January 25, 2010
In a 5-4 ruling last Thursday, the U.S. Supreme Court Justices rejected corporate spending limits on political campaigns.
The case, Citizens United v. Federal Election Commission, involved the Bipartisan Campaign Reform Act, a 2002 statute passed by Congress to limit election-related communications, especially so-called “attack ads.” At issue was whether federal campaign finance laws apply to a critical film about Senator Hillary Clinton intended to be shown in theaters and on-demand to cable subscribers. National Public Radio described the case as one “that could rip apart the legal underpinnings of the nation's campaign finance laws.”
The Jan. 21 ruling in Citizens United overruled two important precedents about the scope of the First Amendment in relation to campaign spending restrictions: A 1990 decision, Austin v. Michigan Chamber of Commerce, which upheld restrictions on corporate spending to support or oppose political candidates, and McConnell v. Federal Election Commission, the 2003 decision that upheld the central provisions of the McCain-Feingold law.
The case was first heard at the high court in March. In June, the Court ordered re-argument to focus on the constitutionality of limiting corporations’ independent spending during campaigns for the Presidency and Congress. On September 9, former HLS Dean Elena Kagan ’86 argued the case, her first oral argument as solicitor general of the United States. Listen to audio recording of oral argument.
The majority opinion was written by Justice Kennedy. Justice Stevens dissented, joined by Justices Ginsburg, Breyer, and Sotomayor.
In September, Harvard Law School Professor Mark Tushnet, a constitutional law scholar and a leading expert on the First Amendment, answered some questions and offered an assessment of what was at stake in the case. Below, Tushnet (along with Laurence Tribe, Jed Shugerman, Mark Roe, Lawrence Lessig, and Lucian Bebchuk) weighs in with reactions to yesterday’s ruling.
Carl M. Loeb University Professor
There is no doubt that Citizens United v. Federal Election Commission marks a major upheaval in First Amendment law and signals the end of whatever legitimate claim could otherwise have been made by the Roberts Court to an incremental and minimalist approach to constitutional adjudication, to a modest view of the judicial role vis-à-vis the political branches, or to a genuine concern with adherence to precedent.
The masterful dissent by Justice Stevens, which merits close reading by anyone interested in the Supreme Court as an institution or in the Constitution as a source of law, shreds any serious claim to the contrary. It also gravely undermines the First Amendment analysis offered by the majority and concurring opinions, doing so thoroughly enough that anyone who (like me) regards the issues in this case as close and difficult has to wish that Justice Kennedy, joined by the Chief Justice and by Justices Scalia, Thomas, and Alito, had been less emboldened by the knowledge that the votes were there for what they all deemed the right result and had taken greater care to respond, point by point, to the largely unanswered critique launched by Justice Stevens, joined in his dissenting opinion by Justices Ginsburg, Breyer, and Sotomayor.
But there will be plenty of time to dissect the several lengthy opinions in this case and to opine on the merits, and it’s not my purpose in this brief comment to add to that growing body of commentary. I would say only that I share neither the jubilant sense that the First Amendment has scored a major triumph over misbegotten censorship nor the apocalyptic sense that the Court has ushered in an era of corporate dominance that threatens to drown out the voices of all but the best-connected and to render representative democracy all but meaningless. Read more »
The William Nelson Cromwell Professor of Law
If Congress wanted to draft limits on campaign contributions or spending, how should they do it now in the wake of Citizens United?
People interested in campaign finance reform and worried about the corrupting effects of money in politics probably should shift their attention from the kind of direct regulation involved in McCain-Feingold to other methods. The most promising, I think, is one proposed many years ago by our colleague Victor Brudney, who saw the problem from the perspective of a specialist in corporate law. Professor Brudney argued that it was well within the ordinary scope of the law of corporations for states (and possibly Congress) to impose requirements of shareholder approval for specific categories of corporate spending. He suggested that states and Congress, to the extent that it has the power to do so, could require that corporate expenditures on campaigns gain shareholder approval. Requiring shareholders to approve a general power in the corporation to spend money on campaigns probably wouldn't accomplish much. Requiring them to approve specific expenditures—in advance—would, probably to the point of making such expenditures impossible for large general-purpose corporations. (It probably wouldn't affect small corporations or ideological ones like Citizens United much, which is an attractive feature of the proposal.) Or, you could require that some supermajority of shareholders approve a general power to spend money on campaigns -- say, two-thirds or three-quarters -- and treat spending in the absence of such approval as ultra vires the corporation. As with all reform proposals, the details matter. But, I think, the decision in Citizens United should spur the kind of creative thinking about campaign finance reform that Professor Brudney's proposals represent.
Assistant Professor of Law
Excerpted from the Harvard Gazette, “Judging the campaign finance ruling,” Jan. 21.
What are the implications here for labor unions and nonprofit institutions? Can they also start to play a more direct role in campaign politics?
From a reading of this decision, labor unions and other nonprofits are free to spend more. There’s nothing in the opinion that forecloses it or makes this distinction. So it seems like there will be more money coming from labor unions. Labor unions are opposed to this decision because they know, in the balance of power, the corporations will be able to spend more money than the unions can. But at least it seems evenhanded in allowing both. And there’s no reason to think that they would distinguish between the First Amendment rights of corporations but not extend those rights to labor unions.
Is there anything to be read into the fact that this began as a fairly narrow case but wound up having such broad implications?
The Supreme Court had in front of it a potentially narrower and more minimalist way to resolve this case without overturning precedent. This is the big deal about this case. This sends a larger signal about the Roberts court. When Chief Justice [John] Roberts was confirmed in the confirmation hearings, he talked about deference and a cautious approach and seeking more consensus. And we have seen that that is not his approach in practice. So today what we’re looking at is an irony. To pass a law in Congress takes a 60-vote supermajority in the Senate. But to strike down a law today takes a one-vote majority in the Supreme Court — and a decision that overturned precedent. … The larger context of the Roberts court’s aggressiveness and lack of concern about consensus is something that we should be paying more attention to.
The next question is whether the Supreme Court will move beyond outside political advertising, issue advocacy, or independent spending, and move from striking down regulations on outside spending to striking down regulations on direct donations. That’s a big deal. So if a corporation can go today and now spend money on its issues, that’s one thing. But there are longstanding precedents that set limits on what individuals and groups can donate to candidates. If there’s now an ability to make direct donations to candidates without limits, that will be a major change. Read entire Gazette story »
David Berg Professor of Law
From an op-ed by Professor Roe, “Corporate consequences of the Supreme Court’s speech decision last week,” which appeared in the Jan. 25 edition of the Financial Times.
Last week, the US Supreme Court ruled that the legal blocks on corporations and labour unions advertising for and against political candidates violates free speech principles.
Constitutional law scholars, the media and the public will debate whether corporations are entitled to free speech protections and Congress may revisit campaign contribution limits and public funding.
But the potential corporate, business and economic consequences of the decision, assuming it stands, are profound. Conservative and business media have thus far favoured the decision as helpful to business; but it is not at all clear that it is favourable to the economy. It is likely to hurt the dynamism of the American economy, perhaps severely. Read more »
Director, Edward J. Safra Foundation Center for Ethics, Harvard University
Professor Lawrence Lessig weighed in via video on the Citizens United ruling after the Court released its decision on Thursday, Jan. 21.
An op-ed by Professor Lessig, “Institutional Integrity: Citizens United and the path to a better democracy,” also appeared in The Huffington Post on Jan. 22.
Whatever else one believes about the Supreme Court's decision striking down limits on corporate speech in the context of political campaigns, there's one thing no credible commentator could assert: That money bought this result. We can disagree with the Court's view of the Framers (and I do); we can criticize its application of stare decisis (as any honest lawyer should); and we can stand dumbfounded by its tone-deaf understanding of the nature of corruption (as anyone living in the real world of politics must). But we cannot say that somehow, the influence of money has produced this extraordinary result. The Court jealously guards its own institutional integrity. Two hundred years of careful doctrine, defining the economy of influence under which it does its work, has produced an institution whose decisions we can disagree with strongly, but whose integrity we can't fairly doubt. Maybe liberal or conservative politics sometimes gets too much mixed with constitutional law. But money is no where even close.
Thursday's decision by the Supreme Court denies to Congress the same institutional integrity enjoyed by the Court. The vast majority of Americans already believe that money buys results in Congress. This Court's decision will only make that worse. The Wall Street bailouts, the caving to insurance and pharmaceutical interests in health care reform, the ability of coal companies to stop Congress from addressing even profoundly important questions like global warming leads most to the view that it isn't reason or even constituent politics that determines what Congress does or doesn't do. It is instead the siren of campaign funding. Now a second siren walks onto that stage, promising, ever so indirectly, more campaign support from corporate treasuries. Who could doubt that this will further distract Members of Congress from what their constituents want? And who could believe it won't make Americans even more cynical about what Congress does? Read the full op-ed »
William J. Friedman and Alicia Townsend Friedman Professor of Law, Economics, and Finance; Director, Program on Corporate Governance
This op-ed by Professor Bebchuk entitled "Corporate political speech is bad for shareholders" appeared as the latest installment of his monthly column in Project Syndicate.
The United States Supreme court recently struck down limits on the freedom of companies to spend money on political elections. Large, publicly traded companies in other countries also often face lax limits on their use of corporate resources to influence political outcomes, fueling fears that the interests of shareholders will trump those of other groups, such as consumers and employees. But corporate spending on politics can also hurt the interests of shareholders.
Stock market listed companies control a big share of almost every country’s resources, so the free flow of corporate money into politics can have a profound impact on politicians’ preferences and choices. In particular, the influence of corporations on politicians and political outcomes can be expected to weaken the rules that protect shareholders and ensure that companies are well-governed.
To understand why, it is important to focus on the individuals who make decisions for companies. When corporations decide which politicians to support, what kind of messages to send, and which political outcomes to seek, their general investors are not consulted. Rather, such decisions are likely to reflect the preferences and objectives of the insiders who manage the companies, ostensibly on shareholders’ behalf. And politicians that benefit from corporate spending and access to corporate resources will have an interest in serving the insiders’ preferences and objectives. Read more »