New from the Institute for Free Speech
The First Amendment Applies to All – And You Can Take that to the Bank
By Nathan Maxwell
New Jersey, as opposed to the federal government, doesn’t ban corporate entities from making campaign contributions. Except, that is, if you’re a bank.
A federal district court upheld the state’s ban on giving by banks last June. Some might think “and for good reason,” but the state’s reasons for singling out banks for special restrictions aren’t nearly as good as the First Amendment requires. That’s why the Institute for Free Speech filed an amicus brief late last year in New Jersey Bankers Association v. Attorney General of New Jersey, asking the Third Circuit to rule that New Jersey’s industry-specific ban on political contributions is unconstitutional.
The only constitutionally valid defense for this sort of ban is to argue that it’s necessary to prevent corruption or the appearance of corruption. Indeed, the idea that politicians receive inordinate amounts of money from big businesses has sent chills down many a (sorely mistaken) spine. At the federal level, that’s plainly false – businesses can’t donate to campaigns for Congress or the presidency. And in New Jersey, it’s also false, because donations from non-bank corporations to state legislative campaigns are capped at $2,600 per election.
This means the state must believe that even bank donations of less than $2,600 would be corrupting. If that were reasonable, the state could surely point to historical examples of corruption involving banks giving these low sums. They’d show that the $2,600 cap wouldn’t prevent corruption and that only a complete ban does the trick.
ICYMI
Wall Street Journal: Ted Cruz vs. Frankenstein’s Monster
By Bradley A. Smith
Finding the loan-repayment provision unconstitutional should be easy for the justices. The provision was clearly based on the constitutionally impermissible motivation of trying to favor certain types of candidates over others. And it’s absurd on its face. The provision doesn’t increase the limits on contributions—a donor who has already given the campaign the legal maximum can’t contribute more to help the campaign pay off the loan from the candidate. So how is an official “corrupted” when he is paid back what he is owed? …
Most important, the law limits speech. Since the amendment was passed, candidate loans to their own campaigns tend to halt at $250,000—limiting a campaign’s resources and hence its speech to the public. You might think this works against wealthy candidates, but in fact it works in favor of extremely wealthy candidates, who can afford to write off large sums of money.
Events
Federalist Society Teleforum: Litigation Update: FEC v. Cruz for Senate
When: Friday, January 21, 1:00 p.m. EST
The webinar will review the traditional free speech issues in the case (including the extent of any risk of corruption or its appearance presented by a candidate’s loan to his or her own campaign), as well as practical concerns about the effect these limitations might have on campaigns — including on the kinds of candidates who will be able to run for office.
Featuring:
Donald A. Daugherty, Jr., Senior Litigator, Institute for Free Speech
Harmeet Dhillon, Founding Partner, Dhillon Law Group Inc.
Supreme Court
SCOTUSblog: Government faces skeptical bench in defending campaign-finance law challenged by Ted Cruz
By Amy Howe
When [Deputy Solicitor General Malcolm Stewart, representing the FEC] turned to the question of whether the loan-repayment limit violates the First Amendment, he emphasized the government’s interest in preventing corruption. But several justices questioned whether limits on loan repayment actually help to prevent corruption. Justice Amy Coney Barrett cited Cruz’s contention that the repayment of his loan “doesn’t enrich him personally because he’s no better off than he was before. It’s paying a loan, not lining his pockets.” Barrett later cited a finding by the lower court that the government had not introduced any evidence of “actual quid pro quo corruption” – that is, politicians trading favors for contributions.
Justice Brett Kavanaugh asked Stewart why another provision of federal campaign-finance law — the $2,900 limit on individual contributions — wasn’t enough to address the government’s interest in preventing corruption. He expressed more skepticism later on, telling Stewart that Section 304 appeared to be a “chill” on a candidate’s ability to loan his campaign his own money: It requires candidates to choose between loaning their campaigns more than $250,000, knowing that they won’t get some of that money back, and not loaning it at all.
The Courts
Reason (Volokh Conspiracy): No First Amendment Violation in Removal of Billboard After S.F. Mayor Had Criticized It
By Eugene Volokh
From Zhou v. Breed, decided Friday by the Ninth Circuit (Judges John Owens and Michelle Friedland, and visiting Sixth Circuit Judge Danny Boggs):
Appellants allege that both [S.F. Mayor London] Breed and Clear Channel violated their First Amendment right to free speech. To the extent that Appellants argue that Breed, or any public official, violated their First Amendment rights simply by speaking critically of a billboard or calling for its removal, that theory is squarely foreclosed by precedent.
We have previously joined a “host of other circuits” in holding that “public officials may criticize practices that they would have no constitutional ability to regulate, so long as there is no actual or threatened imposition of government power or sanction.” …
The mere fact that Breed or other public officials criticized a billboard or called for its removal, without coercion or threat of government sanction, does not make that billboard’s subsequent removal by a private party state action.
Missoula Current: Attack ads: Judge strikes down part of Montana’s ‘clean campaign’ law
By Mike Dennison
A federal judge Tuesday struck down a portion of Montana’s “clean campaign act,” saying it’s an unconstitutional burden on free speech to require political committees to notify candidates about last-minute attack campaign material.
U.S. District Judge Don Molloy of Missoula said the so-called “fair notice” requirement, which applies only to material distributed within 10 days of the election, has the potential to “chill” campaign speech in the final days before an election.
“It imposes a more pernicious burden on speech, in that it delays, and sometimes even prevents, political speech on the basis of its content,” the judge wrote…
Molloy also said the requirement doesn’t inform the electorate, because it doesn’t require disclosure of anything to them, and that the desire to give candidates a chance to respond to last-minute negative ads is not a compelling reason to burden free speech.
“In a perfect political place, that notion makes sense,” he wrote. “But last-minute negativity is a reality whether endorsed or not. … While the court might agree that negative campaigning is distasteful, that is not a sufficient basis for interfering with core First Amendment rights.”
Congress
The Hill: Manchin, Sinema join GOP to sink filibuster change for voting bill
By Jordain Carney
Senate Democrats failed to change the legislative filibuster for a voting bill on Wednesday night, after Sens. Joe Manchin (D-W.Va.) and Kyrsten Sinema (D-Ariz.) voted with Republicans to oppose the rules reform, handing President Biden and the party a stinging defeat.
Senators voted 52-48 to defeat the rules change, which would have nixed the 60-vote hurdle for the election bill. To have been successful, Democrats would need total unity from all 50 of their members, plus Vice President Harris to break a tie.
The outcome of the vote was telegraphed, but it marks a defeat of Democrats’ months-long push to pass voting rights legislation, even if it meant changing the rules so they could do it alone.
By Jim Geraghty
Perhaps one of the most glaring signs that the “Freedom to Vote: John R. Lewis Act’” represents a wish-list for Democratic groups is that it includes the DISCLOSE Act, which various Democrats have wanted to pass for more than a decade.
This version of the DISCLOSE Act requires any group that spends more than $10,000 in an election cycle disclose the names of donors who give $10,000 or more.
The American Civil Liberties Union opposes the DISCLOSE Act because it’s basically a formula for more public harassment of donors to political organizations.
“Our Constitution embraces public discussion of matters that are important to our nation’s future, and it respects the right of individuals to support those conversations without being exposed to unnecessary risks of harassment or embarrassment,” the ACLU wrote when assessing the DISCLOSE Act.
“Only reforms that promote speech, rather than limit it, and apply evenhandedly, rather than selectively, will bring positive change to our elections. Because the DISCLOSE Act misses both of these targets, the ACLU opposes its passage.”
The States
Washington Post: Youngkin addresses General Assembly, sets priorities for session as partisan clouds gather
By Gregory S. Schneider and Laura Vozzella
But there were glimmers of bipartisanship Monday. Democratic Sen. Chap Petersen (Fairfax City) and Republican Del. Lee Ware (Powhatan) held a joint news conference to propose legislation that would ban public utility companies from making political donations.
The measure — versions of which they have introduced before — is aimed largely at Dominion Energy, the state’s biggest utility and a regulated monopoly. Dominion is also one of the most generous campaign contributors to members of both parties and wields enormous clout in the lawmaking process.
Ware and Petersen both said they had spoken with the new administration and are optimistic that Youngkin might support their bill. “I think it’s fair to say he sees some affinity … with this legislation,” Ware said.
“We need the new governor to speak out on this issue,” Petersen said.
Atlanta Journal-Constitution: Kemp campaign says fund illegally helping rival Perdue’s campaign
By James Salzer
Gov. Brian Kemp’s reelection campaign filed an ethics complaint Tuesday against its Republican rival, David Perdue, alleging that the challenger’s effort to oust the incumbent is getting an illegal boost from a new fundraising committee.
Under state law, political action committees and so-called “independent committees” that can raise and spend unlimited contributions are not allowed to directly coordinate their efforts with a candidate’s campaign.
But Kemp officials said the website for the Georgia Values Fund asks donors to provide cellphone numbers to get Perdue campaign alerts, updates and news, and it instructs donors to mail contributions to Perdue’s campaign, giving them a mailing address for where to send checks.
The page includes a photo of Perdue, a former U.S. senator, with ex-President Donald Trump, who has endorsed him in his race to oust Kemp.
