From the Washington Post

Justices Split on Campaign Finance
Court Will Debate Case This Fall
By Charles Lane
Washington Post Staff Writer
Tuesday, September 9, 2003

With the first caucuses and primaries of campaign 2004 bearing down on them, the justices of the Supreme Court convened yesterday for an unusual late-summer oral argument on campaign finance law, and when it was over, the four-hour debate seemed only to have injected a new element of uncertainty into the looming political season. On the fundamental provisions of the 18-month-old Bipartisan Campaign Reform Act, known as BCRA or the McCain-Feingold law, the justices seemed deeply and evenly divided, with the ultimate outcome apparently dependent once again on the closely held views of one member of the court: Sandra Day O'Connor.
The court will wrestle with the multiple issues in the case over the fall, fully aware that the parties and candidates are expecting a decision in time to conduct the rest of the campaign under a finished rulebook. Yet the splits that were evident at the court yesterday left legal analysts wondering whether the result would be clarity or renewed controversy.
"We are very possibly looking at a decision that would be a little of this and a little of that," said Bob Bauer, a Democratic Party lawyer who attended the argument. "If so, the Federal Election Commission would have to revise the implementing rules" that have governed campaign finance since President Bush signed McCain-Feingold into law in March 2002.
Though O'Connor mostly listened yesterday, her role came into focus because of the comments of the colleague sitting next to her. Chief Justice William H. Rehnquist rained unexpectedly heavy skepticism on the law's two key components: a ban on "soft money" donations to political parties and new limits on corporate- and union-sponsored "issue ads" that air on TV and radio near election time.
Rehnquist's record on the court had led supporters to view him as a probable vote in favor of the law. But his performance yesterday suggested that there was little daylight between him and the three justices whose writings suggest they are unsympathetic to the law: Antonin Scalia, Anthony M. Kennedy and Clarence Thomas.
On the soft money ban, Rehnquist expressed doubt that "Congress can regulate willy-nilly any sort of contribution in connection with an election." And when the hearing turned to issue ads, he said he had reconsidered a decision that supporters of BCRA had relied on as evidence that he would support that part of the law.
Meanwhile, the four members of the court most sympathetic to the law -- John Paul Stevens, David H. Souter, Ruth Bader Ginsburg and Stephen G. Breyer -- held firm, directing generally challenging questions to lawyers opposing the law.
Enacted in response to the fundraising scandals of the 1996 campaign and the Enron affair during the Bush administration, McCain-Feingold -- named for its Senate co-sponsors, John McCain (R-Ariz.) and Russell Feingold (D-Wis.) -- seeks to control the influence of money in politics by prohibiting the national political parties and their officers, as well as federal officeholders and candidates, from raising and spending "soft money" -- donations ostensibly directed to state parties and therefore not subject to federal regulations. The two parties hauled in nearly $500 million in such donations in the two-year election cycle that ended in 2000, most of it from large corporations, labor unions and a handful of wealthy individuals.
The law defines issue ads, or "electioneering communications," as any radio or TV ad that runs within 60 days of a general election or 30 days of a primary and "refers to" a candidate. Before McCain-Feingold, unions and corporations were free to buy as many such ads as they wanted, paying for them out of their general funds. Now, they may do so only with money raised by a separate political action committee, and they are fully subject to federal contribution limits and disclosure rules.
Opponents of the law, led by Sen. Mitch McConnell (R-Ky.), who fought a losing battle against BCRA in the Senate, argue that it poses a threat to freedom of speech and association by choking off the supply of money that pays for political debate and party activities.
In the past, the court has upheld some limitations on contributions in the name of eliminating corruption, real or perceived. Much of yesterday's debate revolved around the question of whether McCain-Feingold struck the right balance between robust debate and clean elections.
Leading off the arguments yesterday, McConnell's lawyer, former Whitewater independent counsel Kenneth W. Starr, urged the court to view the soft money ban as an unconstitutional usurpation of state authority over state elections.
The law, he said, "intrudes deeply into the political life of the nation in a way that not even the most nationalist of the Founding Fathers would have countenanced."
But neither Starr nor Bobby R. Burchfield, who pressed similar arguments on behalf of the Republican National Committee and the California Democratic Party, appeared to make much headway on this point, as even justices who sympathized with them suggested the case should be decided on free-speech grounds.
"The problem I'm having," Kennedy told Burchfield, "is you're bringing out a federalism argument and you have a First Amendment argument."
Breyer and Souter, for their part, took Burchfield to task for saying that Congress had gone too far in limiting soft money before the practical consequences for political parties have become evident.
"We don't have a scalpel . . . in saying what's 'too far,' " Souter told Burchfield.
"Congress has to make an effort to closely draw the standard to fit the ill it's trying to address," Burchfield said.
Solicitor General Theodore B. Olson defended the soft money ban, speaking not only for the Federal Election Commission -- the nominal defendant -- but also symbolizing the support of Bush, who signed BCRA after the Enron scandal. Seth P. Waxman, a Washington lawyer who served as solicitor general under President Bill Clinton, represented the law's authors -- McCain, Feingold, Sens. Olympia J. Snowe (R-Maine) and James M. Jeffords (I-Vt.), as well as Reps. Martin T. Meehan (D-Mass.) and Christopher Shays (R-Conn.), all of whom were in court yesterday.
Olson depicted the soft money ban as a moderate measure designed not to overhaul the political system but to close a "loophole" that was permitting unregulated corporate and union cash to pour into campaigns. Long-standing Supreme Court precedent, he said, gave Congress the authority to keep business and labor from using their bank accounts as political war chests.
But it was then that Rehnquist, who has written in the past that Congress may prevent corporations from using their shareholders' cash for political purposes, observed that Congress cannot regulate contributions "willy-nilly."
Olson objected that all the soft money provisions do is to subject donations to disclosure rules like those with which direct campaign contributions must already comply.
In the afternoon, the spotlight was on the issue-ad provision, with Rehnquist observing that his 1990 vote upholding a Michigan state ban on corporate expenditures in campaigns might have been mistaken, because he now finds the rationale for the court's decision "dubious."
Waxman countered with statistics showing that during a recent campaign, a group called Citizens for Better Medicare, underwritten by the pharmaceutical industry, had run more than 20,000 issue adds before Labor Day that did not mention candidates' names, followed by a burst of more than 10,000 ads that did refer to candidates in the run-up to Election Day, and then "stopped cold" when the election was over.
Such "sham ads," Waxman said, made the law banning corporate support for campaigns "an object of scorn."
He also prompted laughter when he observed that, after the long and complex case, "I'll be one of the happiest people on the face of the planet when I sit down, however you decide." © 2003 The Washington Post Company