Tag: campaign finance

The First in a Long Series

The Washington Post offers today a critical look at independent fundraising and spending in the 2012 campaign.

The article states independent groups are raising money “in response to court decisions that have tossed out many of the old rules governing federal elections, including a century-old ban on political spending by corporations.”

But the century-old ban is on campaign contributions by corporations, and it is intact. Spending on elections was not prohibited to some corporations until much later.

Other spending by corporations, like the money spent by The Washington Post Company to produce the linked story, has never been regulated or prohibited by the federal government.

The article mentions a “shadow campaign” and refers to Watergate. It states “independent groups are poised to spend more money than ever to sway federal elections.” Surely something is amiss here! Or at least the causal reader of the Post might conclude that.

But what is going on? A spokesman for one of the independent groups says they are trying to influence the debt ceiling debate and that as far 2012 goes: “We’re definitely working to shape how the president is perceived, because how he is perceived will have a huge impact on how this issue is resolved.”

It sounds like the group is engaging in political speech on an issue, speech that could have some effect on next year’s election. What is amiss about that? Isn’t the right to engage in such speech a core political right under our Constitution?

The article also argues that independent groups, being independent, may fund speech that may harm a candidate they are trying to help. Candidates, in a sense, have lost some control over their campaigns and their messages.

Of course, absent limits on contributions to candidates and parties, the money going to independent groups might go to…candidates and parties. Liberalizing speech, not suppressing independent groups, might be a good way to prevent groups from airing ads that harm or misrepresent candidates for office. Finally, candidates do have the power to repudiate independent ads.

Expect more news stories like this one over the next 18 months. The cause of campaign finance reform is in desperate straits. Reformers in the media are going to construct a narrative that says: money is destroying democracy in 2012, all because of Citizens United. They hope thereby to set the stage to restore restrictions on campaign finance.

Defending Anonymous Speech

For some time now, the U.S. Supreme Court has placed little weight on the value of anonymous speech, especially in the campaign finance context. True, in McIntyre v. Ohio Elections Commission (1995), the Court struck down a state law prohibiting distributing anonymous campaign literature. But from Buckley v. Valeo (1976) onward, the Court has looked favorably on disclosure of campaign spending. Even Citizens United saw only one justice, Clarence Thomas, speak out in favor of anonymous speech.

Long-time First Amendment advocate Nat Hentoff raises some questions about limiting anonymous speech in this video. He praises Justice Thomas and recalls the importance of anonymous speech during the founding era.

A Weak Defense of Disclosure

In an earlier post, I wrote about the problems with the Obama administration’s executive order to force government contractors to reveal their political activity.

The administration defends the mandate by arguing “taxpayers deserve to know how contractors are spending money they’ve earned from the government.”

For the first (and perhaps last) time, I rise to the defense of government contractors. The President apparently believes that anyone who sells a good or service to the government must account for the uses of the money received in the transaction in perpetuity? Obama’s press secretary said the President’s “goal is transparency and accountability. That’s the responsible thing to do when you’re handling taxpayer dollars.”

I do not understand this. The government extracts taxes and spends the money. Indeed, government officials should be accountable for that spending. But once the exchange is made, the money belongs to a private firm. It is no longer the property of the taxpayers.  Perhaps the use of a firm’s money should be disclosed, but you need a different argument to justify that mandate. The President seems to be proposing that anyone who does business with the government may have to account for the money they earn in those transactions. That assertion strikes me as a real expansion of government power.

The most troubling part of all this remains the President’s view that he can enact this mandate through an executive order. Americans should be wondering why a rule rejected by Congress can simply be enacted by fiat by the President. The President does not enjoy the power of a king, does he?

The President’s gambit may be in trouble. Sen. Susan Collins, a Republican from Maine, is questioning the content of the decree. I am glad she is concerned about the First Amendment. I would be happier if she questioned the Obama-Bush conception of executive power that informs this effort.

Monday Links

  • “One of the first rules of negotiating is never to threaten to do something unless you are prepared to do it.”
  • Policymakers and pundits assume the U.S. is so dominant that we’re prepared to fight multiple fronts at once, and that it won’t affect our security.
  • Candidates for office should prepare to raise money, not rely on taxpayer subsidies.
  • More market liberalization could help prepare Japan for any other natural disaster.
  • Are Tea Party-backed Republicans prepared to go the distance on spending cuts?


If the Government Gives Your Election Opponent More Money the More Money You Spend, It Burdens Your Speech

Yesterday the Supreme Court heard oral arguments in the Arizona matching-public-campaign-funding case, McComish v. Bennett, spearheaded by our friends at the Goldwater Institute and the Institute for Justice.

Here’s the background:  In 1998, after years of scandals ranging from governors being indicted to legislators taking bribes, Arizona passed the Citizens Clean Elections Act. This law was intended to “clean up” state politics by creating a system for publicly funding campaigns.  Participation in the public funding is not mandatory, however, and those who do not participate are subject to rules that match their “excess” private funds with disbursals to their opponent from the public fund. In short, if a privately funded candidate spends more than his publicly funded opponent, then the publicly funded candidate receives public “matching funds.”

Whatever the motivations behind the law, the effects have been to significantly chill political speech. Indeed, ample evidence introduced at trial showed that privately funded candidates changed their spending — and thus their speaking — as a result of the matching funds provisions. Notably, in a case where a privately funded candidate is running against more than one publicly assisted opponent, the matching funds act as a multiplier: if privately funded candidate A is running against publicly funded candidates B, C, and D, every dollar A spends will effectively fund his opposition three-fold. In elections where there is no effective speech without spending money, the matching funds provision unquestionably chills speech and thus is clearly unconstitutional.  For more, see Roger Pilon’s policy forum featuring Goldwater lawyer Nick Dranias, which Cato hosted last week and you can view here.

The oral arguments were entertaining, if predictable. A nice debate opened up between Justices Scalia and Kagan about the burden that publicly financed speech imposes on candidats who trigger that sort of financing mechanism under Arizona law. Justice Kennedy then entered the fray, starting out in his usual place — open to both sides — but soon was laying into the Arizona’s counsel alongside Justice Alito and the Chief Justice.

The United States was granted argument time to support Arizona’s law, but Justice Alito walked the relatively young lawyer from the Solicitor General’s office right into what I consider to be his (Alito’s) best majority opinion to date, the federal “millionaire’s amendment” case (paraphrasing; here’s the transcript):

Alito:  Do you agree that “leveling the playing field” is not a valid rationale for restricting speech?

US:  Sort of.

Alito:  Have you read FEC v. Davis?

Note to aspiring SCOTUS litigators: try not to finesse away direct precedent written by a sitting justice.

My prediction is that the Court will decide this as they did Davis, 5-4, with Alito writing the opinion striking down the law and upholding free speech.  Cato’s amicus briefs in this case, which you can read here and here, focused on the similarities to Davis, so I’m keeping my fingers crossed that we’ll get cited.

NB: I got to the Court too late to get into the courtroom today but live-tweeted (@ishapiro) the oral arguments from the (overflow) bar members’ lounge, which has a live audio feed. I was later informed that such a practice violates the Court rules, however – ironic given how pro-free-speech this Court is – so I will not be repeating the short-lived experiment.  (That said, you should still follow me on Twitter – and also be sure to follow our friends @IJ and @GoldwaterInst!)

A Year After Citizens United, Campaign Finance Back at the Court

As Caleb noted earlier, today marks the one-year anniversary of Citizens United, a case I first thought ”just” concerned some weird regulation of pay-per-view movies, but turned out to be about asserted government power to ban political speech — including books and TV commercials — simply because the speaker was not one individual but a group (in corporate or or other associational form).  See also this op-ed by ACLU lawyer Joel Gora.

Roger similarly noted the continuing discussion in Congress and elsewhere about the public financing of elections.  As it turns out, the Supreme Court has agreed to hear a challenge to such a system, specifically Arizona’s Clean Elections Act.  Brought by our friends at the Institute for Justice and the Goldwater Institute and supported by our brief at the cert petition stage, this lawsuit challenges a law that aimed to “clean up” state politics by creating a system for publicly funding campaigns.

Participation in the public funding is not mandatory, however, and those who do not participate are subject to rules that match their “excess” private funds with disbursals to their opponent from the public fund. That is, if a privately funded candidate spends more than her publicly funded opponent, then the publicly funded candidate receives public “matching funds.”

Whatever the motivations behind the Clean Elections Act, the effects have been to significantly chill political speech: privately funded candidates changed their spending — and thus their speaking — as a result of the matching funds provisions. In elections, where there is no effective speech without spending money, matching funds provisions such as those at issue here diminish the quality and quantity of political speech.

In 2008, however, the Supreme Court struck down a similar part of the federal McCain-Feingold law in which individually wealthy candidates were penalized for spending their own money by triggering increased contribution limits for their opponents (Davis v. FEC, in which Cato also filed a brief). Even this modest opportunity for opponents to raise more money was found to be an unconstitutional burden on political speech.

Cato’s latest brief thus asks the following question: Whether Arizona may give a publicly funded candidate extra money because a privately funded opponent or his supporters have, in the state’s judgment, spoken too much. We highlight Davis and numerous other cases that point to a clear answer: if the mere possibility of your opponent getting more money is unconstitutional, then the guarantee that your opponent will get more money is even more so. Allowing the government to abridge political speech in this fashion not only diminishes the quality of political debate, but ignores the fundamental principle upon which the First Amendment is premised: that the government cannot be trusted to regulate political speech for the public benefit. Moreover, the state cannot condition the exercise of the right to speak on the promotion of a viewpoint contrary to the speaker’s.

The case is McComish v. Bennett, consolidated with Arizona Free Enterprise Club’s Freedom Club PAC v. Bennett.  The Court will hear it March 28, with a decision expected by the end of June.