I think Rick's analysis of the opinion is right on the money. (No pun
intended.) Although we can all think of ways of distinguishing this
case from McConnell v. FEC, what is most important here is that the
Court went out of its way to reemphasize the special nature of corporate
corruption and O'Connor and Rehnquist signed on. Indeed, we also have a
new term -- "war-chest corruption" (slip. op. at 7) -- for what is an
old concept, but which can easily be transferred to the soft money
context and perhaps the electioneering provisions of the BCRA. And, as
Rick noted, the capacious language concerning conduit corruption
(singling out the NRA, also an appellant in the BCRA litigation, slip op
at 13) could lead to many analogies with respect to soft money
contributions to political parties. One other point deserves mentioning
-- the Court also emphasizes the "PAC option" for corporations and
unions, slip op at 15-16, suggesting that the law is closely drawn
because it still allows some avenue for corporate/union contributions.
That same argument could rear its head in the BCRA case, since the law
preserves the PAC option.
Of course, opponents of the BCRA will try to distinguish this case as a
contribution-to-candidate case as opposed to a contribution-to-party or
an expenditure case.
Rick Hasen wrote:
Beaumont is Very Good News for Supporters of the McCain-Feingold law
In his case preview of Federal Election Commission v. Beaumont, 539
U.S. ___ (2003) (decided today) in the Election Law Journal, Fred
Woocher wrote that "the case that was reportedly thought to be too
'insignificant' by some FEC commissioners to warrant a petition for
certiorari to the Supreme Court may well end up providing great
insight into how the Court will rule in what is shaping up to be its
most important campaign finance reform decision since Buckley v.
Valeo." Fred Woocher, Beaumont v. Federal Election Commission: A
Pre-Cursor of More Important Things to Come?, 2 Election Law Journal
255, 260-61 (2003). When Fred wrote those words I was skeptical, but
it turns out he is absolutely right. The opinion is very significant
for the pending BCRA (McCain-Feingold dispute), and in all ways it
helps the law's defenders.
First a capsule summary, then a few initial insights on the relevance
of this case to BCRA.
Capsule summary Briefly stated, the question in the case was whether
it was constitutional to prevent ideological corporations (such as the
plaintiff in this case, the North Carolina Right to Life--NRCL) from
making unlimited campaign contributions to candidates for federal
office. Federal law requires all corporations to make any
contributions or expenditures through a corporate PAC, rather than
directly, and there are limits on who can contribute, and how much, to
the PAC. In Federal Election Commission v. Massachusetts Citizens for
Life, 479 U.S. 238 (1986) (MCFL), the Supreme Court held it
unconstitutional to prohibit independent expenditures by ideological
corporations that do not take significant corporate or union money.
The lower court in Beaumont held that NRCL was entitled to an
exemption as an MCFL-type corporation, and that the rationale behind
MCFL's prohibition on independent expenditures applied to prevent the
government from limiting contributions as well. MCFL, however, had
some language distinguishing limits on contributions from limits on
expenditures, and an earlier Supreme Court case, FEC v. National Right
to Work Committee, 459 U.S. 197 (1982) (NRWC), strongly suggested that
a ban on contributions by corporations was constitutional, even as
applied to ideological corporations.
In Beaumont, six justices, in an opinion written by Justice Souter,
relied on MCFL and NRWC to uphold the ban on contributions by
ideological corporations.
Insights
1. Very strong reaffirmation of campaign finance laws limiting
corporate and union involvement in the electoral process. The Court
could have written a very brief opinion, primarily what appears in the
opinion in Part I.B, spelling out how MCFL and NRWC control the
outcome in the case. But the opinion does much, much more in ways that
strongly suggest the Court will uphold the electioneering
communications provisions of BCRA---these are the rules that require
corporations and unions to pay for "issue ads" featuring the name or
likeness of a candidate for federal office in a certain time period
before an election using funds from a separate segregated fund (or
PAC). Beaumont's analysis strongly supports the idea that Congress
acted constitutionally in imposing this requirement.
a. The opinion extols the virtues of longstanding limits that Congress
has placed on corporations and unions. It gives a completely
unnecessary "historical prologue" (slip. op. at 8) explaining the
unique purposes that corporate/labor union separate funds requirement
serves. This discussion supports Congress's need to regulate the rise
in "issue ads."
b. In setting forth the interests served by the requirements, the
opinion stresses the dangers of political war chests created with the
help of the corporate form. It also points to the law's role in
protecting shareholders or members from corporate spending on
political speech that is not in line with the shareholders' or
members' interests. It then adds yet another interest (slip. op. at
7): "restricting contributions by various organizations hedges against
their use as conduits for 'circumvention of [valid] contribution
limits.'" Again, these rationales could be used to support Congress's
issue ad provisions.
c. The opinion minimizes the First Amendment protections for
corporations. In footnote 5, the Court writes: "Within the realm of
contributions generally, corporate contributions are furthest from the
core of political expression, since corporations' First Amendment
speech and associational interests are derived largely from those of
their members, and the public in receiving information. A ban on
direct corporate contributions leaves individual members of
corporations free to make their own contributions and deprives the
public of little or no material information." (Citations omitted) This
language is quite significant in that the Court in the past had,
especially in Bellotti (cited in this Beaumont footnote), had rejected
the idea the corporations were entitled to fewer First Amendment
protections. Of course, this footnote again strengthens the arguments
for constitutionality of congressional provisions regulating corporate
and union issue ads.
d. Justice Souter in the opinion appears to do the impossible: he
simultaneously appears to resurrect the analysis of Austin v. Michigan
Chamber of Commerce (a case upholding a ban on corporate independent
expenditures) and at the same time do so obliquely enough to keep
Justice O'Connor's vote. O'Connor dissented in Austin, and her vote in
the BCRA case on the issue ad requirements is expected to be
important, especially if the Chief Justice retires. Souter quotes
enough from Austin to suggest that the majority believes that too much
corporate wealth in the political process can be corrosive to the
system without actually quoting the key language from Austin on this
point. Perhaps a BCRA opinion upholding the issue ad provision can be
crafted the same way.
2. The case is good news for the soft money provisions of the BCRA.
There is ample language in the opinion reaffirming Congressional power
to prevent corruption through conduits and to control the perception
of corruption in the electoral process. The Court strongly reaffirms
that contribution limits are not subject to strict scrutiny, and that
the legislative body passing such limits need not provide much
empirical evidence to support any contribution limit that lacks
"novelty." These statements are strong indications supporting the
rationale behind Congress's soft money ban.
In short, there is only good news in this opinion for supporters of
BCRA.
--
Rick Hasen
Professor of Law and William M. Rains Fellow
Loyola Law School
919 South Albany Street
Los Angeles, CA 90015-1211
(213)736-1466 - voice
(213)380-3769 - fax
rick.hasen@lls.edu
http://www.lls.edu/academics/faculty/hasen.html
http://electionlaw.blogspot.com
--
Nathaniel Persily
Assistant Professor
University of Pennsylvania Law School
3400 Chestnut Street
Philadelphia, PA 19104
(o) 215-898-0167
(f) 215-573-2025
npersily@law.upenn.edu
http://persily.pennlaw.net/