The Loophole We Can't Close


By Paul Starr
The American Prospect, January-February 1998

Nineteen ninety-eight is the 200th anniversary of an event that I trust no one will care to celebrate: the Sedition Act of 1798, the single most egregious violation of freedom of speech in American history. Less than a decade after the adoption of the Bill of Rights, the Sedition Act made it a crime to defame President John Adams or the Congress, which was then in the hands of the Federalists. The Adams administration used the law to imprison most of the editors of the major opposition (Jeffersonian Republican) newspapers. Nothing in American history, not even McCarthyism, comes close in the scale of political repression, and thankfully nothing like it is on the horizon.

Nonetheless, the Sedition Act still holds two lessons for us today. First, otherwise reasonable people can convince themselves that there is a compelling governmental interest in the restriction of political speech. In the case of the Sedition Act, those reasonable people included Washington, Adams, and Hamilton as well as several leading Federalists in Congress who had earlier voted for the Bill of Rights. In the midst of an undeclared "half-war" with France in 1798, they thought the country could no longer afford the insolence and divisiveness of an opposition press.

The second lesson is that the Sedition Act was an utter political failure. The jailed editors emerged as popular heroes. The reaction to the act and the prosecutions under it helped Jefferson's Republicans claim victory in 1800. In fact, rather than stopping the opposition, the Sedition Act was a contributing factor in the self-destruction of the Federalists. Their party never won another national election. It was not until 1957 that the Supreme Court decisively repudiated "seditious libel" and ruled that the Sedition Act had been unconstitutional. But for most of our history, the popular verdict of the "revolution of 1800," as Jefferson called it, was a sufficient deterrent. No party wanted to repeat the mistake the Federalists had made in underestimating Americans' attachment to freedom of speech.

Unfortunately, however, the impulse to limit political speech has not disappeared. Conservatives today seem to be intent on commemorating the Sedition Act by passing a constitutional amendment to ban "desecration" of the flag, which would be the first amendment to restrict the Bill of Rights. And some liberals and moderates would like to see campaign finance reform that includes comprehensive limits on spending, including limits on issue advocacy expressly tied to candidates. The motivation of such efforts to limit campaigns is understandable, but the results would be appalling.

Someday you and millions of other Americans opposed to a policy or action of the government -- say, a war in Asia, a denial of civil rights, or a failure to prevent an environmental catastrophe -- may try to elect a new majority in Congress. To do that will require an enormous efforts, as defeating incumbents always does. But if the campaign finance measure being promoted as our best hope in Congress, the original version of the McCain-Feingold bill (before it was watered down this fall), were someday to be enacted and upheld in court, you might find it difficult to mount a campaign directed at the incumbents you wanted to oust without running afoul of federal law.

During the past year, the supporters of McCain-Feingold have succeeded in making their approach virtually synonymous with campaign finance reform. That success is a tribute to the obvious sincerity and bipartisan cooperation of its sponsors, Senator John McCain, Republican of Arizona, and Russell Feingold, Democrat of Wisconsin. Although their bill was blocked in October, it had the support of all 45 Democrats and 8 Republicans in the Senate, and its sponsors promise to bring it up again. So many good-government groups and editorial pages have rallied behind McCain-Feingold that it may seem as if no one could possibly have any principled reservations about it. But there is a highly respectable case that key provisions of the measure (particularly in its full, undiluted form) are unconstitutional and that rather than opening up the political system, McCain-Feingold could be used to entrench incumbents against effective opposition.

In raising these objections, I do not mean to suggest that all campaign finance reform is ill-conceived. The current system does invite corruption and cynicism. We need change and there are constitutional ways to achieve it that would help reduce candidates' dependence upon private money and the time they devote to fundraising. The most direct way is through public funding of campaigns, as we have in presidential elections; another means is through free or discounted broadcast airtime. Candidates and parties that voluntarily accept public funds or free airtime can be legitimately required, as part of the bargain, to abide by spending limits. And if a candidate is the target of an "independent campaign," it is reasonable to allocate that candidate additional, equalizing public funds. These elements -- public funding, voluntary limits, and equalizing offsets to independent campaigns -- are the key provisions of a proposal known as the Clean Money Option [see Ellen S. Miller, "Clean Elections, How to," TAP, January February 1997, and my own discussion, "Democracy v. Dollar," TAP, March-April 1997].

The original version of McCain-Feingold did not provide any public funds to congressional candidates, though it required TV stations to give candidates a modest amount of free advertising and half-off rates for additional airtime. (For the debate on the Senate floor, both the broadcasting benefits and the spending limits were shorn from the bill and proposed as a separate amendment.) Low-cost TV would be a positive step, but candidates would still need to devote much of their time to courting private donors for the substantial sums that running for office would still require. To keep the money hunt from escalating, the bill limited total spending on campaigns by candidates who accept the airtime benefits, and it expanded the definition of "express advocacy" in independent and issue-oriented campaigns. And it is here, in trying to set comprehensive limits on campaign spending, that McCain-Feingold runs up against the First Amendment.

Supporters of campaign spending limits seem to regard the First Amendment as an annoying impediment to reform erected by a wrong-headed Supreme Court. In Buckley v. Valeo(1976), the Court overturned the post-Watergate spending limits on congressional campaigns -- a decision often described by its critics as mistakenly equating money and speech. But as Alan Morriston argues in this issue [Watch What You Wish For: The Perils of Reversing Buckley, page 38], if Buckley were to be overturned, a series of other important First Amendment precedents would likely fall with it, radically narrowing the compass of free expression in America. The problem is that most political speech in our society requires money to be heard. If the financing of that speech does not qualify for First Amendment protection, the speech itself can effectively be curtailed.

Buckley was not a close decision. As Morrison notes, there was only one justice (White) who would have upheld spending limits, and he failed to make much of a case. No Court opinion since then suggests any potential for a reversal. And as Robert Dreyfuss points out also in this issue [Harder Than Soft Money, page 30], the courts have repeatedly rebuffed the Federal Election Commission's efforts to regulate spending on political campaigns by independent issue advocacy groups. The judicial consensus here ought to give advocates of spending limits pause. There may be constitutional ways to limit spending. There may be effective ways to limit spending. But there may be no way to limit spending that is both constitutional and effective.

An effective limit requires limiting all sources of expenditures. There is no difficulty limiting expenditures by candidates who voluntarily accept either public funds or free airtime; the spending limit is part of the deal. And if the party that nominates a candidate can be made a signatory to this voluntary agreement, such limits can probably be applied to parties (overcoming the Supreme Court's decision in Colorado Republicans v. FEC to treat state party spending as an unregulated independent campaign). However, extending an expenditure limit to other associations (and individuals) that have an interest in the outcome of the election is another matter -- particularly if those groups are genuinely independent and have no involvement with any candidate in the race.

The difficulty in regulating independent political speech is that such advocacy groups, by virtue of being independent, will not have been part of any voluntary agreement on spending and will not have received any benefit from it. In Buckley, the Court did allow limits on a narrowly defined type of independent speech, "express advocacy," that used such explicit words as "vote for," "reject," or "defeat." McCain-Feingold would expand the definition of express advocacy to include any communication by an independent group that a reasonable person would take to be advocating the election or defeat of a candidate, regardless of language. For a 60-day period before a general election, all such express advocacy involving expenditures of $ 10,000 or more would have to be paid for with "hard money" -- which is to say, incorporated nonprofit groups, from Handgun Control to the National Rifle Association, could not mount campaigns out of their general budgets, but only with money raised according to the rules and within the limits set for campaigns by Congress.

Since the Supreme Court only recently let stand a lower-court ruling against such an expanded definition of express advocacy, this provision would certainly face a constitutional challenge. In future elections, a vague standard of express advocacy could be used to criminalize independent political activity (and lead organizations and publications to steer clear of partisan political expression for fear of investigations). If the First Amendment is intended to protect anything, it is issue advocacy. At what time do Americans pay attention to issues if not during elections? To limit groups campaigning against politicians they oppose during the most important season of politics seems to me a clear violation of the First Amendment and fundamental political freedoms. The purpose of such groups may be not only to elect or defeat a particular candidate, but also to make their issue the pivot of the election and thereby to bind the victor to their cause. Surely they have a right to do that. Even if I disagree with them, I want to preserve that right for the day when I may depend upon it. But the move to impose comprehensive spending limits on campaigns seems inevitably to threaten greater control over such political activity.

It might be said that we regulate political speech in other ways. Loudspeakers on roving vehicles cannot be so overpowering that they drown out other voices; legislatures allocate time among opposing sides in debate. But these are not comparable cases. A regulation limiting the volume of loudspeakers doesn't restrict anyone's ability to communicate a message. And time on the floor of a legislature is inherently limited and must be apportioned; there is no inherent limit on the amount of communication possible in public debate. If the government were to establish such limits on the grounds that compelling interests overrode the right to free speech, it would establish the principle, as Morrison describes it, "that, although the First Amendment allows a person to state his views, the government has the final authority to decide how widely they may be disseminated." That's a principle worthy of comparison with the Sedition Act.

Concern about the potential abuse of this power ought to be intensified by the spending limits originally proposed in McCain-Feingold: $600,000 for House campaigns and from $2,004,000 to $8,250,000 in Senate races depending on a state's population. A recent study by the Committee for the Study of the American Electorate, chaired by Curtis Gans, points out that the majority of successful challengers in congressional races typically spent more than these limits (particularly if expenditures by parties and independent campaigns are included, as they would be under McCain-Feingold). Gans point out that "if the experience of successful challengers is any guide to what is needed to run a successful competitive campaign, the proposed spending limits in the Senate are universally too low to ensure competition and those in the House are too low for certain geographical areas and media markets."

In recent decades, political campaigns have risen dramatically in cost. Some of this increase is akin to an arms race that might be controlled by spending limits (or by "gentleman's" agreements, as in the Senate race between John Kerry and William Weld in 1996). But given the difficulty all candidates now face in mobilizing the electorate, it may simply take more resources to run effective campaigns than Congress would permit. Incumbents typically begin any race with a huge advantage in public recognition; challengers need correspondingly huge amounts of publicity to break through the indifference of the public. Thus members of Congress could entrench themselves over time by allowing spending limits to fall further behind the real cost of effective opposition. In fact, the incentives for incumbents would favor their doing exactly that.

Much of the attention during the debate over campaign finance reform has focused on "soft money," the unregulated contributions to political parties that have been at the center of congressional hearings on the 1996 campaign. Virtually everyone seems to agree that banning soft money is the key to reform. But what difference will a ban on soft money really make? The most likely effect is simply to divert spending from political parties to unregulated activity by advocacy groups -- that is, to bring about a change in the organizational form of uncontrolled spending, not to control it. Such a diversion would further reduce the role of parties (already reduced in recent decades as a result of party reforms and the impact of television), and thus encourage an even greater fragmentation of interests.

Comprehensive controls on fundraising by parties also create a potential for entrenchment. The dominant parties, like congressional incumbents, may have an interest in setting limits low enough to make it difficult for new parties to challenge them. Moreover, by regulating total funds raised by parties but not by other kinds of organizations, the law will encourage parties to set up unregulated organizations and spin off activity into them.

And suppose that the Supreme Court were to uphold McCain-Feingold's expanded definition of express advocacy. Groups would have an incentive to find channels of influence not covered by the law. For example, advocacy groups could invest their resources in the period right up to the 60-day limit, or they might create their own magazines, newspapers, and other media to reach the voters. Are newspapers that favor a particular candidate to be counted as campaign expenditures? And if not, why should the owners of newspapers have the right to endorse a candidate when others do not have the right to place advertisements favoring another candidate or party? In the future, radio and television will be delivered via the Internet (or its successor) rather than via the airwaves and thus become increasingly difficult to regulate. As spending flows into unregulated channels, will lawmakers and prosecutors pursue it? Will they try to shut down newspapers or internet sites that evade the campaign spending laws?

The prospect for enforcement is horrendous. Remember what happened with the Sedition Act. The very attempt to enforce it produced a reaction against it. Americans do not want the government regulating what they can read or watch. Enforcing limits on issue advocacy would be the surest way to make campaign spending limits abhorrent to the majority of Americans.

In fact, we don't need comprehensive spending limits to reform campaign finance. The single most important change would be public funding and discounted airtime of sufficient value to free candidates from what is now a perpetual hunt for donors. (Some reformers plead that public finance doesn't have the votes in Congress, but the difficulty of doing something right is not an argument for doing something wrong.) Gans notes that "the critical financial determinant of electoral success is not the amount any individual candidate spends, but whether each serious competitor has enough to get a message to the voters." Candidates can certainly lose elections if they don't have the resources, and it's an advantage -- though not a decisive one -- to have more money. But it is better to raise the floor than to lower the ceiling. If the cost of spending equality is government control of political speech, it's not worth it, and it won't work. There's one loophole that we can't and shouldn't try to close. That loophole is the First Amendment.

Copyright 1998 by Paul Starr Preferred Citation: Paul Starr, "The Loophole We Can't Close," The American Prospect, January-February, 1998. This article may not be resold, reprinted, or redistributed without prior written permission from the author. Direct questions about permissions to permissions@prospect.org.