Supreme Court Frees Corporations to Spend on Federal Campaigns

BY Quinn Bowman  January 21, 2010 at 10:35 AM EDT

UPDATED 5:15 p.m. ET| In a much-anticipated decision in the case of Citizens United v. Federal Election Commission, the Supreme Court in a 5-to-4 decision Thursday removed the distinction between individuals and corporations as it applies to spending on federal campaigns.

Writing for the court’s majority, Justice Anthony Kennedy ruled the 2002 McCain-Feingold campaign finance reform act violates the freedom of speech afforded to corporations under the First Amendment.

“If the First Amendment has any force, it prohibits Congress from fining or jailing citizens, or associations of citizens, for simply engaging in political speech,” Justice Kennedy wrote in a 57-page opinion. Read the opinion here.

In his dissenting opinion, Justice John Paul Stevens wrote, “The court’s ruling threatens to undermine the integrity of elected institutions around the nation.”

In practical terms, the ruling will allow corporations and unions to pay for campaign ads, but not contribute directly to federal campaigns, according to the Associated Press.

The case “basically eliminates a middleman” in campaign finance, writes The Atlantic’s Chris Good. “Before today,” he says, “corporations and unions had to set up PACs (political action committees), filed separately with the IRS, that would receive donations. And they did. Corporations and unions spend millions of dollars on elections. Now, however, the accounting firewall is gone, and Wal-Mart or the Service Employees International Union, for instance, can spend their corporate money directly on candidates.”

Tom Goldstein from SCOTUSblog writes: “Today’s decision is a small revolution in campaign finance law.” He added, “The decision presumably applies equally to state and local elections, given that the Court recognizes a First Amendment right.”

The case stemmed from an attempt by Citizens United, a nonprofit organization, to air an anti-Hillary Clinton movie, “Hillary: The Movie” on cable and pay-per-view networks, as well as ads for the movie in other venues. The FEC ruled that federal law prohibited airing of the movie.

In considering that case, the court decided to widen the case to consider the broader question of whether it was constitutional to limit corporate and union money in federal campaigns.

The court even held a special session in September, a rare occurrence, to rehear the case with this broader focus. Watch our coverage of that here:

Read our coverage of the argument here and more background on the case from The Oyez Project.

Politics reporter Elizabeth Summers spoke to NewsHour regular Marcia Coyle of the National Law Journal this afternoon about the case. Coyle has this to say about how the makeup of the court impacted today’s decision.

With the departure of Justice [Sandra Day] O’Connor and the addition of Chief Justice [John] Roberts and Samuel Alito, the court’s campaign finance decisions have swung like a pendulum from a period of great deference to Congress’s judgment in this area to increasing deregulation. … The court’s ruling will likely be interpreted to lift the prohibition on campaign spending by unions as well. And, because this decision was a constitutional ruling, similar corporate and union spending bans in roughly half the states also will be invalidated. What remains in place, at least for now, is a ban on direct corporate contributions to candidates.

Already, the ruling has drawn praise from the right and equally strong criticism from the left. The Washington Post has a roundup of reaction here, while the Wall Street Journal collects feedback here.

On tonight’s broadcast of the PBS NewsHour, Marcia Coyle will examine the decision with Jeffrey Brown and legal analysts will discuss its impact. Stay tuned.