Magazine article Politics Magazine

What It Means

Magazine article Politics Magazine

What It Means

Article excerpt

Speculation about the impact of the Citizens United decision has run the gamut from mass hysteria to communal ecstasy. Most campaign finance experts, however, agree that little is known about exactly how this will affect our election system.

"Citizens United elicits very strong feelings but to a certain extent, what it means lies in the eye of the beholder," says Chris DeLacy, a campaign finance lawyer. "A lot of this is going to play out over time."

Some things, however, are more likely to happen than others. Most campaign finance experts agree, for example, that there will be a rise in third party group expenditures in future elections. How large this influx will be remains unclear. "I tell people to look at what happened before," says Brad Smith, a campaign finance lawyer and former chairman of the FEC. In 2007, the Court ruled in FEC v. Wisconsin Right to Life that corporations had a right to air issue advocacy ads, ones that did not expressly advocate for the election or defeat of a candidate. "What we saw then," Smith says, "was a bit more spending of that type. So there will probably be more spending, but the idea that there is going to be this torrent is not true."

The increase in spending will like come from 501(c) groups, particularly: 501(c)4s--typically social welfare groups, 501(c)5s--labor unions and 501(c)6s--trade associations like the Chamber of Commerce. All of these groups may engage in political activity, but they must disclose that activity to the IRS as well as contributors who give more than $5,000.

Groups are already forming that seek to take advantage of the ruling. In early February, a group of Republicans, including former Minnesota Sen. Norm Coleman, announced the creation of the American Action Network. The group will have a 501(c)4 arm that will engage in political activity and it has already said the Citizens United ruling will significantly help its fundraising efforts.

The impact of the Wisconsin Right to Life case may be instructive on other levels as well. Following that ruling, the FEC required corporations airing issue ads to disclose where their funding came from if--and only if--the funds were given with the express purpose of airing political ads. If the FEC adopts the same rules post-Citizens United, it would be easy for third party groups to shroud their donors, says Paul Ryan, a campaign finance reform advocate at the Campaign Legal Center.

"That would be a huge loophole," he says. "It would be child's play for an organization to characterize the influx of funds it can now receive from corporations after this decision as an increase in dues. [They could] then turn and use that money for political expenditures and the public wouldn't know where the money is coming from."

Ryan recommends that Congress focus on beefing up these disclosure laws in the wake of Citizens United. That is one of the few areas where Congress can legislate. As noted previously, because the Court ruled on constitutional grounds, what Congress can do--or, more specifically, what Democrats may want to do--to rein in the ruling is severely limited. One aspect of the bill Sen. Charles Schumer (D-N.Y.) and Rep. Chris Van Hollen (D-Md.) introduced in February does tackle disclosure. It would require 501(c)s to disclose all their donors and create "political broadcast spending" accounts with the FEC. …

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