Supreme Court: campaign finance overhaul in 'Hillary' case?

The US Supreme Court this week takes up a potential crossroads case that could greatly expand the ability of corporations and labor unions to wield influence in federal elections.

The high court on Wednesday is re-hearing a case it heard last spring involving a Federal Election Commission (FEC) effort to block an unflattering 90-minute video portrait of Hillary Rodham Clinton. She was then running for the Democratic presidential nomination. The film was called, "Hillary: The Movie."

The FEC said the film was the equivalent of an electioneering attack advertisement and thus could be regulated under the 2002 Bipartisan Campaign Reform Act. The conservative nonprofit group that produced the film, Citizens United, charged that the FEC's actions amounted to unconstitutional suppression of political speech.

"Hillary: The Movie" is a documentary, the group said, not a political advertisement.

The case, Citizens United v. Federal Election Commission, asks a fundamental question: Whether corporations and labor unions have the same protected First Amendment free speech rights as individuals to engage in political debate during elections without facing government censorship.

The answer to that question is important because it could open the door to a flood of corporate and union dollars to try to influence federal elections.

The case could mark a turning point in the legal battle over campaign-finance reform. The justices have suggested they will be taking a close look at two existing legal precedents with an eye toward overturning them. Both deal with government efforts to restrict corporate spending for certain issue advertising and other political broadcasts immediately prior to elections.

During the earlier oral argument in March, a government lawyer – in response to a hypothetical question – told the justices that the FEC had the power to ban corporate-produced political books that urge the election or defeat of a particular candidate. The exchange may have triggered the high court's decision to re-hear the case and closely examine the underlying precedents.

"When the government of the United States of America claims the authority to ban books because of their political speech, something has gone terribly wrong," writes Theodore Olson, lawyer for Citizens United, in his brief to the court. "And it is a sure sign as any that a return to first principles is in order," he said.

Not so fast, counters Solicitor General Elena Kagan, in her brief. "Overruling the [two prior cases] would fundamentally alter the legal rules governing participation of corporations – including the nation's largest for-profit corporations – in electoral campaigns, and would make vast sums of corporate money available for overt electioneering," she writes.

Since 1947, federal campaign laws have barred corporations and unions from spending their general treasury funds in federal elections, and corporate contributions to candidates have been banned since 1907. But the regulations have been difficult to enforce.

The 2002 campaign-finance law sought to close what reform advocates said were "loopholes" permitting corporations and unions to support candidates through sham issue advertisements.

Opponents of the legislation claimed the law was too restrictive of corporate speech.

Now the high court may be on the verge of declaring that corporations have a First Amendment right to spend their money and express a corporate viewpoint during elections, just like individual voters.

A few years ago in a dissenting opinion, Justice Antonin Scalia sought to counter concerns by reform advocates about the potential corrupting influence of money in politics. Justice Scalia alluded to the signers of the Declaration of Independence as pledging their "fortunes" as well as their "sacred honor."

Solicitor General Kagan seeks in her brief to draw a sharp distinction between corporations, the nation's founding fathers, and individual voters. "John Hancock pledged his own fortune," Ms. Kagan writes. "When the CEO of John Hancock Financial uses corporate-treasury funds for electoral advertising, he pledges someone else's."