Mr. Chairman, distinguished members of the committee:
My name is Roger Pilon. I am a senior fellow at the CatoInstitute and the director of Cato's Center for ConstitutionalStudies.
I want to thank you Mr. Chairman for inviting me to testify onthe important question of whether the federal election campaignfinance reforms that have been under consideration this year inCongress are constitutional. I regret to say that too many inCongress have raised that question--when they have raised it atall--almost as an afterthought.
That is a striking statement about political life in Americatoday, of course. In a constitutional republic such as ours, wherethe Constitution not only authorizes but limits government, oneshould expect constitutional questions to come first. Thosequestions are: (1) Does Congress have the power to do what someamong it want done? and (2), If so, can that be done consistentwith the rights of the American people? Those questions will guidemy analysis here.
Plainly, in Article I, section 4, and Article II, section 1, theConstitution authorizes Congress to regulate federal elections.But, just as plainly, that regulation must conform to restraintsimposed by the First Amendment to the Constitution. And here, theSupreme Court has said repeatedly that, under the First Amendment,campaign contributions and expenditures are protected speech.
Thus, more precisely, the Court has said that regulations ofpolitical contributions and expenditures will be upheld only ifthey achieve a compelling governmental interest by the leastrestrictive means--the most difficult of constitutional hurdles.Recently, the Cato Institute published two studies--one byProfessor Lillian R. BeVier of the University of Virginia School ofLaw,  the other co-authored byattorneys Douglas Johnson of the National Right to Life Committeeand Mike Beard of the Coalition to Stop Gun Violence --both of which conclude that the campaignfinance reform proposals currently before Congress will not passconstitutional muster. Because I find the arguments and conclusionsof those studies compelling, I will simply summarize them here.
Modern federal election campaign finance regulation stems fromthe Federal Election Campaign Act of 1971 (FECA), as amended in1974.  Two years later, in thelandmark case of Buckley v. Valeo,  the Supreme Court struck down many of the1974 revisions as impermissible under the First Amendment.
Since then the Federal Election Commission (FEC) has fought toclose the perceived "loopholes" created by Buckley. Inresponse, the Court has repeatedly held that the First Amendment isnot a loophole.  Most recently, theCourt held 7 to 2 in Colorado Republican Federal CampaignCommittee v. FEC  thatindependent expenditures by political parties cannot be limited byCongress. Then in April of this year, as if to underscore the longseries of cases since Buckley, the Fourth Circuit took theextraordinary step of ordering the FEC to pay the legal feesincurred by the Christian Action Network in defending itself froman FEC lawsuit. 
Yet despite that string of cases, now spanning more than twodecades,  many in Congress persist inbelieving that they have the power to restrict what the FirstAmendment was plainly written and meant to protect. Thus, it isworth examining, if only in outline, just why the Constitution doesnot permit such restrictions. 
As the Court held in Buckley, to be constitutional,campaign finance regulations must not violate basic principles ofpolitical freedom and free political speech recognized andprotected by the First Amendment. The plaintiffs inBuckley had challenged FECA's stringent limitations on theamounts of money individuals could contribute to and spend oncampaigns for federal office and the act's provisions for publicfunding of presidential candidates who agreed to abide by spendinglimits during their campaigns. The Court sustained the provisionsfor public funding of presidential campaigns and the contributionlimitations. It invalidated the expenditure limitations.
A "major purpose" of the First Amendment, the BuckleyCourt said, was "to protect the free discussion of governmentalaffairs." In that regard, contribution and expenditure limitations"operate in an area of the most fundamental First Amendmentactivities."  Thus, limitations aresubject to strict judicial scrutiny: they must serve a "compellingstate interest" employing the "least restrictive means."
Applying that strict standard of review, the BuckleyCourt distinguished limits on contributionsto campaigns and limits on expenditures bycitizens and candidates. Contribution limits, said the Court,entail "only a marginal restriction on the contributor's ability toengage in free communication" because "the transformation of contributions into political debateinvolves speech by someone other than the contributor."  Expenditure limits, by contrast, "representsubstantial rather than merely theoretical restraints on thequality and diversity of political speech." 
Whether that distinction will itself withstand strict scrutinyhas been a matter of no small debate. In fact, in the recentColorado case, Justice Thomas joined the many critics whowould give contributions the same protection expenditures enjoy.Thus, the Court may one day revisit its distinction. In themeantime, it has upheld contribution limitations if their purposeis the compelling one of preventing corruption--"the attempt tosecure a political quid pro quo from current or potentialofficeholders" --or the appearanceof corruption. In fact, the Court has since said that preventingcorruption or the appearance of corruption remains the "singlenarrow exception to the rule that limits on political activity" arecontrary to the First Amendment. 
Applying Buckleyto Current Proposals
Since the Buckley Court agreed unanimously thatcampaign finance regulations implicate protected First Amendmentrights, the basic questions in applying Buckley and itsprogeny are whether the interests the government asserts by way ofjustifying a given measure are compelling and whether the leastrestrictive means have been employed to secure those interests.Although applying "strict scrutiny" to the proposals presentlybefore Congress is not an exact science, the result of doing soshould be relatively clear: if Congress enacts the measures nowbefore it, the Court is not likely to uphold them. Let us lookbriefly at those measures, treating them generically.
The PAC Ban. Those who advocate banningPolitical Action Committees, or "PACs," ordinarily invoke vagueconcerns about "big money" and "special interests," the implicationbeing that such PACs unduly influence elections in order to advancetheir own narrow ends. Never mind that PACs arose in the firstplace as a result of the 1974 FECA restrictions; never mind alsothat empirical studies show that such contributions rarely buyelections, much less the votes of incumbents once in office: the rationales given by PAC banadvocates simply do not amount to the prevention of corruption asthe Court has strictly defined it--a financial quid pro quo,dollars for political favors. Moreover, even if a PAC ban could bejustified as serving a compelling governmental interest along thelines the Court has established, the means employed, far from beingnarrowly tailored, are grossly overinclusive. In a word, people andorganizations have a right to join together to enhance theirpolitical voices. Prohibiting such activities strikes at the veryheart of the First Amendment.
The PAC Ban Fallback. Assuming that aPAC ban would be found unconstitutional, reformers have advocated anumber of fallback proposals, including lowering the permissibleamount of PAC contributions from $5,000 to $1,000 per election andprohibiting PAC contributions that raise a candidate's PAC receiptsabove 20 percent of campaign expenditure ceilings. Here too,however, the same constitutional infirmities arise. Lowering PACcontributions allegedly serves the same interests as eliminatingthem, yet in neither case are those interests compelling. Moreover,the means are again not narrowly tailored. Indeed, it is difficultto identify any interest--other than incumbency protection--that isserved by making it more rather than less difficult for candidatesto raise money.
It should be noted, however, that the Buckley Court,even as it upheld the particular contribution limits at issue,"cautioned . . . that if the contribution limits were too low, thelimits could be unconstitutional." Many have argued that the current $5,000 limit, upheld in 1976, haslong been too low to be any longer constitutional.
Finally, the attempt to redefine "independent expenditure"--and,in particular, to redefine "express advocacy" so as to include anyand all partisan communications--runs flatly counter to theBuckley Court's explicit effort to immunize issue advocacyfrom regulation or restriction: "So long as persons or groupseschew expenditures that in express terms advocatethe election or defeat of a clearly identified candidate,they are free to spend as much as they want to promote thecandidate and his views." 
"Voluntary" Spending Limits. Becausemandatory spending limits face an impenetrable constitutional wall,reformers have proposed various "voluntary" limits that a candidatewould abide by in exchange for such benefits as "free" orreduced-rate television time, reduced mailing rates, raisedcontribution or expenditure ceilings, and the like--all in the nameof "leveling" the playing field. The Court has given such proposalsshort shrift. Indeed, the Eighth Circuit recently noted whenevaluating analogous state provisions that one is "hard-pressed todiscern how the interests of good government could possibly beserved by campaign expenditure laws that necessarily have theeffect of limiting the quantity of political speech in whichcandidates for public office are allowed to engage."  Far from leveling the playing field, suchlimits only enhance the already substantial advantages ofincumbency.
Limits on "Soft Money". The recentdistress of reformers over "soft money"--money contributed topolitical parties for other than candidate-oriented advertising--isrooted in the belief that such contributions, because they areunlimited, invite a wholesale evasion of contribution limits now inplace. They do. Indeed, such evasion is exactly what one wouldexpect to find when people are prohibited from contributing in moredirect ways to candidates of their choice. The solution to theproblem of evasion, however, is not to ban or limit softmoney--which would be patently unconstitutional--but to eliminateor at least raise the limits on direct contributions.
Because soft money, under present arrangements, goes to parties,not candidates, there is no possibility of the kind of quid-pro-quocorruption that alone justifies limits. Thus, any attempt to limitsuch contributions would not pass even the threshold test the Courthas set. Indeed, such limits would strike at the very core of theFirst Amendment. People contribute to political parties, after all,to advance the ideas for which the parties stand and to encourageand support the political speech that parties promote. If thoseefforts were thwarted--not to prevent quid-pro-quo corruption butto eliminate the "appearance" of corruption--the First Amendmentwould be utterly eviscerated. The "appearance" can be addressedmore directly--by eliminating its source in the present law.
So without constitutional merit is the attack on soft money, infact, that four justices in the recent Colorado case wentso far as to say that, given the practical identity of interestsbetween party and candidate during an election, thecorruption-prevention rationale for sustaining limitations oncontributions did not support any limits on party spending, whethercoordinated with the candidate or not. Although present law makescoordinated spending illegal, Justice Thomas pointedly questionedthe rationale for that restraint: "What could it mean for a partyto 'corrupt' its candidate or to exercise 'coercive' influence overhim."  In sum, soft money is not theproblem. The present law is the problem.
Issue Advocacy. Proposals to limitspeech that does not "in express terms advocate the election ordefeat of a clearly identified candidate for federal office" areconstitutionally infirm for the same reason that the soft-money banis infirm: they would regulate--and thus unacceptably chill--corepolitical speech about the merits of policies and the properresolution of public issues without a corruption-preventionrationale for doing so. To the objection that issue advocatesexercise "undue influence," the answers are, that is their right,and we have no measure of just how much influence is "due."
Of late, however, those who would expand current law to coveradvocacy ads that do not expressly urge support or defeat of acandidate have sought refuge in a case the Ninth Circuit decided in1987, FEC v. Furgatch. That is a dubious shelter, however, for Furgatch was, bythe circuit's own reading, a "very close call."  Moreover, its holding that anon-candidate's campaign communication can amount to prohibited"express advocacy" for or against a candidate without having used the Buckley buzzwords--"vote for," "defeat," etc.--is hardly inconsistent withBuckley. The issue in Furgatch was simplywhether, under its facts, the advocate was engaged in "express"advocacy, even though he did not use the "express" words mentionedin Buckley. To read the case as inconsistent withBuckley--and thus as opening the door to overturningBuckley--is grasping at straws, straws that are not eventhere.
Thus, for these many reasons, here only outlined, the effort tofurther restrict the financing of federal election campaigns is notlikely to survive a constitutional test. The Framers wrote and thefounding generation ratified the First Amendment to ensure free androbust political debate. They did not want it restricted byartificial limits on the means that are necessary for suchdebate--financial support. Far worse than the corruption of moneyis the corruption of politics. Yet that is what further limitswould ensure, as our present limits already have.
 Lillian R.BeVier, "Campaign Finance 'Reform' Proposals: A First AmendmentAnalysis," Cato Policy Analysis No. 282, Sept. 4, 1997.
 DouglasJohnson and Mike Beard, "'Campaign Reform': Let's Not GivePoliticians the Power to Decide What We Can Say about Them," CatoBriefing Paper No. 31, July 4, 1997.
 2 U.S.C.§ 431 et seq. (amended 1974).
 424 U.S. 1(1976).
 See JamesBopp, Jr., and Richard E. Coleson, "The First Amendment Is Not aLoophole: Protecting Free Expression in the Election CampaignContext," 28 University of West Los Angeles Law Review 1(1997).
 116 S. Ct.2309 (1996).
 FEC v.Christian Action Network, Inc., 110 F. 3d 1049 (4th Cir.1997).
 See, e.g.,First National Bank of Boston v. Bellotti, 435 U.S. 765(1978); California Medical Association v. FEC, 453 U.S.182 (1981); FEC v. National Right to Work Committee, 459U.S. 197 (1982); FEC v. National Conservative Political ActionCommittee, 470 U.S. 480 (1985); FEC v. MassachusettsCitizens for Life, Inc. 479 U.S. 238 (1986); Austin v.Michigan Chamber of Commerce, 494 U.S. 652 (1990); FEC v.Colorado Republican Federal Campaign Committee, 116 S.Ct. 2309(1996).
 The analysisthat follows draws heavily upon the study by Professor BeVier, note1 above.
Buckley, at 14 (quoting Mills v. Alabama, 384U.S. 214, 218 (1966).
 Id. at20.
 Id. at21.
 Id. at19.
 Id. at26.
Citizens Against Rent Control v. Berkeley, 454 U.S. 290,296 (1981).
 See BradleyA. Smith, "Campaign Finance Regulation: Faulty Assumptions andUndemocratic Consequences," Cato Policy Analysis No. 238, pp. 8-11,Sept. 13, 1995, and the citations therein.
 Carverv. Nixon, 72 F.3d 633, 637 (1995) (citing Buckley at30).
 BeVier,note 1 above, at 12 (citing Buckley at 45).
 ShrinkMissouri Government PAC v. Maupin, 71 F.3d 1422, 1426 (8thCir. 1995).
Colorado at 2330-31.
 807 F.2d857 (9th Cir. 1987).
 Id. at861.