McCutcheon Argument Recap

by Carrie Severino

It’s the first week of oral arguments at the Supreme Court, and the term is opening with a major case on campaign finance and the First Amendment: McCutcheon v. FEC. The case challenges aggregate spending limits in the Bipartisan Campaign Reform Act. Under BCRA, not only must individuals abide by caps on how much they donate to each candidate or party organization, they also cannot donate an aggregate amount that exceeds $48,600 to all candidates and another $74,600 to all political committees, such as those of parties.

The arguments were unusual in that they seemed more fit for the halls of Congress than the Supreme Court, focusing largely on questions of policy rather than legal analysis. But in one sense the arguments were predictable: The court seems yet again to be split 4-4-1.

Justices Ginsburg, Breyer, and Kagan all seemed in favor of upholding the donation restriction, while the chief justice and Justices Scalia and Alito seemed to think it ran afoul of the First Amendment. Justice Thomas, quiet as always, is a good bet to vote to strike down the restriction based on his prior opinions. Justice Sotomayor, while uncharacteristically taciturn, seems a safe bet to vote with her liberal colleagues as she almost always does. The real question, of course, is what Justice Kennedy will do, and he didn’t exactly tip his hand today. While his record tends to be on the side of free speech in campaign-finance cases, the solicitor general and Justice Kagan seemed to be making a play for his vote to uphold the law.

Caps on donations have been upheld by the Court in the past on the theory that large monetary donations create the risk of government corruption. A key early case, Buckley v. Valeo, permitted limitations on contributions but found that expenditures cannot be limited because that violates a candidate or party’s First Amendment free-speech rights. It also found that independent expenditures — made through PACs that are not controlled by a candidate — do not create a substantial risk of corruption and therefore must be allowed under the First Amendment.

None of the parties arguing yesterday seemed to think Buckley was correctly decided. Appellants explicitly asked the Court to overrule Buckley’s holding on aggregate contribution limits, arguing that the risk of corruption the Court worried about in Buckley is now addressed by individual contribution limits and other existing FEC regulations. The solicitor heneral was open to revisiting Buckley in the other direction to reinstate expenditure limits. Nonetheless, in his argument he accepted Buckley, which required him to focus on risk of corruption from high aggregate donations even when spread across many candidates. The justices, for their part, didn’t seem any more committed to Buckley than the parties.

Overall, I think Justice Alito summed up the tenor of the arguments well as consisting of “wild hypotheticals that are not obviously plausible and that lack empirical support.”  

Justice Breyer got into the hypothetical mode right off the bat, by positing 40 PACs that are independently run and not coordinated with any candidate, but all happen to be patently designed to funnel money to Candidate Sam Smith. Justice Kagan followed, positing her own collection of 100 PACs dedicated to funding the top five most contested Senate races, or with 150 members of Congress holding a joint fundraiser and transferring their money to a single candidate. In each case the justices suggested a single donor could, while abiding by the individual contribution limits, nonetheless donate huge aggregate sums that could find their way into a single candidate’s coffers.

Appellants, supported by Justices Scalia and Alito, claimed that current FEC regulations make those hypotheticals illegal. They also questioned the very possibility of such circumstances since they would rely on over 100 people acting in a concerted way yet without any actual coordination that would trigger earmarking regulations.

The chief justice brought the discussion back to the harm done to donors by limiting an individual from supporting as many candidates as he wants. It’s not clear whether he was trying to make appellants state their position more firmly or looking for one of his trademarked split-the-baby rulings when he asked, “Is there a way to eliminate that aspect while retaining some of the aggregate limits? In other words, is that a necessary consequence of any way you have aggregate limits? Or are there alternative ways of enforcing the aggregate limitation that don’t have that consequence?” In a later colloquy with the solicitor general, he suggested that prohibiting transfers from one candidate to another might achieve that goal. He also signaled that he took this harm very seriously, emphasizing the “First Amendment cost” to donors by creating “a very direct restriction on much smaller contributions that Congress said do not present a problem with corruption.”

While the Court itself’s creating such a distinction would seem to be a form of legislating from the bench (an enterprise the chief justice would hopefully steer clear of), Justice Alito clarified that the very possibility of such a limitation highlights that the aggregate contribution limits are overbroad.

Questioning the lawyer for Senator McConnell who received the rare opportunity to argue as an amicus, Justice Ginsburg brought out another line of questioning suggesting that aggregate contribution limits promote democratic participation by forcing candidates to talk to more individuals. That justification for the limits was not the one Buckley pointed to as a compelling interest supporting a speech limitation, and neither the parties nor the justices addressed how those considerations might fit into a traditional First Amendment analysis. 

Justice Scalia also brought in practical, rather than legal, consequences of the law by pointing out that the aggregate contribution caps force money into PACs rather than political parties and can work to the benefit of incumbents. Justice Ginsburg contested his assertion and the solicitor general later responded to Scalia by saying we don’t know the practical effect.

Justice Kagan then explored a new line of argument that seems specifically tailored to appeal to Justice Kennedy. She claimed that even without having to transfer money from one candidate or committee to another, the donor who responded to a solicitation by writing checks for the maximum amount to a large number of different candidates would create feelings of obligation on the part of the asker. Justice Kennedy made a similar argument in his separate opinion in McConnell v. FEC.

The solicitor general later picked up this approach when responding to the chief justice’s suggested limitation of inter-candidate money transfers. He also elaborated on it, suggesting that party leaders in particular would feel indebted to donors of this sort because their power depends on the party retaining control. Justice Scalia, for his part, cautioned that this way of viewing gifts risked conflating basic gratitude with corruption.

In addition to his contribution to the world of hypotheticals, Justice Breyer articulated a First Amendment principle that I hope does not find its way into our already muddled campaign-finance jurisprudence. He proposed what seemed to be a new balancing test of “positives” and “negatives” and then declared it “basic.” Only a direct quote can do it justice:

There are apparently, from the Internet, 200 people in the United States who would like to give $117,000 or more. We’re telling them: You can’t; you can’t support your beliefs. That is a First Amendment negative.

But that tends to be justified on the other side by the First Amendment positive, because if the average person thinks that what he says exercising his First Amendment rights just can’t have an impact through public opinion upon his representative, he says: What is the point of the First Amendment? And that’s a First Amendment point. All right. So that’s basic, I think.

Justice Breyer then moved onto a topic that interested many of the justices: the apparently formalistic distinction between direct donations and independent expenditures. Justice Kennedy proposed that direct contributions subject to individual limits were actually less likely to influence a candidate than a large independent expenditure that BCRA does not touch. Justice Alito later followed up by pointing out the absurdity of many of the hypotheticals presented earlier in light of the fact that independent expenditures represent a simpler and more effective way to circumvent aggregate contribution limits than the hypotheticals. And Justice Scalia opined that if such independent expenditures do not — as a matter of law — create a risk of corruption, neither should contributions without an aggregate limit. The solicitor general finally did acknowledge that, while he accepted Buckley’s distinction, he would be just as happy to see independent expenditures regulated along with contributions. Justice Kagan agreed.

Justices Breyer and Sotomayor both floated the idea of sending this case back to the District Court to build a more complete record, but that option was opposed by Justices Ginsburg and Scalia and neither party felt it necessary.

Thus it seems we will get a decision out of the Court that does more than bounce this case back to the lower courts. Here’s hoping the justices can find five votes for an opinion rooted in the First Amendment rather than rhetoric or policy arguments, and manage to bring clarity to Buckley’s unsatisfying status quo.