‘Last week,” President Obama declared a decade ago, “the Supreme Court reversed a century of law that I believe will open the floodgates for special interests—including foreign corporations—to spend without limit in our elections.”
Mr. Obama was wrong in almost every respect about Citizens United v. Federal Election Commission, which the court decided on Jan. 21, 2010. Hysterical predictions about Citizens United—then-Rep. Ed Markey, among others, compared it to Dred Scott—haven’t held up.
Contrary to Mr. Obama’s assertion about a century of law, Citizens United overturned portions of McCain-Feingold, a campaign-finance law that wasn’t even 10 years old, and another law from 1947. Those laws prohibited unions and corporations, including nonprofits, from voicing support for or opposition to candidates for federal office.
Citizens United didn’t affect the longstanding ban on corporate contributions to candidates, and it didn’t legalize foreign political spending in the U.S. Most Russian online ads in 2016 would have been protected under the First Amendment even before Citizens United, because the ads didn’t urge a vote for or against a candidate.
Far from handing power to the 1%, Citizens United unleashed rapid political diversification. Since the ruling, the White House or Congress has changed parties in every federal election except 2012. Twenty eighteen saw the highest midterm voter turnout in a century. Small-dollar donors are more coveted than ever. Donald Trump raised more money from donors who gave less than $200 than any candidate in history.
Since Citizens United, party outsiders such as Mr. Trump and Bernie Sanders have risen to national prominence. And money hasn’t been able to buy elections as predicted. Sheldon Adelson donated record amounts to Republican super PACs in 2012 but failed to prevent strong Democratic victories. Democrats Tom Steyer and Michael Bloomberg came up empty after putting huge sums of money behind climate change and gun control.
Hillary Clinton outspent Mr. Trump 3 to 1 in 2016. Congressional leaders and big-time fundraisers such as Reps. Eric Cantor (R., Va.) and Joe Crowley (D., N.Y.) lost their seats to primary challengers who spent a fraction of what the incumbents did. Incumbent re-election rates in the House never dipped below 94% from 1996 to 2008, but did in 2010, 2012 and 2018.
Citizens United deserves a share of credit for all these trends. The decision made it easier to promote (or criticize) a candidate without help from party leaders or media elites.
Perhaps the worst prediction was that Citizens United would allow a corporate takeover of democracy. The New York Times accused the justices of having “paved the way for corporations to use their vast treasuries to overwhelm elections” and “thrust politics back to the robber-baron era of the 19th century.”
A decade later, most spending comes from the same place it always has: individuals who donate directly to candidates, up to legally limited amounts. Corporations contribute well under 10% of federal political spending, Their voice is not dominant—and voters have a right to hear it. Justice Anthony Kennedy and his colleagues didn’t hold that “money is speech” or “corporations are people.” The ruling was part of a healthy shift in favor of free speech in politics—a trend that began with 2007’s Wisconsin Right to Life v. FEC, and continued through 2014’s McCutcheon v. FEC.
The questions is whether the justices think their work is done. If they truly want to empower democracy, they should continue to look skeptically at regulation of campaign finance. Political speech, after all, is at the core of the First Amendment’s protection.
Mr. Smith served as chairman of the Federal Election Commission, 2001-05, and is chairman of the Institute for Free Speech.
Shays-Meehan would limit spending in House races to $600,000. In 1996, every House incumbent who spent less than $500,000 won compared with only 3% of challengers who spent that little. However challengers who spent between $500,000 and $1 million won 40% of the time while challengers who spent more than $1 million won five of six races. The McCain-Feingold bill, which sets spending limits in Senate races, would yield similar results. In both 1994 and 1996, every challenger who spent less than its limits lost, but every incumbent who did so won.
This anecdotal evidence supports comprehensive statistical analysis: The key spending variable is not incumbent spending, or the ratio of incumbent to challenger spending, but the absolute level of challenger spending. Incumbents begin races with high name and issue recognition, so added spending doesn’t help them much. Challengers, however, need to build that recognition. Once a challenger has spent enough to achieve similar name and issue recognition, campaign spending limits kick in. Meanwhile the incumbent is just beginning to spend. In other words, just as a challenger starts to become competitive, campaign spending limits choke off political competition.
‘Russia Hoax’ author Gregg Jarrett and former FEC chairman Bradley Smith join ‘Life, Liberty & Levin’ to discuss campaign finance laws.
Smith’s breakthrough came in 1996, with the publication of his article “Faulty Assumptions and Undemocratic Consequences of Campaign Finance Reform” in the Yale Law Journal.
In “Faulty Assumptions”, Smith laid out a case against campaign finance regulation, arguing that efforts to regulate money in politics had been based on a series of incorrect beliefs about the effects of money in politics, and that as a result reform efforts had failed to accomplish their objectives and had made many of the problems of money in politics worse. “Faulty Assumptions,” and later articles by Smith, have been cited in numerous recent Supreme Court decisions striking down campaign finance laws on Constitutional grounds, including Citizens United v. Federal Election Commission. In 2010 The New York Times called Smith the “intellectual powerhouse” behind the movement to deregulate campaign finance. The importance of “Faulty Assumptions” lay in its blending of existing political science research with legal and constitutional theory. Before “Faulty Assumptions”, most legal scholarship on campaign finance had followed a narrative that assumed the corruptive and anti-egalitarian effects of large campaign contributions and spending, and had then focused on the creating a legal regime to control those effects and justify regulation against First Amendment claims recognized by the Supreme Court in Buckley v. Valeo. At the same time, these articles largely ignored a growing literature in political science based on empirical studies of campaign spending and regulatory regimes. Smith’s contribution was to bring these two arms of scholarship together, blending the growing body of empirical data to the constitutional and legal principles laid out elsewhere. The result was to challenge the very foundation of campaign finance reform in both politics and constitutional law. Smith’s analysis forced proponents of reform to rethink many basic assumptions, or at least to justify them against his critique.
.. Smith also wrote Unfree Speech: The Folly of Campaign Finance Reform, a book published by the Princeton University Press in 2001. By the time Unfree Speech was published, both Smith and his campaign finance scholarship had become something of a Rorschach test for attitudes about campaign finance. The book met with near universal praise among opponents of regulation, such as columnist George Will, who called it “the Year’s most important book on governance,” and condemnation from supporters of regulation, with journalist Eliza Newlin Carney lambasting it as “facile and boggling.” Scholars, including the British political scientist Michael Pinto-Duschinsky were more balanced and generally complimentary, but by the time of publication Smith had been appointed to the Federal Election Commission and the book was largely reviewed as a political tract, rather than as the scholarly manuscript Smith presumably intended.
.. The Brennan Center for Justice, a harsh critic of Smith’s work, nevertheless recognized him as “the most sought after witness” to make the case for deregulation of campaign finance before congressional committees.
.. Because of his contrarian, deregulatory views on campaign finance, there was a strong objection to his nomination from reform advocates.
The libertarian magazine Reason noted that virtually all reform advocates “agreed that he was the wrong person for the job”. His nomination, however, received support from supporters of deregulation of campaign finance, such as the Cato Institute.
.. After leaving the FEC, Smith returned to teaching at Capital University and founded a non-profit organization, the Center for Competitive Politics to promote deregulation of campaign finance.
The prosecutor is twisting campaign-finance law.
Donald Trump’s wayward counsel, Michael Cohen, was sentenced today as part of a plea bargain with the government. As part of that settlement, Cohen has admitted to criminal violations of federal campaign-finance law and has implicated President Trump in those violations. The press is ablaze with headlines trumpeting the president’s possible involvement in two felony campaign-finance violations. The source of these violations are Mr. Cohen’s arranging — allegedly at Trump’s direction — hush-money payments to women alleging long-ago affairs with the 2016 presidential candidate.
The Federal Election Campaign Act holds that an “expenditure” is any “purchase, payment, loan, advance, deposit or gift of money, or anything of value, for the purpose of influencing any election for Federal office.” According to Cohen and the U.S. Attorney, the hush-money payments were, it appears, made in the hopes of preventing information from becoming public before the election, and hence were “for the purpose of influencing” the election. This means that, at a minimum, they had to be reported to the Federal Election Commission; further, if they were authorized by Mr. Trump, they would become, in the law’s parlance, “coordinated expenditures,” subject to limits on the amounts that could be spent. Since the lawful contribution limit is much lower than the payments made, and the payments were not reported, this looks like an open and shut case, right?
Well, no. Or at least not in the way some might presume. To the contrary, the law — following our common sense — tells us that the hush-money payments outlined by the U.S. Attorney are clearly not campaign expenditures. There is no violation of the Federal Election Campaign Act.So what does it mean to be “for the purpose of influencing an election”? To understand this, we read the statutory language in conjunction other parts of the statute. Here the key is the statute’s prohibition on diverting campaign funds to “personal use.” This is a crucial distinction, because one of the primary factors separating campaign funds from personal funds is that the former must be spent on the candidate’s campaign, while the latter can be used to buy expensive vacations, cars, watches, furs, and such. The law defines “personal use” as spending “used to fulfill any commitment, obligation, or expense of a person that would exist irrespective of the candidate’s election campaign.” So a candidate may intend for good toothpaste and soap, a quality suit, and a healthy breakfast to positively influence his election, but none of those are campaign expenditures, because all of those purchases would typically be made irrespective of running for office. And even if the candidate might not have brushed his teeth quite so often or would have bought a cheaper suit absent the campaign, these purchases still address his underlying obligations of maintaining hygiene and dressing himself.
The settlements in this hypothetical are made “for the purpose of influencing the election,” yet they are not “expenditures” under the Federal Election Campaign Act. Indeed, if they were, the candidate would have to pay for them with campaign funds. Thus, an unscrupulous but popular businessman could declare his candidacy, gather contributions from the public, use those contributions to settle various preexisting lawsuits, and then withdraw from the race. A nice trick!
When faced with the vague, sweepingly broad “for the purpose of influencing any election” language, the Supreme Court has consistently restricted its reach to brightly defined rules. For example, in determining whether a public message was an “expenditure” made “for the purpose of influencing any election,” it has construed the later phrase to apply only to messages “expressly advocating” the election or defeat of a candidate, such as “vote for,” “vote against,” “defeat,” “re-elect,” and the like, or to other clearly defined messages that are the “functional equivalent” of that express advocacy.
In short, Michael Cohen is pleading guilty to something that isn’t a crime. Of course, people will do that when a zealous prosecutor is threatening them with decades in prison. But his admissions are not binding on President Trump, and Trump should fight these charges ferociously.
In A Man for All Seasons, Sir Thomas More’s future son-in-law, Roper, states that he would “cut down every law in England” if it would enable him to catch the devil. To which More responds,
And when the last law was down, and the Devil turned ’round on you, where would you hide, Roper, the laws all being flat? This country is planted thick with laws, from coast to coast, Man’s laws, not God’s! And if you cut them down, and you’re just the man to do it, do you really think you could stand upright in the winds that would blow then? Yes, I’d give the Devil benefit of law, for my own safety’s sake!
We do ourselves no service by distorting and misapplying our campaign-finance laws in the hope of bagging Donald Trump.Comments:
In response to the emerging evidence that Donald Trump directed and participated in the commission of federal crimes, all too many Republicans are wrongly comforting themselves with political deflection and strained legal argument. The political deflection is clear, though a bit bizarre. The recent wave of news about Trump’s porn payoffs is somehow evidence that investigators and critics are “shifting focus” from the Russia investigation to alleged campaign-finance violations.
It’s almost as if the campaign-finance news is taken as some sort of evidence that Mueller’s core investigation is faltering, so the media and investigators have to find something to use to attack Trump.
But the campaign-finance investigation has little to do with Mueller. It’s run by the U.S. Attorney’s Office for the Southern District of New York, and — besides — what do we want federal prosecutors to do when they discover evidence of unrelated crimes when engaged in a different investigation? Let bygones be bygones? Or refer that evidence to the proper jurisdiction — as Robert Mueller’s office did — for further investigation and potential prosecution?
.. The current wave of news reports is largely driven by court filings, and those court filings don’t represent a shift in law-enforcement focus on Trump but rather an arena of additional inquiry. The sad reality is that the Trump operation was a target-rich environment for any diligent investigator.
.. The Edwards prosecution failed not as a matter of law but of fact. The prosecution simply didn’t produce sufficient evidence to prove its case. Here’s Conway, Katyal, and Potter on the contrasts between the Edwards and Trump cases:
A key witness, Bunny [Mellon], was 101 years old and too frail to show up at trial. There were no written legal agreements providing money in exchange for silence, as there are in Trump’s case, and no threats by the mother of the child to go public immediately if the funds were not received. That’s why one juror told the media that the evidence wasn’t there to show even that Edwards intended the money to go to Rielle Hunter. In contrast, in a bombshell disclosure this week, the public learned that AMI, the parent corporation of the National Enquirer, is cooperating with the prosecution and has stated that the payments were made to influence the 2016 election. And even more worrisome for Trump, reports emerged Thursday that Trump was the third person in the very room where Cohen and David Pecker (the head of AMI) discussed the hush money payments — making it very hard for Trump to assert a non-campaign-related purpose
..So far, the best available evidence indicates that Trump’s commitments to Stormy Daniels didn’t exist “irrespective” of his campaign but rather because of his campaign. That’s Michael Cohen’s assertion. That’s AMI’s assertion. The affairs were relatively old — and so was the threat to his family — but the payments were new, rendered at a crucial time in a very close presidential contest.
.. Moreover, Cohen has indicated that prosecutors have a “substantial amount of information” that corroborates his testimony. And what is that information? Well, as the Wall Street Journal has already reported:
Mr. Trump was involved in or briefed on nearly every step of the agreements. He directed deals in phone calls and meetings with his self-described fixer, Michael Cohen, and others. The U.S. attorney’s office in Manhattan has gathered evidence of Mr. Trump’s participation in the transactions
Here is the fundamental reality, Republicans — there is already far more evidence of legal culpability against Trump than ever existed against Edwards, and a federal judge permitted the Edwards case to go to trial. It is true that, if Trump does eventually face indictment, a different judge may have a different view of the law, but if Trump is counting on a favorable legal ruling, he’s playing a dangerous game indeed.
.. Campaign-finance law is constructed from the ground up to require candidate transparency and guard against corruption. Thus, it is purposefully very hard for candidates to find a way to legally and quietly use substantial sums of money to cover up dirty deeds. In his essay, Smith argues, “Indeed, it is quite probable that many of those now baying for Trump’s scalp for illegal campaign contributions would be leading a charge to prosecute Trump for illegal ‘personal use’ of campaign funds had he made the payments from his campaign treasury.”
That’s likely correct — and evidence that campaign-finance law is working as intended. In other words, if you’re a campaign-finance lawyer, and a candidate asks your advice on how to buy the silence of a porn star and hide that payment entirely from the American people, your best response should be, “Have you considered not running for office?”
During times of peace, executives can move more slowly and ensure that everybody is on board with key decisions, he said during the June meeting, according to people familiar with the remarks. But with Facebook under siege from lawmakers, investors and angry users, he needed to act more decisively, the people said... The 34-year-old CEO believes Facebook didn’t move quickly enough at key moments this year and increasingly is pressing senior executives to “make progress faster” on resolving problems such as slowing user growth and securing the platform, said people familiar with the matter. Mr. Zuckerberg also at times has expressed frustration at how the company managed the waves of criticism it faced this year... On Friday, that tension was on display when, during a question-and-answer session with employees at Facebook’s headquarters in Menlo Park, Calif., he blasted a fresh round of critical news coverage as “bullshit,” according to the people familiar with the remarks.
One employee at the session asked if Facebook could deter leaks by publishing an internal report about how frequently offenders are found and fired. Mr. Zuckerberg said Facebook does fire leakers, but the root cause was “bad morale” perpetuated by attacks in the media... He believes this tougher management style is necessary to tackle challenges being raised both internally and externally, according to a person familiar with his thinking... Mr. Zuckerberg’s new posture could trouble those who feel his “move fast, break things” mantra from Facebook’s early days contributed to many of the company’s current problems. It also has led to confrontations with some of his top reports, including Ms. Sandberg, who has long had considerable autonomy over the Facebook teams that control communications and policy... This spring, Mr. Zuckerberg told Ms. Sandberg, 49, that he blamed her and her teams for the public fallout over Cambridge AnalyticaMs. Sandberg later confided in friends that the exchange rattled her, and she wondered if she should be worried about her job.
.. Mr. Zuckerberg also has told Ms. Sandberg she should have been more aggressive in allocating resources to review troublesome content on the site
.. The heads of some other key Facebook units didn’t survive conflicts with Mr. Zuckerberg.
.. The co-founders of WhatsApp likewise left after disagreements with Mr. Zuckerberg over how to generate more revenue from the messaging-service
.. More recently, Mr. Zuckerberg forced out Brendan Iribe, co-founder of Oculus VR, in part because of a disagreement about the future of the Oculus Rift virtual-reality headset
.. Facebook remains hugely profitable, with net income of more than $5 billion in the third quarter, but its margins are under pressure in part because of its increased spending on security.
.. Mr. Zuckerberg has said Facebook is in the midst of a three-year turnaround ending in 2019 to strengthen its defenses against the risks posed by having an open platform.
.. All told, about a dozen senior or highly visible executives disclosed their resignations or left Facebook in 2018. In May, Facebook announced a major reshuffling of top product executives in a way that helped free up Mr. Zuckerberg to oversee a broader portfolio within the company.
.. This turmoil at the top of Facebook has made it difficult for the company to execute on some product decisions and shore up employee morale, which has been sinking over the last year along with the stock price, which has fallen 36% since its peak. Many employees are frustrated by the bad press and constant reorganizations, including of the security team, which can disrupt their work, according to current and former employees.
.. Scrutiny of Facebook has only escalated in the past week after the New York Times reported its use of opposition-research firms tasked with exposing critical information about Facebook’s detractors, including one called Definers Public Affairs. Ms. Sandberg and Mr. Zuckerberg both said the decision to employ the firm was made by Facebook’s communications officials.