The Road to Citizens United

The Citizens United decision granting corporations the rights of personhood is a key grievance in the Occupy movement

Commenting on the growth and prosperity of the nineteenth century Gilded Age, historians Samuel Eliot Morison and Henry Steele Commager wrote: “The nation was fabulously rich but its wealth was gravitating rapidly into the hands of a small portion of the population, and the power of wealth threatened to undermine the political integrity of the Republic.” In other words, there was a fear that money had the great potential to be a corrupting force in the American democracy.

Fast-forward a hundred years and a growing proportion of national income and wealth is held by the top 1%, while the other 99% fails to keep pace. As we continue comparing free speech and political influence between the top 1% and the other 99%, we turn our attention to paid speech, as practiced by interest groups and corporations. The landmark Citizens United case sets the stage.

When Citizens United vs Federal Election Commission came before the U.S. Supreme Court in 2010, the court was being asked, culturally as much as constitutionally , to decide whether money was a corrupting force in American politics. A slim 5-4 majority, returned a resounding “maybe.”

So, as it stands, corporations are protected under the First Amendment right to free speech and thereby empowered to make general election campaign donations with minimal government interference.

It was not always like this.

In the earliest regulation of campaign financing, the 1907 Tillman Act banned direct donations by corporations during federal elections. There is some debate over whether the act was intended as a political reform to curb the influence of big money power, or whether it was intended as corporate reform to impede corporations from using shareholders’ money to “buy” legislation that would attempt to loosen shareholders’ control over the company.

In either case, the result was that for decades the federal government was insulated from paid corporate political advertising.

The Citizens United decision that changed the status quo stemmed from a political documentary called “Hillary: The Movie.” It was created by Citizens United, a conservative nonprofit corporation, and released during the Democratic presidential primaries in 2008. But, under the McCain-Feingold Act, the Federal Election Commission banned the film’s release on cable channels and the accompanying television advertisements.

The bi-partisan act was designed to address two issues: first, the increasing role of so called soft money (defined below) in campaign financing and the actions of political party committees (PACs); and second, the proliferation of issue advocacy advertising, by prohibiting communications paid for by corporations within certain time constraints. The Supreme Court decision in Citizens United overturns the second provision with regards to American corporations and individuals, despite the continuing ban on soft money. ["Soft money" is defined as contributions to the political party as a whole, as opposed to “hard money” that is given directly to an individual.]

Upending precedent to fundamentally change how corporate spending influences political elections is not a trivial decision. So, how did the Court get there?

The Fourteenth Amendment to the U.S. Constitution dictates that “no persons shall be deprived of life, liberty or happiness without due process of law.” Since the First Amendment right to freedom of speech is applicable through the fourteenth, when it was decided that corporations were persons, albeit legal and fictitious ones, it followed that corporations had a constitutional right to free speech. Therefore, campaign donations, classified as symbolic speech are protected from government involvement by the constitution, like the symbolic and controversial burning of American flags.

The case passionately divided the Court.

By a 5-4 decision, the majority ruled that government has no business regulating political speech. Justice Kennedy wrote for the majority: “When government seeks to use its full power…to command where a person may get his or her information or what distrusted source he or she may not hear, it uses censorship to control thought. This is unlawful. The First Amendment confirms the freedom to think for ourselves.”

In dissent, Justice Stevens acknowledged that while “we have long since held that corporations are covered by the First Amendment,” allowing corporate money to flood the marketplace will corrupt democracy. Echoing Stevens, Berkeley Law professor Jesse Choper, who we spoke to in last week’s podcast, agreed that corporate money was a dangerous injection into the democratic system: “the force of big sums of money is really a very corruptive force in American democracy.” Choper’s sentiment fits squarely with the views of the Court’s dissenters, as Stevens went on to explain that “the difference between selling a vote and selling access is a matter of degree, not kind…And selling access is not qualitatively different from giving special preference to those who spent money on one’s behalf.”

Thus, the narrow-margin Citizens United ruling, ostensibly protecting free speech in all its forms, is expected to have significant political consequences. President Obama declared that the ruling was “a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans.”

This perception of the growing political voice of corporations and the wealthy is at the heart of both the Occupy and Tea Party movements. Stay tuned as we provided profiles, interviews and analysis of how each evolves, reacts and contributes to political speech and influences the 2012 election.