Campaign Finance Reform: Supreme Court Ditches Last Chance to Increase Super PAC Transparency

At the end of February, the Supreme Court refused without comment, to take up a case that would have lifted the ban on direct corporate campaign contributions to federal candidates. Spurred by the Court’s ruling in 2010 on Citizens United v. the Federal Election Commission, Danielczyk v. United States sought to apply the same free speech argument to direct contributions. Given the ruling on Citizens United and the influence of Super PACs during the last election, this decision will have no impact on future elections.

Direct corporate contributions were banned by the Tillman Act in 1907. President Theodore Roosevelt recognized the potential for corruption if a small group could exercise greater influence over elected officials than the ordinary citizen. While restrictions on the dollar amount of contributions has been added and upheld by the Court, the Tillman Act remains intact.

The role of Super PACs following Citizens United is well known. However, the presumed impact did not materialize. Former Speaker of the House Newt Gingrich (R-Ga.) was supported by a Super PAC that raised just under $24 million dollars in an effort to gain the GOP presidential nomination. He quit the race three months before the convention. Republican-leaning PACs raised $35 million more than Democratic-leaning ones and the GOP outraised Democrats by $100 million. (President Obama outraised Mitt Romney by $100 million). The president was reelected and the Democrats picked up seats in both chambers of Congress.

Had the Court agreed to hear Danielczyk v. United States and ruled in favor of the plaintiff, basically overturning the Tillman Act, the money going to Super PACs would most likely be given directly to the candidates’ campaigns. The need for Super PACs would be significantly reduced. There would be no change in how members of Congress are lobbied. However, because of reporting requirements contained in the Federal Election Campaign Act of 1974 the system would have become more transparent. This is one of the major arguments used by opponents of Citizens United, since PACs are not required to disclose donor information. These reporting requirements would have given the Court a basis to overcome objections of possible corruption.

Since the Supreme Court’s decision not to hear Danielczyk v. United States was without comment, we don’t know if the decision was based on not wanting to confront the Tillman Act or a belief that Citizens United was as far as campaign finance reform needed to be addressed.

What we do know is money impacts the outcome of elections and that campaign donations are considered a form of speech. Based on the last election results, we also know the candidate or party that raises the most money may not always win. This recent decision by the Court will not have any impact of future elections. Super PACs and lobbyists will have the same influence as they do now under Citizens United. Without a Constitutional amendment, the only campaign reform we can hope for is one that pushes voters to disregard the ads, do their own research, and make an informed decision.