Nahmod Law

Introduction

This is the second of two posts on the Supreme Court‘s controversial decision dealing with corporate expenditures and campaign finance reform in Citizens United v. FEC, No. 08-205 (1-21-10). The immediately preceding post, which should be consulted, sets out the relevant case law, from Buckley to Wisconsin Right to Life, leading up to that decision. This post comments on Citizens United.

The thoughtful comments of my colleague, Steve Heyman, on Citizens United are accessible through the following link: http://blogs.kentlaw.edu/faculty/2010/03/the-public-vs-the-supreme-court-a-comment-on-the-citizens-united-case.html

Citizens United: The Decision.

All of this finally brings us to Citizens United. Here, the Court, after oral argument, decided not to deal with the narrow question of the constitutionality of BCRA’s application to a not for profit’s documentary about Hillary Clinton that it wanted to make available through video on demand within 30 days of primary elections for President (an “electioneering communication” under BCRA). Instead, the Court ordered reargument, asking the parties to address and argue the broader issue of the facial validity of BCRA with regard to profit and not for profit corporations and labor unions. This latter issue was not really raised by the parties.

The Court ultimately found the electioneering communications provisions unconstitutional, and more. In the course of a 57 page opinion by Justice Kennedy, Austin and McConnell (in part) were overruled. Applying strict scrutiny, the Court determined that corporations have the same First Amendment rights as individuals. According to the Court, corporations could make unlimited independent expenditures for candidates for federal office from their general treasury funds; there was no constitutional need to create PACs.

The Court reached this conclusion for the following reasons:

1. It was only in 1947, in the Labor Management Relations Act, that Congress prohibited independent expenditures by corporations and labor unions.

2. Buckley did not address the issue of corporate campaign expenditures.

3. The rationale of Bellotti was clear and covered this case directly.

4. Austin, a 1990 decision, was the first case that allowed the imposition of a direct restriction on independent corporate expenditures for political speech. Thus, there was a conflict between the pre-Austin and post-Austin line of cases.

5. The anti-distortion, anti-corruption and shareholder protection rationales relied on in Austin did not justify restrictions on corporate speech for political purposes. Political speech may not be limited based on a speaker’s wealth, and no meaningful distinction between media corporations and others existed. Also, independent corporate expenditures don’t give rise to concerns with quid quo pro corruption and the appearance of corruption. Finally, the shareholder protection rationale also applied to media corporations and this proved too much under the First Amendment.

6. Stare decisis was not controlling here: Austin had been undermined by experience (evasion) and rapid changes in technology, and there also were no serious reliance interests.

Justice Stevens, joined by Justices Ginsburg, Breyer and Sotomayor, dissented in a 90 page opinion, disagreeing with the Court in virtually every respect.

Observations

No Surprise. Despite the hue and outcry, Citizens United should have come as no surprise to knowledgeable observers. Campaign finance reform, whether it involved individuals or corporations, has always raised serious First Amendment concerns, as demonstrated by Buckley itself. Moreover, various justices, particularly in the last decade, have questioned the soundness of Austin. Likely factors contributing to the current public outcry over Citizens United are the dire economic situation in which the country finds itself, the obvious involvement of corporate interests in debates over health care reform and the so-called bailout of the big banks.

Stare Decisis. Overruling precedent while contending that the principles of stare decisis are not controlling is a game (a serious one, of course) that all justices play, whatever their political ideology. In any event, everyone knows, or should know, that this is an activist Court. A Court that was truly sensitive to judicial restraint concerns—the so-called passive virtues which include not reaching out to decide constitutional issues that can be avoided– would not have addressed the case before it in facial validity terms, especially since the parties themselves did not do so at the outset.

The Court’s Low Opinion of Congress and Its Politics. Citizens United is of a piece with other Supreme Court decisions of the last several decades in which the Court has treated Congress badly and come close to disrespecting a politically accountable branch of national government. Think of the Commerce Clause cases, including Lopez and Morrison. Think of the City of Boerne case and the section 5 power of Congress, where the Court treated Congress with less deference than if it were a trial court. And consider that as to Citizens United and electioneering communications, Congress made extensive findings about the corrosive effect on federal elections of corporate expenditures and that the trial court held lengthy hearings as well.

I suspect that the Court takes a jaundiced view of the decision-making processes of Congress and considers political outcomes, i.e., legislation, to be the result of naked interest group politics. It is therefore suspicious of Congress (and incumbents) even when Congress enacts bi-partisan legislation dealing with campaign financing reform. Notice how this view of the political process can be used to justify judicial intervention by an activist Court.

The Marketplace of Ideas, Self-Fulfillment and Self-Government. Citizens United appears to be based on the marketplace of ideas rationale of John Stuart Mill, later picked up by Justice Holmes in his famous dissent in Abrams. Under this kind of laissez faire approach to the First Amendment, government is not allowed to regulate the marketplace of ideas. Instead this marketplace functions exclusively in the private sector, and people enter it and leave it whenever they want and with whatever resources they may possess. Of course, in the marketplace of products, government does in fact intervene to prevent monopolies and anti-competitive practices. But the marketplace of ideas is thought by many to be different because of the distrust of government to regulate in an even-handed and neutral manner.

In contrast, the self-fulfillment rationale of the First Amendment plays no role here since corporations are not people. And the powerful self-government rationale, articulated eloquently first by Justice Brandeis in Whitney and thereafter by Alexander Meiklejohn, similarly does not ground Citizens United. Under the latter with its town hall meeting model, what is important is that everything worth saying should be said. The corollary is that no speaker or speakers should be allowed to drown out others and to monopolize.

Federalism. Citizens United has immediate real world implications for federalism. If Citizens United is read broadly, as intended by the Court, states are now disabled from regulating independent corporate expenditures made in connection with state and local government elections.

When all is said and done, this is a blockbuster First Amendment decision. Will it promote intelligent democratic decision-making? Only time will tell.