Corporate contributions to federal candidates have been prohibited for more than 100 years; union contributions have been outlawed for more than 60 years. These prohibitions are not at issue and never have been. The propensity of reformers to exaggerate betrays the weakness of their position.

The question before the court is whether corporations are permitted to engage in speech that might influence public opinion about a candidate. The type of activity being considered is an "independent expenditure"; a category of spending created in recognition of the fact that people have legitimate reasons to weigh in on political issues, quite apart from making direct contributions to candidates. For example, a homemade protest sign might be a kind of independent expenditure, as might a blog in which you express political opinions.

The courts permit restrictions on direct contributions to candidates; the rationale is that unlimited contributions may lead to the appearance of corruption, if not actual corruption. In contrast, independent expenditures, which are made without the cooperation or consent of any candidate, do not raise these same concerns.

In 1990, the Supreme Court held that corporations and unions may not engage in independent expenditures. At the time, this wasn't as crippling to speech as it might be, since "campaign speech" then was defined narrowly to be only those communications that expressly advocate for or against a candidate. This left open many close substitutes for campaign speech, including independent issue ads or direct contributions to political parties. Not surprisingly, many groups availed themselves of these means of exercising their free speech rights.

That led to a decade of wailing and handwringing over soft money; then as now, reform advocates argued that democracy was slipping away. In 2002, the McCain-Feingold reform restricted contributions to political parties and added an electioneering communications ban, which redefined campaign speech to include any broadcast that mentions a candidate too near an election.

The Citizens United case is about whether people should be allowed to see "Hillary: the Movie." That particular flick never threatened to be a blockbuster, but should it be illegal? The government argues that the movie, which questions Hillary Clinton's character, is the functional equivalent of campaign speech. If so, where are the limits to this sort of reasoning? What about movies that are more subtle in their pitch, like "They Live" or "Bob Roberts"? What if regulators decide that "Mr. Smith Goes to Washington" is an allegory for Sarah Palin? These are the issues that the court will address in Citizens United; not whether corporations can cut checks directly to candidates.

And some clarification is needed, as the government originally argued that Congress has the power to regulate political books. Popular books by Al Franken, Ann Coulter or candidates themselves, if funded by a corporation, then would be in the purview of FEC regulators.

Reasonable people may wonder how empowering regulators to outlaw books and movies squares with the First Amendment. Especially since there is no scientific evidence that campaign reforms have any real impact on corruption or the appearance of corruption.

In fact, several states allow direct contributions from corporations or unions to candidates; yet there is no evidence that democracy has been undermined Idaho or Virginia. As a state legislator, Barack Obama collected corporate and union contributions; does that make him corrupt?

Reform advocates avoid these issues by recasting "corruption" to mean any political influence. That's how Sen. McCain could claim that our campaign finance system is corrupt, even though he couldn't identify any illegal activity.

But it is a stilted view of democracy that reserves no place for persuasion in political discussion. The original genius of American democracy is that it encourages open and vigorous debate, even when you don't like the speaker.

The amendment would have allowed raises in contribution limits for candidates when their opponents declare an intention to self-fund by more than $350,000. Although Mr. Davis spent more than $3 million of his own money for both races, he lost. Running again this year, Mr. Davis sought relief from the courts in being able to finance his own race without suffering regulatory disadvantage.

Yesterday, he got it.

Justice Alito wrote that the Millionaire's Amendment penalized Mr. Davis's right to spend money on his campaign. In Justice Alito's judgment, the inability of candidates like Mr. Davis to exercise their First Amendment rights "produces fundraising advantages for opponents in the competitive context of electoral politics."

By imposing additional costs on electoral spending, the Millionaire's Amendment leads to less spending and less speech. And while congressmen would love to hear less speech from self-funders, the Court said that the Constitution frowns on their self-serving law.

In 1976, Congress imposed limits on campaign contributions by individuals and organizations. These restrictions were said to prevent corruption — one couldn't give enough money to a candidate in order to buy a favor — or the appearance of corruption. The Supreme Court later decided that such limits could not apply to candidates who funded their own campaigns. After all, a self-funder can't buy favors from himself.

As part of the 2002 Bipartisan Campaign Reform Act (McCain-Feingold's formal name), however, Congress passed a "Millionaire's Amendment," which tried to "level the playing field" for opponents of self-funding candidates. The more a self-funder spent, the higher individual contributions his opponent could receive. And restrictions on coordinated spending of the opponent's political party also evaporated. With loosened limits — a "get out of McCain-Feingold free" card — the opponent could ensure that the self-funder wasn't allowed to "buy a seat" in Congress.

That's not the whole story, of course. Need we tell you that an incumbent congressman's worst fear is a millionaire challenger? Incumbents almost always have more money than their opponents and they also almost always win reelections, and naturally they prefer unfunded challengers and minimal competition. Hence the Millionaire's Amendment.

In floor debates before McCain-Feingold passed, congressmen argued that the amendment was necessary to neutralize the financial advantages of wealthy self-funders, but thankfully, the Court has never accepted a "level playing field" rationale for political speech restrictions.

Some current examples suggest the wisdom of the Court's rejection of "equal speech." Al Franken became famous as a comedian and critic of the Bush administration. Should his celebrity — a formidable asset for his campaign — force television networks that play his material to provide his competitor in Minnesota's senate race with equal airtime? And when newspapers endorse candidates, should government edict force other newspapers to endorse their opponents?

We rely on the judiciary to protect our rights, especially when Congress threatens them, and the courts' job is particularly hard in cases involving political speech. Campaign finance reformers believe money is the root of all evil in politics, and that Congress should be in the business of stamping out this evil. But speaking out on politics — the very freedom the Founders most sought to protect in the First Amendment — demands raising and spending money.

While the Roberts Court appears determined to protect freedom of speech, both presidential candidates have been at least as enthusiastic for limits on campaign speech as Congress has. John McCain, of course, co-sponsored the law that enacted the Millionaire's Amendment. And Barack Obama has spoken of the need for further campaign finance "reform," while nonetheless opting out of the public financing system for the general election.

The Supreme Court has shown considerable courage in defending First Amendment rights. As it's currently composed, the Court might even have struck down McCain-Feingold at its inception. The danger is far from over, but at last, the judiciary is living up to its obligation to protect free speech.

Reformers have long equated public financing with cleaning up elections. But "reformer-in-chief" Obama has realized public financing would reduce his cash advantage over John McCain for the fall election — and opted to rely on private money instead.

But is the good government crowd criticizing Obama? Hardly.

Reformers may not like his decision, but their real reason for demanding restrictions on money in politics was always to help liberals win elections.

Indeed, public financing of campaigns has always been more about partisan politics than the public interest.

Today's system of public funds for presidential candidates was born in 1974, after Republicans had opened up large fund-raising leads over the Democrats in three straight presidential racs. The new rules closed the gap between the parties overnight. Some experts even credit the public-funding mandate with handing Jimmy Carter the 1976 election.

Note that the general public also didn't react strongly to Obama's decision. That's no surprise. Public support for the taxpayer financing of elections has never been strong.

Consider: The money for the presidential system comes from a check-off on tax forms, which ask taxpayers if they'd like to earmark $3 of their taxes for the presidential system. And ever-fewer taxpayers are willing to check off the box to support the system.

In the late 1970s, 28 percent of filers earmarked money for it. The percentage has dropped steadily ever since; it's now well under 10 percent.

Apart for a brief time in the 1970s, public opinion surveys have also indicated that the majority opposes public funding of campaigns.

Nor has the presidential fund shown many benefits. It hasn't even increased the number of candidates entering party primaries — it was about the same in elections before 1976 as after. And the most successful third-party candidate after 1976 — Ross Perot in 1992 — declined public funding, and over the years, the system has produced only a tiny increase in third-party candidates.

Conspiracy theorist Lyndon LaRouche has raised millions for his many runs for the presidency, but few taxpayers would count his campaigns (especially the 1992 one, when he ran from federal prison) as a public benefit.

So taxpayers have spent over a billion dollars funding candidates since 1976, with little evidence that they're getting more or better choices than they had before.

Obama's campaign this year helps show why public financing is obsolete: He has proven that private donors — a large percentage of them giving only small sums — can turn a long shot into a serious contender for the White House.

If Obama can do all this, why should taxpayers be forced to fund campaigns?

Congress ought to loosen existing restrictions on political fund-raising and campaign spending. While they're at it, our representatives should also bring the presidential public-financing boondoggle to a merciful and well-deserved end.

The McCain-Feingold bill, now codified as the Bipartisan Campaign Reform Act, specifies that individuals may contribute a maximum of $4,600 per election campaign to a presidential candidate. The act's prime mover, Sen. John McCain (R-Ariz.), apparently hoisted by his own petard, now wants individuals to donate $70,000 to various fundraising accounts that will find ways to channel the money in his direction. Of course, McCain is not the only presidential candidate who decided to circumvent the Bipartisan Campaign Reform Act. Both President Bush, who signed the legislation, and Sen. John F. Kerry (D-Mass.), who supported it, used similar accounts during the 2004 election.

One of McCain's fundraising accounts raised $317,000 in a single day from a few Wall Street bankers and consultants. Out of each $70,000 contribution, $2,300 will go toward McCain's primary campaign; another $2,300, to his general election campaign; $28,500, to the Republican National Committee, which will spend the money on his behalf; and the rest, to key state committees.

So much for McCain's own 2002 admonition: "It is self-evident that contributions from a single source that run to hundreds of thousands of dollars are not healthy to a democracy." Yes, the accounts are perfectly legal — but only because politicians such as McCain haven't gotten around to closing all the loopholes. Nor could they. Campaign finance reform is like pushing on a balloon: The quantity of air, like the amounts contributed to campaigns, is not diminished; it simply occupies a different space.

Meanwhile, Bill Clinton and Hillary Rodham Clinton reported earning a paltry $109 million over the past eight years, of which $20.4 million was earned in 2007, as the 2008 election season unfolded. Where did the money come from? Well, Bill gets up to a quarter of a million dollars per speech, which has generated nearly half of the $109 million total. Did those who paid such enormous fees expect access and influence in a Clinton II presidency? And what about access and influence for Ronald Burkle, the billionaire investor and supermarket titan whose partnership with Bill Clinton yielded an estimated $12 million to $15 million in advisory fees for the Clinton coffers? Or Vinod Gupta, whose InfoUSA database company threw off another $3.3 million as payment for Bill Clinton's consultations? Gupta, by the way, has been sued by some of his shareholders for improper fees and jet travel related to the Clintons.

Maybe the Clintons are simply exploiting their fame and connections and have promised no political favors. I have seen no evidence that suggests otherwise. Then again, according to the Supreme Court, it's not necessary to prove actual corruption to justify Congress' campaign finance restrictions. The "appearance" of corruption is quite enough. That's what the court held in McConnell v. Federal Election Commission in 2003. Essentially, said the court, preventing the appearance of corruption is a sufficiently important governmental interest for Congress to disregard First Amendment protections of political speech.

But instead of preventing either actual or apparent corruption, the real effect of the regulations upheld in McConnell has been to protect incumbents from upstart challengers. The careers of sitting politicians are more easily perpetuated if the speech of their opponents can be repressed. The architects of modern campaign finance laws have never produced any evidence either of corruption that allegedly results from privately financed campaigns or of wealthy individuals or companies "buying" elections.

Instead, reformers merely assert a litany of potential horribles to rationalize their opposition to the current system. They favor a managed system, one that is managed by their rules, according to their standards, and designed to achieve their ends, which do not include a vigorous and free marketplace for political expression.

As for money in political campaigns, it's just a symptom of two larger problems: too much government power and too much government money that can be doled out to those whom politicians favor.

Overweening government has wormed its way into nearly every aspect of our lives, and our pervasive regulatory and redistributive state creates huge incentives for profiteering. If you want to minimize the influence of big money on officeholders and candidates, the answer is to cut the size and power of government. Until we do that, we need to restore free political speech by razing the ineffective and unconstitutional structure condoned by the Supreme Court in McConnell.

The "Millionaires' Amendment" of the McCain-Feingold law discourages congressional candidates from using their own funds to finance their campaigns. The supposed reason for this blatant restriction on free speech is to prevent people from "buying" a seat in Congress, but its actual effect is to protect officials who've already been elected and who plan to stay that way.

When a candidate decides to run for Congress, he has to file, under penalty of criminal law, a statement of how much he intends to spend out of his own pocket. But if the amount is over $350,000 (less than a quarter of the expected cost of a House race this year), then his opponent -- typically the incumbent -- is allowed not to comply with some of McCain-Feingold's anti-corruption "reforms."

For example, the incumbent enjoys a tripling of the $2,300 individual contribution limit, and a total exemption from the restrictions on coordinating expenditures with the national party.

Moreover, once the "statement of intent" to spend over $350,000 is filed -- or once the limit is reached, if it is reached unexpectedly, which could itself give rise to criminal and civil liability -- then that self-funded candidate has to disclose every expenditure of $10,000 or more to his opponent within 24 hours of spending that money.

This disclosure signals the self-funded candidate's tactics, enabling his opponent to infer and counteract television and radio advertising, leafleting, and the like.

So not only does the opponent of a self-funded candidate (again, almost always the incumbent) enjoy relaxed campaign finance restrictions, he gains a strategic advantage over his hapless challenger!

And remember, $350,000 -- a figure set in 2002 and not indexed to inflation -- simply does not go far in competitive races. Especially when you're running against an incumbent who has built up a war chest, which doesn't count for calculating the "gross receipts differential" at the heart of the convoluted formula used to determine the extent to which the opponent can use the relaxed contribution and coordination limits.

Not to mention the other inherent advantages of incumbency: greater name recognition, "franking" privileges to get your message out to constituents without mailing costs, the ability to gain publicity by securing earmarks and otherwise going about your "public service," and, of course, taxpayer-funded travel home.

So instead of "leveling the playing field" between candidates for office, the Millionaires' Amendment further tilts it the incumbents' way. That's the other unfortunate aspect of this mess: Not only is this tremendously complex regulation bad policy, it's also unconstitutional.

First, the provision burdens the exercise of political campaign speech without serving any compelling governmental interest. By enhancing the political speech of a self-funded candidate's opponent -- through the increased contribution limits and unlimited coordinated party expenditures -- it creates a de facto expenditure limit, in essence restricting speech beyond the $350,000 threshold. The Supreme Court ruled in the famous 1976 case of Buckley v. Valeo that expenditure limits were unconstitutional.

Second, the Millionaires' Amendment does not prevent actual or apparent corruption because there is no threat of a quid pro quo from a candidate spending his own funds. The provision actually undermines the stated interest in combating corruption by preventing candidates from reducing their dependence on outside contributions -- and increasing their opponents' purportedly corrupt contributions and coordinated expenditures.

Finally, the compelled disclosure requirements further penalize candidates for exercising their right to engage in political discourse by imposing significant personal liability on them. The disclosure requirements also infringe on a candidate's First Amendment right not to associate with campaign contributors. And they do so without serving any informational interest the public may have, because the underlying information is already disclosed to the FEC under other McCain-Feingold requirements.

In short, the "Millionaires' Amendment" is nothing more than incumbency protection disguised as a good-faith effort to cleanse our political system, much like most campaign finance "reform."

McCain and Obama have long boasted of their support for aggressive regulation of money in politics. But now each would love to avoid taking public money. In that irony lies a lesson about campaign-finance "reform."

The presidential public-funding system dates to 1974, after President Richard Nixon resigned. At the time, Democrats held large majorities in Congress, but their presidential candidates faced serious funding challenges.

Since 1960, GOP presidential candidates had opened up a growing fund-raising lead over Democrats. If that trend had continued, Republican presidential candidates would be raising many times the sums raised by Democratic ones in 1976 and beyond. Public financing put an end to that threat.

The law offers equal sums to both major-party candidates for the fall campaign - so long as they don't raise money from private contributors. That imposed an equality of funding, stopping the growing GOP edge.

In other words, for all the talk of "reform" and corruption, regulations of campaign finance in fact are all about manipulating elections to boost specific interests. (In '74, it was Democrats in the presidential arena. Other "reform" laws have greatly benefited incumbents of both parties, at the expense of challengers. Still others, like recent New York City laws, boost labor unions' political power at the expense of businesses'.)

Back to the '08 race. Sen. McCain started his White House bid with private financing but ran out of cash last June. To keep going, he sought to qualify for public funding for the primary phase of the campaign - and used the possibility of such money as collateral for a loan.

That move got him through. McCain now is the sure GOP nominee. But it puts him in a bind as he looks toward the general election. If he's trapped in the public-funding system, he can can spend only $4 million more between now and the Republican convention. That's far too little to keep his message before the public.

And it's a disaster for him. Barack Obama and Hillary Clinton have turned out to be extraordinary fund-raisers - and opted out of the public system for the primaries. If either captures the nomination soon, he or she can keep raising and spending private money all spring and summer long. McCain might well have lost the fall race before he receives more public money after the Republican convention.

Not surprising, McCain desperately wants out of the public system. (And since he hasn't actually received any public funds yet, he may be able to escape.)

Obama, meanwhile, is eager to escape the public system for the general election, the phase that begins after the conventions. He promised last year to take public financing if the GOP nominee did - but he's now learned that he could vastly outraise McCain in the private sector.

The American public plainly shares this cynical view of our supposely "clean" public-finance system. In recent years, only about 6 percent of federal tax filers have checked off the box that directs $3 from their payment to the presidential campaign fund.

That's a 94-6 vote of no confidence in the system.

The system of public funding - and heavy regulation of private giving - for political candidates has its sincere defenders, people who believe democracy demands it.

But the facts speak for themselves. The system was enacted for partisan gain, not for lofty public purposes. And now two of its strongest supporters are looking to game the system - to escape public funding and rely on private cash - because it's in their clear self-interest.

It's time to end the wretched pretense that this system serves democracy.

But the last year has brought better news. In a Vermont case, the Court affirmed that spending limits violated the Constitution and that low contribution limits could also impinge on First Amendment freedoms. Now the Roberts Court has given us its decision in Federal Election Commission v. Wisconsin Right to Life. Sometimes nice gifts come with strange names.

McCain-Feingold made it a federal crime for any corporation to broadcast, 30 to 60 days before an election, any communication that mentions a federal candidate for elected office and is aimed at relevant voters. Wisconsin Right to Life (WRTL) is an ideological corporation that accepted funding from other corporations. Its members wanted to run ads in 2004 urging citizens of their state to contact its two senators and urge them to oppose a filibuster of judicial nominees. Sen. Russ Feingold, one of the senators and a co-author of the law in question, was running for reelection. Wisconsin Right to Life's advertising plans thus constituted a federal crime. At least, they were a crime if the relevant part of McCain-Feingold was constitutional as applied to WRTL.

In fact, McCain-Feingold was constitutionally invalid in this case and probably many others. To understand why requires a quick summary of campaign-finance law.

Congress long ago prohibited contributions to candidates from the general treasuries of corporations and labor unions. But corporations could fund ads commenting on the issues of the day. However, if those ads directly advocated the election or defeat of a candidate, they became an attempt to circumvent the ban on corporate contributions and thus a federal crime. In Buckley v. Valeo, the Court said such "express advocacy" contained words like "elect" and "defeat." If an ad did not use the words, it was not express advocacy and hence, not subject to campaign-finance regulation.

In the 1990s some businesses and labor unions started funding advertising that met the legal standards for issue advocacy. The ads were legal and often highly critical of vulnerable members of Congress in the run up to an election. McCain-Feingold made such speech illegal. It said corporations could not fund ads that mentioned a candidate for federal office with 30 to 60 days of an election. The McConnell Court went along arguing that the ads in question were the "functional equivalent of express advocacy."

In the WRTL decision, Justice Roberts has contracted rather than expanded the scope of government regulation. He has done so by redefining the meaning of express advocacy: "a court should find that an ad is the functional equivalent of express advocacy only if the ad is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate." The WRTL ad seemed to a reasonable person to be attempt at grassroots organizing. Hence, WRTL wins.

But this standard implicates more than this case. Many of the ads in the 1990s that were the target of McCain-Feingold might have been free of regulation under this standard. Reasonable people could have believed that the ads were attempts to persuade voters to contact their representatives. The political space free of government regulation seems to have expanded. Indeed, it seems possible that many fewer ads will be judged the "functional equivalent of express advocacy" in the future.

So, the good guys won one at last. "Enough is enough," as Justice Roberts writes in considering efforts to further expand regulatory control of politics.

But still there is reason to worry. The majority did not declare the relevant part of McCain-Feingold unconstitutional. Justice Alito did suggest a willingness to hear constitutional challenges to the McConnell decision (and hence, to McCain-Feingold). Justice Roberts also set out some criteria for the "express advocacy" that are fairly broad. An ad that mentions "an election, candidacy, political party, or challenger; or [that takes] a position on a candidate's character, qualifications, or fitness for office" could become express advocacy depending on future judgments by the Court and perhaps, by the Federal Election Commission. An important battle has been won. The war continues.

The WRTL decision adds to Sen. McCain's misery. His presidential campaign has been floundering for some time. The value of a McCain share at the Iowa Electronic Market has dropped by more than fifty percent in the last month. He now trails the other three major candidates by a long way; Fred Thompson's share is worth three times McCain's. Investors are telling us that there is about a 5 percent chance McCain will win the presidency next year. Now his vaunted law may not matter very much in reality even if it remains more or less constitutional. Moreover, the corporations and labor unions harmed by McCain-Feingold may now be able to run ads during the 2008 primaries. If McCain's campaign survives into the primaries, he may find that turnabout is indeed fair play.

Shortly after the numbers became public, predictable laments began. The presidential candidates supposedly had been bought by the highest bidder - they were, in the words of a Washington Post editorial, "beholden to well-connected financiers." But the truth is exactly the opposite.

In fact, money follows the message of a candidate and his or her prospects for winning the presidency. That is especially clear with Obama, who emerged from nowhere to raise $25 million by offering hope and charisma to Democratic activists starving for both.

Critics also complain that the public doesn't get a chance to hear the messages of candidates who can't raise sufficient funds to make a race. But when Tom Vilsack, the former Iowa governor, dropped out of the Democratic race for lack of funding, party activists had heard Vilsack's pitch - and decided not to support him. Either they didn't like his message or they thought he'd be a weaker candidate than his competitors for the nomination.

People also worry that we are spending ever-larger sums on presidential campaigns: Overall, the candidates and parties are expected to spend over $1 billion on the 2008 primaries and general election - a sum that, taken alone, is unimaginable for most people.

But put that $1 billion in perspective: The next president will strongly influence how the federal government raises some $12 trillion in taxes over the next four years. And discretionary federal spending - that is, discounting "automatic pilot" programs like Social security - during those years will total about $3 trillion.

Spending $1 billion to keep voters informed about candidates who'll help manage trillions seems like a pittance - without even considering the fact that he or she will also make countless life-or-death decisions, not least by becoming commander-in-chief when the nation is at war.

Aren't the candidates setting fund-raising rec- ords? Yes, but that's not surprising.

Generally speaking, Americans spend about the same proportion of national wealth on each presidential election. Since the economy grows continually, each presidential election tends to set a record for campaign spending.

Spending for the 2008 race may grow even faster since both parties have wide-open races. Open contests usually attract more candidates, who raise more money. Record spending thus corresponds to record competition for the nominations of the two parties. This strong competition is a reason to celebrate, not to lament, the state of American democracy.

Indeed, studies have shown that more spending on elections means better-informed voters. John Coleman of the University of Wisconsin compared contests for congressional seats - and found that voters were better informed about the candidates in the most expensive races. He also discovered that spending helped the "information poor" voters more than it did the "information rich." That is, those who knew less about the candidates and the issues gained more information from high spending than did voters who were already well informed.

Consider, too, that this year's record fund-raising reflects the free choices of many individuals. It is a serious choice demanding a real sacrifice in money in support of their hopes for the nation. Americans have a right to give to the candidate or party of their choice or not to give at all.

Those who complain about record fund-raising often recommend government financing of campaigns - as in the partial public funding for U.S. presidential elections. In such systems, the government taxes citizens to provide funding for candidates and political parties.

This offends liberty twice: Taxes are not voluntary, and everyone is forced to fund candidates and causes they deplore. Those who prefer not to give at all are forced to do so. Not surprising, only 7 percent of Americans support the U.S. system of taxpayer financing of presidential campaigns.

In short, record fund-raising is cause for celebration, not concern. It informs voters, fosters competition and indicates support for candidates.

Most of all, it shows that Americans are free to support the candidates and ideas of their choice. That's a freedom well worth preserving.

If Mr. Shays survives his November rematch against Ms. Farrell, he will owe his political life to a moderate voting record, independence from the Republican leadership, pork spending and, perhaps most important, the McCain-Feingold campaign finance law, which he co-sponsored and championed in the House of Representatives.

Before McCain-Feingold, vulnerable incumbents like Mr. Shays faced two significant dangers to their re-election: the first was so-called "soft money," the unregulated funds allowed for party building. Soft money, ostensibly intended to nurture party grassroots, frequently ended up financing party attack ads in hotly contested districts like the Fourth. In 2002, for example, the national parties channeled a total of more than $3 million in soft money into television advertising directed at voters in one such district in Pennsylvania.

The second danger was embodied by unaffiliated but essentially partisan outside groups, often tied to labor unions, business interests or special-interest groups focused on issues like the environment, guns or abortion. These groups also were willing and able to finance ads criticizing sitting members of Congress.

McCain-Feingold effectively eliminated both threats. The law virtually prohibited soft money fund-raising and prevented unions and corporations alike from paying for attack ads during the 60 days before an election — in other words, the time during which most voters begin paying attention. Mr. Shays, in trouble now, would almost certainly face defeat without these McCain-Feingold prohibitions on spending.

Diane Farrell, in contrast, would probably be on her way to victory had McCain-Feingold not become law. From 1998 to 2002, the national Democratic Party raised as much soft money as the Republicans. Labor unions and other groups affiliated with the Democrats were well financed and active in campaigns. Without McCain-Feingold, both the national party and the affiliated groups would have ample resources to attack Mr. Shays and support Ms. Farrell.

Under McCain-Feingold, however, the Republican National Committee is expected to spend five times more than its Democratic counterpart While the two parties' Congressional campaign committees have raised similar amounts, the Republicans' overall superiority in fund-raising gives them a distinct advantage. Ms. Farrell may win in spite of it, but other Democratic challengers who lose tight races will have a legitimate claim that McCain-Feingold contributed to their defeat.

The law undermines Democrats in more subtle ways, as well. In 2004, Democratic partisans circumvented the ban on party fund-raising by exploiting a loophole in the law that enabled groups, called 527's after the applicable section of the tax code, to raise and spend several hundred million dollars. Yet these 527's were not part of the Democratic Party; they could not legally coordinate with party leaders or committees.

Consequently, the Democrats couldn't incorporate 527 fund-raising and spending into their 2004 strategy and the party became less a single-minded organization seeking electoral victory and more an assembly of groups pursuing similar aims in disparate ways. The Democrats did achieve a record turnout in 2004, but the highly organized Republican Party (which largely avoided 527's) did even better by integrating their strategy with their abundant party funds.

Chris Shays may face some opposition from groups unaffiliated with the Democratic Party. But such efforts will probably prove less effective than an integrated Democratic attack financed by soft money.

McCain-Feingold has also pitted current Democrats' hopes against their long-term aspirations. Howard Dean, chairman of the Democratic National Committee, and Rahm Emanuel, the chairman of the Democratic Congressional Campaign Committee, have fought bitterly over the allocation of party resources.

Mr. Dean wants to build up the party throughout the nation, branching out in states where the Democrats are now weak. Mr. Emanuel argues that the future is now, and that Democrats should spend their money to win a Congressional majority in November. Mr. Dean appears to have won the battle, perhaps at the cost of dimming Democratic prospects this year. If party soft money still existed, however, the Democrats would probably have had sufficient resources to finance both their 2006 effort and their party building for the future.

More than 90 percent of Democrats in Congress voted for McCain-Feingold in 2002. That's not surprising. Democratic activists support campaign finance reform without much thought about its electoral consequences. But at the time, Democratic leaders like Tom Daschle worried that the law, especially the soft money ban, would particularly hurt Democrats. Now we see why. If Chris Shays and other vulnerable Republicans return to Congress in January, they will have McCain-Feingold to thank.

You might be surprised to learn that lobbying like this is illegal at all. The First Amendment prevents Congress from abridging freedom of speech or the right "to petition the government for redress of grievances." So urging fellow citizens to contact their senators about issues on which you feel strongly seems like a fundamental right. But there are caveats.

In 2004, Wisconsin Right to Life, a pro-life organization, produced several television ads appealing to Wisconsin residents to ask their senators not to filibuster President Bush's judicial nominees. One of those senators, Russell Feingold, was running for re-election in 2004, which meant—under the McCain-Feingold law, co-sponsored by Feingold himself—that airing the ads would have been illegal.

The same year, the ACLU sponsored radio ads opposing parts of a homeland security bill that affected immigrants. If those ads had been run in Wisconsin and had mentioned Feingold, they too would have been illegal.

How could this be? In 2002, McCain-Feingold stipulated that broadcast ads that mentioned a candidate for federal office less than two months before a general election were subject to federal campaign finance law.

Though they retained some First Amendment rights, labor unions and corporations have been prohibited for some time from contributing directly to candidates for federal office. Until 2002, they like everyone else had a right to sponsor ads concerning public issues and run them at a time of their choosing. Not surprisingly, they ran many of their ads near election day.

And why shouldn't they? The public debates that inform voter choice inevitably involve issues and candidates. Much of the advertising blocked by McCain-Feingold—though hardly all—reflected poorly on incumbent members of Congress. Without such criticism and the debates it engenders, elections would hardly have any point.

Members of Congress, however, do not take threats to their re-election lightly. In passing McCain-Feingold, they required labor unions, corporations, and other groups to stop funding ads that threatened members of Congress at the moment the ads mattered most.

Sadly, the U.S. Supreme Court upheld this blow to free speech in a 2003 ruling that left groups like WRTL and the ACLU in the same boat as unions and corporations.

In spite of their desire to deflect criticism, a majority of Congressmen would probably support exemptions for the speech of groups like WRTL and the ACLU. Vermont senator James Jeffords, who wrote part of McCain-Feingold, stated in 2002 that it "will not affect the ability of any organization to urge grassroots contacts with lawmakers on upcoming votes."

The law already has certain exemptions for news stories, commentaries and editorials, as well as speech on the Internet. Grassroots lobbying of the public, however, is not exempt. It should be.

Campaign finance laws are often intended to help or hurt political parties or sets of candidates seeking office. In votes on matters of procedure, the FEC sometimes splits along party lines. In this case, partisan concerns are irrelevant. As the examples of the WRTL and ACLU show, the benefits of freeing up grassroots lobbying will fall across the political spectrum.

Let's not forget what is at stake here. A Republican member of the FEC, Hans A. von Spakovsky, noted recently that "the right of citizens to petition the government was deemed so fundamental and of such central importance that it formed the basis for the American Revolution." Indeed, the right is older than the United States itself. The 1688 Declaration of Rights in England insisted upon the people's right to petition king and parliament for redress of grievances.

Many Americans supported McCain-Feingold in the hope that it would prevent corruption of politics. Their concern is understandable. However, efforts to educate citizens on the issues facing them can hardly corrupt our political life. To the contrary, those efforts make our political decisions more informed. Like citizens, grassroots groups have a right to petition the government, and the FEC should vote to restore it.

Taxpayer financing often involves further limiting private contributions and restricting independent spending by anyone other than the candidates and the two major political parties. Such restrictions are inherent in public funding; without them, candidates would reject public funding for fear of being outspent by their opponents. Advocates say public financing brings more electoral competition, giving voters more choices, but most studies indicate such programs have not increased competition in state elections.

They might also have other unwanted effects. Jeffrey Milyo, of the University of Missouri-Columbia, and David Primo, of the University of Rochester, studied gubernatorial races and found public financing was associated with lower trust in government. This is not surprising considering that polls show little support for taxpayer campaign financing, and that the number of people who support the presidential public funding program on their tax returns has dwindled to 11%.

Advocates also argue that private contributions corrupt government, implying that taxpayers should replace private donors. Professors Stephen Ansolabehere and James Snyder of MIT examined more than 40 academic studies and concluded that private contributions have little influence.

There is a larger issue here: Few Americans believe the government should control the financing of newspapers and television because public funding of the media would enable public officials to restrict or even eliminate spending on ideas that challenged the political status quo. Complete public financing of campaigns would pose the same danger to candidates and causes — the very sources of change and choice. Private funding of private political activity is thus vital to our limited and democratic government.

Arguments for and against the legislation have focused on issues like transparency and the potential for corruption. It is surprising then that neither side has thought to take a look at the rich body of existing evidence from the scholarly research on American politics. In fact, there is no evidence to support the claim that campaign finance rules have any impact on political corruption. The most recent research shows that restrictions on campaign financing have either no effect or a perverse impact on the public's faith in state government.

Often lost in the debate over campaign finance proposals is the simple fact that giving money to support candidates and causes is a fundamental way for people to participate in politics. That's a good thing in a democracy. It is a liberty that is good in itself and an effective way to make the government more accountable. Ordinary citizens ought to be wary when politicians propose limiting their freedom to engage in politics.

The typical retort to this is that ordinary citizens are shut out of the political process when moneyed special interests dominate. Once again, this ignores recent social scientific research that demonstrates that more money in politics is associated with more campaigning and advertising, which in turn leads to a better informed and more interested electorate, and increased voter turnout.

Also, there is no evidence to suggest that public policy is skewed toward the wealthy or to big business when unlimited contributions are allowed. This may seem counterintuitive at first, but for every interest on one side of an issue, there's always an interest on the opposite side. And what are interest groups but the vehicles by which ordinary citizens band together to petition government and make their voices heard?

Contribution limits also make it harder for potential candidates to raise the money necessary to run for office. Several recent studies suggest that the ease of raising campaign funds is an important determinant of the number of contested elections in a state. Contribution limits are one way that the people already in office try to reduce the competition for their jobs. And the less competition there is for political offices, the less elected representatives have to be concerned about representing their constituents.

In Missouri, contribution limits also had unintended and unfortunate results. Restricting donations to candidates does not restrict the desire for people to engage in electoral politics. After all, we live at a time when government is involved in almost everything. What elected officials do about taxes or regulations matters a lot. Limited in their donations to candidates, political donors turned to giving to local political party committees or other groups which then supported candidates or ran their own advertisements.

That's hardly a terrible outcome. Parties play an important role in our elections. But by forcing donors to give in a roundabout way, the law prevents citizens from directly supporting their preferred candidates. It also makes it more difficult to say where money came from and where it went in Missouri elections.

The new legislation separates the work of candidates and parties. Candidates raise money to run for office while the parties provide in-kind help (polling, phone banks, consulting and so on) for their candidates. This division makes candidates accountable for their fundraising, so voters will know if a candidate has received large donations from a source with a particular interest. And candidates can make an issue out of troubling contributions to their opponents. Voters can then decide to cast their ballot for or against the candidate who received the donation in question. Such open debate is a cornerstone of democracy, and a hallmark of liberty.

Some opponents say enacting House bill 1900 will turn Missouri into another Illinois. Missouri's neighboring state does not have limits on contributions and has suffered several corruption scandals involving vote fraud, bribery, and obstruction of justice. But campaign contributions are not bribes, not least because they will be public knowledge in Missouri; no elected official wants to be seen as a sellout, lest he be voted out. And decades of study confirm this: political contributions simply do not sway politicians' opinions. Instead contributions are the means by which donors support like-minded persons, and there's nothing illegal or immoral about that.

He might have been talking about limiting the federal government, controlling entitlement spending, federalism or a realistic foreign policy. In fact, he was talking about free speech. House Republicans have now voted to prohibit certain political organizations (called 527 groups).

Where did my friend get the idea that Republicans believed in free speech? Maybe he first heard the idea from President George H.W. Bush who vetoed a 1992 campaign finance bill passed by a Democrat Congress. That President Bush said the bill was nothing more than incumbent protection as well as a violation of freedom of speech.

Perhaps my friend listened to Republican leaders throughout the 1990s who said time and again that the various versions of the McCain-Feingold campaign finance law contravened the First Amendment. Or maybe my friend watched in 2002 as 80 percent of Republicans in the House and the U.S. Senate voted against McCain-Feingold.

But times change and political reality has a tendency to relativize principles. In 2004, George Soros, a wealthy man of liberal sympathies, spent tens of millions of dollars of his own money trying to defeat President Bush. A few other rich liberals spent similar sums, primarily through 527 organizations. A small number of Republican donors used the 527 vehicle to expend much smaller sums to defeat Sen. John Kerry. The most famous of the Republican groups was the Swift Boat Veterans for Truth. Overall, Democratic 527s outspent Republican groups by four to one.

The 527s did not spend much in 2004 on congressional races. But the groups could get involved in the 2006 elections, and House Republicans, already shaken by scandals and low approval ratings for President Bush, are not in a mood to take chances.

You might think House Republicans have little reason to fear electoral defeat; after all, 98.5 percent of incumbents win re-election. But they don't see it that way. Many members "run scared" for re-election, and their worst fear is someone like Soros showing up in their district with a few hundred thousand dollars to spend on attack ads.

The threat is not just from the left. At least one 527 group spent modest sums supporting conservative candidates running in GOP primaries against liberal Republican incumbents.

So it is that the Republicans have learned the limits of free speech and the virtues of restricting the corrupting influence of "Big Money" in our politics. There's just one problem with that flip-flop. Money must be given to public officials to corrupt the political process. Money given to consultants and marketing companies to spread ideas cannot corrupt our elections or Congress. To be sure, the 527s of all stripes had political agendas, and George Soros was no doubt on an ideological crusade in 2004. However, under the U.S. Constitution, whether a majority of Congress or anyone else likes or loathes Soros' crusade matters not at all. He has a right to spend his money spreading political ideas.

Some Republicans no doubt feel the Democrats deserve the 527 ban. After all, Democrats spent the better part of two decades passing and trying to pass campaign finance laws designed to harm Republican campaigns. For Democrats the chickens of the 1970s and the 1980s have come home to roost. But no one deserves to have their political rights restricted for partisan advantage. The Republicans didn't deserve it in 1974, and the Democrats don't deserve it now.

Proponents of measures to make independent section 527 organizations into "political committees" under the Federal Election Campaign Act, subjecting the organizations federal campaign limits and reporting requirements, misunderstand both the role and result of regulation in campaigns and the jurisprudence in this area.

Such measures would leave much activity unregulated and would induce a shift of activity from one legal structure to another, thus rendering any perceived partisan advantage arising from the measures improbable or incalculable.

Organizations engaged in independent speech and association with no connection to candidates or officeholders cannot be made to register with the Federal Election Commission simply because they mention candidates; and they cannot be limited in the financial contributions they may receive for their independent communications. Independent organizations do not corrupt the legislative process. They are not corrupting the balloting process. They are a part of, not corrupters of, the information exchange process in and around elections.

That politicians and party chairmen on both sides of the aisle favor restricting the speech of independent organizations on vaguely egalitarian grounds ignores the Supreme Court's clear instruction that limiting the voice of some to enhance the relative voice of others is foreign to the First Amendment. The instrumental value of this maxim is backed by data. Studies show that more speech in campaigns, not less, benefits voters of all socio-economic backgrounds.

But McCarthy's upstart campaign managed to lose and to win the New Hampshire primary. By getting 42 percent of the vote (and holding LBJ under 50 percent), McCarthy paved the way for Johnson's withdrawal from the race. Incumbents are still expected to win their re-election bids. Incumbents still have an advantage in running for re-election. What is missing now are challengers coming out of nowhere to challenge the status quo.

Eugene McCarthy's campaign depended on two factors, shifting public opinion and money. Public support for the Vietnam War remained strong for a longer time than we now remember. Only in the fall of 1968 were a majority of Americans willing to say that the Vietnam effort had been a mistake.

McCarthy sensed that his campaign could represent an emerging public sentiment against the war. But to enter the race for the presidency, he needed more than a message, more even than the volunteers that flocked to him that spring.

McCarthy needed money to finance his campaign. He got it. McCarthy received several six-figure donations from affluent individuals deeply opposed to the war in Vietnam. Herbert Alexander, a leading campaign finance expert, estimates that about one-third of McCarthy's total fundraising in 1968 came from just 50 large donors. David Hoeh, the organizer of McCarthy's New Hampshire campaign, recalled later that a single "financial angel" saved their media effort at a crucial point.

McCarthy spent the money effectively in spreading his anti-war message. The McCarthy campaign devoted $110,000 to radio and television in New Hampshire and over $150,000 on all communications media in that primary. That does not seem like much today. In those days such sums were large enough to get McCarthy into the presidential game, large enough to all but defeat a sitting president, and begin the winding down of the Vietnam War.

McCarthy's campaign made a difference in that year of living dangerously, 1968. It thus attracted attention, not all of it welcome. Many love competition more in theory than in practice. McCarthy had shown the electoral potential of television backed by political contributions in service to a political message. McCarthy had, in short, threatened the political status quo.

Congress moved quickly to deal with the threat. Early 1969, legislation limiting campaign spending on television and other broadcasting outlets appeared in Congress and was passed in 1970 (President Nixon vetoed it) and 1971.

The purpose of the law was clear. If the campaign finance law of 1971 had been in effect in 1968, McCarthy would have been required to spend 80 percent less on the media in the New Hampshire primary. Congress had, as one member put it, "tamed the television monster." More concretely, Congress had tried to make sure no more Eugene McCarthys rose up to challenge the status quo.

After Watergate, Congress replaced the limits on broadcast spending with more general spending limits, which the Supreme Court voided in the case of Buckley v. Valeo (McCarthy was a plaintiff against the limits). Contribution limits, a weaker way to same end of suppressing competition, received judicial blessing.

In our time the men who supported McCarthy's 1968 effort would be liable for the crime of contributing too much money to a political campaign. Not surprisingly we have many fewer upstart campaigns like McCarthy's and 98 percent of incumbents win their bids to be re-elected to Congress.

McCarthy himself believed that campaign finance restrictions complicated the lives of candidates and their supporters, increased the influence of special interests, and ultimately made lawbreakers out of people seeking to exercise their right to political association. Most of such laws, he said, violated the Constitution while upholding the privileged status of the major parties. His opposition to campaign finance law was, he explained near the end of his life, a "free speech kind of thing."

Indeed it was. Contrarian and principled. A Gene McCarthy kind of thing.]]> Thu, 15 Dec 2005 00:00:00 EST http://www.cato.org/pub_display.php?pub_id=5331 http://www.cato.org/pub_display.php?pub_id=5381 insulates incumbents from tough reelection fights and hence prevents the very ballot box competition necessary to ensure Vermont officials serve the general public.]]> Wed, 14 Dec 2005 00:00:00 EST http://www.cato.org/pub_display.php?pub_id=5381