A Note On FEDERAL CAMPAIGN FINANCE REFORM

Limiting The Right To Make Campaign Contrib11tions Without Violating The First Amendment

William G. Grigsby*

April2013

Professor Emeritus, City and Regional Planning, University of Pennsylvania

emgrigsby@earthlink.net

I would like to thank Professor Richard Hasen for his very generous advice and encouragement -commencing well before the Citizens United decision - in helping me formulate this new approach to federal campaign finance UHaRUP

EXECUTIVE SUMMARY
The Supreme Court's decision in Citizens United v. Federal Election Commission 130 S. Ct. 876 (2010), spawned an almost immediate outpouring of campaign donations by corporations, unions, and wealthy individuals to Presidential and Congressional.candidates. The bulk of these new contributions are made through so-called Super PACs and non-profit social welfare organizations (501(cX4)s that run campaigns supporting particular candidates while maintaining, at least on paper, their independence from the campaigns of these candidates. Even if the large contributions unleashed by Citizens United do not lead to quid pro quo corruption or the appearance thereof (and they clearly do the latter) they have a devastating impact on America's representative democracy by enabling a relatively few wealthy individuals and large corporations and unions to have overwhelming influence over elected officials and election outcomes, and in the process to substantially weaken the influence of the people that candidates and office holders are supposed to represent. According to one reputable study, in federal elections the candidate with the largest war chest wins 94 percent of the time. It is not simply the size of some contributions that is a problem, it is equally or more so the fact that the large donors, can vote with their dollars for candidates anywhere in the country. In so doing, they are undermining this country's representative democracy and replacing it with a political system best characterized as governance by the wealthy few - an unvarnished plutocracy. Most regrettably, none of the remedies which have been proposed to address this problem would do very much to solve it. They leave the Citizens Unision largely untouched, and they only peripherally address the federal campaign finance excesses that were already in place prior to Citizens United.

political jurisdiction in which the election is being held. Rephrased, the right 't o make contributions must be co-terminus with the right to vote. Voters in a Congressional District should not have the value of their :franchise diluted by donations coming from outside their District or by non-natural persons domiciled within their District. Placing boundaries on voting speech but not on contributions speech - the need for which exists only because of the prior right of citizens to exercise voting speech- makes no sense either Constitutionally or in terms of simple logic. 2. For this proscription not to violate the freedom of speech portion of the First Amendment, the Supreme Court must abandon the legal fiction that political donations are a form of speech no different from ordinary speech. Like construction loans that enable a home to be built, money is usually needed if political speech is to be heard, but it is not synonymous with that speech. To argue otherwise is a grievous error in logic. 3. Contributions that are made through the Super PAC independent-expenditure campaigns (IECs), and 50 1(cX4)s by persons and entities that are ineligible to cast a ballot must also be prohibited because they are not functionally different from either direct contributions or contributions made through PACs despite their presumed independence from the campaigns of the candidates they are assisting. 4. With respect to contributions to Presidential candidates, both the primary campaigns and the general election must be treated as 51 separate campaigns because that is exactly what they are. In the primaries, the general rules and regulations vary hugely from state to state, and in the general election, the electoral college in effect makes that contest a collection of individual state elections, not a single QDaRQDO one.

If representative democracy in the United States is to be

saved, five changes in current law must be made: 1. The right to make financial contributions in a federal election campaign, whether directly to a candidate or through a PAC or Super PAC or a 50l(cX4) organization, must be restricted to eligible voters in the

5. In order to prevent the above restrictions from being circumvented through the mis-use of so-called issue ads, any such ad that includes the name of one of the candidates for office should be treated as electioneering and subject to the same rules as those for campaign contributions generally.
Absent these reforms, we can kiss the great American experiment in representative democracy good-bye.

1.

Baekgroud
The Supreme Court's 5-4 decision in Citizens United v. Federal Election Commission (FEC) 130 S. Ct. 876 (2010), has ushered in a new era in the In financing of federal election campaigns. removing almost all limits on campaign contributions, this decision, as expanded upon in Speech Now v. FEC, 599 F.3d 686 (D.C. Cir. 2010), has intensified, rather than settled, controversies over what are appropriate rules regarding donations to candidates for federal office. Partially overturning aR recent Court decisions -Austin v. Michigan Chamber of Commerce. 494 U.S. 650 (1990), and McConnell v. FEC. 540 U.S. 93, (2003) -- as well as century-old campaign finance law, the Court majority concluded that the First Amendment to the Constitution: (a) gives organizations the same rights as natural persons with respect to their financial involvement in fedel election campaigns (upholding First National Bank of Boston v. Bellotti. 435 U.S. 765 (1978); and

In addition, several legislative remedies have been proposed in Congress, particularly:

(a) The Disclose Act requiring full and prompt disclosure of the names of the individuals making contributions through Super PACs, whether they have done so directly or through dummy organizations. Although it was the opinion of eight of the nine Supreme Court justices (Justice Thomas excepting) in the Citizens United decision, 130 S.Ct. at 913-914, that Congress should legislate such a disclosure requirement, the proposed Act has languished in Congress largely because of strong resistance in some quarters on the grounds that such a requirement would have a chilling effect on advocacy speech.

(b) permits corporations to make expenditures from their general treasuries for electioneering communications if these activities are not coordinated in any way with those of the candidate being supported.
This new freedom spawned, not surprisingly, the creation of a number of independent-expenditure political action committees (Super PACs) that poured huge amounts of money into the 2010 Congressional races and then again in the 2012 campaigns. There has also been an expansion of activity by social welfare non-profit organimtions (S01(cX4)s) which are allowed to use up to 49 percent oftheir .contributions for political advocacy without revealing the identity of their donors. In an effort to reduce this torrent of dollars flowing into federal election campaigns, several proposals have called for a Constitutional amendment giving free speech protection only to natural persons. 1

(b) The Fair Elections Now Act (FENA) which would provide partial public funding of Congressional campaigns, mainly through matching grants to candidates who were able to raise funds through small donations. 2 This approach has been resisted for ideological reasons and perhaps also because opponents feel that it would result in even more of the same low quality political advertising that already alienates so many potential voters.
Two otlier proposals pre-dating Citizens United by a number of years also have gone nowhere. The first, which would give voters a voucher that could be used to make campaign donations. The second, in anticipation of the current FENA proposal would require that the names of all contributors be kept secret from candidates, removing the possibility of quid pro quo coiTUption or appearance thereof. 3

Jeffrey Clements, C01p01'8tions Are Not Pewle (San Francisco: Berrett-Koehler, 2011 ).

Lawrence Lessig, Rej>ublic Lost: How Money Corrupts Congress and a Plan to Stop It. (New York: Twelve/Hatchette, 2011 ). Adam Skaggs and Fred Wertheimer, "Empowering Small Donors in Federal Elections" Brennan Center For Justice (2012). ' 3 Bruce Ackerman and Ian Ayres, Voting With Dollars: A New Paradigm For Campaign Finance. New Haven: Yale University Press, 2002.
2

2.

An Unexplored Facet Of The Problem

Possibly because Citizens United involved a Presidential campaign, not a Congressional campaign, none of the discussions or suggestions which were precipitated by the decision have addressed an equally or more important question with respect to current campaign finance law. Why should any entity - whether it be a corporation, union, PAC, Super PAC, 501(c)4), nformal group, or person - not having the right to vote in a particular election still have the First Amendment right to influence the outcome of that election through direct or indirect financial assistance to one of the candidates? Dlustrative of the critical importance of this question is the 2008 election campaign of Montana Senator Max Baucus. In this campaign, Senator Baucus received a mere 15 percent of his $8.4 million in campaign contributions from individuals and organizations domiciled within the Grizzly state. 4 Eligible voters in Montana provided an even smaller proportion of the financial support for his successful re-election effort Their aggregate contributions did not even equal the aggregate contributions from the health industry's political action committees (PACs) alone. 5 Indeed, Montanans were barely in the Baucus re-election game at all. And this was well before Citizens United. Equally disturbing, Montanans did not have an adequate voice in the selection of the Senatorial candidates they would get to vote on. Outside interests not only overwhelmed eligible Montana voters during the campaign itself, they almost certainly deterred possible candidates for the Baucus seat from even getting into the race. After looking at the Senator's huge, largely out-of-state financed war chest, these potential opponents would reasonably have concluded that it made no sense to challenge him.

The financing of Senator Baucus's campaign is not an isolated example. All Congressional campaigns are funded to a large extent, both directly and indirectly, by those who are not eligible to vote in the election whose outcome they are seeking to influence. As would be expected, the proportions vary with the closeness of the race and other factors, but in nearly all elections, contributions by persons and entities who are ineligible to vote play a pivotal role in the outcome. According to the Center For Responsive Politics, the largest fund raiser wins Congressional elections 94 percent of the time. The Citizens United decision merely opened up new sources of support. Money is, of course, not only necessary to enable politicians to be heard by potential voters, it is also frequently necessary if politicians are to be persuaded to listen. In this latter sense, money does indeed talk. If contributions were unable to "talk'' to candidates, they would soon dry up, and a First Amendment issue regarding campaign finance support would not arise. This is especially true with respect to contributions from those lacking voting eligibility because donations are their only tool of potential influence. Congressional candidates should be expected, therefore, to do their best to represent their non-conStituent contributors as vigorously as they do potential voters, because both groups are instrumental to the success of their campaigns. Through their donations, non-constituent contributors, not just voters, become constituents to be served. The legitimacy of non-constituent campaign contributions is so much an accepted fact of political life that it is not questioned in discussions of campaign finance reform. Only the rules for such contributions are debated. But allowing contributors who are not eligible YRa to become constituents of a successful candidate on an equal footing with eligible voters . automatically diminishes the First Amendment rights of the eligible voters. The money-speech rights of the non-eligibles lessen the ballot-speech rights of the eligibles. They do so by offsetting to varying degrees the efforts of eligible voters to affect election outcomes and to influence the views of

Compiled from a list of contributor names, addresses, and contribution amounts filed with the Federal Election Commission. 'Ibid

3.

their elected representatives. The speech of eligible voters is often not even heard by those at whom it is directed. It is blocked out by the money speech of those who are barred from casting a vote. This is unavoidably so, even if the outside money does not talk too much; that is, lead to quid pro quo coJTUption. Nevertheless, in several of its decisions, the Supreme Court has concluded that it is only the danger of quid pro quo corruption or the possible appearance of such coJTUption that constitutes sufficient reason for narrowing First Amendment protection of contributions speech. In Citizens United the Court stated that "the fact that speakers may have influence over or access to elected officials does not mean that these officials are corrupt'' and also that "ingratiation and access... are not corruption" (130 S. Ct. at 910). Even in the absence of provable or apparent quid pro quo coJTUption, however, allowing campaign contributions to be made to PACS or to Super PACs or to 50l(cX4)s or directly to candidates by those who are not eligible to vote COJTUpts the core structure of America's system of representative democracy in at least five ways. It does so by: (a) shaping some legislation in ways that favor the interests of those whom the office holders have not been elected to represent at the expense of their voter constituents; fully nationalizing some with a corresponding shift of political power away from state electorates;
&RQJUHVVLRa elections

(e) creating, in effect, government by a wealthy few, an unvarnished plutocracy.

In addition, and critically important, using First Amendment protection as the argument for allowin those who are ineligible to vote the right to make contributions to candidates, either directly or through independent expenditure campaigns, defies simple logic. The right to express one's opinion through voting is highly circumscribed, being provided only to persons who are eligible to vote by reason of age, place of residence, and citizenship. Since the right to make campaign contributions emanates from this right to vote (i.e. without the right to vote the need for campaign contributions would not arise), it makes no sense that the right to influence the outcome of an election through contributions speech is extended to a broader segment of society than is the right to vote itself.
This point may have escaped the Court majority in its Citizens United decision. Following the Court plurality in Buckley v. Yaleo. 424 U.S. 424 (1976), and Justice Scalia's dissent in McConnell. 540 U.S. at 250-255, in which he argued that the proposition that ''Money Is Not Speech" is fallacioUs, even the majority on the Court treated contributions speech and speech qua speech as virtually synonymous. Throughout its opinion, "speech" and "contributions" are used interchangeably, and the fact that money speech and speech qua speech are different is mentioned only in passing in Justice Stevens' dissent. Yet as the Court itself has recognized in allowing restrictions on the size of campaign contributions while simultaneously upholding the right of everyone to speak out on any political matter anywhere at any time, the two types of speech are quite different even within the context of the First Amendment. This difference, which has been persuasively argued elsewhere, should be reflected in campaign finance law.6

(b)

almost

(c) breeding disillusionment among eligible voters about our political system; (d) discouraging well qualified persons from standing for office.

Deborah Hellman, "Money Talks But It Isn't Speech", Minnesota Law Review, vol. 25, 2011.

4.

Possible Solution To The Campaign FiDaaee Problem

If one accepts the fact that speech in the form of

campaign donations is different from ordinary speech and that the right to make donations derives from the right to vote, then it follows that

eligibility limits with respect to contributions speech (though not actual speech) should be co-terminus with eligibility limits for voting speeck In federal elections, candidates should be allowed
to accept financial contributions only from eligible voters in their state or Congressional district.

In keeping with the Court's reasoning in Citizens United that individuals usually must join together in organizations if they are able to amass the dollars necessary to get their message heard, any organi:ration of any type should be allowed to make donations to its PAC (Donations to Super PACs and 501(c)(4)s are dealt with in the next section) for use in support of a Congressional candidate, but with one key caveat. Since an organization should not have broader contribution speech rights than those of the persons who make up the organilJJtion, the donations which the organi:mtion or its PAC makes to candidates should come only from persons pre-identified as eligible to vote in the election being contested. Thus, if Goldman Sachs wished to make a $25,000 contribution to Senator Baucus through its PAC, all of the funds that were bundled together for that donation should come only from persons having a voting residence in Montana.
Allowing only eligible voters to make campaign contributions extends a principle already established in law. Just as British citizens and British organizations are not allowed (at least on paper) to fmancially support candidates for federal office in America, Californians and Californa organizations using money raised outside Montana would no longer be allowed to similarly interfere with Congressional elections in Montana. Also, Montana organimtions could not make political contributions in Montana elections using funds obtained from out-of-state members, employees, stockholders, customers, or other supporters. Even though the persons whom Montanans elect

may be expected to support or oppose legislation in which people in other states have a keen interest (or this contribution issue would not even arise), this is not sufficient reason to allow contributions that would serve to weaken the political influence of Montanans over their own elected representatives. By permitting only HOLJaROH voters to make contributions, the electoral playing field would become less unequal as between political interests having no right to vote in a particular election and those who do have that right. And corporations and other organizations would not be totally prevented from making campaign contributions but rather would simply be put on an equal footing with natural persons.

The Super PAC ud 501(e)(4) Problem

Unfortunately, by allowing contributions that are made to the independent expenditure campaigns of Super PACs and 501(c)(4)s to be treated as not contributions to candidates, the Citizens United decision (following Buckley) totally vitiates the just described eligible-voter route to campaign fmance reform. By decreeing that these donations are not the equivalent of direct contributions to candidates even though their avowed purpose is the same, Citizens United makes it possible for donatiot;s to be made in unlimited amounts to independent expenditure campaigns. The Court majority's argument for this treatment is that if independent expenditure campaigns are indeed totally independent of the campaigns of the candidates whom their sponsors are supporting, neither the incentives for quid pro quo corruption nor the appearance of such corruption are likely to materialize, as they might in connection with direct contributions to candidates or contributions that are funneled through ordinary PACs. The only way to remove this barrier to campaign finance reform is to persuasively rebut this reasoning so that PACs, Super PACs, 501(c)(4)s and individual donors would all be treated equally. If that were done, contributions regardless of source could come only from eligible voters, and would be capped at the same level or possibly not at all. (In the latter case, wealthy donors could remain king makers in their states but not

s.

elsewhere.) Four arguments support such a restriction on Super PAC and 50I(c)(4) donations. First, even though independent expenditure campaigns are required by Citizens United to_ be completely separate from the campaigns of the candidates they are supporting, in practice most of them are functionally a part of candidates' campaign apparatus. The two campaigns have precisely the same objective. Their key staff members have often worked together before. And anecdotal evidence indicates that some of the seemingly separate campaigns do interact with each other. In brief, the notion that independent expenditure campaigns are more than rarely truly independent is a bit of a sham, as is now widely acknowledged. Yet corrective legislation has not been proposed. Second, the assumption of the Court majority that quid pro quo corruption or the appearance thereof is less likely in the case of independent expenditure campaigns than it is in connection with direct donations to candidates could not be more wrong. The persons who donate to these campaigns are well known to the candidates. The huge sums involved are embossed invitations to quid pro quo corruption and foster the widespread perception that the invitations are usually accepted. Indeed, the concerns about such corruption that were vigorously expressed by Justice Stevens in his Citizens United dissent do appear to have materialized in the 2012 Presidential and Congressional campaigns. Third, since contributors to Super PACs and 50l(c)(4s) have the same objective as those who make contributions directly to candidates or to PACs, i.e. to elect a particular candidate, they should be subject to the same voter-eligibility restrictions. The way in which they make their contributions should be irrelevant. Fourth, and consequentially the most important, the huge flow of contributions into independent expenditure campaigns :from other than eligible voters, just like contributions from ineligible voters that go directly to candidates, is undermining America's system of representative democracy by

sharply diminishing the ability of eligible voters to influence election outcomes and the contours of future legislation. Even in the absence of the potential for quid pro quo corruption, this diminishment of franchise value should be a compelling reason to curtail such contributions. restriction would apply only to speech qua speech. It would in no way diminish the First Amendment right of an ineligible voter to contribute to a candidate's campaign by speaking out directly for the candidate. The ineligible voter would be prohibited only from hiring someone else to do the speaking or from contributing to a Super PAC or SO I (c)(4) for that purpose. Ordinary speech by the ineligible voter would be unconstrained. To explain by example, Nebraskan Warren Buffett using his own money and speaking for himself could carpet Montana with TV ads endorsing Senator Baucus for re-election, but he could not contract out the electioneering to others.

It is important to emphasize that the voter eligibility

Because under Citizens United. political speech may not be suppressed on the basis of the speaker's corporate identity, Mr. Buffett's Berkshire Hathaway firm would have the same right to speak out as does Mr. Buffett himself. And just like Mr. Buffett, ib.e firm CQuld not under this proposal hire someone else to do the sPeaking, because that would be functionally the same as simply giving the candidate the money necessary to hire a speaker or to put together an ad. Berkshire Hathaway would somehow have to do the speaking itself. Consistent with such reasoning, the only allowable Wa.y for the firm to do so would be by having its chief executive officer (in this example, Mr. Buffett) be the person making the presentation. This bit of inconvenience is unavoidable if organizations are to be placed on equal First Amendment footing with natural persons and if a First Amendment difference between speech qua speech and contributions speech is to be given legal recognition. Although requiring that those who are not eligible to vote but who wish to speak out must do so in their own voice may impose an inconvenience, it is not a Constitutionally impermissible restriction of

6.

speech since it affects only the manner of expression, not speech itself. Potential small-sum donors would not, of course, be able to reach a large audience in their own voice. But in return for not being able to make donations anywhere they wished, they would be assured that their own elections would not be similarly corrupted. . The Question Of Presidential Campaigns Although the Citizens United case arose within the context of a Presidential primary, the bulk of this paper has focused on the financing of Congressional campaigns. The reason for doing so is that the residency requirement which is proposed here with respect to contributors to Congressional candidates would not be applicable in Presidential campaigns, since under current law both the state-by-state presidential primaries and the general election are treated as single national As a consequence, the campaign contests. contributions to a Presidential candidate could, even under this proposal, be spent by the candidate anywhere in the country regardless of the place of residence of the contributor. Because the Presidency is a national office, treating the Presidential primaries and general election as national campaigns has a certain internal logic, but it is a logic that disappears on closer examination. The primaries are clearly state-by-state affairs. Not only are they held sequentially, their participatory rules vary widely, as do their rules governing the ways in which the delegates are divided up between winning and losing candidates and also the legal responsibilities ofthe delegates at the party conventions. The general election might .seem, by contrast, to be truly a national referendum, but since this election is decided in the Electoral College, not by popular vote, it too is really an amalgamation of 51 separate contests in the states and District of Columbia. Given that our Presidential elections are designed so as to reflect state-wide, not nation-wide, preferences, regulations regarding campaign contributions should conform to this ammgement. Only persons eligible to vote in a particular state should be allowed to make contributions to the

campaigns of Presidential candidates in that state. And their contributions should be spent in that state or not at all. Under such a restriction, candidates would be unable to concentrate their spending in swing states while ignoring most of the rest of the country. Presidential candidates using their own wealth to finance their campaigns would not be restricted in their expenditures in their own state, but in other states, they could use their own money for ads only if they did the narration. The Proposal Summarized And Rephrased This proposal focuses on a central but indefensible feature of current federal campaign finance law that has been ignored by the Supreme Court in Citizens United and prior decisions - the right of persons who are not eligible to vote in a particular election to affect the outcome of that election through campaign contributions. This right has not been questioned because the Court has mistakenly deemed contributions speech to be equivalent to speech qua speech for First Amendment purposes.
It is this Court-declared equivalency that is at the root of the misguided Citizens United decision. Contrary to the Court's opinion, important First-Amendment relevant differences between campaign contributions and campaign speech do exist. The notion that proscriptions on contributions will correspondingly constrain speech is simply wrong. And much of the mischief in the Citizens United decision arises from that notion.

In order to preserve the country's system of representative democracy and prevent it from
becoming a plutocracy with governance exercised, in effect, by the wealthy few, four changes in current law are needed: These changes would apply to Congressional and Presidential elections alike.

1. Only persons who are eligible to vote in the political jurisdiction in which a federal election is being held should be permitted to make contributions to the campaigns of candidates in that election either directly or. through a PAC or Super PAC or 50l(c)(4).

7.

2. Persons who are not eligible to vote in a particular federal election and therefore not permitted to make contributions to candidates in that election should, nevertheless, be permitted to speak out for or against a candidate. They should, however, be required to do so with their own resources and in their own voice, not pay someone else to present their views for them. 3. Corporations, unions, and other associations, should also be permitted to support candidates if they do so either by using only funds provided by eligible voters or by speaking in their own voice. In order for an organi:ration to speak in its own name in a manner that would be in conformance with this proposal, the chief executive officer of the organization would have to make the presentation personally. An advertisement in which the CEO was not the lead participant would be deemed to be a contribution and not permissible unless it had been funded by eligible voters. Llike the Citizens United decision, this restriction would serve to treat natural persons and corporations equally. 4.While individuals would continue to be allowed to fonn Super PACs and 501(cX4)s, these organizations would be subject to the same restrictions as those for PACS. Their electioneering communications would have to be Otherwise their funded by eligible voters. contributors would have to speak in their own voice. In addition, contributions to PACs, Super PACs and 50l(c)(4)s would be capped at the same level.

1. Partial public financing of federal election campaigns: Although this approach did not offer sufficient funds to the Obama campaign in 2008 for him to take the public funding route, if the amount of needed campaign funding were estimated by Congress with reasonable accuracy, a high rate of candidate participation could be expected. Still, other possible barriers to its success would need attention. First, without companion legislation, the refonn would leave independent expenditure campaigns untouched, as one of the OHDGLQa proponents of this reform himself conceded. Second, since political campaigns are about winning, not educating, tax payers might find themselves paying for the same objectionable rhetoric which they now criticize. And if that happened, would they stand for it? One possibility would be to allow public dollars to be used only for debates, but whether that would be both feasible and helpful is open to question. 2. Full and timely disclosure of the names of contributors: More transparency with respect to the sources of a candidate's campaign funds should cause at least some donors to think more carefully about what the content of ads that are funded in part with their money, and this added attention might raise the average quality of political advertising. Greater transparency would also, according to opponents of this idea, reduce the dollar volume of donations through its chilling effect on those who would fear reprisal if they spoke out. That is not necessarily an outcome not to be desired. The main problem with greater transparency is that it is not a game changer. Indeed, more disclosure is provided by the proposal outlined in this paper than by the revised Disclose Act now before Congress. 3. A Constitutional amendment declaring that the freedom of speech portion of the First Amendment is applicable only to natural persons: Since this widely promoted refonn would leave wealthy contributors untouched, domination of Congressional elections by outside interests would continue at a lower but still unacceptable level.

Tile Maddy Road Ahead

Enactment of either this campaign finance reform proposal or any of the others that are presently being discussed would not end the federal campaign financing problem entirely. In the case of this proposal, campaign contributions in the form of ordinary speech by the donor could possibly also lead to quid pro quo corruption. With respect to the other leading proposals, all would be helpful but none of them offer much hope by themselves for significant change. To elaborate briefly on this pessimistic conclusion:

8.

Lessig op. cit. p. 271.

4. Uncapping of campaign contributions with a requirement that contributions in excess of a specified amount n and make independent expenditures campaign unnecessary. Ironically, it would also likely cause an even greater drying up of largedonations than would full disclosure, confirming beliefs that the entire system of federal campaign finance is corrupt.8 So anonymous giving might have to be supplemented by public subsidies with their own set of problems. It seems clear from this quick review of federal campaign finance reform proposals that despite widening concern over the consequences of the Citizens United decision, significant reform is not near at hand. There is absolutely no way that current excesses and also those which preceded Citizens United will be eliminated unless the right to make campaign contributions in a particular election is restricted to eligible voters in that election. And there is little likelihood that this restriction will be imposed unless the Supreme Court makes a legal distinction between actual speech and speech in the form of campaign contributions. Even if what is proposed here were to become law and restore some integrity to the federal election campaign process, there are at least two reasons why one should still not be sanguinDMGONIMDVONGMIO st reason has to do with so-called issue ads. Since these ads are not regarded as electioneering communications if they do not endorse any candidate, they are exempt from meeting the disclosure requirements and campaign contribution limits of the Federal Election Campaign Act of 1971. Ifthe ads do not use what have been termed the "magic words", such as "Vote For Smith", they are deemed to be in compliance with the Act. Through clever wording, issue ads have been able to clearly support particular candidates without using the magic words. And their apparent effectiveness has been sufficiently worrisome to
1

result in Congressional hearings. Yet nothing has been done about the problem, partly because Citizens United has made the ads unnecessary. If, however, restrictions were placed on contributions to independent election campaigns, as is proposed here, there would be an immediate rush back to the use of issue ads both by various interest groups and by CEOs who would rather express themselves through such ads than through their own voice. And this would effectively eviscerate any legislation based on the proposal outlined here.

It is essential, therefore, that putting an end to the gross mis-use of issue ads be part of the reform package. Contrary to what one might think, particularly given the failure of Congress to deal with the "magic words" problem, it would be relatively easy to craft rules for issue ads that would prevent disguised electioneering and also be feasible to administer. For example, there could be a simple requirement that within 90 days of a federal election, advertisements that referred in any way to that election or to any of the candidates either indirectly or by name would be presumed to be intended to influence the outcome ofthe election and therefore to be treated as electioneering.
The second reason to withhold one's optimism about the extent of the improvement that could be accomplished by this proposal is that some of the power relationships in Washington which are so important in shaping legislation would be largely unaffected. The many widely reported ways by which political influence is exercised, either through long established networks or through sophisticated lobbying strategems such as those described in recent books by Lessig, Abramoff, and Nevertheless, Schweizer, would continue. 9 because it would remedy fundamental flaws both in the Citizens United decision and in prior federal campaign finance law, enactment of the federal campaign finance reforms proposed here would be a key first step in preserving our system of representative democracy. Lawrence Lessig, op. cit.; Jack Ab ramoff, Capitol Punishment (Wash. DC: WND Books, 2011); Peter Schweizer, Throw Them All Out (NYC: Houghton Miftlin Harcourt, 2011).
9

Lessig, op. cit. pages 262 and 263.

9.