Citizens United and Campaign Finance

Paying attention to the U.S. process for choosing the American President currently underway can breed some cynicism about the process, especially when it concerns the “invisible” or “money” primaries. There is an unseemly scramble among the Republican hopefuls to court some very rich people, and Hillary Clinton has apparently warded off any serious opposition to her quest for the Democratic nomination by the amount of money she and her supporters have on hand. While there are clear differences between the two major parties, it does cause some to wonder about how much choice the American electorate has and whether certain interest groups will always have a loud voice at the table, no matter who wins. We can partially assign blame for this state of affairs at the U.S. Supreme Court, which has effectively said that not only does money talks but it can also be speech protected by the First Amendment of the U.S. Constitution.

Not surprisingly liberals have attacked the Supreme Court for its Citizens United decision, and some have even called for an amendment to the Constitution. In this case, though, talk is cheap for the Supreme Court is not likely to reverse its decision anytime soon, if ever, and an amendment to the Constitution on this subject is not likely to happen.

As for the Supreme Court, the case that the First Amendment not only applies to individuals but to groupings or associations of individuals, such as in clubs, unions, or corporations is stronger than the case that money that is given to a third party is a form of speech that cannot be limited by statute. In other words, it is one thing for an association of persons to speak, or, in the case of Citizens United, make a movie attacking a particular candidate (Hillary Clinton), but it is another to give money to a super PAC so that it can speak.

If one is to be serious about what can be done given Supreme Court decisions, rather than a continual deploring of Citizens United and asserting that corporations are not people, it would be more useful to ask who has the right to decide for corporations what they can say of a political nature. For example, publicly held corporations could be required to submit to a vote of its shareholders expenditures of a political nature in excess of some de minimus amount. Critics of this would mostly certainly argue that this would stifle political speech, which to their way of thinking would include contributions. As a practical matter, it would probably limit corporations’ political activities, but why should management be allowed to use shareholder money to engage in political speech and make contributions if that is contrary to the desires of the shareholders, who own the corporations? The general treasury of a corporation should not be a piggybank that management can use in any way it wants to, especially in matters not directly related to the business the corporation is in.

As for the conservative bogeymen, unions, which are much less powerful than they used to be, one could subject them to a parallel requirement, that they submit to their membership expenditures greater than a certain minimal amount of a political nature not directly related to their collective bargaining to a vote of their membership. Some liberals might not like that, but it would be worth it to limit corporate cash.

These ideas of course would not limit the influence of money and that of extremely wealthy individuals in our political process, but it would be a start. That ideas about what one could do in the present legal environment shaped by Supreme Court decisions are not being vigorously pursued by politicians of either political party would seem to indicate a certain level of comfort among politicians with the current system. It is particularly disconcerting to hear liberals yell about Citizens United but not advance any practical proposals.

As a final note, it was disconcerting to read recently that Mary Jo White, who is chair of the SEC, recently state before a Congressional committee that the SEC has not taken up rules requiring greater transparency about corporate political contributions because the SEC had more pressing matters to address.  On March 27, the New York Times editorialized:

“Midway into a three-and-a-half-hour congressional hearing this week featuring Mary Jo White, the chairwoman of the Securities and Exchange Commission, none of the legislators had bothered to ask if or when her agency would require that corporations disclose their political spending.

“The bipartisan silence testified to the growing importance to both parties of anonymous campaign donations. With each passing year since 2010, when the Supreme Court’s decision in Citizens United opened the floodgates to secretive political giving, politicians appear to value so-called dark money more and value disclosure of unnamed donors less. The issue was finally broached by Representative Michael Capuano, Democrat of Massachusetts. He observed that shareholders have a right to know how corporate cash is spent, and demanded to know why the S.E.C. has not required disclosure. Ms. White gave the same answer she has given since she became chairwoman in 2013 — essentially, that the agency is too busy with more important issues.”