This issue's shoptalkers: Marc Elias, chairman of the political law group at Perkins Coie; Robert Lenhard, former chairman of the FEC and member of the election and political law practice group at Covington & Burling; Neill Reiff, a founding member of the D.C.-based firm Sandler, Reiff, Young & Lamb; Michael Toner, former chairman of the FEC and partner at Wiley Rein; and Jason Torchinsky, partner at Holtzman Vogel.
C&E: What has surprised you the most about what has resulted in the wake of Citizens United?
Marc Elias: When the decision came down I think there was a lot of agreement that this was a big deal less because of the holding of Citizens United and more because of the atmospheric effect it would have. 527s were always complicated to explain to people. You had groups that would register with the IRS and could run ads that impacted elections but were not for the purpose of influencing elections. And thanks to Chairman Toner’s regime at the FEC, there were restrictions on what you could do once you solicited the money and what you could tell donors about how the money would be used. It was all just very complicated. What Citizens United did was not necessarily affect any of that, but it affected the psychology around all of it. I suspect the enduring legacy of Citizens United is less the narrow holding that corporations may engage in independent campaign speech, but rather what it meant for all kinds of groups and individuals and organizations. Now they could engage in independent expenditure activity without having to worry about some of the things that the FEC passed by regulation in the early part of the last decade.
Neil Reiff: We all can admit that the whole process of outside groups for the last several years has been the process of subterfuge—running ads that drew to a line, but didn’t cross a line. You could say that, in and of itself, destroys confidence in the system. The other thing is the reporting regime. We all know that the 527 reporting regime at the IRS is just inadequate and awful.
Jason Torchinsky: One of my biggest frustrations with the Citizens United decision is how the general media has represented it. I just had to deal with a corporate client who didn’t understand that his corporation couldn’t make a contribution to a candidate post-Citizens United. What I’m hoping the decision leads to is raising the limits on what people can actually give to candidates and party committees. I think when you cut off their ability to fundraise by artificially limiting the dollars they can raise, you weaken their voice.
Michael Toner: I did think that there would have been a legislative response in Congress after Citizens United. A tremendous effort was obviously made. In fairness, some of the reform groups really mishandled that opportunity, because they did have working margins to get something done had they taken a more narrow approach. Obviously, Citizens United broadened the ability of corporations to finance this independent spending. But if you look at the Super PAC reports, individuals are the ones contributing. You’re not seeing Fortune 100 companies out here. That may change, but right now it’s still the province of much smaller privately held companies and individuals.
Robert Lenhard: I think that’s true. There’s a great deal of reluctance on the part of the widely publicly traded consumer products companies to get into a political space that looks controversial.
Elias: For now. The fact is that when the party committees raised soft money, they got six figure checks from Fortune 100 companies and they were engaged in partisan activity—in some instances it was controversial advertising activity. It may be an acculturation. I’d be surprised if there’s not a greater level of involvement. On the 10th anniversary of the new ownership of Campaigns & Elections when you do that issue that looks back on the last decade, I think that’s what you’ll see. There’s reluctance now, but that tends to work itself out.
Torchinsky: I almost think that we’re going to see some yo-yoing of the Super PACs. When Citizens came out in 2010, it was largely too late in the cycle for Super PACs to organize and impact primaries. Now we’re seeing single candidate oriented Super PACs involved in presidential primaries. I think we’re going to see a lot of single candidate Super PACs in House and Senate races. And I think we’re also going to see the same thing at the state and local government level. I think that’s where the corporate money might come in.
Elias: I totally agree with that and in some respects I think it’s the most important point about Citizens United. For most companies, who the president is matters less day to day than who sits on the city council and the zoning board.
Reiff: I think Citizens United really stole the thunder of a different case, which in the scheme of Super PACs is way more important. The SpeechNow.org case is probably more important than Citizens United. The oral argument in SpeechNow happened the week after Citizens United was decided, and it was fascinating. It was an en banc hearing—nine judges—and they were completely fixated by the Citizens United decision and the absolutist language from Justice Kennedy on independent expenditures.
Torchinsky: The opening question from the chief judge of the 9th Circuit to the lawyer for the Institute for Justice was, “What do you have to add to what the Supreme Court said last week?” That was the question. It was as if the lawyer needed to say, “Nothing your honor” and just sit down and that would have ended the case.