The Meaning of Corruption in Campaign Finance Law, and Buckley's Contribution/Expenditure Distinction

Students of campaign finance learn early on that contribution limits are subjected to less judicial scrutiny, and therefore generally upheld by the courts, while spending limits are subject to the highest judicial scrutiny, and consistently struck down by the Courts.

Bob Bauer and David Gans have been going back and forth on this, and their exchange is well worth reading. While the contribution/expenditure dichotomy serves a purpose as legal shorthand (sort of like the claim that Buckley says money is speech, which it doesn’t), it has, as Bauer notes, always oversimplified a complex issue.

What’s interesting to me is that the reform camp generally consist of liberals who tend to favor a “living constitution” and bridles whenever the free-speech camp, which generally consists of conservatives who tend to take historical or textual approaches to interpretation, says, “Congress shall make no law… .”  Yet the reform camp is in totally in a formalistic rut on this one, even after getting kicked around a bit by the courts in recent years.

What Buckley saw as a legitimate concern of reform legislation was the effort to stamp out corruption. But by corruption, Buckley didn’t mean anything people didn’t happen to like about elections, nor did it mean some alteration from a perceived baseline of how political decisions would be made in the absence of campaigning and the money that finances campaigns. The Court clearly rejected the idea that speech itself is corrupting (and speech, of course, must be financed to be truly effective and to reach large numbers).

In tolerating restrictions on contributions, Buckley was tolerating restraints on a form of associational conduct – not the conduct of spending money, as the Court of Appeals had decided, but the conduct of bargaining for favors. Buckley justified contribution limits because “[t]o the extent that large contributions are given to secure political quid pro quo’s from current and potential office holders, the integrity of our system of representative democracy is undermined.” Such exchanges occurred within the context of “large contributions [being] given to secure a political quid pro quo.” Thus Buckley finds that the type of corruption sufficient to justify limitations on campaign finance must include non-speech conduct – some type of quid pro quo exchange. Such a definition inherently rejects as sufficient justification for regulating speech the idea that large sums of money “distort” the process and do not “reflect actual public support for the political ideas” espoused, the notion briefly resurrected in Austin. Speech itself is not corrupting, and is not made corrupting merely because the speech may be effective in persuading voters or because candidates might be grateful for the support of the speaker.

The Court upheld limits on contributions because the process of contributing opened the possibility for explicit exchange bordering on bribery. Buckley rejected the idea that “corruption” was limited solely to malfeasance of the sort that would be illegal under bribery laws: “laws making criminal the giving and taking of bribes deal with only the most blatant and specific attempts of those with money to influence governmental action.” But it demanded behavior of a similar type if not degree. Contributions to candidates and parties, Buckley held, posed a direct threat of corruption similar to bribery – donors might give to a candidate or officeholder with the understanding that in return, the officeholder (or candidate/future officeholder) would take some official action he would not otherwise take. At no point does the Court deny that speech will influence races, or that it may create a sense of indebtedness on the part of the officeholder. That’s the point of supporting candidates and speaking out.

Indeed, the Court specifically recognized that independent expenditures could be used by “unscrupulous persons and organizations to expend unlimited sums of money in order to obtain improper influence over candidates for elective office.” But it dismissed the constitutional importance of this concern. In doing so, it suggested that independent expenditures were likely to be of less value to a candidate than direct contributions, and might even be counterproductive. But more importantly, it noted that the requirement of independence – the absence of “prearrangement and coordination” – “alleviates the danger that expenditures will be given as a quid pro quo for improper commitments from the candidate.” This point re-emphasizes the Court’s focus on conduct resulting in the possibility of quid pro quo exchange as the type of corruption sufficient to justify government regulation of political contributions and spending. The Court was willing to give the government leeway to regulate activity that did not rise to the level of bribery, but it insisted upon an explicit quid pro quo exchange, as opposed to some tacit understanding between the parties.

The insistence upon a quid pro quo exchange indicates that the Court is not allowing limitations on speech. Rather, it is allowing regulation of a particular type of conduct, the overt exchange of campaign contributions for legislative favors, where that exchange may not qualify as bribery, perhaps because of the lack of personal inurement to the officeholder, or simply because bribery is too difficult to prove.

Thus, when the Court in Citizens United proclaimed that “independent expenditures … do not give rise to corruption or the appearance of corruption” it was making a statement of constitutional law, not reviewing public opinion polls. The Court was referencing a specific type or meaning of corruption by officeholders, not whatever some observers might call “corruption” from some norm. Among other things, the Court has not accepted what might be termed the “gratitude” theory of corruption. Merely because an officeholder might be grateful to those who supported him, and thus inclined to listen more sympathetically to their requests or consider more generously their desires for government policy, is not corruption. Candidates may be aware of a supporter’s spending, and may accordingly be inclined to reward supporters, but mere speaking is not a form of conduct by supporters that can be regulated.

Similarly, the Court has rejected the idea that mere “access” to a politician is itself a form of corruption that justifies restrictions on political contributions and spending. And the Court rejects the idea that an effort to make one’s speech effective, by, for example, developing media to compliment the candidate’s own efforts, hiring persons familiar with the candidate’s views to help develop independent messages, or working with persons familiar with the race, constitutes conduct that can be regulated. (These are the types of activities undertaken by many “Super PACs,” which reformers claim demonstrate lack of “independence.”)

One final element of Buckley’s reasoning merits review. In addition to the prevention of “corruption,” Buckley recognizes limiting “the appearance of corruption resulting from large individual financial contributions” as an important state interest sufficient to justify restrictions. This too, however, is not an expansive license to find “corruption” in everything that the public may not like about politics, or distrust in officeholders. The Court discusses the “appearance of corruption” in the same breadth and sentence as actual “corruption,” as “the extent that large contributions are given to secure political quid pro quo’s from current and potential office holders.” It further describes the “appearance of corruption” as “public awareness of the opportunities for abuse inherent in a regime of large individual financial contributions.” The “abuse” described immediately prior, is, of course, that of quid pro quo exchange.

In accepting the “appearance of corruption” as a compelling state interest, the Court seemed to recognize the inherent difficulty of determining if a quid pro quo exchange has taken place, given that written proof will typically be lacking and the details of any arrangement known only to the parties. It is extremely difficult to determine why an official takes any particular action, as an officeholder can almost always justify his action on the basis of some neutral principle. If the measure is popular, he can cite the wishes of constituents; if it is unpopular, his own judgment; if it benefits his district, he can argue he was “bringing home the bacon;” if it does not benefit his district directly, he can argue he acted for the good of the nation. Thus, the “appearance of corruption” standard can be a means of getting past these burden of proof issues.

The “appearance of corruption” interest also addresses the argument that limitations on contributions fail the overbreadth doctrine because most contributors do not seek any special favors. Because voters cannot know what goes on in private meetings between donors and candidates/officeholders, and proof of quid pro quo activity will be difficult, the public may suspect much quid pro quo activity is occurring. The “appearance of corruption” standard deals with this concern. But in all cases, the “appearance of corruption” is firmly tied to the actual corruption found by the Court – quid pro quo exchange.

Buckley is thus best understood not as allowing the suppression of some speech that might be corrupting, but rather as allowing the suppression of certain associational activities because they allow the opportunity for corruption. The Court doesn’t see speech as corrupting at all, and it doesn’t see spending money to amplify one’s speech as corrupting, either. The corruption is in the bargain. The bargain can take place in the context of contributions or expenditures. Contributions are by definition coordinated with the candidate, and so subject to some limitations across the board. Expenditures are not inherently coordinated with the candidate, and so can only be limited as an incidental result if such coordination occurs. (At least that’s the theory – one might argue that much fund-raising involves no contact between donor and candidate, whereas more contact might exist between the candidate and persons making independent expenditures. But that’s a different argument).

What should be clear is that Buckley applies a functional dimension to the government interest that justifies regulation. Contributions are not subject to lower scrutiny because they are contributions, but because they offer a greater chance for quid pro quo corruption. Expenditures get strict scrutiny not because they are expenditures, but because they seem to pose no threat of quid pro quo dealing. This is less true of independent expenditures than a candidates own spending, but still true enough. By definition it is not true of coordinated expenditures, so restrictions there are given less scrutiny. But the type of coordination that matters is actual contact that would allow for quid pro quo dealing. Thus, Justice Breyer’s concurring opinion in Nixon v. Shrink Missouri Government PAC is off base. Breyer writes that we could allow more regulation of campaign finance within the Buckley framework if, for example, “expenditures [by independently wealthy candidates] might be considered contributions to their own campaigns.” But that would miss the whole point of Buckley. It would be either the type of clever, meaningless distinction that gives lawyers a bad reputation, or the dull-witted, utterly literalist reading of the opinion that Breyer typically despises.

Post-Buckley, unfortunately, the FEC took this literalist, formalist view of the distinction. Thus, it argued that it could limit the size of “contributions” to political committees even when those committees made only independent expenditures. The FEC continued with this interpretation even after California Medical Association v. FEC. In Cal Med, the Court upheld, 5-4, restrictions on what the Association could contribute to its own PAC. But the decisive fifth vote came from Justice Blackmun, who voted to uphold the law only because the Association’s PAC made contributions directly to candidates, creating the possibility of quid pro quo dealing using the Association as an intermediary. Blackmun specifically argued that the ruling should not apply to a group that only made independent expenditures. Normally, as the decisive vote, his view should have been controlling. The FEC refused to treat it that way. Incredibly, it was not until SpeechNow.org v. FEC was decided in 2010 that the FEC abandoned this interpretation.

In the meantime, the FEC’s ongoing efforts to restrict contributions to independent expenditure committees led to the explosion of “issue advocacy.” Issue ads did not count as “expenditures” under the Act, and thus the growth of “527s.” Since Buckley also ruled out compulsory disclosure of donors and members of organizations that did not qualify as “political committees,” Congress, in turn, turned to the tax code to regulate 527s. And that, in turn, has largely brought us to the current IRS scandal, as the IRS attempts to decide if various groups engaging in political activity are “527s” or “501(c)(4)s,” a distinction that really didn’t matter prior to 2000.

If all of this seems hopeless snarled, well, it is. We can start to unsnarl this mess, however, by attempting to understand Buckley on its own terms. This doesn’t mean one cannot say it is wrong, or uses an incorrect framework. But much of the confusion in campaign finance law stems from efforts to reinterpret Buckley to meet a “reform” paradigm that Buckley rejects. If future reform efforts were to focus on what Buckley actually sees as the important issues – mainly preventing quid pro quo corruption, and in the realm of disclosure providing information to voters – it is more possible to find common ground for substantive change. For example, looking at Buckley’s concern about opportunities for quid pro quo dealing, it might be reasonable to further restrict officeholder fundraising for Super PACs. Or a better disclosure regime might be developed if it were not perceived by the “free speech” side of the debate that the “reform” side mainly sought to use disclosure to indirectly limit spending, because they see spending as corrupting, Buckley notwithstanding.

Meanwhile, David Gans continues to argue for his client, Prof. Larry Lessig, and his claim that the Founders would have favored campaign finance restrictions because they opposed what Lessig calls “dependence corruption,” a type of corruption which, it appears, is merely asserted rather than actually observed. We tend to think that there isn’t much to line of attack. But the question in McCutcheon, unless the Court wishes to renounce Buckley’s approach, is whether or not the aggregate limits are necessary to prevent quid pro quo exchanges. McCutcheon’s case is strong. It’s hard to see how a candidate is corrupted by a $2600 contribution given to someone else’s campaign.

It’s also hard to imagine, though, that the Founders would really have favored a government bureaucracy policing political spending, or favored such constraints at all. As the late Senator Eugene McCarthy used to say:

“They didn’t end the Declaration of Independence with a pledge of ‘Our Lives, Our Sacred Honor, and Our Fortunes Up to $1000 per Election.’” 

 

 

 

Comments

  1. There needs to be term limits set on both the house representatives and senators at both the state and federal levels. This would help eliminate the “seniority” that allows incumbents to get plush positions that they hold for way to long. If we set a two term limit for the President , then we should do the same for other branches. The Supreme Court lifetime appointment has to change. There should be terms and they should also be limited. We also need to set more than age, and residency requirements. The decisions being made by our elected leaders are too important not to require some sort of experiment and or educational requirements, at the very least we should have some sort of “government administrative” test , similar to the civil service exams we give our civil service workers. We are obligated as Americans to change our broken system, if we do not do our part and get informed and get involved we will continue to have ineffective leadership and inefficient management from our governmental leaders at all three levels.

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