Abstract

http://ssrn.com/abstract=2138828
 


 



Employers United: An Empirical Analysis of Corporate Political Speech in the Wake of the Affordable Care Act


Elizabeth Weeks Leonard


University of Georgia School of Law

Susan Scholz


University of Kansas - Accounting and Information Systems Area

Raquel Meyer Alexander


Washington and Lee University

August 30, 2012

Journal of Corporation Law, Vol. 38, 2013, Forthcoming

Abstract:     
Is the Patient Protection and Affordable Care Act (ACA) bad for business? Did the countries' most prominent companies game the Securities and Exchange Commission (SEC) disclosure process to make negative political statements about ObamaCare? Immediately following the ACA's enactment on March 23, 2010, a number of companies drew scrutiny for issuing SEC filings writing off millions – and in AT&T's case, one billion dollars – against expected earnings for 2010 alone, based on a single, discrete tax-law change in the ACA. Congressional and Administration officials accused the firms of being “irresponsible” and using “big numbers to exaggerate the health reform's burden on employers.” To further test the suggestion that these disclosures were politically motivated, we searched all publicly filed SEC real-time and scheduled filings for the quarter following the ACA's enactment. We identified 147 firms that issued SEC disclosures relevant to the tax-law change, writing off a total of five billion dollars. Our deeper analysis of these data amplifies the congressional committee's conclusion that the firms’ disclosures were consistent with SEC requirements and financial accounting standards. A handful of firms account for the bulk write-offs, but the only evidence of political speech was by politicians. The episode has significant implications for government regulation of corporate speech and the integrity of the securities disclosure system, particularly as the remaining portions of the ACA are implemented.

Number of Pages in PDF File: 50

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Date posted: August 31, 2012 ; Last revised: September 17, 2012

Suggested Citation

Leonard, Elizabeth Weeks and Scholz, Susan and Alexander, Raquel Meyer, Employers United: An Empirical Analysis of Corporate Political Speech in the Wake of the Affordable Care Act (August 30, 2012). Journal of Corporation Law, Vol. 38, 2013, Forthcoming. Available at SSRN: http://ssrn.com/abstract=2138828 or http://dx.doi.org/10.2139/ssrn.2138828

Contact Information

Elizabeth Weeks Leonard (Contact Author)
University of Georgia School of Law ( email )
Athens, GA 30602
United States

Susan Scholz
University of Kansas - Accounting and Information Systems Area ( email )
1300 Sunnyside Ave
Lawrence, KS 66045
United States
785-864-7554 (Phone)
785-864-5328 (Fax)
Raquel Meyer Alexander
Washington and Lee University ( email )
Lexington, VA 24450
United States
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