Limiting the Impact of Corporate Money in Politics

In his State of the Union address, President Obama said the Supreme Court had "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." As Justice Alito could be seen mouthing the words "that's not true" in response, Obama went on to say he didn't "think American elections should be bankrolled by America's most powerful interests, or worse, by foreign entities" and to call on Congress pass a bill limiting the power of corporations to affect elections.

While financial reform legislation dominates the political headlines, Congress is finally preparing to do as President Obama asked. In his speech Obama was referring the Supreme Court's 5-4 decision in Citizens United v. Federal Election Commission that Congress can't pass a law prohibiting corporations or unions from paying for political advertising. The legal question is murky. It's not obvious that spending money to broadcast advertising is speech in the sense that is protected by the Constitution. Nor is it clear that corporations should necessarily have the same rights to express themselves as their individual members. In his dissent, the now retiring Justice Stevens worried about "the distinctive corrupting potential of corporate electioneering" and said that the ruling threatened "to undermine the integrity of elected institutions across the Nation." In the end, however, the majority decided that it was hard to draw a bright line between corporate political advertising and protected private political speech.


The decision completely overturned the court's 1990 decision in Austin v. Michigan Chamber of Commerce, and it called into question—although without directly reversing—more than a hundred years of law limiting the ability of corporations to make contributions to political campaigns. It probably tilts the electoral balance somewhat toward Republicans, who typically receive more corporate support than Democrats. But it is not merely a partisan issue. At stake is whether corporations should have even more influence over the political process than they already do. And while people are generally sympathetic to the argument that campaign spending is a form of speech, a large majority favors limiting the ability of corporations to participate in political campaigns. As President Obama said in one of his radio addresses, the ruling "gives the special interest lobbyists new leverage to spend millions on advertising to persuade elected officials to vote their way—or to punish those who don't."

There's not much Congress can do to limit corporations' ability to produce political advertising if it's protected by the First Amendment. But the Supreme Court did leave open the possibility that Congress could prevent corporations from producing advertisements anonymously. So the Democrats are proposing legislation that would force corporations to disclose that they paid for their ads, and would even require CEOs to personally appear in their company's ads and to take responsibility for their message. The law would make it difficult for corporations to take positions they could not defend, as well as give voters a way to judge whether ads were biased or self-serving. While the Republican leadership has attacked the proposal as a way to game the fall elections, it has attracted at least one Republican sponsor, and its broad popular appeal makes it likely to pass.

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