Citizens United and Contributions to Super PACs: A Little History Is in Order

On January 21, 2010, the Supreme Court in a misguided and destructive decision ruled in Citizens United v. Federal Election Commission that the longstanding ban on corporate expenditures in federal campaigns was unconstitutional.

In reaching this decision, the Court unleashed a flood of unlimited contributions into federal elections through Super PACs and other independent spending entities, and thereby unleashed the corruption of our government.

Recently the argument has been made that the Citizens United decision had little responsibility for the torrent of unlimited individual contributions being spent by Super PACs to influence the 2012 elections.

This argument is wrong. A little history is in order.

Citizens United and Super PACs

Super PACs are federally registered political action committees that file disclosure reports with the FEC and spend unlimited contributions from individuals, corporations, labor unions and other entities on independent expenditures to influence federal elections.

Super PACs are playing a major role in the 2012 presidential primaries and will continue to be a major factor throughout the 2012 presidential and congressional races.

The Citizens United decision explicitly held that corporations could make independent expenditures in federal elections and also implicitly held that corporations could give unlimited amounts to third party groups, such as Super PACs, to make independent expenditures in federal races.

Two months later, on March 26, 2010, the D.C. Circuit Court of Appeals in SpeechNow v FEC held unconstitutional the existing $5,000 per year limit on the amount that an individual could contribute to a third party group, such as a Super PAC, to make independent expenditures in federal elections.

The SpeechNow decision is explicitly based on the earlier Citizens United decision.

In the operative sentence of the SpeechNow decision, Judge David Sentelle writing for the full D.C Circuit Court of Appeals stated:

Thereafter, the Supreme Court decided Citizens United v. FEC, 130 S. Ct. 876 (2010), which resolves this appeal. In accordance with that decision, we hold that the contribution limits of 2 U.S.C. § 441a(a)(1)(C) and 441a(a)(3) are unconstitutional as applied to individuals' contributions to SpeechNow. (Emphasis added).

Floyd Abrams, an attorney who supported the Citizens United challenge in the Supreme Court, has argued that the right of individuals to make unlimited contributions to Super PACs was established by the landmark Supreme Court decision in 1976 in Buckley v. Valeo.

This argument is wrong.

While the Buckley decision held that an individual could make unlimited expenditures of his own money in federal elections, the Court did not rule that an individual could make unlimited contributions to a group that is making independent expenditures in federal elections.

And until 2010, federal campaign law and FEC regulations limited to $5,000 per year the amount that an individual could give to a PAC making independent expenditures in federal elections. It is this individual contribution limit that was declared unconstitutional in the SpeechNow case, which was based on the Citizens United decision.

Mr. Abrams also cites the Swift Boat PAC ads in 2004 which attacked Senator John Kerry and the expenditures by two pro-Democratic PACs that supported Senator Kerry, funded in part by multimillion dollar contributions from George Soros, to argue that unlimited individual contributions to PACs making independent expenditures to influence federal elections have long been allowed.

This argument is wrong.

The unlimited contributions from individuals to these three PACs went to groups that operated illegally in the 2004 presidential election and accepted contributions that did not comply with federal law. The PACs paid substantial fines to the FEC for making combined illegal expenditures of $170 million in the 2004 presidential election.

If these PACs had properly complied in 2004 with existing campaign finance laws, the contributions from individuals to the Swift Boat PAC and to the two pro-Democratic PACs would have been limited to $5,000 per donor per year.

The bottom line is this: the ability of corporations, labor unions and individuals to give unlimited contributions to Super PACs making independent expenditures to influence federal elections flows directly from the Supreme Court's decision in the Citizens United case.

Unlimited contributions in federal elections invariably lead to corruption and scandal, and that is what is unfolding in the 2012 elections.

Fred Wertheimer is the President of Democracy 21, a nonprofit, nonpartisan organization that promotes campaign finance reforms and related government integrity measures.