing rights of Super PACs. The objective here is to make sure that there's transparency in who is funding the super PACs, so if this bill passes, you can't create a shell corporation to hide your money. We really are only talking about individually wealthy people. You can still donate unlimited amounts of money into a Super PAC. We cannot stop that, but what we can do is create transparency.
How did you and the Center for American Progress get together on this?
It's [Sen.] Karl Rhoad's bill. They [CAP], pitched this to legislators before the session. I get pitched all kinds of bills, from all sorts of corners. I get conservative bill pitches every year and so on. But this one caught my eye. I introduced a different [bill with] the same objective [but a] different concept, and then we deferred my bill because it just wasn't as clean as Karl's version, which I co-sponsored anyway, and then because this is fundamentally a proposed change to the corporate charter, HRS 414, this [made it a bill under the purview] of the commerce committee, and so I'm the lead negotiator on it, and worked out most of the language and negotiated the final form with [state Re. Scot] Matayoshi, my counterpart on the House side.
As I watched the different conference votes, it looked like maybe you and Matayoshi had some disagreements over what should be in and what should be out.
I wouldn't characterize it as disagreement. We had different concerns about the how the substantive provisions would be treated and implemented, and in the conference process, we were trying to work through how to address those concerns in clear and concise language in the bill, which can get really complicated. Even the Center for American Progress — like, Tom [Tom Moore, CAP senior fellow, democracy and government] has got this legal theory, and then we have to fit this legal theory into the Hawai‘i Revised Statutes and it's not always a clean fit. And so, we were trying to figure out how to make it work. Eventually we came to an agreement. But, we had to do a floor amendment to come to a final, final agreement, and then the effective date of the measure is delayed out [to January 1, 2027] because we're trying to just make sure this is the cleanest possible version of this concept as it relates to Hawai‘i law.
One of the ironies is that in Montana, this [legal concept] is being introduced via ballot initiative [by CAP], and yet it seems like the whole idea here is to try to prevent outside groups and money from interfering with ballot initiatives. But that's, I mean, that's Montana, that's not Hawai‘i. You don't have to opine on that.
It's like moving targets, right? I introduced a ballot initiative bill this year after opposing it for a long time, but I changed my mind on it. And we can't get [legislation] perfect. It's not supposed to be perfect anyway. I think democracy is fundamentally messy and for good reason.
Has our congressional delegation taken an interest in this? Are they in communication with you one way or the other on it?
No. I can't say whether they've taken interest. I think all of them have probably spoken out. Well, I don't know about [Rep. Ed] Case, but I know for sure [Sen. Mazie] Hirono and [Sen. Brian] Schatz have made statements about how they don't like Citizens United. I assume [Rep.] Jill [Tokuda] is right there. And then, they could take action at the federal level and the most common proposal across the country to reverse Citizens United is a federal constitutional amendment. But that's gone nowhere for the last 16 years. And so, when Tom and the Center for American Progress proposed amending the corporate charter, and I went in and looked at it, it makes sense. It follows a more general theme that I've been pursuing in the last year, which is the assertion of states' rights, which I never thought, ever, I would be as aggressively pursuing. In my view, we have a really aggressive consolidation of federal power, and so the states should assert their authority in ways that benefit the public. Maybe we disagree on that.
Is there anything I haven't asked you about that that you would want Aloha State Daily readers to know?
For me, corporations and other entities that are chartered in the state of Hawai‘i [such as] limited partnerships, nonprofits, all that, all the corporate entities derived in Chapter 414, of the Hawai‘i Revised Statutes, are granted really significant privileges that individuals are not afforded by taking the forms that are allowed under the law. They're granted significant tax privileges that individuals are not entitled to, and they're granted limited liability that protects their founders and investors and individuals are not afforded those privileges. In order to be afforded those privileges, they need to follow the rules as established in the corporate charter. Most people just think that's submitting your Articles of Incorporation and paying the fee every year and all that. But 414 establishes pretty clearly that you've got to follow the law in Hawai‘i, and then you are granted these privileges. Human beings are different. Human beings have natural rights. God given rights. I just fundamentally disagree with the Supreme Court saying, 'Oh, the fundamental rights you as a human being have, they flow to the corporation.' You can't access any of the privileges that the corporations get unless you follow the dictates of the corporate charter. If we, as a state, elect to limit any of those powers or privileges that are granted from state law, then the individuals behind the corporation don't lose rights. That's not a thing. They still have their individual rights to speak, to spend as much as they want, to participate in elections. I just don't understand how you can have an entity that is created by state law and given powers under state law at the same time have naturally inherent rights that are God given, inalienable.
This bill, just for clarification, it's specifically about — I've seen the word electioneering, so we're talking about spending that is meant to influence the outcome of an election, either [for or against a candidate] or some initiative that's up in an election, on a ballot, is that right? It's constrained to that?
I think it's the same standard as 501(C)3s under the IRS code, which, ironically, the federal government restricts 501(C)3s from electioneering.
Would those same corporations still be allowed to spend money on lobbying; on proposing legislation. Like, for example, CAP has drafted, I think, significant parts of this legislation, as it's appearing in multiple states. So, lobbying, drafting legislation, any other form of interaction with legislators through the political process — that all still can happen, even if this passes, right?
Yeah, this bill doesn't touch that. But that's an interesting point. It's a really interesting point, you know? And then that's part of the process, right? This is eliciting all kinds of fair questions, and it's not like the passage of one bill means the end of the issue.
It's a continuum. I'm sure that if this bill passes and it withstands what's likely to be an inevitable legal challenge, then we'll probably get asked those exact questions next year, probably by the right and the left, and they're fair questions.
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A. Kam Napier can be reached at kam@alohastatedaily.com.
