Where Is All This Corporate Corruption I Keep Hearing About?


The official constitutional justification for the federal ban on "electioneering communications," as I noted in my column yesterday, is the perceived need to control the "corrosive and distorting effects of immense aggregations of wealth that are accumulated with the help of the corporate form." According to the Supreme Court's 1990 decision in Austin v. Michigan Chamber of Commerce, corporate spending on political messages is "distorting" because the money corporations have does not necessarily reflect public support for the ideas they advocate. This concern plainly does not apply to the nonprofit interest groups, such as Citizens United and Michigan Right to Life, that object to the Bipartisan Campaign Reform Act's speech restrictions, since a) they do not have access to "immense aggregations of wealth" and b) whatever resources they do have come from citizens who support their ideological agendas. So perhaps it's not surprising that, after the Supreme Court signaled its intention to re-examine the anti-distortion rationale by ordering a second round of arguments in Citizens United v. FEC, the government suddenly lost interest in defending it.

Instead Solicitor General Elena Kagan argues in the government's supplementary brief (PDF) that limits on the political speech of corporations (including nonprofit interest groups) are necessary to prevent official corruption or the appearance of it, the most commonly cited justification for campaign finance rules. The idea is that if corporations are free to advocate for or against federal candidates, politicians who benefit from such speech will feel indebted to them, which will affect the positions they take. The problem is that the government cannot cite any actual examples of such corruption. Nor can it show that corporations dominate the political debate when they are allowed to spend money on political speech close to elections. Former FEC Chairman Bradley Smith highlights the absence of such evidence in a New York Post op-ed piece:

In 2002, the last election cycle in which soft money contributions from corporations were allowed in federal races, the largest corporate donor spent only $9.3 million. Fewer than 10 corporations spent as much as $2.5 million….The overwhelming majority of some $2 billion in political spending came from individuals.

The evidence is even more convincing in the states.

Today, 26 states allow unlimited corporate electioneering in state races—independent ads advocating for or against candidates. Are these 26 states hopelessly lost in a cesspool of corporate influence? Certainly not.

Furthermore, 28 states allow direct contributions from corporations to candidates—in seven states, such contributions are unlimited….Yet states like Utah and Virginia, with no limits, are consistently ranked among the best governed in the nation.

Nor did corporate money take over the political process when the Supreme Court weakened the federal ban on "electioneering communications" by restricting it to messages "susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate." In the first election cycle after that decision, Citizens United notes (PDF), "political parties and PACs still spent 25 times more than corporations on electoral advocacy."

Smith correctly argues that "those who support restrictions on speech bear the burden of proof to show that unfettered speech by corporations corrodes democracy." So far they have been unable to do so, and with the second round of oral arguments in Citizens United scheduled for Wednesday, they are running out of time.