Event: The Impact of the Citizens United Decision on Federal Elections

Last week, former FEC Commissioner Hans A. von Spakovsky (now affiliated with the Heritage Foundation) moderated a panel discussion, sponsored by the Heritage Foundation and the free speech and election law practice group of the Federalist Society, that examined the practical impact and potential outcomes of the decision in Citizens United v. FEC.  The panel – whose other members were all veterans of the FEC and/or campaign law specialists – agreed that the decision was one of the most (if not the most) significant campaign finance decisions since Buckley v. Valeo.  The panelists also largely agreed on three other points: first, Congress and state legislatures will likely enact stricter disclosure laws to monitor corporate and labor spending on election advertising; second, the decision will likely spur further litigation and require courts and the FEC to resolve additional questions, while also addressing the status and rights of foreign corporations; third, because it is difficult to predict what the results of the decision will be, the panel should reconvene next year to reflect again on the decision.

Jan Baran, the former general counsel for the Republican National Committee, first described two ways the decision changes the election advertising rules for corporations and unions.  First, he pointed out that the decision allows unions and corporations to fund “magic words” advertisements – which, unlike advocacy ads that might encourage voters to “call candidate Jones about issue x,” encourage listeners to “vote for candidate Jones.”  Second, Baran noted that the Citizens decision eliminates the McCain-Feingold ban on ads thirty days before a primary and sixty days before a general election ban.  Thus, the FEC will no longer regulate the timing or content of ads.  The decision requires twenty-four states to repeal their bans on corporate and union advertising; as states repeal these laws, Baran reasoned, they might concurrently strengthen their reporting and disclosure laws.  Next, Baran predicted that more money will be spent in the 2010 elections than in the previous cycle (he conceded, however, that he has made this prediction for the past thirty years and always been right).  The point, he explained, is that the question is not so much if more money will be spent in elections, but rather how that money will be spent.

Joseph Birkenstock, former chief counsel for the Democratic National Committee, expressed his concern that the decision disfavors regulatory law, and in so doing, favors criminal law.  Birkenstock explained that there are two realms of law the government uses to regulate connections between politics and money: criminal law and regulatory law.  He predicted that the Citizens decision will result in a decline of the regulatory system, thereby diminishing requirements for paperwork and forms.  At the same time though, there will be a new “high-water mark” of criminal enforcement.  As such, some people will be investigated, charged, and prosecuted.  By disfavoring the regulatory system, Birkenstock reasoned, the Court inherently favors the criminal law approach, an approach that concerns him.  He also made two predictions: first, Congress may pursue more robust disclosure laws in response to the opinion.  Second, the Court’s decision will lead to questions regarding whether multi-national corporations are “foreign” and thus precluded from advertising in American elections.

Marc Elias, an election-law attorney at Perkins Coie, emphasized that – regardless of one’s view of the results in Citizens United – the procedural posture of the case was odd.  Both Buckley and McConnell interpreted significant challenges to recently passed legislation, he explained.  However, Citizens United began as a challenge by a non-profit regarding a pay-per-view movie; until the Court ordered re-hearing, the broader challenge to McConnell, Austin, or the McCain-Feingold Act was not before it.  The atypical manner by which the case reached the Court, the length of the opinion, and the Court’s focus on a question not originally posed by the case, suggested Elias, suggest that this may be the beginning of a new direction for the Court.  Elias was ultimately uncertain regarding what that direction may be, but he predicted that this would be a “tipping point” for the Court, a moment when we might look back and realize that the Court had begun to shift.

Elias also discussed the concern that corporate and labor interests might “hide” funding behind various non-profit corporations; such a concern, he concluded, justifies a disclosure system that will inform voters about who has funded an advertisement or group.  The opinion is also “a bad opinion for parties and candidates,” Elias said, who will face more difficulties in purchasing advertising slots or competing with the buying power of corporations and unions.  During the recent election run-off in Massachusetts, for example, television networks experienced a surge in the number of customers purchasing ads, and the networks announced prior to election day that no slots were available for advertising.  To offset this problem, Elias argued, the FEC should disconnect parties from the coordination rules that apply to corporations and politicians.

Michael Toner, a former FEC chairman, spoke next, observing that the opinion is categorical on two formerly confusing questions of law, though other areas will require further clarification and may encourage legislative responses or further litigation.  First, the Court was clear that when corporations or unions are buying ads, no content restrictions are permissible.  Second, there are restrictions may no longer be placed on the time period when advertising is permitted.  However, Toner foresees a potential ripple effect on other long-standing areas of FEC regulation, and he suggested that it may become quite difficult for the FEC to regulate “get out the vote” efforts, voter registration efforts, and corporate voter guide, which had previously been closely regulated.  Toner also remarked that the case may encourage additional campaign finance litigation; for example, SpeechNow.org v. FEC, a case pending in the D.C. Circuit, challenges contribution limits as applied to non-affiliated campaign groups.