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How Does Money Impact a Presidential Election?

created May 02, 2016 02:18 PM

Note:  The following article is excerpted from the April 2016 edition of Teach the Election, "Money, Influence, and Presidential Elections."  For the full issue (and all other issues), subscribe to the Teach the Election series.

By Shelley Brooks

The 2010 U.S. Supreme Court ruling in Citizens United v. Federal Election Commission opened the door for corporations and labor unions to exert a greater influence on elections. In an ideological split, the five conservative justices ruled that it was a violation of the First Amendment’s guarantee of free speech to prevent a corporation or union from using general treasury funds to fund an election communication (such as a television ad) during the campaign season. In other words, the Court loosened the rules that govern the ways that businesses and labor unions spend money to influence an election. The case in question involved the partisan nonprofit corporation Citizens United. The corporation had produced a film critical of presidential candidate Hillary Clinton and wished to go against federal election laws by advertising the film during the 2008 primary election season. 

In an historic Supreme Court decision that invalidated sections of campaign finance laws and overturned in part two earlier Supreme Court rulings, the majority opinion held that “political spending is a form of protected speech under the First Amendment, and the government may not keep corporations or unions from spending money to support or denounce individual candidates in elections.” The four liberal justices dissented, arguing against the interpretation that corporations and unions are entitled to the same protections as individuals under the First Amendment. In what would become another important campaign finance ruling, the 2010 federal court case v. Federal Election Commission determined that limiting the campaign contributions that individuals can make is in violation of the First Amendment’s protection of free speech. These two rulings have created conditions that allow businesses, unions, and wealthy donors to have greater influence in the country’s election process. Prior to 2010, campaign finance laws capped at $5,000 the contribution that an individual could make to a group that spent money to influence an election (through donations to a candidate for instance). Called a political action committee (PAC), these organizations can be run by a corporation, union, membership organization, or trade association. Such organizations existed since the middle of the twentieth century and take an active role in each election by promoting or criticizing candidates in the race. Today, there is a new spin on the PAC.