As Democrats headed for what promised to be a midterm election fiasco of historic proportions, a pre-emptive excuse began to circulate: It was all the Supreme Court’s fault. In an August Washington Post column, Katrina vanden Heuvel, editor of The Nation, said Citizens United v. Federal Election Commission, the January decision in which the Court overturned restrictions on political speech by corporations, had created a “very alarming” situation in which democracy (not to mention Democrats) would be swept away by “a flood of corporate campaign cash” because “there is no way private citizens can match the resources available to corporations to make their voices heard.” In a radio address around the same time, President Barack Obama dreaded “a flood of attack ads run by shadowy groups with harmless-sounding names,” unleashed by a ruling that “allows big corporations to spend unlimited amounts of money to influence our elections.”
In September a front-page New York Times story seemed to confirm these antediluvian prophecies. The paper reported that “outside groups supporting Republican candidates in House and Senate races across the country have been swamping their Democratic-leaning counterparts on television.” The Times worried that “a relatively small cadre of deep-pocketed donors, unknown to the general public, is shaping the battle for Congress in the early going.” It said “Democratic officials” believed “corporate interests, newly emboldened by regulatory changes,” were trying to “buy the election.” In short, the spending patterns seemed to be “a fulfillment of Democrats’ worst fears after the Supreme Court’s ruling in the Citizens United case.”
Except that, as the Times conceded in the next paragraph, “it is not clear…whether it is actually an influx of new corporate money unleashed by the Citizens United decision that is driving the spending chasm.” Other factors—“notably, a political environment that favors Republicans”—might be at work. In fact, the spending cited in the story was mostly by rich individuals or by groups organized under Section 527 of the Internal Revenue Code, both of which were legal before Citizens United.
An October story in The Washington Post likewise suggested that Citizens United helped explain the Republicans’ spending lead but was hazy as to how. “The outside group spending is primarily being driven by the political climate,” a campaign finance expert told the Post. “Organized groups are looking at great opportunity, and therefore there’s great interest to spend money to influence the election.”
When you get beyond the scaremongering about deluges of dollars, the practical consequences of Citizens United so far seem to be much less dramatic than its critics predicted. But how could they not be? “The Court’s ruling threatens to undermine the integrity of elected institutions across the Nation,” Justice John Paul Stevens warned in his dissent. “A democracy cannot function effectively when its constituent members believe laws are being bought and sold.” The New York Times said the “radical” and “disastrous” decision “strikes at the heart of democracy.” Rep. Alan Grayson (D-Fla.) said Citizens United was “the worst Supreme Court decision since Dred Scott,” because “it leads us all down the road to serfdom.”
President Obama managed to outdo them all, declaring that he “can’t think of anything more devastating to the public interest.” To Obama, apparently, the prospect of a less restricted political debate was more horrifying than an economic collapse, a military coup, or a nuclear war. Although it’s too early to predict exactly what will happen as a result of Citizens United, it seems safe to say that plenty of things are more harmful to the public interest. Among them are laws that seek to silence some so that others may be heard.
Everything Is Incorporated
The over-the-top reactions to Citizens United reflect a view of corporations as giant, soulless automatons that are fine for producing goods and services in a regulated environment but bound to wreak havoc if let loose in the halls of political power. That view obscures the fact that corporations, no matter how large or profit-driven, are by definition associations of individuals who have joined together for a common purpose. It also misleadingly suggests that behemoths such as Wal-Mart and Exxon Mobil are typical corporations, when in fact the vast majority of the 6 million or so corporations registered in the United States are small businesses or nonprofits.
“In 2010 almost everything is incorporated,” notes Allison Hayward, a former George Mason University law professor who recently became vice president of policy at the Center for Competitive Politics, which favors deregulation of political speech. “Anything you want to do as a group with other people—apart from the context where partnerships might work, like practicing law—you’re going to do through a corporate form of some kind.” Civil society, including churches, charitable organizations, and grassroots political groups of every interest and ideology, consists largely of corporations.
For an illustration, one need look no further than the case the Supreme Court decided. Citizens United, founded by the conservative activist Floyd Brown in 1988, is not a huge corporation seeking subsidies or permission to pollute. It is a nonprofit, ideological organization with an annual budget of $12 million that wanted to run a documentary about Hillary Clinton on pay-per-view TV. It was forbidden to do so, under threat of fine and imprisonment, because a) Clinton was running for the Democratic presidential nomination, and b) the documentary made her look bad. The movie therefore violated the Bipartisan Campaign Reform Act of 2002, a.k.a. McCain-Feingold, which banned “electioneering communications,” defined as TV or radio ads sponsored by unions or corporations that mention a candidate for federal office within 30 days of a primary or 60 days of a general election.
Contrary to all the rhetoric about corporations drowning out the voice of the people, corporations are the voice of the people—people who pool their resources because they hate Hillary Clinton, love the rainforest, worry about the national debt, support gay marriage, think abortion is murder, oppose gun control, or even believe that corporations have too much influence on politics. McCain-Feingold told these groups they were not allowed to talk about their issues close to an election if the discussion happened to mention any politicians running for federal office.
The ban on electioneering communications was supposed to strengthen a pre-existing ban on spending by unions or corporations “in connection with” a federal election. That prohibition, originally imposed by Congress in 1947, was incorporated into the Federal Election Campaign Act (FECA) of 1971, which Congress amended in 1974 following the Watergate scandal to impose new restrictions on contributions and spending, require detailed recordkeeping and reporting by political committees, and create the Federal Election Commission (FEC) to oversee the new regulatory system.
In the 1976 case Buckley v. Valeo, the Supreme Court upheld FECA’s limits on campaign contributions (such as the ceiling on how much you can give a particular candidate during one election cycle) but overturned its limits on spending by candidates and independent spending by individuals and groups, which it said “place substantial and direct restrictions on the ability of candidates, citizens, and associations to engage in protected political expression, restrictions that the First Amendment cannot tolerate.” The Court did not directly address the ban on election-related expenditures by unions and corporations. But to avoid unconstitutional vagueness, it ruled that the election-related speech covered by the law should be limited to “express advocacy”—messages explicitly advocating a candidate’s election or defeat. According to a footnote in the decision, that meant “communications containing express words of advocacy of election or defeat, such as ‘vote for,’ ‘elect,’ ‘support,’ ‘cast your ballot for,’ ‘Smith for Congress,’ ‘vote against,’ ‘defeat,’ ‘reject.’ ” This definition, as interpreted by lower courts and the FEC during the next two decades, gave rise to “issue ads,” the target of the McCain-Feingold ban on electioneering communications.
The Unbearable Cacophony
Issue ads, which became especially conspicuous in the mid-1990s, avoided express advocacy by eschewing the “magic words” that the Supreme Court had identified as forbidden. Many of them nevertheless managed to communicate an opinion about the merits of electing particular candidates. A 1997 report by the University of Pennsylvania’s Annenberg Public Policy Center estimated that political parties, labor unions, and interest groups spent about $150 million on issue ads during the 1996 campaign, compared to about $400 million in advertising by the candidates themselves.