Political Contributions in the U.S.

In a decision that surprised experts and was questioned by President Obama, the U.S. Supreme Court threw out regulations prohibiting corporations from paying for political advertising that explicitly supports a candidate or expresses disapproval of the opposing candidate. Of the nine judges, the five who voted in favor of throwing out the regulations that restricted these political contributions argued that, in keeping with the spirit of the First Amendment — which guarantees free speech — Congress may not prohibit citizens or associations of citizens from entering into political discourse in any of its forms.

It is surprising that it was decided that associations of citizens have the same right to freedom of expression as an individual citizen, and that this right is extended to all forms of discourse, including spending on political advertising in support of or against a specific candidate. It should be noted that this ruling does not only apply to corporations but also to unions, which are also associations of citizens, and more generally to any citizens’ association.

For its part, the minority opinion does not deny that associations of citizens have the right to freedom of expression and, therefore, to express themselves politically. Its stance is that there already exist ways for this expression to take place, and that the restrictions this ruling eliminates were reasonable, sensible and largely oriented toward reducing the possibility of corruption.

The tradition of the U.S. Supreme Court has been that legislative limitations on private political spending only make sense in order to combat corruption or the appearance of corruption. That is why direct donations to candidates by citizens’ associations have been limited up until now. The argument of the majority is that there is no convincing evidence that the laws restricting the purchase of political advertising for or against a candidate reduced corruption. This is a debatable point, about which opinions are divided; but without a doubt, the available empirical studies have not been able to demonstrate that this type of donation gives rise to corruption.

Chilean law does permit donations by for-profit corporations — with some specific restrictions — although there are strict limits on the amounts. But they can only be made to a campaign or a [political] party. So, in our country, a corporation cannot buy advertising for or against an individual candidate. The criterion that our law has followed certainly has nothing to do with the right of these organizations to freedom of expression. Rather it is prudence, based on the assumption that it is very difficult to control these donations (or, if you will, we assume that the cost of implementing such a prohibition would be very high) and we have preferred to create a flexible and limited mechanism for donations.

An interesting aspect of our law, which is beginning to gain some appreciation in discussions internationally, is that donations by corporations are confidential; the candidate and the public do not know the donor. This limits the possibility of corruption or extortion, the avoidance of which the U.S. Supreme Court has been willing to accept as a motivation for imposing limits on certain political contributions. In any case, in the Chilean experience, it is noteworthy that donations by corporations are limited only when they are made by for-profit companies, a rather narrow concept of freedom of association.

Surely this asymmetry would not be acceptable to the U.S. Supreme Court.