Wednesday, June 29, 2011

Money Makes the World Go ’Round; Or, Some Candidates Are More Equal Than Others

So, this is interesting. On Monday the Supreme Court announced its decision in Arizona Free Enterprise Club’s Freedom Club PAC v. Bennett, No. 10-238 (slip op. June 27, 2011) (you can download a .pdf version of the opinion here), and in so doing invalidated the Arizona Citizens Clean Elections Act of 1998, which provides public financing and matching funds to candidates who elect to forego private fundraising.

As the Court explained, under the Arizona statute a candidate for public office who elects to receive public funds is granted an initial allotment of funds to run his or her campaign. In the event that candidate’s opponent elects to use his or her own funds or to raise campaign funds privately, the publicly funded candidate is entitled to receive essentially dollar-for-dollar matching funds once the privately financed candidate’s campaign funds exceeded the amount the publicly funded candidate received in his or her initial allotment. Moreover, if private organizations raise funds to oppose the publicly funded candidate or to support his or her privately funded opponent, the state likewise provides matching funds to counterbalance the monies expended by those private organizations, once the combined total of the privately raised campaign funds and the funds expended by private opposition groups exceed the publicly funded candidate’s initial allotment from the state. The funds the state provides to match both the opponent’s privately raised campaign funds and the funds expended by private organizations for the opponent (or against the publicly funded candidate) are capped at two times the initial allotment of public funds. Arizona Free Enterprise Club’s Freedom Pac, slip op. at 2-4 (.pdf).

Note, too that under the Arizona statute if there are multiple publicly funded candidates facing a privately funded candidate in a given race, all of the publicly funded candidates can receive matching funds under the circumstances described above. Apparently this is not an unusual occurrence in Arizona. Thus, the Court explained, “[i]n an election where a privately funded candidate faces multiple publicly financed candidates, one dollar raised or spent by the privately financed candidate results in an almost one dollar increase in public funding to each of the publicly financed candidates.” (Slip op. at 4.)

Although the purpose of the Arizona law is to enable publicly funded candidates to have access to a comparable amount of money as wealthy, privately financed candidates, and thereby to increase participation in the electoral process itself, the Supreme Court ruled that Arizona’s system created an impermissible burden on the First Amendment rights of privately funded candidates and private organizations challenging publicly funded candidates. To reach this conclusion, the Court first reviewed the general principles applicable to cases involving campaign finance:

“Discussion of public issues and debate on the qualifications of candidates are integral to the operation” of our system of government. Buckley v. Valeo, 424 U. S. 1, 14 (1976) (per curiam). As a result, the First Amendment “‘has its fullest and most urgent application’ to speech ut-tered during a campaign for political office.” Eu v. San Francisco County Democratic Central Comm., 489 U. S. 214, 223 (1989) (quoting Monitor Patriot Co. v. Roy, 401 U. S. 265, 272 (1971)). “Laws that burden political speech are” accordingly “subject to strict scrutiny, which requires the Government to prove that the restriction furthers 
a compelling interest and is narrowly tailored to achieve that interest.” Citizens United v. Federal Election Comm’n, 558 U. S. ___, ___ (2010) (slip op., at 23) (internal quotation marks omitted); see Federal Election Comm’n v. Massachusetts Citizens for Life, Inc., 479 U. S. 238, 256 (1986).

Arizona Free Enterprise Club’s Freedom Pac, slip op. at 8.

The Court then found that the Arizona public campaign financing statute violated the First Amendment rights of privately funded candidates for this reason:

Once a privately financed candidate has raised or spent more than the State’s initial grant to a publicly financed candidate, each personal dollar spent by the privately financed candidate results in an award of almost one additional dollar to his opponent. That plainly forces the privately financed candidate to “shoulder a special and potentially significant burden” when choosing to exercise his First Amendment right to spend funds on behalf of his candidacy. [Citing Davis v. Federal Election Comm’n, 554 U. S. 724, 739 (2008).] If the law at issue in Davis imposed a burden on candidate speech, the Arizona law unquestionably does so as well.

… Here the benefit to the publicly financed candidate is the direct and automatic release of public money. That is a far heavier burden than in Davis.

Slip op. at 11.

Furthermore, the Court found that “the matching funds provision [in the Arizona law] can create a multiplier effect” in elections with multiple publicly financed candidates running against a single privately funded candidate:

[E]ach dollar spent by the privately funded candidate would result in an additional dollar of campaign funding to each of that candidate’s publicly financed opponents. In such a situation, the matching funds provision forces privately funded candidates to fight a political hydra of sorts. Each dollar they spend generates two adversarial dollars in response.

Id. at 11-12. Finally, the Court found that the matching funds provision created an additional First Amendment problem for privately funded candidates, in that the privately funded candidate often will have no control over the actions of private organizations supporting the his or her candidacy or opposing the publicly funded candidate, yet each additional dollar expended by those organizations can trigger matching funds for the publicly funded candidate. Id. at 12.

Turning to private organizations that advocate against publicly funded candidates (or for privately funded candidates), the Court found that the Arizona law violated the free speech rights of those organizations, too:

The burdens that this regime places on independent expenditure groups are akin to those imposed on the privately financed candidates themselves. Just as with the candidate the independent group supports, the more money spent on that candidate’s behalf or in opposition to a publicly funded candidate, the more money the publicly funded candidate receives from the State. And just as with the privately financed candidate, the effect of a dollar spent on election speech is a guaranteed financial payout to the publicly funded candidate the group opposes. Moreover, spending one dollar can result in the flow of dollars to multiple candidates the group disapproves of, dollars directly controlled by the publicly funded candidate or candidates.

In some ways, the burden the Arizona law imposes on independent expenditure groups is worse than the burden it imposes on privately financed candidates, and thus substantially worse than the burden we found constitutionally impermissible in Davis. If a candidate contemplating an electoral run in Arizona surveys the campaign landscape and decides that the burdens imposed by the matching funds regime make a privately funded campaign unattractive, he at least has the option of taking public financing. Independent expenditure groups, of course, do not.

Once the spending cap is reached, an independent expenditure group that wants to support a particular candidate – because of that candidate’s stand on an issue of concern to the group – can only avoid triggering matching funds in one of two ways. The group can either opt to change its message from one addressing the merits of the candidates to one addressing the merits of an issue, or refrain from speaking altogether. Presenting independent expenditure groups with such a choice makes the matching funds provision particularly burdensome to those groups. And forcing that choice – trigger matching funds, change your message, or do not speak – certainly contravenes “the fundamental rule of protection under the First Amendment, that a speaker has the autonomy to choose the content of his own message.” Hurley v. Irish-American Gay, Lesbian and Bisexual Group of Boston, Inc., 515 U. S. 557, 573 (1995)

Slip op. at 12-14.

The Court then went on to consider, and reject, the state’s (and the federal government’s) arguments to the effect that the burdens the statute imposed on the free speech rights of privately funded candidates and private organizations were narrowly tailored to meet compelling government interests in leveling the electoral playing field, curtailing corruption and encouraging broader participation in the electoral process. Ultimately, the Court concluded:

Arizona’s program gives money to a candidate in direct response to the campaign speech of an opposing candidate or an independent group. It does this when the opposing candidate has chosen not to accept public financing, and has engaged in political speech above a level set by the State. The professed purpose of the state law is to cause a sufficient number of candidates to sign up for public financing, see post, at 5, which subjects them to the various restrictions on speech that go along with that program. This goes too far; Arizona’s matching funds provision substantially burdens the speech of privately financed candidates and independent expenditure groups without serving a compelling state interest.

“[T]here is practically universal agreement that a major purpose of” the First Amendment “was to protect the free discussion of governmental affairs,” “includ[ing] discussions of candidates.” Buckley [v. Valeo], 424 U. S., at 14 (internal quotation marks omitted; second alteration in original). That agreement “reflects our ‘profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open.’” Ibid. (quoting New York Times Co. v. Sullivan, 376 U. S. 254, 270 (1964)). True when we said it and true today. Laws like Arizona’s matching funds provision that inhibit robust and wide-open political debate without sufficient justification cannot stand.

Slip op. at 29-30.

In the end, I certainly understand the underlying principles the Supreme Court is seeking to vindicate in Arizona Free Enterprise Club’s Freedom PAC v. Bennett – basically, candidates and organizations should be free to spend their own money without it triggering a government-sponsored windfall to their opponent – but it’s difficult to figure out what’s left of campaign finance laws after Monday’s decision. What, other than restricting the dollar amount of individual contributions and requiring candidates to disclose whom their contributions come from, can the public do to limit the pernicious and corrupting influence of money in electoral politics?

That’s not a rhetorical question.

© 2011 David P. von Ebers. All rights reserved.


  1. "What, other than restricting the dollar amount of individual contributions and requiring candidates to disclose whom their contributions come from, can the public do to limit the pernicious and corrupting influence of money in electoral politics?"


    We can win, and flush a billion dollars of corporate cash down a giant shitter. We can do it again and again until they stop. We can make the name "Koch" and the phrase "Chamber of Commerce" radioactive. We can fight and win.

  2. Amen, Matt! Let's make that happen.

  3. Did you read Kagan's dissent? I posted the most acerbic part over at my place.


    "Arizona, remember, offers to support any person running for state office. Petitioners here refused that assistance. So they are making a novel argument: that Arizona violated their First Amendment rights by disbursing funds to other speakers even though they could have received (but chose to spurn) the same financial assistance. Some people might call that chutzpah.

    "Indeed, what petitioners demand is essentially a right to quash others’ speech through the prohibition of a (universally available) subsidy program. Petitioners are able to convey their ideas without public financing—and they would prefer the field to themselves, so that they can speak free from response. To attain that goal, they ask this Court to prevent Arizona from funding electoral speech—even though that assistance is offered to every state candidate, on the same (entirely unobjectionable) basis. And this Court gladly obliges."

    End quote.