Wealthy Special Interest Groups Can More Easily Influence State Elections

Yesterday the Supreme Court handed down its decision in Arizona Free Enterprise Club’s Freedom Club PAC v. Bennet (consolidated with McComish v. Bennett). At stake was States’ ability to combat the influence of wealthy special interests in elections. The Court decided in favor of the Arizona Free Enterprise Club.

Arizona voters passed the Citizens Clean Election Act in 1998. The Act created a detailed scheme under which candidates were required to demonstrate a certain level of support and abide by a strict set of fundraising and spending restrictions in order to receive public funds for a campaign. The Act allowed a candidate to receive additional funding if the candidate faced attacks from well-financed independent expenditure groups who spent a certain amount of money or if the candidate’s opponent refused public funds and spent over a certain amount. The Act was designed to combat government corruption, as Arizona had recently had a scandal involving bribery. The Act also leveled the playing field when a publicly-funded candidate faced a wealthy, self-financed opponent.

The petitioners claimed that the law was prohibited by the First Amendment, citing a host of “burdens” that discouraged them from outspending publicly-financed candidates.

The Court held that the matching funds system “substantially burdens protected political speech without serving a compelling state interest and therefore violates the First Amendment.” In order for the challenged legislation to stand, the State must show that the law furthers a compelling government interest and that it is narrowly tailored to accomplish that interest. Drawing from case law, the majority reasoned that the fund-matching scheme “plainly forces the privately financed candidate to ‘shoulder a special and potentially significant burden’ when choosing to exercise his First Amendment right to spend funds on behalf of his candidacy.” The majority pointed out that private contributions to a candidate’s campaign would result in each publicly funded candidate receiving public funds, producing a “multiplier effect.”

In addition, the majority argued that the assertion that the law combats corruption is illegitimate because it could keep candidates from spending their own money on their campaigns (and self-funding reduces corruption). The majority also stated that independent spending is a form of speech that “is not coordinated with a candidate” and thus does not encourage corruption. According to the majority, simply limiting the amount of money an organization or individual can contribute to a campaign sufficiently serves to combat corruption.

The four dissenting Justices, led by Justice Kagan, countered that the statute does not hinder free speech but encourages it by producing more speech. Justice Kagan also noted that Arizona enacted its campaign funding scheme to prevent corruption following a political scandal and that this goal is a compelling government interest. She pointed out that the law applies equally to candidates of all viewpoints, so given the controlling case law, it should pass First Amendment muster. “[W]hat petitioners demand,” she continued, “is essentially a right to quash others’ speech through the prohibition of a (universally available) subsidy program.”

By overturning Arizona’s election reform, the Court has closed off another avenue of reform designed to reduce the undue influence of corporate interests and wealthy candidates in political races.