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Beyond Citizens United: Fixing the American elections system

MinnPost photo by Corey Anderson
The American election system is broken, and it demands even broader changes beyond reversing 'Citizens United.'
David Schultz
David Schultz

In post-election statements, both Sen. Amy Klobuchar and Rep.-elect Rick Nolan called for campaign finance reform. They singled out the role of big money and negative ads in campaigns, demanding among other things, an overturning of the Supreme Court’s 2010 Citizens United v. Federal Election Commission. Campaign-finance reform is needed, but the American election system is broken, demanding even broader changes beyond reversing Citizens United. These changes extend to the role of money in politics, voting, and the quality of political debate and information.

Money and politics

Citizens United is one of many Supreme Court decisions that try to define the role of money and speech in American elections. Concern that money corrupts the political process goes back to the 19th century. Beginning in 1907 with the Tillman Act, federal law made it illegal for corporations to make direct political contributions to candidates for federal office. In 1947 the Taft-Hartley Act did the same for labor unions.

Many states have similar laws. The concern, especially with corporations, as Chief Justice Rehnquist once stated in First National Bank of Boston v. Bellotti (1978) is that the government might reasonably fear that a  “corporation would use its economic power to obtain further benefits beyond those already bestowed.”  The task is now to prevent the conversion of resources amassed in the economic marketplace from corrupting the political marketplace.

What Citizens United actually did was to say that corporations (and unions) have a First Amendment right to make direct expenditures from their treasuries to make independent expenditures to advocate for the election or defeat of a candidate for office. The decision did not overturn the ban on direct contributions to candidates, but it overturned laws  that made it illegal for corporations to spend money independently to support a candidate for office.

Is Citizens United responsible for the $6-8 billion election cycle spending that just concluded? Yes and no. Prior to Citizens United, corporations already had lots of ways of getting around the law. They could do issue ads that attacked candidates but did not expressly urge their election or defeat. They could set up political action committees. They could fund get-out-the-vote, voter-registration, and voter-education programs. Individual corporate officers could give money. There were many ways around the law. 

Citizens United did not necessarily mean that more money would go into elections; instead it meant that money would enter in different ways and with less transparency. Given that it was illegal for corporations to make express advocacy independent expenditures before Citizens United, when the Supreme Court declared that ban unconstitutional there were no laws in place to force corporate disclosure.  The intensity and closeness of the 2012 elections probably explains how much money was spent; Citizens United tells us about why, in part, we do not know who spent it.

In addition the Citizens United decision was built upon in a 2010 Court of Appeals decision, v. Federal Election Commission, that allowed for the creation of Super PACS that could accept unlimited political donations from corporations, unions and individuals to engage in independent expenditure express advocacy. With limited disclosure and often innocuous sounding names, these groups provided another outlet for money. 

Finally, the transparency problem with money was exacerbated in 2012  by the misuse and hijacking of nonprofits. Basically, there are two types of nonprofits under the federal tax code. Entities classified as 501(c)(3)s are prohibited from engaging in partisan politics as a condition of donations to them being tax deductible. But contributions to nonprofits classified as 501(c)(4)s are not tax deductible, and they may engage in partisan politics  and endorse candidates for office so long as that political activity is not a major purpose of their activity.

There is extremely limited disclosure required on nonprofits in terms of donors, and there are no contribution limits to them. Corporations and wealthy donors used them as laundering mechanisms to escape disclosure requirements.

So what could be done on campaign finance? More disclosure is needed and efforts to pass the Disclose Act to force that is a first step. But partisan opposition to it in Congress has prevented that. Overturn Citizens United? That requires a constitutional amendment and that means two-thirds vote of both the House and Senate and ratification of three-fourths of the states. Little chance there. The Supreme Court could reverse itself, but unless President Obama can replace a conservative Supreme Court Justice, that option, too, looks unlikely.

Yet President Obama could act on his own to mitigate some of the problem. He could issue a procurement rule barring corporations from making express advocacy independent expenditures  above a certain dollar amount as a condition of bidding on federal contracts.  Here the issue is about conflict of interest.

Additionally, he could direct the Securities and Exchange Commission to engage in rule-making to require shareholder assent before expending money for political purposes. The issue here is protecting the First Amendment rights of shareholders not to have their money spent for political causes they do not support.  This rule would parallel those already found with unions and their members. 

Third, Congress could change the tax code to require more disclosure for nonprofits that use money for political purposes. The president alone might also be able to direct the IRS to do that.


The defeat of the voter ID amendment is a rare victory in the battle to fight the second great wave of disenfranchisement in American history. The first wave was after the Civil War and when  Reconstruction ended. It ushered in the Jim Crow era and a 100-year effort to prevent African-Americans from voting.

Voter ID, based on the erroneous claim of widespread voter fraud, is one part of this disenfranchisement. Across the United States in the last few years many states have enacted voter ID and other laws such as cutting back on early voting and restricting voter registration  drives. Pre-election voting-rights litigation was significant in 2012. The United States effectively has 50 different state laws regarding voting. Were it not that Obama won the 2012 presidential race so decisively, problems this year in Florida would be holding up the election results yet again.

One solution is to use federal voting rules and procedures. The Constitution gives Congress the authority to regulate federal elections. Congress could construct rules regarding voter eligibility, ban voter ID, allow for early voting, or whatever else it wants to do. Uniformity and fairness across states in elections too.

Political speech and rhetoric

The final critique is that political campaigns have become too negative and nasty. Maybe. They are tame by comparison to the 19th century. But there are limits regarding what can be done to regulate political speech.  The Supreme Court correctly in its 1964 New York Times v. Sullivan gave broad First Amendment protection to speech that criticizes public officials and candidates. A free society should encourage robust political debate, and it should be the people and  not judges or government officials who decide what is true. Moreover, attack ads will continue to be used so long as they are effective and voters respond to them.

The bigger problem now is that voters have developed partisan choices when it comes to the consumption of news. The world is increasingly divided between FOX and MSNBC. It seems all of us want our own truth now. The rise of the new and social media has done little to encourage voters to seek out alternative information.

One solution to this would be to reinstate the fairness doctrine and vigorously enforce the equal time doctrine, requiring television and radio to offer opposing viewpoints. The public has a First Amendment right to a diversity of viewpoints and broadcasters, as a condition of holding a license, should be required to honor this. 

Overall, Klobuchar and Nolan are correct that the American elections system is a mess.  But the causes are varied and the fixes more complex than they realize.

David Schultz is a professor at Hamline University School of Business, where he teaches classes on privatization and public, private and nonprofit partnerships. He is the editor of the Journal of Public Affairs Education (JPAE). Schultz blogs at Schultz’s Take, where this article first appeared.


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Comments (8)

  1. Submitted by Sarah Silander on 11/13/2012 - 06:31 am.

    Reinstating the fairness doctrine does not address the heart of the problem as to why voters prefer media that aligns with their partisan views.

    The bottom line problem is voters lack critical thinking skills and the solution is making those skills more of a priority in K-12 education.

  2. Submitted by myles spicer on 11/13/2012 - 11:47 am.


    Ironically, I had just submitted a commentary on this very subject (with the same points) to various media…so obviously, I agree completely with Schultz. However, I might add two other components to his analysis: first, our elections are also much much too long. They have deadened the electorate to even wanting to discuss salient issues by the time the voting finally comes alongs.

    Secondly, kindly note how FEW allegations there were in this past election regarding fraudulent ID. To date, I have heard of none. Again proving this is a solution in search of a problem.

    • Submitted by George Paul on 11/13/2012 - 04:48 pm.

      Not ironic

      That’s not ironic. The word you’re looking for is “coincidently” not “ironically.”
      The “irony” police

  3. Submitted by Steve Titterud on 11/13/2012 - 11:49 am.

    Corporations are persons and money is speech – …

    …these are the two roots of the problem.

  4. Submitted by john milton on 11/13/2012 - 11:54 am.

    Our system is indeed a horrific mess

    Even though the results of the 2012 elections are better than I had feared, I agree with Sen Klobuchar and Rep-elect Nolan that we need to substantially fix the electoral process. I like many of David Schultz’ suggestions: President Obama issuing a procurement rule barring expenditures above a certain amount to qualify for bidding on federal contracts; requiring shareholder assent before spending money on political causes only the bosses favor; requiring non-profits to disclose their contributors for political causes; and federalizing the entire crazy system of state and local voting idiosyncrasies. But on the issue of enforcing the equal time doctrine for broadcasters, I think we’ve already gone too far. So-called “balanced” reporting by the media has resulted in giving both sides equal voice, regardless of merit. So the religiously- impaired can claim that the world was created in six days? (Early versions of homo sapiens riding on dinosaurs?) Or, that what our species has done to alter the earth’s climate is merely a fantasy of the “tree-huggers?
    Finally, I’d rather require all citizens to vote in order to qualify for tax refunds and drivers’ licenses. And reserve voting time for an entire (holiday) weekend, not the primitive Tuesday based on citizens’ need to get to the polls in our horses and buggies. And — hate to bring this up — increasing the level of education among our people so that we don’t fall any farther down than 28th in the world. That would mean an informed citizenry. Take that, Koch Brothers!
    — John Watson Milton, Afton MN

  5. Submitted by George Paul on 11/13/2012 - 04:49 pm.

    This citizens group is working to fix many of these problems with money in politics:

  6. Submitted by Jon Kingstad on 11/14/2012 - 08:09 am.

    Corporations and speech.

    Mr. Schultz is right about the fixes but Citizens United is symbolic of the problem as well as a problem in its own right. It goes back to the First National Bank of Bellotti case that really took “corporate personhood” to a new level of extreme. Citizens United is the logical result of such a wrong opinion. Time to overrule all of these cases and restore civil liberties to individual human beings.

    Re: The “fairness doctrine”: I completely agree it ought to be reinstated. But we should be clear about what it actually is. It’s similar but a little different from the “equal time” rule which I think is really something just applied to candidates for public office. The “fairness doctrine” requires that broadcasters who make personal attacks on individuals allow the recipients of such attacks the right to respond on the air. It’s an “anti-personal attack”, anti-defamation policy.

  7. Submitted by William J. Kelleher, Ph.D. on 11/15/2012 - 05:52 pm.

    Internet Voting – Yes We Can!

    Schultz is right that the US election system has problems, but his suggestions are mere tinkering with the bilge pump on a sinking ship. Each bill in Schultz’s pile would be a separate legislative battle, opposed by forces far more powerful than mere tinkerers could match. Anything that got through would face court challenges. His procurement rule has 1st Amendment and Equal Protection problems. The idea of federal regulation of the entire election process is not only dictatorial, but would eviscerate our federal system – an essential element of American Liberty.

    Schultz neglected all the problems of voters. His tinkering wouldn’t shorten lines, or provide more parking for voters at the polls. Prez Obama said recently “we need to fix that.” So why be so piecemeal? Lets do this right.

    This is the 21st Century. We need a Great Leap Forward, not picky fixes. A properly organized election process based on Internet voting can neutralize the power of Big Money, and eliminate the threat that more campaign finance regulation would supposedly mitigate (although more such regulation has never cleaned up our election process, or reduced the costs). The nation can move into Internet voting state by state, as the people of each state demand it of their state legislatures. The convenience would empower more citizens, and participation would increase. (For more on this, )

    William J. Kelleher, Ph.D.
    Twitter: wjkno1
    Author: Internet Voting Now!

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