Nixon v. Shrink Missouri Government PAC: Rethinking Campaign Contribution Limits

Statement of Joel Gora, General Counsel,
New York Civil Liberties Union and Professor of Law, Brooklyn Law School

The ACLU has been involved in the debate over government regulation of campaign speech ever since the initial government effort in 1972 to use the new Federal Election Campaign Act against political dissenters engaged in classic issue advocacy and citizen criticism of incumbent officeholders. We provided counsel to the challengers in Buckley and the New York Civil Liberties Union was a co-plaintiff in that case.

Today, two decades later, the rationale that Buckley relied on to uphold contribution limits in 1976 is no longer persuasive. Instead, we have been left with a regulatory scheme that has not leveled the playing field between challengers and incumbents, has not halted the spiraling costs of political campaigns, and has not restrained the political spending of wealthy contributors, with whatever implications that may have in terms of undue access or influence. Buckley's one clear accomplishment has been to force candidates to spend more time on fundraising than ever before. If we are serious about campaign finance reform, it is time to get serious about public financing.

Shrink (98-963) demonstrates both the practical and constitutional flaws with the current system. This case challenges a set of contribution limits adopted by the Missouri legislature in July 1994. The challenged limits went into effect in December 1995 after the Eighth Circuit struck down an even more stringent set of limits that had been adopted by the Missouri voters through the ballot initiative process. As originally enacted in Senate Bill 650 (SB 650), the limits prohibited any person, which for these purposes is defined to include a political action committee (PAC), from contributing more than $1,000 to a candidate for statewide office, $500 to a candidate for state senate, and $250 to a candidate for state representative. Because the statute also included a periodic adjustment for inflation, these numbers had risen by the time of the lawsuit to $1,075, $525, and $275 per candidate per election.

In March 1998, the Shrink Missouri Government PAC, a registered political action committee, and Zev David Fredman, a prospective candidate for the Republican nomination for Auditor, a statewide elective office, filed suit. The committee claimed that SB 650 prevented it from making contributions larger than the specified amounts to state and local candidates whose views it shared and whose candidacies it wished to enable and support. (J.A. 17). From his perspective as a candidate who was a political newcomer, Fredman alleged that SB 650 effectively prevented him from raising the money necessary to compete in the Republican primary scheduled for August 1998 and to get his message to the electorate.

The District Court granted the state's motion for summary judgment and upheld the constitutionality of Missouri's contribution limits. In its ruling, the court placed great weight on a litigation affidavit submitted by the bill's co-sponsor, who had asserted, in a conclusory fashion, that the appropriate legislative committee "had heard testimony on and discussed the significant issue of balancing the need for campaign contributions versus the potential for buying influence." Based almost exclusively on this after-the-fact representation, the District Court held that the State had carried its burden of establishing "real harm." The Court supported its conclusion by noting that the legislature is "uniquely qualified" to assess the risk of corruption and by further noting that "a perception of influence peddling is ‘real harm' regardless of whether such peddling is actually afoot."

On appeal, the Eighth Circuit reversed by a 2-1 vote. Writing for the majority, Chief Judge Bowman held that Missouri's contribution limits failed to survive the strict scrutiny that the Supreme Court's decisions required.

"We will not infer that state candidates for public office are corrupt or that they appear corrupt from the problems that resulted from undeniably large contributions made to federal campaigns over twenty-five years ago," the Circuit Court wrote. "The State therefore must prove that Missouri has a real problem with corruption or a perception thereof as a direct result of large campaign contributions."

The majority then found that Missouri had "failed to come forward with evidence to prove a compelling interest that would be served by the restrictions SB 650 imposes on campaign contributions." In addition, Chief Judge Bowman concluded that SB 650 failed the "narrow tailoring" requirement of strict scrutiny because, by today's standards, its limits are so small that "they run afoul of the Constitution by unnecessarily restricting protected First Amendment freedoms."

The case raises both narrow and broad issues. The narrow questions are whether, under Buckley v. Valeo and traditional First Amendment analysis, a state can introduce severely low campaign contribution limits with virtually no evidence of any real or apparent corruption during the period when there were no such limits. And even if some evidence of real or apparent corruption has been shown, is the adoption of extremely low contribution limits like Missouri's a "narrowly tailored" response to such concerns? The ACLU believes that, for the reasons persuasively set forth in the Eighth Circuit's opinion, the answer to both those questions is no.

More fundamentally, however, this case offers the Court an opportunity to reexamine its approach to contribution limits. Buckley proceeded on the assumption that contribution limits provide a meaningful check on the influence of money in the electoral system. But, as noted above, today there is more money in politics than ever before. The First Amendment bargain that Buckley struck in rejecting expenditure limits yet upholding contribution limits simply has not paid off. Accordingly, the ACLU suggests in its brief that it is time to consider a different approach that is both more consistent with First Amendment values and has a greater chance of achieving its stated goals.

Narrow Issues

In striking down Missouri's contribution limits, the Eighth Circuit relied on three well-established First Amendment principles, two of which are derived from Buckley itself. First, political contributions, as well as political expenditures, are core constitutional activities affecting freedom of expression and freedom of association. Second, contribution limits, as well as expenditure limits, are therefore subject to "the closest scrutiny." Id. at 25. Third, whenever the government attempts to regulate speech, it "must demonstrate that the harms are real . . . and that the regulation will in fact alleviate these harms in a direct and material way." United States v. National Treasury Employees Union, 513 U.S. 454, 475 (1995).

We contend that Missouri has failed to make that showing in this case. Instead, the state's defense of its contribution limits begins and ends with the talismanic reference to corruption and the appearance of corruption.

If that is all that Buckley requires, that opinion would have been much shorter than it was, including its section on contribution limits. The Court, however, has never permitted First Amendment rights to be overridden so casually. To the contrary, the Court has repeatedly recognized that heightened scrutiny is defined by its insistence that the government do more than "posit the existence of the disease to be cured." Turner Broadcasting System, Inc. v. FCC, 512 U.S. 622, 664 (1994). Accordingly, the debate over whether contribution limits are subject to strict scrutiny or intermediate scrutiny is almost beside the point. On this barren record, petitioners can prevail only if contribution limits are not subject to any First Amendment scrutiny at all. As the Eighth Circuit properly recognized, that is clearly not the holding of Buckley.

In seeking reversal of the Eighth Circuit, Missouri and her supporting amici basically contend that the Court should not give strict scrutiny to the contribution limits, but should defer to the political expertise of elected officials; that government can impose restrictive contribution limits in a prophylactic attempt to ward off corruption and salve public concerns; and that the level of contribution ceilings is essentially a legislative matter with only a minimal judicial inquiry appropriate. The Court's resolution of these issues will significantly determine the Court's disposition of the case.

Broader Issues

Of course, Buckley plainly does hold that contribution limits can be sustained, on a proper record, because of the state's interest in curbing corruption or the appearance of corruption. Experience has proved otherwise in terms of the efficacy of restrictive contribution limits to achieve the goals they are claimed to serve. Political spending has not decreased because of contribution limits, it has merely been diverted into other channels -- primarily, PACs, soft money, and issue advocacy -- most of which are beyond regulatory control, and properly so, under the Court's First Amendment precedents.

Such a misguided scheme might be merely regrettable if we were not dealing with First Amendment rights. Because we are dealing with First Amendment rights, such an imprecise fit between means and ends raises severe constitutional problems. To let political speech be protected or prohibited solely on the basis of distinctions between expenditures and contributions, "express advocacy" and "issue advocacy," media speech and other corporate speech, coordinated activity and uncoordinated activity, party activity and issue group activity, is to tolerate an irrational and intolerable speech code for political speech.

Based on our extensive experience with these issues, we believe that the answer to the campaign finance dilemma does not lie in more limits, more loopholes, and more public cynicism. Rather, it lies in an adequate and equitable system of public financing, coupled with technologically facilitated disclosure of private contributions and faith in the ability of voters to judge where their own best interests lie. By focusing our efforts in this direction, we are far more likely to accomplish meaningful reform and far less likely to run afoul of the First Amendment.