Supreme Court reviewing corporate campaigning

WASHINGTON – The Supreme Court’s conservative bloc sounded poised Wednesday to strike down on free speech grounds a 100-year-old ban against corporations spending large amounts of money to elect or defeat congressional and presidential candidates.

If the justices were to issue such a ruling in the next few months, it could reshape American politics, beginning with the congressional campaign in 2010. Big companies and industries – and possibly unions as well – could fund campaign ads to support or defeat members of Congress.

Since 1907, federal law has prohibited corporations from giving money to candidates. And since 1947, corporations and unions have been barred from spending money on their own to urge voters to elect or defeat federal candidates. Corporate executives, as individuals, can contribute money to a corporate political action committee or PAC, but these amounts are relatively modest compared to the funds available to the corporate treasury.

At least 24 states have similar bans on corporate spending in state races.

All those spending limits have come under growing legal attack from conservatives and libertarians who say the government should not be allowed to set limits on campaign spending and electioneering, even when corporate or union money is in play.

Three justices – Antonin Scalia, Anthony Kennedy and Clarence Thomas – have already said they would overrule past decisions that had upheld federal and state restrictions on corporate election spending. Chief Justice John Roberts and Justice Samuel Alito also have said they favor free speech over the campaign funding limits. But they have not yet said whether they would go along and give corporations a free speech right to spend on campaign ads.

That was the issue before the court Wednesday. It was a rare re-argument in a seemingly narrow case of a small nonprofit group called Citizens United. It had produced a video called “Hillary: The Movie,” which was designed to undercut Hillary Rodham Clinton’s 2008 campaign for the presidency. However, it got tied up in a legal battle with the Federal Election Commission.

Because Citizens United is incorporated and received a small amount of corporate money, the group and its movie came under FEC regulation. Any amount of corporate money can trigger regulatory action under the election laws.

In March, the justices debated whether the law should apply to a nonprofit group that produced a campaign-related video. But rather than decide that narrow question, the justices said in June they would focus instead on whether to say that all corporations, like individuals, have a right to spend freely to elect or defeat candidates.

Washington lawyer Ted Olson, the former solicitor general under President George W. Bush, pressed the justices to rule broadly. “Corporations are persons entitled to protection under the First Amendment,” said Olson, who represented Citizens United.

Sens. John McCain, R-Ariz., and Russell Feingold, D-Wis., co-sponsors of the 2002 campaign funding law, were in the courtroom and listened intently to the 90-minute argument. The ruling could strike down part of the McCain-Feingold Act that restricted corporate and union-funded election ads in the months before the election.

The court will meet behind closed doors later this week to vote on the case. A decision could come within a few months.