Sunday, May 29, 2011

Virginia Federal Court paves the way for direct corporate contributions to federal candidates, and it does not matter

UPDATED: see below

On May 26, 2011 Judge James Cacheris sitting in the U.S. District Court for the Eastern District of Virginia ruled that the Supreme Court case of  Citizens United v. FEC, 130 U.S. 876 (2010), by extension makes unconstitutional  a criminal law banning direct contributions from corporations to federal candidates  under the First Amendment.

The case is U.S. v. Danielczyk, Case No. 1:11cr85, and the 52 page opinion can be found here.

How the Court ruled on the issue of corporate First Amendment rights

The determination of the Court on this widely reported issue is summarized n page 46 of the opinion as follows:

“Citizens United held that there is no distinction between an individual and a corporation with respect to political speech. Thus, if an individual can make direct contributions within FECA’s limits, a corporation cannot be banned from doing the same thing. So because individuals can directly contribute to federal election campaigns within FECA’s limits, and because § 441b(a) does not allow corporations to do the same, § 441b(a) is unconstitutional and Count Four must be dismissed.”
In short, corporations and individuals enjoy equal political speech under the Constitution, and any law that applies to Corporations in a more stringent manner than individuals, and regulates political speech is inherently unconstitutional.

It is important to note that the Court only addressed this issue on pages 42-46 of the opinion.  In other words only about 4.75 pages of a 52 pages decision were devoted to this one issue.

What did the other 47 pages of the opinion say?

In short, the rest of federal criminal campaign contribution regulations remain intact and robust.  Five of six of the challenged counts of the indictment were upheld, and set to go to trial.  Most importantly the laws banning individuals from contributing money only to be reimbursed by another party (in this instance a corporation) were reinforced.  It is still illegal for a corporation to order hundreds of employees to make contributions and still be reimbursed by their employer.

Why the 4.75 pages don’t really matter

Corporations may now make direct contributions to federal candidates, but they are subject to the same rules as individuals.  They have the same campaign limits, and the same campaign disclosure requirements.  As a federal candidate, how much positive affect on a candidate will an additional $2,500 from a corporation have on a candidate?  How much access will that candidate give to a single corporate donor that makes up ~$2,500 of a $1,000,000+ campaign budget?  How much scrutiny is a candidate willing to endure for such a small portion of a total campaign budget?  How much scrutiny are corporations willing to endure for favoring candidates for office?  The answers to these questions explain why Judge Cacheris’ ruling not only vindicates Supreme Court caselaw and the Constitution, but also poses very little threat to our Constitutional republic. 

UPDATE:  Above are the practical reasons why the decision will have minimal effect.  The legal reasons the decision will have minimal effect can be found here

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