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How will the Supreme Court’s recentruling impact corporate campaignfinance laws?
No less than twelve House andSenate bills addressing the Court’sruling are currently before U.S.Congressional Committees. All bills introduced to this point areaimed at limiting the immediateand long term effects of
. Several bills seek toreduce foreign influence in U.S.elections by preventing foreigncorporations or other companieswith foreign ownership fromrunning electioneering ads.Others, such as H.R. 4537, seek toamend the Securities ExchangeAct of 1934 by requiringshareholder authorization prior toan electioneering expenditure notrelated to a corporation’s productsor services. Taxpayer protection bills, such as H.R. 4550, would prevent companies from spendingfederal bailout money onelectioneering communications.One joint resolution, H.J. Res. 68,would amend the U.S. Constitutionto prohibit corporations and labor organizations from using operatingfunds for advertisements inconnection with any federalelection. These legislative effortsto diminish
maydrag on for months and possiblyyears. Those who prefer to bypass
Citizens United v. FEC
, adivided U.S. Supreme Court struck down portions of 2 U.S.C. § 441b,which prohibits corporations andunions from making independentexpenditures for electioneeringcommunications. As a result,
makes it permissible for corporations andunions to spend unlimited dollarson independent advertisingintended to influence federalelections at any time before a primary or general election.Because the Court’s holding deals primarily with First Amendmentissues, it does little to clarify practical matters germane tocorporations and unions, such ashow independent expendituresmay be restricted in the future or the manner in which corporationsand unions may make independentexpenditures in state elections. So, before spending your organization’s dollars on politicaladvertisements, three key issues toconsider are as follows: (1) thedecision’s immediate effect onfederal law; (2) the decision’simpact on state campaignspending; and (3) the decision’s potential effect on organizationalgovernance.From a federal law perspective,
invalidatedrestrictions on independentcorporate and union expenditureson “electioneeringcommunications.” Anelectioneering communication isdefined as “any broadcast, cable,or satellitecommunication…[that]…refers toa clearly indentified candidate for Federal office,” made within 30days of a primary election or 60days of a general election. Inaddition,
onlyapplies to independent campaignspending. Corporations andunions are still prohibited fromcollaborating directly with any particular candidate or politicalgroup.The Court’s ruling did notinvalidate several key areas of campaign finance regulation.First, the ruling does not removerestrictions on direct corporatecontributions to a particular candidate, party or political groupduring federal elections. Second,the Court upheld current disclosurerequirements related to corporatecampaign expenditures,specifically those associated withindependent electioneering.Finally, the Court’s ruling does notaffect a corporation’s or union’sability to use political actioncommittees to promote politicalspeech.
Issue 1, 2010
W. Plumer Wiseman Jr.email@example.comMark A. Melvin502firstname.lastname@example.org