When the Supreme Court decided Citizens United v. FEC last fall, holding that corporations have a First Amendment right to spend money in candidate elections, analysts were divided over how much the case was going to affect U.S. elections. Writing in the July/August issue of The American Interest (as part of its extensive coverage of the Citizens United decision) I took somewhat of a middle position:
But it is easier to understate the importance of the case. First, it has become apparent that corporations and trade associations, such as the Chamber of Commerce, now feel as though a cloud has been lifted on their election-related activities. What was of questionable legality before is clearly legal now. Full-blown corporate involvement in Federal elections likely awaits the striking down of rules prohibiting corporations from making contributions to independent expenditure committees, so that corporations will not risk losing their customers by identifying with one side or the other in a candidate election. They will hide behind groups with innocuous names like “Americans for a Strong America” and other such anodyne labels.
When I wrote those words, I did not expect the other shoe to drop as quickly as it did. Three significant post-Citizens United rulings, as well as the continued intense partisanship of our elections, have contributed to the precipitous decline in our campaign finance laws. First, the United States Court of Appeals for the D.C. Circuit held in the SpeechNow.org case that individual human beings have a constitutional right to contribute directly to political committees that make only independent expenditures. Eliza Newlin Carney has dubbed these independent expenditure-only committees “Super PACs.” The theory of SpeechNow.org is that if independent spending cannot corrupt, contributions to fund such independent spending cannot corrupt either.
The Federal Election Commission, with a single sentence of constitutional analysis, followed up on SpeechNow.org by granting the right of corporations and labor unions to make unlimited contributions to super-PACs. (Disclosure: I am representing the City of San Diego in the United States Court of Appeals for the Ninth Circuit arguing that similar limitations in the City’s law remain constitutional.)
Finally, the FEC split 3-3 along party lines on the question of what needs to be disclosed when groups broadcast television and radio ads mentioning federal candidates close to the elections. The three Republican Commissioners have taken the position that virtually nothing needs to be disclosed about contributions to fund these ads.
Groups quickly have become emboldened by these rulings, especially those that are using the 501(c)(4) tax status, which allows for shielding even more contributions from public disclosure. This of course has the potential to undermine confidence in the electoral process, with Democrats raising the specter (thus far, no more than a specter) of foreign money influencing our elections.
It does not have to be so. Citizens United actually endorsed the idea of quick and full Internet disclosure of money going in and out of campaigns. But attempts to fix the disclosure rules got mired in partisan controversy this past fall, and no one seems ready to subject political groups to random audits, which seems to be the only way to assure that foreign money doesn’t make it into our campaigns.
The rules continue to be in flux, and the real test will come in 2012. Remember that President Obama raised $785 million of mostly disclosed money under the old rules. What will the future look like? I don’t expect it to be pretty.