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Wednesday, July 18, 2012

The Impact of Citizens United

Our chapters on interest groups and elections discuss Citizens United, the Supreme Court case that reduced restrictions on campaign spending by outside groups.  At The New York Times Magazine, Matt Bai asks whether the decision has transformed politics as thoroughly as critics claim.
Well, not necessarily. Legally speaking, zillionaires were no less able to write fat checks four years ago than they are today. And while it is true that corporations can now give money for specific purposes that were prohibited before, it seems they aren’t, or at least not at a level that accounts for anything like the sudden influx of money into the system. According to a brief filed by Mitch McConnell, the Senate minority leader, and Floyd Abrams, the First Amendment lawyer, in a Montana case on which the Supreme Court ruled last month, not a single Fortune 100 company contributed to a candidate’s super PAC during this year’s Republican primaries. Of the $96 million or more raised by these super PACs, only about 13 percent came from privately held corporations, and less than 1 percent came from publicly traded corporations.
"Social welfare groups," or "501(c)(4) groups," do not have to make public disclosure of contributors, yet can make issue advocacy ads and (subject to IRS limits) some express advocacy ads.  Have they become the conduit for corporate money?
But the best anecdotal evidence suggests that this kind of thing isn’t happening in nearly the proportions you might expect. Kenneth Gross, an election lawyer who represents an array of large corporations, told me that few of his clients have contributed to the social-welfare groups engaged in political activity this year. They know those contributions might become public at some point, and no company that sells a product wants to risk the kind of consumer reaction that engulfed Target in 2010, after it contributed $150,000 to a Minnesota group backing a conservative candidate opposing gay marriage. “If you’ve got a bank on every corner, if you’ve got stores in every strip mall, you don’t want to be associated with a social cause,” Gross told me.
 What accounts for the increase in outside spending?
 The level of outside money increased 164 percent from 2004 to 2008. Then it rose 135 percent from 2008 to 2012. In other words, while the sheer amount of dollars seems considerably more ominous after Citizens United, the percentage of change from one presidential election to the next has remained pretty consistent since the passage of McCain-Feingold. And this suggests that the rising amount of outside money was probably bound to reach ever more staggering levels with or without Citizens United. The unintended consequence of McCain-Feingold was to begin a gradual migration of political might from inside the party structure to outside it. 
And why did liberal outside spending spike under Bush while conservative outside spending is soaring under Obama?
A consequence of McCain-Feingold has been to flip on its head an old truism of politics, which is that incumbency comes with a fixed financial advantage. In the era of soft money, controlling the White House meant that a party could almost always leverage its considerable resources to dominate fund-raising. But today it’s much easier to tap into the fury and anxiety of out-of-power millionaires than it is to amass contributions in defense of the status quo. This dynamic probably explains why wealthy Democrats who pioneered the idea of outside money during the Bush years have largely stood down this year, even while conservative fund-raising has soared. It isn’t that liberals don’t like Obama or grow queasy at the mention of super PACs. It’s a function of human nature: nobody really gets pumped up to write a $10 million check just to keep things more or less as they are.