How did the Supreme Court decide Buckley v. Valeo ?

The Supreme Court's approach to the case was almost the exact opposite of the circuit court's. The court did not see protecting the integrity of elections as a compelling public interest, so it did not judge the new law by whether it served that interest well enough to justify incidental infringements upon First Amendment rights. Instead, it focused on the First Amendment rights and judged the law by whether it infringed upon them.

The court agreed with the challengers that limits on contributions and expenditures were infringements upon forms of political speech protected by the First Amendment. The challengers were less concerned about limits on contributions than on expenditures, and the court made an even sharper distinction between the two, giving them different degrees of constitutional significance. On the basis of this distinction, the justices upheld limits on contributions but struck down limits on expenditures.

The justices said contributions had less constitutional protection because they were only indirect speech, not the direct speech of the donors. As the majority put it, "the transformation of contributions into political debate involves speech by someone other than the contributor." A limit on the amount of money a person can give to someone else is thus only a "marginal restriction" upon that person's own political speech.26

But the justices held that this marginal restriction significantly deters corruption. Because contributions are money given directly to candidates, the justices decided that they had the potential for corrupting candidates. That meant that limits on contributions protect democracy by preventing rich donors from "securing a political quid pro quo from current and potential office holders."27

Expenditures were another matter. The Supreme Court held them to be the purest form of political speech: "political expression at the core of our electoral process and of the First Amendment freedoms."

It was also direct speech and so, unlike contributions, could not be corrupting. The justices struck down expenditure limits because they were not marginal but "direct and substantial restraints on the quantity of political speech" and because they did not deter corruption.28

That was true by definition for expenditures made by candidates themselves, but the court said it was equally true for expenditures made on their behalf by citizens and non-party groups. These are called independent expenditures because they are made without the candidates' authorization. And without that authorization, the justices said, they could not be used to secure political quid pro quo from those candidates.

Congress was not so sure, and limited independent expenditures for express advocacy on behalf of candidates to the same $1,000 it had imposed on contributions to those candidates. By 1974, Congress had had more than thirty years of experience with such expenditures and knew that most of them were independent only in a formal, legal sense. Independent expenditures had been used to evade contribution limits since the 1940s, and Congress imposed the $1,000 limit to prevent such evasion in the future.29

The Supreme Court, however, chose to believe that independent expenditures really were independent, that candidates who did not authorize them formally also did not do so informally. Such expenditures, the court said, "may well provide little assistance to the candidate's campaign, and indeed may prove counterproductive." If these expenditures could not assist candidates they also could not corrupt them, which meant that limiting them could not prevent corruption. So the court struck down the limit.30

The court also made a sharper distinction than Congress did between two kinds of political expenditures: issue advocacy and express advocacy. Congress and both courts generally agreed on how to tell one from the other. Issue advocacy expenditures are advertisements about public policy issues, not candidates. Congress and the circuit and Supreme courts all agreed that this definition held true even if such advertisements mention clearly identified federal candidates.

They also agreed that express advocacy advertisements are those that expressly urge the election or defeat of clearly identified candidates. But it was the Supreme Court that drew a bright line between issue and express advocacy, as advertisements that did and did not use what came to be called "magic words," such as "vote for," "vote against," "elect," and "defeat."31

The Supreme Court decided that issue advocacy was not political at all, even if the ads mention candidates in ways that are clearly positive or negative; and because they are not political, they cannot be subject to FECA regulation. The court permitted the government to regulate only ads that expressly urge voters to vote for or against a candidate, because only those ads are political.

The justices made these distinctions on the basis of another one, between two of the three public interests put forward to justify the reforms: promoting equality and preventing corruption. All the justices agreed that preventing corruption was a legitimate public interest, but the majority decided that it was the only legitimate interest, the only constitutionally permissible reason to regulate campaign funds.

 
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