The United States Supreme Court has come under fire in recent decades for what many critics have condemned as a hunger to subsume the policymaking functions of Congress and the executive branch. But this January, the Court rocked the political landscape by performing what is indisputably its core function: serving as the constitutional guardian of fundamental rights that elected leaders have blithely disregarded in pursuit of political advantage or in the name of a misbegotten policy goal.
In Citizens United v. Federal Election Commission, the Court struck down a key provision of the Bipartisan Campaign Reform Act of 2002—commonly known by the monikers of its two principal authors, “McCain–Feingold.” The provision in question “prohibits corporations and unions from using their general treasury funds” to make independent expenditures for speech that either is an “electioneering communication” or that expressly advocates the election or defeat of a candidate.
In declaring this provision unconstitutional by a 5-to-4 margin, the Court affirmed the right of labor unions and corporations to expend their own funds to engage in political speech. The specific matter before the Court was a documentary film called Hillary: The Movie, which had been produced by a nonprofit corporation called Citizens United. The film harshly criticized Hillary Clinton, then a presidential candidate, and, in effect, urged voters not to elect her. McCain-Feingold effectively outlawed the release of the film, and the Court found that to be an unconstitutional abridgment of free speech.
But the shock waves from the decision shot through the political landscape, unleashing curious political alliances and exposing the precarious nature of fundamental rights in a hyper-politicized culture.
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Federal campaign-finance law has a long and tortured history, but it really began garnering widespread attention only in the mid-1970s, when the Watergate abuses led to major legislative action—action that has since been the subject of several major Supreme Court rulings and congressional revisions, of which McCain-Feingold was the most far-reaching. The purpose of campaign-finance law has always been to combat corruption. But over the years, the definition of corruption has expanded from unvarnished influence-peddling and vote-buying to far more vague worries about the influence of the “rich.”
The first approach was to control the use of “hard money”—dollars donated and spent in the explicit effort to secure a candidate’s victory—by limiting contributions to a set amount. Then came efforts to restrict political parties’ use of so-called soft money, money not used expressly to advocate the election or defeat of specific candidates and therefore not subject to specific fundraising or spending restrictions. Controls have also been sought on independent, third-party groups, which legally should have no ties whatsoever to campaigns or parties.
McCain-Feingold restricted the amount of soft money that national parties could collect. As a result, cash began to pour into less visible independent groups, the 527s (so named after the section of the federal tax code that governs them). That fact, in turn, begat regulations on the issue advertising produced by those groups. The course of campaign-finance reform offers an object lesson in the dangers of the administrative state and the way in which good intentions give way to bureaucratic accretions and the heavy hand of regulation.
The political class had become accustomed to restricting political speech in the name of rooting out corruption and purifying American electioneering. Justice Anthony Kennedy’s majority opinion represents a sharp break with that precedent. It is a bold rejection of the notion that government officials can micromanage speech in the hopes of leveling the political playing field. No longer will they be allowed to pick favorites among political speakers. Kennedy’s far-reaching decision overturned two previous Supreme Court rulings, one from 2003 and another from 1990, and explained exactly why such a sweeping approach was necessary. “The law before us is an outright ban, backed by criminal sanctions,” making it, Kennedy wrote, “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.”
Given these facts, he continued, “the following acts would all be felonies:
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 Web site 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.
Quite simply, then, the law’s “prohibition on corporate independent expenditures is thus a ban on speech.” Courts have allowed electioneering restrictions, citing Congress’s constitutional authority to “make or alter” the rules regulating “the Times, Places and Manner of holding Elections for Senators and Representatives.” Kennedy pointed out that if the restriction on corporate or union speech “applied to individuals, no one would believe that it is merely a time, place, or manner restriction on speech. Its purpose and effect are to silence entities whose voices the Government deems to be suspect.” And in stirring words that came as a torrent of icy water in the faces of those good-government advocates who fancy themselves defenders of democracy, he wrote:
Speech is an essential mechanism of democracy, for it is the means to hold officials accountable to the people. … The right of citizens to inquire, to hear, to speak, and to use information to reach consensus is a precondition to enlightened self-government and a necessary means to protect it. … Political speech must prevail against laws that would suppress it, whether by design or inadvertence. Laws that burden political speech are “subject to strict scrutiny,” which requires the Government to prove that the restriction “furthers a compelling interest and is narrowly tailored to achieve that interest.
This was as bold a stroke as the usually measured Kennedy has ever delivered from the bench. Political expenditures are equivalent to speech. Speech cannot be censored. The government cannot pick and choose among those speakers it wishes to be heard. With a thud, much of the foundation of campaign-finance reform has been exposed as constitutionally illegitimate. “Premised on mistrust of governmental power, the First Amendment stands against attempts to disfavor certain subjects or viewpoints,” Kennedy wrote. “Prohibited, too, are restrictions distinguishing among different speakers, allowing speech by some but not others.”
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The political establishment was horrified. Editorial boards and pundits thundered that this was the end of democracy as we know it. The New York Times’s editors bellowed, “With a single, disastrous 5-to-4 ruling, the Supreme Court has thrust politics back to the robber-baron era of the 19th century.” Ruth Marcus of the Washington Post pronounced it “an intellectually dishonest power grab” and decried “the audacity of the result it has inflicted on the political process.” Howard Fineman took to MSNBC to call the decision “an amazing piece of alleged jurisprudence” and warned that power companies and other corporate interests would take out Democrats in “Red states.”
Politicians threatened that we would see corporate leviathans control our political system. “The Supreme Court’s divided opinion,” said Senator Patrick Leahy, “is likely to change the course of our democracy and could threaten the public’s confidence in the Court’s impartiality.”
Self-appointed government-reform advocates were beside themselves. Long-time campaign-finance champion Fred Wertheimer proclaimed: “Today’s Supreme Court decision in the Citizens United case is a disaster for the American people and a dark day for the Supreme Court. The decision will unleash unprecedented amounts of corporate ‘influence-seeking’ money on our elections and create unprecedented opportunities for corporate ‘influence-buying’ corruption.”
And then, in an unprecedented bit of grandstanding from a former constitutional-law professor, President Barack Obama announced at the State of the Union:
Last week, the Supreme Court reversed a century of law to open the floodgates for special interests—including foreign corporations—to spend without limit in our elections. Well, I don’t think American elections should be bankrolled by America’s most powerful interests, or worse, by foreign entities. They should be decided by the American people, and that’s why I’m urging Democrats and Republicans to pass a bill that helps to right this wrong.
A “century of law” has not been reversed. The ban on contributions and expenditures by foreign corporations remains, in Section 441e of the statute. As Senate Minority Leader Mitch McConnell, a former litigant in the overturned case and the Senate’s primary opponent of McCain-Feingold, succinctly put it: “Contrary to what the President and some of his surrogates in Congress say, foreign persons, corporations, partnerships, associations, organizations or other combination of persons are strictly prohibited from any participation in U.S. elections, just as they were prohibited before the Supreme Court’s Citizens United decision.”
But the president’s comments—however inaccurate—perfectly encapsulated the rage and fear that gripped many in the political establishment who had spent decades trying to control the speech of certain speakers. And the fix the president called for seemed to exemplify the indifference to the constitutional niceties the Court was emphatically reasserting.
Any law professor or first-year law student knows that it is quite dicey for Congress simply “to pass a bill” that countermands a Supreme Court’s constitutional ruling. Nevertheless, Senator Charles E. Schumer and Representative Chris Van Hollen promptly trotted out their proposed solution, a bevy of onerous reporting regulations for corporations, an attempt to ban speech by those corporations that conduct business with the government, a redefinition of “foreign corporation” as entities with as little as 20 percent ownership based abroad, and a jury-rigging of advertising regulations to ensure that politicians get the “lowest unit” rate to respond to corporate ads.
Noteworthy was the absence of any concern about the political expenditures of unions, which had also been unshackled by the Court decision. Many prominent unions, such as the United Auto Workers and the Service Employees International, have noncitizen members, yet there was no suggestion from Schumer and Van Hollen that these noncitizens might unduly influence elections. Instead, the liberal establishment concentrated on corporations they feared might now run ads, thereby managing somehow to hijack American democracy from unwitting voters. But when the AFL-CIO announced a $53 million campaign aimed at saving Democratic congressional seats, the same Citizens United critics fell mute.
The vast majority of those groups defined as “corporations” by the law do not resemble ExxonMobil or AT&T but instead are small proprietorships. More to the point, the sort of corporation most likely to participate in campaigns is of the nonprofit variety, such as the Sierra Club or the National Rifle Association. However, the suggested legislative “fixes” would go after all incorporated entities, just as the eviscerated McCain-Feingold act had done.
The proposed end around of the Court’s ruling could very well be struck down if it is signed into law. As government contracts constitute a large and important segment of America’s corporate sector, any broad attack on them would most likely provoke strong objections. The Court also left open the door to legal challenges to onerous regulations that are styled as mere disclosure requirements if, in their application, they impermissibly intimidate those who wish to participate in campaigns. One legislative proposal, for example, would require corporations to list the names of the five top contributors to their ads, thereby subjecting members of private-interest groups to harassment or attack ads, as was the case when donors to Proposition 8 (the gay-marriage ban) in California had their names released.
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Campaign-finance reform creates an odd divide in the political landscape, one that does not break down neatly along ideological lines as a split between conservatives and liberals. Conservative think tanks, the ACLU, and a heterogeneous group of special-interest groups—from the liberal feminist political fundraiser Emily’s List to the libertarian CATO Institute—have always been aligned against McCain-Feingold. On the other side stand McCain and Feingold themselves (an odd couple from the Center-Right and far Left), professional reformers, and nearly the entire media establishment. At issue is not merely whether “corporations should dominate politics” but rather two contrasting views of our political system.
Yet for all the talk of first principles, self-interest has guided much of the debate. Mainstream-media outlets, under the stringent rules of McCain-Feingold, have been operating in a protected realm, sheltered from competition in their ability to influence the outcomes of elections by corporations and unions. If corporations were unshackled and could partake in the political process as editorial pages do, the traditional media would face yet another blow to their authority. And then there are the politicians themselves, from McCain and Feingold outward, who have used legislation to tip the scales toward incumbent protection, inveighing against “attack ads” by special-interest groups that seek to hold them accountable for their voting records.
But there was and remains more at stake than incumbency and the relative influence of the New York Times and Time. For the reformers, the preservation of democracy in a stratified, industrial polity is a matter of minute balancing and strict attention to evaluating good and bad speech. They do not share the conviction of the nation’s Founders that robust, even aggressive speech is fundamental to the country’s political health. Campaign-finance reformers believe that large, wealthy forces operating clandestinely behind the scenes are always working to capture the political system and that therefore the only means of counterbalancing their influence is to evaluate political speech itself and orchestrate an elaborate set of rules to make sure no one gets more speech than anyone else.
Those on the other side of the divide, including the five Supreme Court justices who voted to overturn McCain-Feingold this year, reject this notion. The Constitution, in their view, is not a social or political equalizer but rather a framework for protecting free expression and other rights essential to the operation of a democratic system. The remedy for “bad” speech cannot be less speech.
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Will the Citizens United ruling permanently shift the balance in this debate to the side of the free-speech advocates? As is the case when discussing the future of any narrowly decided ruling, changes in the composition of the Supreme Court could revive McCain-Feingold. In the short run, the political class will need to digest the ruling and prepare for still more legislative activity and possibly more constitutional housekeeping by the Supreme Court.
Most Supreme Court observers, however, detect little appetite for eviscerating the limits on corporate donations or addressing the dollar limits on campaign spending more generally, insofar as the Court has previously upheld such limits if they are not so draconian as to prevent voters from expressing support for candidates of their choice.
As for the potential for overweening corporate influence in campaigns, the reaction of the political class and alarmist pundits seems overblown, if not hysterical. Reform groups who argue that the political system is at risk of becoming a corrupt racket in which huge public corporations monopolize campaigns to the benefit of the Republican party were especially loud in denouncing the ruling. But corporations spread their money around; they wish to ensure access to both sides of the aisle. A 2009 study released by the Center for Responsive Politics, for example, showed that 63 percent of corporate donations (by both political-action committees and individual donors) flowed to Democrats. Moreover, more than 20 states permit all manner of corporate contributions and unlimited expenditures. There is scant evidence in states like Virginia and Nebraska that the absence of corporate restrictions has unleashed an avalanche of boardroom political influence or increased corruption. And it is far from clear that corporations with diverse shareholders and an aversion to public controversy would choose to wade into federal campaigns with full-blown ad offensives hawking one candidate or another.
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Meanwhile, at least for the foreseeable future, the ultimate goal of the reform clique—public financing of campaigns—may have suffered a serious blow. But the chief culprit for the demise of the idea of completely replacing the private financing of elections with a system in which all expenditures would be funded by the taxpayers was not the Supreme Court or even the Republican party. It was, instead, the idol of most of those who have longed for such a scheme: Barack Obama. It was candidate Obama who undermined the basis for the myriad of restrictions that had accumulated in the post-Watergate years designed to squeeze private money out of politics and replace it eventually with a public-financing plan.
Though he had expressed warm support for public-financing ideas in the past, the massive outpouring of private donations from millions of individuals to his campaign—chiefly through the Internet—trumped such theoretical considerations. Obama’s declaration during the 2008 race that he would not make use of the public financing now available to presidential candidates of major parties if they agree to spending limits sounded the death knell for that liberal fantasy.
The irony that it was a liberal Democrat who nailed the lid on the public-financing coffin is not lost on supporters of the idea. Indeed, Obama’s example skewered the entire rationale for the belief that only by driving out private money can a long-shot outsider stage a successful charge for the White House. Large numbers of individuals expressed their preference for Obama principally through the giving of money to his campaign—thus illustrating a point conservative opponents of such reforms have long made. Given the success, both financially and electorally, of the Obama campaign’s approach, it is doubtful, then, that other well-run campaigns will ever limit themselves to public financing again.
This is not to say that campaign-finance-reform advocates have lost their passion for public financing. Senator Richard Durbin has a proposal to extend public financing to congressional races. But there is a significant impediment: the public overwhelmingly opposes it. Even voluntary support, in the form of a check-off on federal tax returns, has diminished over time. The very notion of funding campaigns with involuntary tax monies would surely raise new constitutional concerns as to whether citizens can be forced through their tax dollars to support candidates whose views they may adamantly oppose.
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Money has always been part of democratic politics. No legislation can change that. All legislation can do is funnel the dollars into different structures that will be, as the history of the past four decades has shown, increasingly less transparent. Efforts to game the system will continue, and the Court will have to remain the umpire—an umpire whose only interest should be the maintenance of a political structure in which the government is prohibited from picking winners and losers among political speakers.
