Friday, May 27, 2022

May 26, 2022
Money speaks

Not surprisingly, the draft opinion on abortion has been the focus of recent commentary about the Supreme Court.  However, the opinions in a case recently decided also deserve attention.

In Federal Election Commission v. Ted Cruz for Senate, the Court continued its assault on the regulation of political spending.  The decision, apart from its own demerits, is the offspring of Citizens United, which not only endorsed the dubious money-equals-speech formula, but was so far removed from proper standards of adjudication that it should be repudiated, not extended.[1]  The Cruz decision was by vote of six to three, the all-too-familiar conservative bloc making up the majority.

The case involves a challenge to a statute, Section 304 of the Bipartisan Campaign Reform Act of 2002, dealing with loans by candidates to their campaign committees.  Here is the majority’s summary of the background: “In order to jumpstart a fledgling campaign or finish strong in a tight race, candidates for federal office often loan money to their campaign committees. A provision of federal law regulates the repayment of such loans. Among other things, it bars campaigns from using more than $250,000 of funds raised after election day to repay a candidate's personal loans.”  The majority held that the statute violates the right of candidates and their campaigns to engage in political speech.

Cruz and the Committee set up this challenge to the regulation by his lending $260,000 to the Committee and their complaining that he was barred from receiving the last $10,000.  The early part of the opinion is devoted to a convoluted discussion of whether Cruz and the Committee had standing to sue, an issue raised in part by their intentional creation of the issue.  They had stipulated in District Court that "the sole and exclusive motivation behind Senator Cruz's actions in making the 2018 loan[s] and the [C]ommittee's actions in waiting to repay them was to establish the factual basis for this challenge."  The government contended, as the majority put it,  “that appellees lack standing because their injuries were ‘self-inflicted.’ . . . Because appellees knowingly triggered the application of the loan-repayment limitation, the Government says, any resulting injury is in essence traceable to them, not the Government.” That argument was rejected.

Limiting reimbursement from post-election donations to $250,000 hardly is an oppressive measure, but the majority declared  any limit to be an interference with speech: “By restricting the sources of funds that campaigns may use to repay candidate loans, Section 304 increases the risk that such loans will not be repaid. That in turn inhibits candidates from loaning money to their campaigns in the first place, burdening core speech.”  That burden, they held, is not justified.  Their conclusion is encapsulated in two passages which echo Citizens: “This Court has recognized only one permissible ground for restricting political speech: the prevention of ‘quid pro quo’ corruption or its appearance.” However, “the Government has not shown that Section 304 furthers a permissible anticorruption goal, rather than the impermissible objective of simply limiting the amount of money in politics.”    
Contrary to the majority’s argument, the statute is not designed to limit the amount of money in politics.  It deals with repayment of candidates’ loans and, to use the majority’s formula, it “furthers a permissible anti-corruption goal.”  The source of funds for repayment would be donors.  Might they wish and assume that a successful candidate, now elected, would be grateful and would favor the donors’ causes?   Is this not a form of corruption or could it not lead to corruption?  Citizens United, offering no authority for its  sweeping conclusion, decided not:  “Ingratiation and access . . . are not corruption."   It must be comforting to live in a world so free of evil.  As the majority put it here, reports relied on by the Government "merely hypothesize that individuals who contribute after the election to help retire a candidate's debt might have greater influence with or access to the candidate. . . . That is not the type of quid pro quo corruption the Government may target consistent with the First Amendment.”

Justice Elena Kagan, writing for the three dissenting liberals, offered a succinct explanation of why reimbursement from post-election contributions to a successful candidate raise the issue:
Political contributions that will line a candidate’s own pockets, given after his election to office, pose a special danger of corruption. The candidate has a more-than-usual interest in obtaining the money (to replenish his personal finances), and is now in a position to give something in return. The donors well understand his situation, and are eager to take advantage of it. In short, everyone’s incentives are stacked to enhance the risk of dirty dealing. At the very least — even if an illicit exchange does not occur — the public will predictably perceive corruption in post-election payments directly enriching an officeholder.
Even if we accept the majority’s insistence upon quid pro quo, this case satisfies the majority’s test.  As Justice Kagan put it,  “The recipe for quid pro quo corruption is thus in place: a donation to enhance the candidate's own wealth (the quid), made when he has become able to use the power of public office to the donor's advantage (the quo).”

The dissent, while pointing out flaws in the majority’s analysis, also nods to the money-is-speech formula by arguing that the regulation has only an indirect and minor effect on political speech.  
    The majority's argument . . . focuses not on the restriction Section 304 actually imposes, but on the indirect effects the provision might have. The majority does not dispute that Section 304 places no limits on the amount a candidate can spend for expression. . . . Nor does (or could) the majority even claim that the provision caps what a candidate can lend his campaign. Instead, the majority argues that the law "may deter" a candidate from making large loans because it curtails a potential source of repayment--i.e., post-election donations. . . . In that way, the majority insists, the law — though concededly regulating only the use of contributions — functions to "restrict[ ] a candidate's speech." . . .  But every contribution regulation has some kind of indirect effect on electoral speech, and we have still understood them to impose only minimal burdens.
It would be better to abandon that fiction, under which, if we take the theory to its logical extreme, a bribe of a public official is political speech under the First Amendment which can be regulated only because of the magic power of thequid pro quo rule.
<br>1.  My comments on Citizens are in a post of 2/6/10.

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Posts © 2011-2012 by Gerald G. Day