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RealClearPolitics HorseRaceBlog

By Jay Cost

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McCain-Feingold Takes Another Hit. Or Does It?

Yesterday, in FEC v. Wisconsin Right to Life, the Supreme Court struck a blow to the campaign finance regime that has been in place since 2004. Or did it?

The issue in question is whether Wisconsin Right to Life, a non-profit corporation, could run what it claimed to be issue ads within thirty days of the primary with money that came from its general treasury fund. The ads in question called upon viewers to encourage Senators Herb Kohl and Russ Feingold to vote against the filibuster of judicial nominations. They did not advocate that Senator Feingold, who was up for reelection in the fall, be defeated. At the time, the FEC ruled that these advertisements were impermissible under the Bipartisan Campaign Reform Act (BCRA), a.k.a. McCain-Feingold.

The BCRA prohibits money from corporation and union general treasuries from financing "electioneering communications" (corporations and unions must instead work through PACs). An "electioneering communication" is, according to the BCRA,

Any broadcast, cable, or satellite communication which--
(I) refers to a clearly identified candidate or Federal office;
(II) is made within--
(aa) 60 days before a general, special, or runoff election for the office sought by the candidate; or
(bb) 30 days before a primary or preference election, or a convention or caucus of a political party that has authority to nominate a candidate, for the office sought by the candidate; and
(III) in the case of a communication which refers to a candidate for an office other than President or Vice President, is targeted to the relevant electorate.

This is known as the "blackout" provision because advertisements that are funded via corporation or union money (or money from individuals who have exceeded the BCRA-imposed limits on individual contributions, e.g. George Soros) cannot be aired within thirty days of a primary election or sixty days of a general election. The Federal Election Commission (FEC) determined that the Wisconsin Right to Life ads were indeed electioneering communications, and could not be run.

In Wisconsin Right to Life, the Supreme Court ruled against the FEC. It upheld the blackout provision, but ruled that the ads were nevertheless permissible.

The blackout provision was one of several intended to close a loophole that parties and interest groups began to exploit in 1996. The Democratic National Committee, at the behest of Clinton-Gore '96, started spending large amounts of soft money on "issue ads" that did not expressly endorse one candidate over another, but effectively did. Soon after, the Republicans followed suit.

How could this occur? In 1979 Congress amended the Federal Elections Campaign Act (FECA) to allow parties to spend "soft" money (i.e. money not raised under the FECA's "hard" limits on who could give and how much they could give) for party building activities. Party building included: (a) the distribution of grassroots, pro-party material that did not expressly promote the election of a federal candidate, (b) slate cards, (c) voter registration, (d) administration and overhead. Individuals could contribute unlimited amounts of soft money to party committees, and corporations and unions were not barred from contributing. In 1996 the parties started dedicating massive amounts of soft money to issue ads that were technically defined as party building, and thus not subject to the hard limits of the FECA, but were effectively expressing advocacy for a candidate's election.

The BCRA forbid parties from raising or spending soft money - and thus did away with soft money issue ads. To prevent non-party organizations from doing what the parties had done, the BCRA also implemented the blackout provision.

This is not the first time the Court has reviewed the blackout provision. In 2003's McConnell v. FEC the Court upheld it in principle, ruling that the FEC could prevent outside groups from funding "electioneering communications" with money collected outside the BCRA limitations. Nevertheless, the Court did indicate that "pure" issue ads would be permissible during the blackout dates. It therefore opened the door to a later challenge. Hence, FEC v. Wisconsin Right to Life. The FEC decided that Wisconsin Right to Life's ads were indeed electioneering, and Wisconsin Right to Life argued that they were pure issue ads.

In siding with Wisconsin Right to Life, the Court did not offer a majority opinion as to a justification for the rule. Chief Justice Roberts, joined by Justice Alito, argued for a standard to differentiate between "electioneering communications" and "pure issue ads." Chief Justice Roberts wrote:

Because [Wisconsin Right to Life's] ads may reasonably be interpreted as something other than an appeal to vote for or against a specific candidate, they are not the functional equivalent of express advocacy, and therefore fall outside McConnell's scope. To safeguard freedom of speech on public issues, the proper standard for an as-applied challenge to [the BCRA] must be objective, focusing on the communication's substance rather than on amorphous considerations of intent and effect...[A] court should find that an ad is the functional equivalent of express advocacy only if the ad is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate. [Wisconsin Right to Life's] three ads are plainly not the functional equivalent of express advocacy under this test.

What the Chief Justice argued for here is seemingly narrow. He does not wish to overturn the blackout provision cited above. Rather, he rejects the FEC's interpretation of it. He holds that so long as one could reasonably interpret an ad as a genuine issue ad, it does not fall prey to the BCRA's definition of electioneering communication. He thus holds the BCRA to be constitutional, but the FEC's interpretation of it to be unconstitutionally broad.

Justices Scalia, Kennedy, and Thomas joined in the ruling with the Chief Justice and Justice Alito. However, they did not join in this opinion. They want the blackout provision overturned altogether.

Thus, the ads are permissible, and the blackout provision is constitutional.

Justices Souter, Stevens, Ginsberg, and Breyer view this as an overturning of the Court's ruling in McConnell, and an effective end to the blackout provision. Justice Souter wrote:

After today, the ban on contributions by corporations and unions and the limitation on their corrosive spending when they enter the political arena are open to easy circumvention, and the possibilities for regulating corporate and union campaign money are unclear. The ban on contributions will mean nothing much, now that companies and unions can save candidates the expense of advertising directly, simply by running "issue ads" without express advocacy, or by funneling the money through an independent corporation like [Wisconsin Right to Life].

Without treading too far into the thorny legal or moral debate, I will say that my intuition is that Justice Souter is being a little hyperbolic. The reason is that the political parties will not be able to participate in this kind of activity. The BCRA ban on soft money has been retained. This will do much to prevent what he fears will happen.

I agree with Souter that the Court has effectively narrowed the BCRA's intended definition of "electioneering communication." I also think that this decision - because it lacks a justification that a majority supports - confuses more than it clarifies. However, to argue that this will once again open the floodgates holding back corporation and union money is to fail to appreciate what induced these organizations to give so much in the past. Their interest in channeling soft money funds to the parties was for access as least as much as it was for electioneering. A big check to the party could get you the ear of a senator if and when you needed it. Will an independently-financed quasi-electioneering ad do the same? I do not think so. I think the latter only influences voters directly, and elected officials indirectly (and I am not sure how much indirect influence it would have over officials - I do not think those "527 organizations" have acquired much influence, despite all of their efforts). Soft money given to parties could influence officials directly.

The key difference is that today, the parties are forbidden from this kind of activity. By locking the parties out of this process - and they still will be locked out - you retain a major impediment to the kind of union- and corporation-driven money that thwarted the old FECA regime. Barring the parties from soft money means impeding corporations and unions from buying access to them. Even if this opens the way for them to participate in electioneering - that is a far cry from what most of us found to be offensive in the wake of the 1996 election. Most of us objected to the direct influence that could be wielded over government officials by massive contributions to their parties.

Where I think this could have an effect is on the role of 527 groups - which in the past have been subjected to the blackout provision. What this might do is allow these groups to engage in their so-called "issue advocacy" further into the campaign season. This is why I agree with the minority that the BCRA has been weakened here, but I do not think it has been weakened by very much. The parties are still barred from receiving soft money, which is what induced this regime in the first place.

But, then again, much depends upon how the FEC deals with this decision. There is no majority-endorsed guideline on how to interpret the blackout rule. All the Court has said here is that the blackout rule does not forbid all ads. If the FEC interprets this ruling narrowly, only a few ads might be aired in the blackout period. In that case, expect to see the Court revisit this issue in the wake of the 2008 cycle.

-Jay Cost