For decades, the issue of “transparency” as applied to giving for charitable, civic, and political purposes enjoyed a rough but widespread consensus. Based on reasonable concerns about corruption in federal elections that began in the early nineteenth century and increased with the growth of powerful and wealthy corporations and labor union organizations, there was a legitimate and compelling reason for the government’s interest in mandatory disclosure of contributions made to candidates for public office as well as the political committees that directly supported their campaigns. The confidentiality of donations to charitable and civic organizations remained under constitutional protection, a distinction that derived primarily from the Supreme Court’s 1958 decision in NAACP v. Alabama, which held that the forced disclosure of the civil rights organization’s membership list threatened the right of free association. Subsequent lawsuits and court decisions extended the same protections to organizations’ donor lists.
These lawsuits, and others like them, are critical to the protection of philanthropic freedom—the right of Americans to choose how and where to spend their charitable assets in order to fulfill their diverse missions. Donor privacy and confidentiality are essential to a vibrant civil society. Unwarranted state incursions into private charitable giving will chill the exercise of the First Amendment freedoms that ensure donors may give even to controversial philanthropic causes without fear of harassment and reprisal. Donor privacy also protects those who choose to give anonymously for a variety of good reasons, including deeply held moral or religious beliefs, a sense of humility, a wish to lead a more private life, and the desire to minimize solicitations from other organizations.
But any consensus that existed about the critical importance of donor privacy has broken down over the past decade. The 2010 U.S. Supreme Court decision in Citizens United v. Federal Election Commission, which allowed incorporated entities, unions, and other organizations to expressly advocate for the election or defeat of candidates for office, prompted a backlash demanding greater transparency in “political” spending—which, in many instances, came to include gifts made to nonprofits (including 501(c)3 charitable organizations) engaging in any public policy work. As anonymous giving is increasingly seen as a sinister—rather than virtuous—undertaking, proposed donor-disclosure mandates have expanded to include the non-campaign activity of advocacy organizations like Planned Parenthood Federation of America and the National Right to Life Educational Foundation. If successful, these proposals would expose philanthropists to the sort of retribution donors to political candidates face today, including job loss, death threats, and boycotts.
This report provides a brief overview of recent efforts to preserve donor privacy, which have generally been successful. Bad legislation that would infringe on donor privacy has been defeated in most instances; good legislation that proactively defends donor privacy has passed in several states and made inroads in more; and courts around the country already have struck down some threats and could deliver a major victory next year.