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Hans von Spakovsky / May 17, 2022

Sen. Ted Cruz, First Amendment Win at Supreme Court in Campaign Finance Case

Cruz won a First Amendment victory not just for himself, but also for other candidates (and their supporters) who want to run for office.

Sen. Ted Cruz, R-Texas, on Monday won a significant First Amendment victory from the U.S. Supreme Court in Federal Election Commission v. Ted Cruz for Senate.

It’s not the first time Cruz has been successful at the court, but it was his first time as an actual plaintiff in a case, rather than as solicitor general of Texas. The latter is a position he held prior to becoming a senator, one in which it was his job to represent Texas before the Supreme Court.

Monday’s ruling was a 6-3 decision — the typical conservatives vs. liberals split — with Chief Justice John Roberts and his colleagues throwing out a particularly troublesome provision of federal campaign finance law as a violation of the First Amendment.

The liberals on the court almost never uphold the First Amendment when it comes to restrictions on political speech and activity.

When Cruz ran for reelection in 2018, he loaned his campaign $260,000. All federal candidates can loan money to their campaigns under federal law, and campaigns can also borrow from third-party lenders.

As Roberts wrote in the decision, this loan provision is important because it allows candidates to “jumpstart a fledgling campaign or finish strong in a tight race.”

Cruz had just such a “tight race” in 2018, when he defeated Beto O'Rourke by only 2.6 percentage points, the closest Senate race in Texas in 40 years and, according to the court, “the most expensive Senate race in history” at that time.

Keep in mind that individual contributions to a campaign are limited to $2,900 for the primary and the same amount for the general election.

To repay such loans and other campaign debt, candidates can continue to raise money in contributions from donors after the election. However, Section 304 of the Bipartisan Campaign Reform Act of 2002 (codified at 52 U.S.C. §30116(j)) — the federal law I helped enforce when I was a commissioner at the Federal Election Commission — provides that a candidate who loans money to his campaign cannot be repaid more than $250,000 from contributions made to the campaign after the election. (Pre-election contributions can be used to pay off a loan no matter how much it is.)

The FEC issued a regulation enforcing this provision, including a rule saying that to the extent the loan is more than $250,000, a campaign can only use pre-election contributions to repay the portion of the loan above that amount if the repayment occurs within 20 days of the election. Cruz was repaid $250,000 by his campaign after the 20-day deadline but was still out $10,000.

The FEC went to great lengths to try to argue that the candidate and senator who had actually lost money because of this statutory provision and the FEC regulation did not have standing to sue, in part because his injury was “self-inflicted.”

But the court quickly dismissed that claim, saying that it has “never recognized a rule of this kind” and instead has made it clear “that an injury resulting from the application or threatened application of an unlawful enactment remains fairly traceable to such application, even if the injury could be described in some sense as willingly incurred.”

But the substantive question, according to the court, was whether a law that “increases the risk that candidate loans over $250,000 will not be repaid in full, inhibiting candidates from making such loans in the first place” violates the First Amendment by limiting political speech and activity.

As the court said, the First Amendment “has its fullest and most urgent application precisely to the conduct of campaigns for political office.”

It “safeguards the ability of a candidate to use personal funds to finance campaign speech, protecting his freedom to speak without legislative limit on behalf of his own candidacy.” Furthermore, this broad protection “reflects our profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open.”

Although this isn’t discussed in the court’s opinion, the censorship, wokeism, cancel culture, speech codes, and persecution of conservative speakers occurring everywhere across America show that the left doesn’t agree that public debate should be “uninhibited, robust, and wide-open.”

According to the court, the burden on First Amendment expression by this limitation is “evident and inherent.” Even though the statutory provision does not limit the amount of personal funds a candidate can use for his campaign, “it imposes an unprecedented penalty on any candidate who robustly exercises that First Amendment right.”

What is that “penalty”? The court says it is “the significant risk that a candidate will not be repaid if he chooses to loan his campaign more than $250,000.”

“And that risk in turn may deter some candidates from loaning money to their campaigns when they otherwise would, reducing the amount of political speech.” This ability to loan money to a campaign is “especially important for new candidates and challengers,” and “early spending — and thus early expression — is critical to a newcomer’s success.”

As the court has said on numerous occasions, the only justification for campaign restrictions that burden the First Amendment are those that prevent “quid pro quo corruption or its appearance,” i.e., candidates promising to take certain actions in exchange for contributions.

The court has rejected other justifications frequently used by so-called reformers, such as reducing “the amount of money in politics,” leveling “electoral opportunities by equalizing candidate resources,” or limiting “the general influence a contributor may have over an elected official.”

Here, the Biden administration tried to argue that the contributions at issue “raise a heightened risk of corruption because of the use to which they are put: repaying a candidate’s personal loans” and that “postelection contributions are particularly troubling because the contributor will know — not merely hope — that the recipient, having prevailed, will be in a position to do him some good.”

The court met those arguments with “skepticism.”

It pointed out that the government was “unable to produce a single case of quid pro quo corruption in this context — even though most States do not impose a limit on the use of postelection contributions to repay candidate loans.”

Moreover, contribution limits even postelection are still capped at $2,900 under federal law, the amount considered to not risk the problem of possible “corruption.”

Furthermore, if that was really a risk, why does the $250,000 restriction apply to losing candidates, too? Obviously, they are in “no position to grant official favors,” and the government did “not provide any anti-corruption rationale to explain why postelection contributions to those candidates should be restricted.”

The only evidence the Biden administration produced to justify this statute was “a scholarly article, a poll, and statements by members of Congress” claiming that “these contributions carry a heightened risk of at least the appearance of corruption.”

The court pointed out major defects in both the article and the poll and said that “a few stray floor statements [by members of Congress] are not the same as ‘legislative findings’ that might suggest a special problem to be addressed.”

All of this was “pretty meager” in the court’s opinion, “given that we are considering restrictions on the most fundamental First Amendment activities — the right of candidates for political office to make their case to the American people.”

The dissent — authored by Justice Elena Kagan and joined by Justice Sonia Sotomayor and outgoing Justice Stephen Breyer — makes the nonsensical claim that this loan repayment limit is acceptable because postelection contributions are a “gift” that “enrich the candidate personally,” allowing him to “buy a car or make tuition payments or join a country club.”

That last claim is especially humorous since in the minds of many liberals, being a member of a country club seems to be the ultimate sin and a sign of corruption.

However, as the chief justice wrote, “This forgets that we are talking about repayment of a loan, not a gift. If the candidate did not have the money to buy a car before he made a loan to his campaign, repayment of the loan would not change that in any way.” Such contributions simply “restore the candidate to the status quo ante” he had before the election.

The Supreme Court, Roberts wrote, has the “role to decide whether a particular legislative choice is constitutional.” Here, “the Government has not shown that Section 304 furthers a permissible anti-corruption goal, rather than the impermissible objective of simply limiting the amount of money in politics.”

So, Cruz won a First Amendment victory not just for himself, but also for other candidates (and their supporters) who want to run for office so they can make a difference in the political life of our country.


Republished from The Daily Signal.

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