Latest Supreme Court Ruling Unlikely to Lead to Deluge of Ad Dollars

Even if Cash Flows to Political Parties, They Tend to Pay Lower Ad Rates

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Credit: Bloomberg/Andrew Harrer

A divided U.S. Supreme Court struck down decades-old limits on the total money donors can give to federal candidates and parties, issuing its biggest campaign-finance ruling since the 2010 Citizens United decision. But it's unlikely to have the same monetary impact the Citizens United case had.

Voting 5-4 along ideological lines, the court today said the caps violated the speech rights of Shaun McCutcheon, an Alabama Republican official seeking to give candidates, parties and political committees more than the $123,200 maximum. The court stopped short of undercutting a 1976 ruling that allows caps on contributions to individual candidates.

The aggregate limits included a cap of $48,600 to federal candidates and $74,600 to political parties and political action committees during each two-year election cycle. Those are now gone. The $2,600 limit on donations to individual federal candidates remains -- but without the $48,600 limit, a deep-pocketed donor could spread his cash to as many candidates as he wanted.

But the move doesn't necessarily mean a huge increase in overall political advertising spending. According to Elizabeth Wilner, senior VP-Kantar Media Intelligence, the big-dollar donors who can afford to donate $2,600 to candidates around the country were likely already donating those amounts to Super PACs and other outside groups. Some money might be redirected from Super PACs to the political parties themselves. "Within the pool of money that is contributed and goes toward advertising, it might bump up the party's share," she said.

Ms. Wilner also noted that whereas TV stations can (and do) charge Super PACs market rates for their ads, stations charge political parties lower rates for advertising that's coordinated with individual candidates. "So to the extent that more dollars flow for use in coordinated TV advertising, those dollars are going to go further," she said. In other words, a Republican National Committee or Democratic National Committee with more cash might buy more ads -- but they could be paying less for them.

There is also another key distinction between Super PACs and the parties. A rich donor can set up his own group and run it as he sees fit rather than working with the official party structure. Super PACs also give shelter to candidates. The outside groups can get away with more aggressive attack advertising than a candidate might feel comfortable with, thus giving a candidate cover while still damaging his opponent.

Intruding on First Amendment
The aggregate limits "intrude without justification on a citizen's ability to exercise the most fundamental First Amendment activities," Chief Justice John Roberts wrote in the court's lead opinion.

Justices Samuel Alito, Anthony Kennedy, Clarence Thomas and Antonin Scalia joined Justice Roberts in the majority, with Justice Thomas saying in a separate opinion that he would have gone further and overturned the 1976 ruling. Justices Elena Kagan, Ruth Bader Ginsburg, Stephen Breyer and Sonia Sotomayor dissented.

The loosening of campaign-finance restrictions has become a hallmark of the court under Roberts. The Citizens United ruling helped fuel an explosion of campaign spending, with spending from candidates, parties and outside groups topping $6 billion in 2012. Today's ruling may affect November's congressional elections, as Republicans seek to take control of the Senate.

Taken together with Citizens United, the decision "eviscerates our nation's campaign-finance laws, leaving a remnant incapable of dealing with the grave problems of democratic legitimacy that those laws were intended to resolve," Justice Breyer wrote in dissent.

--Bloomberg News, with additional reporting by Ken Wheaton

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