Two years ago, the Supreme Court of the United States found unconstitutional the so-called Millionaire's Amendment provision of federal campaign finance law, which had allowed candidates running against self-funders to raise funds at twice or even three times the contribution limits otherwise applicable. As Justice Alito argued for the 5-4 majority, "Leveling electoral opportunities means making and implementing judgments about which strengths should be permitted to contribute to the outcome of an election. The Constitution, however, confers upon voters, not Congress, the power to choose the Members of the House of Representatives, Art. I, §2, and it is a dangerous business for Congress to use the election laws to influence the voters’ choices."
As I wrote on that June 2008 day, "The more ominous implication is what this may mean for public financing systems, which after all are premised on government's ability to institute measures to level the electoral playing field."
On Tuesday, the Supreme Court of the United States ordered a freeze of Arizona's public financing matching funds system, ordering the state of Arizona not to release further matching funds to candidates who are running for state offices this year with public financing. [There was no dissent.]
Let's take a step back. On May 21, 2010, the United States Court of Appeals for the Ninth Circuit issued its opinion finding Arizona's clean election laws to be constitutional. It's a standard public financing scheme: qualified candidates can choose to eschew private fundraising and instead receive an initial grant and supplemental matching funds from the state to have a fair opportunity to campaign and get the message out depending on what the opposition was spending. The challenge was raised by past and future Arizona candidates complaining that the matching funds provision "severely burdens their exercise of protected political speech by punishing them for making, receiving, or spending campaign contributions," but as far as the Ninth Circuit was concerned this was no Millionaire's Amendment:
In Citizens United, the Supreme Court elaborated on its decision in Davis, indicating that the Millionaire’s Amendment was unconstitutional because it specifically sought to disadvantage the rich. "The rule that political speech cannot be limited based on a speaker’s wealth is a necessary consequence of the premise that the First Amendment generally prohibits the suppression of political speech based on the speaker’s identity." Citizens United, 130 S. Ct. at 905. Under the Act, while matching funds are calculated based on the total contributions received and expenditures made by a nonparticipating opponent, they are not distributed specifically to the opponents of wealthy candidates. Matching funds do not distinguish between different sources of nonparticipating candidates’ financing at all.
Several Plaintiffs testified that they would have made increased expenditures or undertaken increased fundraising but for the matching funds provision. No Plaintiff, however, has pointed to any specific instance in which she or he has declined a contribution or failed to make an expenditure for fear of triggering matching funds. The record as a whole contradicts many of Plaintiffs’ unsupported assertions that their speech has been chilled.... Plaintiffs bemoan that matching funds deny them a competitive advantage in elections. The essence of this claim is not that they have been silenced, but that the speech of their opponents has been enabled. We agree with the First Circuit that the First Amendment includes "no right to speak free from response — the purpose of the First Amendment is to secure the widest possible dissemination of information from diverse and antagonistic sources."
Furthermore, the Court held, Arizona's long history of political corruption justified this response:
The record demonstrates that Arizona has a long history of quid pro quo corruption. AzScam, in which legislators literally sold their votes for cash bribes, was just one of many substantial, wide-spread, and highly-publicized political scandals that Arizona experienced in the late 1980s and 1990s. These incidents occurred despite the contributions limits in place prior to the Act. Regardless of whether quid pro quo corruption continued to be a problem at the time of the Act’s passage, the appearance of quid pro quo corruption to the electorate was undeniable. Arizona voters were justified in concluding that contribution limits alone were not sufficient to combat corruption and its appearance. As the Supreme Court has recognized, the State’s interest in eradicating the appearance of quid pro quo corruption to restore the electorate’s confidence in its system of government is not "illusory," it is substantial and compelling.
And public financing, held the Ninth Circuit, furthers this anti-corruption interest:
[T]he Act is aimed at reducing corruption among participating candidates. The relevant inquiry thus is whether matching funds bear a substantial relation to reducing corruption among participating candidates. In exchange for public funding, participating candidates relinquish their right to raise campaign contributions from private donors. They therefore have both reduced opportunities and reduced incentives to trade legislative favors for financial favors. The Supreme Court has held "[i]t cannot be gainsaid that public financing as a means of eliminating the improper influence of large private contributions furthers a significant governmental interest." Buckley, 424 U.S. at 96.
Viewing the Act from this perspective, it is clear that the Act’s anticorruption interest is further promoted by high participation in the program. The more candidates that run with public funding, the smaller the appearance among Arizona elected officials of being susceptible to quid pro quo corruption, because fewer of those elected officials will have accepted a private campaign contribution and thus be viewed as beholden to their campaign contributors or as susceptible to such influence.
The Supreme Court's action today means that publicly-financed candidates will be eligible to receive one-third of the money to which they'd otherwise be entitled, and given the Court's calendar this is not likely to be resolved before the 2010 elections.
Way back in 2006, the first panel I moderated for YearlyKos I was on election reform and clean elections, and one of our panelists was Kyrsten Sinema, then 28 and a freshman in Arizona's legislature. A social worker by training, she'd never have run for office but for Arizona's clean elections system. We need more Kyrsten Sinemas in public life, and as ElectionLawBlog's Rick Hasen notes, the Court's action today does not bode well for the future of public financing of public elections:
If the Court takes the case, it is likely to be to reverse the Ninth Circuit. The Ninth Circuit's opinion is a very well written and thoughtful opinion for the position finding matching funds provisions constitutional. There would be little reason to take the case to affirm the Ninth Circuit.
The developments in Arizona show just what a tough litigation environment it is right now for those in the lower courts seeking to defend reasonable campaign finance regulations. As I've suggested, without matching funds provisions, public financing programs are unlikely to attract substantial participation from serious candidates, who fear being vastly outmatched by self-financed opponents or major independent spending campaigns.
See also NewDealer's rec-listed diary.
Added: It's worth noting that Public Campaign is confident that the Fair Elections Now Act, which would provide voluntary public financing for House and Senate elections, would avoid this difficulty because its matching funds provisions are pegged to each candidate's in-state, small-donor fundraising, and not to opponent or independent fundraising.