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High court divided over political donor limits

By Bill Mears, CNN Supreme Court Producer
updated 5:50 PM EDT, Thu October 10, 2013
STORY HIGHLIGHTS
  • A spirited hour of oral arguments left in doubt how the court might rule
  • The suit challenges limits on how much a donor can give to candidates for federal offices
  • Much of Tuesday's oral arguments dealt with competing views on fairness

Washington (CNN) -- A free-speech legal fight over the fuel of partisan politics -- the billions at stake in federal campaign donations -- produced a predictably divided Supreme Court on Tuesday.

A spirited hour of oral arguments left in doubt whether current aggregate limits on direct campaign contributions by individuals -- in the Federal Election Campaign Act -- will stay in place.

A ruling by spring could have an immediate impact on the congressional midterm elections next November, and be another blow to existing federal election laws.

The appeal from Shaun McCutcheon, 46-year-old owner of an Alabama electrical engineering company, is supported in court by the Republican National Committee.

They object to a 1970s Watergate-era law restricting someone from giving no more than $48,600 to federal candidates, and $74,600 to political action committees during a two-year election cycle, for a maximum of $123,200.

McCutcheon says he has a constitutional right to donate more than that amount to as many office seekers as he wants, so long as no one candidate gets more than the $2,600 per election limit.

But supporters of existing regulations say the law prevents corruption or the appearance of corruption. Without the limits, they say, one well-heeled donor could in theory contribute a maximum $3.6 million to the national and state parties, and the 450 or so Senate and House candidates expected to run in 2014.

Someone who gives that amount, said Justice Elena Kagan, would get "a very, very special place at the table," of grateful candidates and parties. "Are you suggesting that party and the members of that party are not going to owe me anything?" she asked.

But Justice Samuel Alito dismissed the suggestion as "wild hypotheticals."

"How realistic is that," that such willing donors exist, he asked U.S. Solicitor General Donald Verrilli. Alito raised a fairness argument, saying it would be far easier for rich contributors to give to independent PACs -- political action committees not encumbered by the same limits, than to give directly to candidates under existing restrictions.

President Obama later weighed in, saying he supports the current law.

"The latest case would go further than Citizens United," a three-year-old ruling expanding corporate spending, he said, "essentially saying: anything goes. There are no rules in terms of how to finance campaigns.

"There aren't a lot of functioning democracies around the world that work this way, where you can basically have millionaires and billionaires bankrolling whoever they want, however they want, in some cases undisclosed. And what it means is ordinary Americans are shut out of the process."

McCutcheon equates his donations to "core political speech," but backers of continued congressional regulation do not see it that way, saying the current limits allow a wider, less affluent electorate to participate in the political process.

A special three-judge federal panel in Washington earlier rejected McCutcheon's appeal.

The individual aggregate limits were passed by Congress in the wake of the Watergate scandal, and upheld by the high court in 1976.

The current competing arguments are stark: Supporters of campaign finance reform say current federal regulations are designed to prevent corruption in politics. Opponents say they criminalize free speech and association.

The current case deals with direct political contributions. A separate 2010 high court case dealt with campaign spending by outside groups seeking to influence federal elections. There, the conservative majority -- citing free speech concerns -- eased longstanding restrictions on "independent spending" by corporations, labor unions, and certain non-profit advocacy groups in political campaigns.

The Citizens United ruling helped open the floodgates to massive corporate spending in the 2012 elections. It also led to further litigation seeking to loosen current restrictions on both the spending and donations.

Much of Tuesday's oral arguments dealt with competing views on the "fairness" argument, and the effect the laws have on donors.

"By having these limits you are promoting democratic participation, then the little people will count some, and you won't have the super-affluent as the speakers that will control the elections," said Justice Ruth Bader Ginsburg.

But Chief Justice John Roberts suggested more modest donations are also improperly hampered by current law.

"You can't pretend that (the donation limit law) is pursued with no First Amendment cost quite apart from the one that's there. It seems to me a very direct restriction on much smaller contributions that Congress said do not present a problem with corruption."

Other members of the court pursued the fairness argument, comparing spending limited by the law with independent spending by wealthy donors or PACs. "You have two persons. One person gives an amount to a candidate that's limited. The other takes out ads, uncoordinated, just all on his own, costing $500,000," said Justice Anthony Kennedy, whose vote may prove decisive. "Don't you think that second person has more access to the candidate who's -- when the candidate is successful, than the first?"

Money and politics: high court's first big case this term

Justice Sonia Sotomayor raised the issue of joint fundraising committees, where candidates work with their respective parties to pool fundraising resources. That meant the recent presidential campaigns of Barack Obama and Mitt Romney were able to solicit contributions to the maximum $70,800 per donor.

"It's very hard to think that any candidate doesn't know the contributor who has enough money to give not only to himself or herself, but to any of his or her affiliates who are supporting him or her," said Sotomayor. "I mean, it's nearly common sense, hard to dispute."

Another point of contention is whether the aggregate spending limits are really having a pervasive effect, or involve only a relative few well-heeled givers. Justice Antonin Scalia suggested free speech applies equally, to rich and poor.

"I assume that a law that only prohibits the speech of 2% of the country is OK," he said somewhat sarcastically to Verrilli, who was arguing for the Federal Election Commission in defending the laws.

But Justice Stephen Breyer there is a free speech "positive" aspect to the restrictions.

"If the average person thinks that what he says, exercising his First Amendment rights, just can't have an impact through public opinion upon his representative, he says: What is the point of the First Amendment?"

Outside the court, supporters of the current restrictions held signs saying "McCutcheon = Corruption," and some demonstrators were dressed as green dollar bills.

"If the court were to strike down the contribution limits at issue in McCutcheon, the government will be back on the auction block to the highest bidders as it was in the Watergate scandals of the 1970s and the soft money scandals of the 1990s," said Fred Wertheimer, founder and president of Democracy 21, a longtime activist on campaign spending reform.

But McCutcheon himself, who attended the arguments, told CNN, "Getting rid of the aggregate limits is not about corrupting democracy-- it is about practicing democracy."

"This case is about freedom -- your freedom and my freedom -- to express ourselves openly and fully within our political system. And if there is one thing that we Americans believe with all our hearts, it is that freedom never corrupts."

If there was one area of agreement, it was the overall byzantine complexity of the issue. "This campaign finance law is so intricate that I can't figure it out," lamented Scalia at one point.

The case is McCutcheon v. Federal Election Commission (12-536).

Justices prepare for hot-button cases -- and hot internal rhetoric

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