Campaign Contribution Caps Questioned by U.S. High Court

Photographer: Andrew Harrer/Bloomberg

Hearing arguments today in Washington, the U.S. Supreme Court justices expressed support for the free speech rights of a Alabama man who says he wants to contribute to more congressional candidates. Close

Hearing arguments today in Washington, the U.S. Supreme Court justices expressed... Read More

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Photographer: Andrew Harrer/Bloomberg

Hearing arguments today in Washington, the U.S. Supreme Court justices expressed support for the free speech rights of a Alabama man who says he wants to contribute to more congressional candidates.

The U.S. Supreme Court signaled a readiness to strike down more campaign-finance regulations, casting doubt on some of the federal limits that restrict donors’ total political giving.

In a one-hour argument highlighted by clashes over the influence of wealthy donors, the court’s Republican-appointed majority expressed support for the speech rights of an Alabama man who says he wants to contribute to more congressional candidates. Federal law limits what people can give candidates, parties and political committees to $123,200 every two years.

“You have somebody who is very interested, say, in environmental regulation and very interested in gun control,” Chief Justice John Roberts said. “The current system, the way the anti-aggregation system works, is he’s got to choose.”

Roberts and Justice Samuel Alito, likely to be the pivotal votes, both suggested overturning only some of the aggregate limits. Neither showed any inclination to address more sweeping arguments that would call into question the limits on contributions to particular candidates.

Alito called the aggregate limits a “very blunt way of trying to get at the problem” of political corruption. At another point, he said those restrictions “might not all stand or fall together.”

Citizens United

The campaign-finance fight is the court’s biggest on that issue since the 2010 Citizens United ruling allowed unlimited corporate and union spending.

The new case focuses on contributions, rather than spending. It raises questions about a landmark 1976 ruling, Buckley v. Valeo, which said the government had broad latitude to limit contributions to guard against corruption.

Though neither Roberts nor Alito suggested they were poised to revisit that ruling, President Barack Obama said at a news conference today that the new case could unleash a torrent of new money.

“The latest case would go even further than Citizens United,” Obama said. “Essentially it would say, ‘Anything goes. There are no rules in terms of how to finance campaigns.’ There aren’t a lot of functioning democracies around the world that work this way.”

The aggregate limits include a cap of $48,600 to federal candidates and $74,600 to political parties and political action committees during each election cycle.

Base Limits

Those restrictions, which date to 1974, are designed to supplement better-known restraints known as base limits. Under those, donors can contribute a maximum of $2,600 to particular candidates per election, $5,000 per year to individual PACs and $32,400 per year to each national party committee. The limits are indexed for inflation and increase every election cycle.

The court is conducting business as normal this week, issuing orders and hearing arguments, even as the federal budget standoff leaves much of the rest of the government closed. The justices are scheduled to consider additional cases next week.

The Obama administration is defending the aggregate caps, which the Supreme Court in Buckley said prevent “evasion” of the base limits. A three-judge panel used similar reasoning to uphold the caps last year.

“Aggregate limits combat corruption both by blocking circumvention of individual contribution limits and, equally fundamentally, by serving as a bulwark against a campaign-finance system dominated by massive individual contributions,” U.S. Solicitor General Donald Verrilli argued.

Free Speech

Shaun McCutcheon, a Republican businessman from Alabama, contends the caps violate his free speech rights, limiting his political participation without serving a clear purpose.

McCutcheon gave a symbolic $1,776 to 15 challengers trying to unseat incumbents in the 2012 election. He says he would have given to a dozen more had the aggregate limits not blocked him. He isn’t challenging the base limits.

McCutcheon’s lawyer, Erin Murphy, today called the limits “an impermissible attempt to equalize the relative ability of individuals to participate in the political process.”

The administration drew support from one of Obama’s appointees, Justice Elena Kagan, who said that without the aggregate limits donors could contribute more than $3.5 million to party committees and candidates, knowing that it would be diverted to support of a favored candidate.

“Having written a check for 3.5 or so million dollars to a single party’s candidates, are you suggesting that that party and the members of that party are not going to owe me anything, that I won’t get any special treatment?” she asked Murphy.

Post-Buckley Restrictions

As Obama’s solicitor general in 2009, Kagan argued on the administration’s behalf in the Citizens United case.

Opponents contend that post-Buckley restrictions on contributions to parties and PACs have made the aggregate limits unnecessary. They also say federal law restricts the ability of donors to earmark their contributions.

McCutcheon is arguing alongside the Republican National Committee and Senate Minority Leader Mitch McConnell, a Kentucky Republican who is making more far-reaching arguments.

Justices Antonin Scalia, Clarence Thomas and Anthony Kennedy have said they would overturn the Buckley analysis, and Alito has hinted he is open to revisiting it. That would subject contribution limits to the same tough scrutiny as spending caps, like those thrown out in Citizens United, and call the base limits themselves into question.

Corrupting Influence

Scalia today questioned whether even a $3.5 million contribution would have a corrupting influence in an era when candidates, parties and political committees spend billions of dollars on each election.

“When you add all that up, I don’t think 3.5 million is a heck of a lot of money,” he said.

Justice Ruth Bader Ginsburg said the aggregate limits might force candidates to raise money from a broader group of donors.

Supporters argue that “by having these limits you are promoting democratic participation, then the little people will count some, and you won’t have the super-affluent as the speakers that will control the elections,” Ginsburg said.

The case, which the court will decide by July, is McCutcheon v. FEC, 12-536.

To contact the reporter on this story: Greg Stohr in Washington at gstohr@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net

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