To: Interested Parties
From: People For the American Way
Subject: The Need for Constitutional Amendment in Response to Supreme Court Decision in Citizens United v. FEC
On Thursday, January 21st, in the case of Citizens United v. FEC, 2010 U.S. LEXIS 766, involving Section 441b of the Bipartisan Campaign Reform Act of 2002 (BCRA), the U.S. Supreme Court made a radical about-face and reversed long-standing precedent that had previously upheld the constitutionality of the federal law that restricts independent corporate spending in elections.1
In a majority opinion written by Justice Kennedy, the Court reversed its decades-long decision in Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990), which upheld a Michigan state law’s restriction on the independent expenditure of funds from a corporation’s general treasury for political speech. In overturning that precedent, the majority declared that “the Government may not suppress political speech” of corporations and that “[n]o sufficient governmental interest justifies limits on the political speech of nonprofit or for-profit corporations.” Citizens United at *93.
A corporation is an artificial creation whose basic nature is determined by law. Federal and state governments allow businesses to form corporations solely for economic purposes – none of which correlate to providing them with rights equal to individuals.
Nevertheless, the Court ruled for the first time that corporations are guaranteed the same free speech rights as real people, thereby ruling that governmental restrictions on corporate spending in elections are invalid and unconstitutional.2 As to that astounding new principle, Justice Stevens noted in his dissent that the framers “had little trouble distinguishing corporations from human beings, and when they constitutionalized the right to free speech in the First Amendment, it was the free speech of individual Americans that they had in mind.” Citizens United at *205.
A corporation’s CEOs and management are now free to withdraw funds from its general treasury to spend in support of or against any candidate that they believe will affect the profitability of the company. The amount of corporate spending allowed in elections as a result of the Citizens United decision is now unchecked and given their overwhelming financial resources, the public debate on the fitness or suitability of any particular candidate may now be drowned out by the limitless pockets of big business.
In finding that such restrictions are unconstitutional, the Roberts Court rendered unenforceable all subsequent attempts to directly regulate corporate political speech. Congress may pass legislation using its Spending Authority to indirectly preclude corporations that receive government contracts, grants or bailout monies from expressly advocating the election or defeat of candidates. State and local governments may be able to do the same. But such indirect attempts, while important and critically needed to mitigate the effects of the decision, may ultimately prove to be inadequate against the unfettered influx of corporate election spending. Only a constitutional amendment can restore the American people’s authority to regulate corporate influence in our elections and restore our democracy.
- As amended by § 203 of BCRA, § 441b prohibited corporations and unions from using their general treasury funds to make independent expenditures for speech that is an "electioneering communication" or for speech that expressly advocates the election or defeat of a candidate. 2 U.S.C. § 441b.
- Although Kennedy’s majority opinion suggests an exception for extending its decision to invalidate the direct contribution ban on corporations, the Citizens United Court’s rationale for holding restrictions on corporate independent expenditures unconstitutional could likely be used to invalidate the ban on direct contributions to candidates by corporations, which is the only remaining restriction on election-related corporate spending. See Citizens United at *60.