share
Print this page

Blog: McCutcheon v FEC – A Damaging Supreme Court Decision

Apr 05, 2014 | By Carolyn Burstein, NETWORK Communications Fellow

I believe that the two Supreme Court decisions  McCutcheon v FEC, issued on April 2, 2014, and Citizens United v FEC, issued on January 21, 2010 – have struck at the heart of the framework created by the court’s seminal 1976 Buckley v Valeo decision, which upheld the political campaign reforms enacted by Congress two years earlier in response to the Watergate scandal. Senator John McCain (R-AZ), a strong proponent of campaign finance reform, said in a statement relating to McCutcheon: “I am concerned that today’s ruling may represent the latest step in an effort by the majority of the Court to dismantle entirely the longstanding structure of campaign finance law erected to limit the undue influence of special interests on American politics.” What McCain did not say is that one of the last remaining efforts to curb the influence of “big money” in politics just vanished through this decision.   

While my focus is the McCutcheon v FEC decision, it is important to recall that the 2010 Citizens United case allowed businesses and unions to spend unlimited and undisclosed amounts of money on political activity, which led to the creation of super PACs and nonprofit advocacy groups that engage in political campaigns. Subsequent polls have shown that the Citizens United was deeply unpopular (disapproval was as high as 80% in some polls). In each of these cases, a sharply split court (5-4) rendered the decisions.

Now, with McCutcheon v FEC that same elite group of wealthy donors will be able to increase their influence because the court’s decision struck down the overall limits on how much individuals can donate to all candidates and political parties. The McCutcheon decision did not affect limits on contributions to individual candidates, which still stands at $2,600 per election, but clarified that “overall contributions” to political parties and to all federal candidates (currently set at specific dollar amounts) were to be removed – they violate a person’s First Amendment right to free speech, in the majority’s opinion.

Both the majority decision and the minority dissent delivered by Justice Stephen Breyer reveal a court with vastly differing visions of the government’s role in regulating campaign finance as well as the meaning of the First Amendment in ensuring participative democracy. Many of the arguments set forth in their opinions mirror the conflicts frustrating Congress and the U.S. populace at large.

The deep divisions between the five justices (Roberts, Alito, Thomas, Scalia, Kennedy) and the other four justices (Breyer, Sotomayer, Ginsburg, Kagan) were on display in their respective opinions. While Roberts, writing for the majority, wrote that Congress did not intend to reduce the amount of money in politics or restrict the political participation of some in order to enhance the influence of others. He maintained that government may restrict political contributions only to target quid pro quo corruption or the appearance of it.

Breyer emphasized the disagreement of the minority by indicating that the decision would open the floodgates to unbounded spending that would undermine what remains of campaign finance reform. In addition, Breyer made clear that the First Amendment not only referred to an individual's right to free speech, but also to the “public’s interest in preserving a democratic order in which collective speech matters.”

It is clear that the minority were not satisfied with the relatively restricted view of quid pro quo corruption proffered by Roberts, but strongly believed in a broader definition that would include privileged access to those in power and their expanded influence on decisions. Breyer maintained, “Where enough money calls the tune, the general public will not be heard … and a cynical public can lose interest in political participation altogether.” When Roberts added that Congress as well as the FEC could address campaign finance reform through earmark requirements, transfer restrictions, segregated accounts and mandated disclosure, Breyer responded that the majority’s understanding of a gridlocked Congress and FEC demonstrated a political naivete.

Public reaction to the decision was instantaneous. Dahlia Lithwick, writing for Slate, claims that Robert’s constrained definition of corruption resembles the type favored in the Gilded Age when robber barons casually left hefty bags of cash with politicians in exchange for political influence.

Lawrence Lessig, a law professor at Harvard, writing in the Daily Beast also takes issue with Robert's narrow definition of corruption by  asserting that corruption can also occur when politicians are beholden to one class of citizen. 

And Fred Wertheimer, a long-time advocate of campaign finance reform, said, "The Court's decisions have empowered a new class of American political oligarchs [which] have come at the enormous expense of the voices and interests of more than 300 million Americans." (http://billmoyers.com/2014/04/02/the-courts-decision).

Today the way is eased for those with money who merely write checks collected by a third party instead of using bags or suitcases of cash, and influence is often wielded with winks and nods. Today’s “robber barons” can be more sophisticated, thanks to the McCutcheon and Citizens United decisions, but the damage to democracy is the same. And who is to say that the average American does not conjure up the image of "fat bags of cash" left for politicians when s/he thinks of our political system?

Just as some were outraged by the McCutcheon decision, others cast the case as a free speech victory or were pleased that most significant bans on political contributions were lifted. Craig Engle, legal adviser to the team that filed the McCutcheon case, stated: "This isn't a threat to democracy -- it is democracy. One of the things that is anti-democratic is when people aren't allowed to express themselves." (Washington Post).

And Reince Priebus, Republican National Committee Chairman, rejoiced not only for McCutcheon, the Alabama businessman who brought the case (the RNC bankrolled the challenge to the FEC), but also for the prospective unlimited funding that could find its way to the RNC, the various Republican committees and candidates.

Only very rich donors are affected by the McCutcheon ruling. As a matter of fact, an analysis by the nonpartisan Center for Responsive Politics, indicates that only 644 donors reached the aggregate limits on campaign contributions to candidates and political parties. Now, however, this narrow universe of donors and others who constitute the top of the wealthy 1% of our country, are able to have outsize influence by writing checks to candidate and party committees. While the direct effects of McCutcheon may appear to involve a small number of wealthy citizens, what is overlooked is the effect on our democracy in transforming it into a full-blown plutocracy.

So how will the super-rich react to the McCutcheon decision? It is possible that now that caps no longer restrict donors from giving unlimited funds to candidates and political parties, the decision will help to re-channel money away from the super PACs and into the coffers of candidates and political parties. The latter, in particular, have been eclipsed by super PACs and politically active nonprofits which have been collecting huge sums without disclosing their donors. This non-transparency has been allowed since the Citizens United decision in 2010. While individual officeholders will be more indebted to those wealthy contributors, at least their names will be disclosed to the public (disclosure continues to be mandated for contributions to candidates and political parties).

Already political parties are planning joint fundraising committees comprising state and national party committees as well as potentially hundreds of congressional candidates. In this scenario, the joint committee could actually receive one check in the maximum amount which could then be distributed to all component candidates and groups, according to Politico.

Perhaps visions of wresting back party control of fundraising from the super PACs is behind some of this planning. Many seasoned fundraisers from both parties are skeptical that the limited universe of wealthy donors would take advantage of this new freedom. Those donors who may have "maxed out" (given the maximum legal amount of money allowed) in the past may not be able to use this excuse post-McCutcheon, but how many would be able or willing to give the millions called for by joint fundraising committees?

It is highly likely that the biggest donors will either have a specific legal or financial result in mind -- then we really have returned to the plutocracy of the Gilded Age -- or will want to help a favored candidate and then would probably fund a super PAC expressly devoted to that candidate. Otherwise, that donor's money, if given to a joint fundraising committee, could be diluted by funding several other candidates or committees. In either case, the 1% dominates the political landscape and the democratic franchise has been rendered meaningless. Is it any wonder that, according to Roll Call, Senator Charles Schumer (D-NY) lamented at a Capitol Hill press conference: "Nothing can stop a single millionaire from lining the pockets of an entire state's congressional delegation, or giving one check to every member of one party in Congress."

I can't  help thinking of the symmetry between Rep. Paul Ryan's proposed 2014 Budget and the McCutcheon decision. Just as the wealthy in Ryan's budget would have their taxes reduced and would be expected to pay little towards deficit reduction, they have also received a boon from the Supreme Court in the form of eliminating caps on political contributions to candidates and political parties. The primary beneficiaries of Ryan's budget are the same few who now will largely fund our so-called "democratic" elections. We cannot allow such an oligarchy to thrive.

The good news is that concerned citizens and good government groups are fighting back. The latter groups have organized across the country to protest the McCutcheon ruling. More than 16 states and hundreds of cities are demanding that Congress end the ever-growing influx of money into politics. Thoughtful people are pushing the two parties to restructure how they finance elections.

There are numerous models that could be followed, all of which involve public financing. More than 10 states have already successfully experimented with publicly funded elections. There are several variations, but most involve a voter's donation coupled with a matching grant from the city, state or federal government (depending on the type of election). These models are not exercises in nostalgia – yearning for the days when campaigns were conducted with smaller sums – but  real attempts to overcome the efforts of the super-rich to dominate elections. Even prior to McCutcheon, in February 2014 Rep. John Sarbanes (D-MD) introduced a variation of this plan in the House – H.R. 20. It badly needs support by more Americans outraged by the trend toward plutocracy.

Political candidates shouldn't have to beg for funds at the feet of wealthy donors by spending 3/4 of their time calling their rich constituents instead of spending their time on the public's business. It is time to change this system before we completely lose what's left of our democracy.