Criticisms of Wednesday's U.S. Supreme Court decision, McCutcheon vs. FEC, removing the overall limit on individual donations to political campaigns, have been overblown. The decision will not bring about the end of democracy in America, as some have claimed. In some minor ways, it may actually benefit U.S. political institutions.
Americans tend to be ambivalent about campaign finance laws because these laws represent a clash of two different values they hold – freedom and equality. We believe we should be free to say what we want, especially in regard to politics. We also do not like the idea of some people having more influence in politics than others. We believe all should have an equal voice in politics.
Campaign finance laws are attempts to prevent some, the wealthy in particular, from having more influence in politics than everyone else. To do that, though, these laws infringe upon freedom. They place limits, or try to at least, on spending money in elections.
The Supreme Court's recent decision struck down a law that limited overall spending in political campaigns. It left in place caps on how much individuals can give to a single candidate, but said that the cap on how much one could spend overall in an election cycle, currently $123,200, was a free speech violation.
Current campaign finance law is a hodgepodge of different laws and court decisions.
Though attempts to regulate political campaigns date as far back as 1883, with the Pendleton Act, the bulk of current campaign laws began with the Federal Election Campaign Act of 1971, which, among other things, placed limits on how much political campaigns could spend. This law was amended in 1974 to place limits on how much individuals could contribute to candidates and political parties, and how much individuals could contribute overall (the part that was struck down this week).
Overall, campaign finance laws have not worked well. Political scientists often use the analogy of a river: When an obstruction is placed in a river, the water will find another path. Similarly, money will find a path to spending in elections regardless of the obstructions Congress places in the way. This is because most political speech, especially the type required to win elections, requires money, and in the United States, there is a constitutional right to freedom of speech.
The Supreme Court has allowed some limits on the financing of political campaigns, but found that others went too far in infringing upon freedom of speech. In 1976, for instance, the Supreme Court said, in Buckley vs. Valeo, that FECA went too far in placing limits upon how much a campaign could spend.
Even with the FECA limits that the Supreme Court upheld, though, money found a way to elections. Rather than going to candidates, more money began going to other entities, generally referred to as "outside groups" because they are outside of the candidates and political parties. Various tax code designations have been used, such as 501(c)3, 501(c)4 and 527.
Congress again tried to plug the flow of campaign spending in 2002 with the Bipartisan Campaign Reform Act, better known as "McCain-Feingold." The law placed additional limits on contributions to political parties as well as limits on "issue ads" by outside groups.
The next major Supreme Court decision related to campaign finance came in 2010 with Citizens United vs. FEC. Here the Court upheld a ban on corporate donations to campaigns but said corporations do have the freedom to spend money on issue ads that are not coordinated with political campaigns.
Looking at the big picture, the overall impact of these laws and court decisions has been to give more power and influence to outside groups while diminishing the role of political parties. This is important because political parties are more moderate by design (they seek to build a broad coalition able to win elections) whereas outside groups more often represent a smaller group and narrower range of interests.
Since FECA, political speech has grown more divisive, with the extremes having a louder voice to the detriment of the moderate middle. Campaign finance laws and court decisions are not the only reason for this trend, but they have played a role.
In a small way, McCutcheon will allow some of that money that used to flow through outside groups to go to parties and candidates instead. For anyone who would like to hear more from the moderate middle rather than narrower interests, this should be welcome news. To some, though, the decision means the end of democracy in America.
"That clanging sound you hear is the Supreme Court hammering the final nails into democracy's casket. With Wednesday's decision in McCutcheon v. FEC, the court has crossed the line protecting the last vestige of campaign finance reform, and making it official: Rule by the rich is now unfettered. Plutocracy's moment has arrived," Calvin F. Exoo and Christian Exoo wrote Wednesday for Salon.
Though he did not use the same hyperbolic tone, Justice Stephen Breyer stated similar concerns in his McCutcheon dissent. The decision "eviscerates our nation's campaign finance laws, leaving a remnant incapable of dealing with the grave problems of democratic legitimacy ...," he wrote.
For at least two reasons, the notion that the decision will lead to "rule by the rich" goes too far. The rich are already able to spend as much as they want through outside groups. The Court's decision only changes where that money can be directed. The rich can spread their money among more candidates instead of outside groups, if they want. Some voters may even prefer to hear more from candidates and parties rather than outside groups in elections anyway.
Additionally, "rule by the rich" assumes that everyone who is rich wants the same thing. This is not the case. Often the rich are competing against each other in campaign giving. Some are conservative and prefer Republicans. Others are liberal and prefer Democrats.
Campaign finance in America is, no doubt, a mess. Congress and the courts should continue their attempts to balance the values of freedom and equality with these laws. All democracies, though, must balance competing values. These efforts, therefore, are not an end to democracy. They are democracy in action.