A Free Market in Political Speech

A Free Market in Political Speech

Posted by Ed Leaver 01 Aug 2012

Free-market considerations are, of course, frequently and willfully misapplied to argue political ends to which they patently do not apply. We’ve seen it before. We will see it again. We would be remiss not to include a brief rant illustrating the technique.

Citizens United and the 2012 DISCLOSE Act

As discussed in the previous post, an efficient free-market is predicated upon free and open business communication. Notwithstanding contrary effort by the People’s Republic of China (among others), such business communication is probably inseparable from the free-flow of information and ideas in the society as a whole. This concept is formalized in the United States by the First Amendment. Here speech is not only protected, its possible anonymity is enshrined in tradition from our country’s inception. Particularly for political speech. For example, at the time of original publication the authorship of The Federalist Papers was a closely guarded secret.

We also have the concept that for various purposes a “Business is a Person”. This is a convenient legal fiction. It is convenient because it allows corporations to enter the same sorts of contracts and assume the same legal responsibilities and liabilities as do people. That is very convenient. Its also a fiction. Corporations are not people. They are not of woman born. They are created by the states, die by the states, and are subject to regulation by the states. Further, the money corporations collect from sales of goods and services comes from real people who may have little choice as to who provides those goods and services, and/or little knowledge – and less say – about how those moneys are to be spent for political causes with which they may not agree. This gives the people who run the corporation a much louder voice in politics, e.g. by buying advertising space, than they would were they spending money solely from their own personal income.

Much the same has been said about labor unions, who collect dues from a membership frequently constituting a broad political spectrum. In this regard labor unions may be considered “corporate entities” in a sense that PACs and focus groups, who solicit voluntary contributions for fairly obvious purposes (usually), might not.

As result we also have a long – nearly 100 year – legacy of restricting the amount of monies corporate entities (individual corporations, consortia, focus groups, unions, etc.) may spend directly on political campaigns. But as money speaks and times change, people find new and innovative ways to circumvent the intent of such regulations, and a decade ago Congress passed the Bipartisan Campaign Reform Act of 2002 (BCRA, McCain-Feingold Act) to address some of them:

“In March 2009, the U.S. Supreme Court heard oral arguments in Citizens United regarding whether or not a political documentary (about Hillary Clinton) could be considered a political ad.[11] In January 2010, the Supreme Court struck sections of McCain-Feingold down which limited activity of corporations, saying, “If the First Amendment has any force, it prohibits Congress from fining or jailing citizens, or associations of citizens, for simply engaging in political speech.” Specifically, Citizens United struck down campaign financing laws related to corporations and unions; law previously banned the broadcast, cable or satellite transmission of “electioneering communications” paid for by corporations in the 30 days before a presidential primary and in the 60 days before the general election. The ruling did not, as commonly thought, change the amount of money corporations and unions can contribute to campaigns. The minority said the court was making a mistake treating the voices of corporations as similar to those of people.[12]”

See the above-linked Wikipedia article for further references. A fascinating behind-the-scenes history of Citizens United is provided by Jeffrey Toobin in The New Yorker.

Citizens United extends the exact same speech freedoms enjoyed by individuals to corporations, consortia of corporations, unions, focus groups and Political Action Committees as well. Again, for the following one should make some distinction between corporations, corporate consortia, and labor unions - collectively “corporate entities” - from focus groups and PACs.

To the very considerable extent that the exercise of political speech is predicated on the funds needed to buy political advertising, the result is a distortion in the volatile marketplace of political ideas and discourse. Because here the person with the most money gets to shout the longest and the loudest. I would argue that extending personhood to corporate entities distorts the political marketplace in much the same way as monopolies and oligopolies distort traditional economic markets: the power to speak is artificially concentrated in the voices of the few, potentially at the direct expense of those the speech may oppose.

Consider Big Oil as a (hopefully) hypothetical example. Most of us have seen the expensive television advertisements companies like Shell, British Petroleum, and Exxon-Mobile purchase to promote their products, services, and corporate economic and environmental policies. To the extent that the name of the sponsoring corporation is proudly and prominently displayed, this is well and (mostly) good. Consider the consumer of petroleum products. That would be most of us who tank up our personal transports on a weekly basis, or are similarly billed for heating oil or gas. One might or might not have much choice from whom one purchases one’s fuel products, but at least one knows or can readily discover who they are and the policies they promote on TV. And make an informed choice if one is available.1

Or so one might hope. But what if the same corporation also makes substantial contribution to anonymous PACs to promote political candidates and ends that might be in direct conflict with the desires of a majority of their customers who must ultimately pay for them? Now we have a relatively few individuals dictating the political speech of the many, who have no way of knowing who is saying what in their name. This is a market distortion of the sort whose economic market counterpart might entail myriad violations of anti-trust. Yet in the marketplace of political discourse such behavior has been deemed constitutionally protected.

The 2012 DISCLOSE Act attempts a partial remedy by requiring public disclosure of contributions to PACs, and the source of funding for political advertisements. The DISCLOSE Act goes directly to the effect of Citizens United, which undid McCain-Feingold and nearly a century of “equal representation and access” precedent. But the July 2012 version of DISCLOSE had flaws of its own, and was defeated in the House of Representatives on a party-line vote. While endorsing the DISCLOSE concept, longtime campaign reform activist Senator John McCain opposed the bill as written.

Perhaps most important, anonymous speech – particularly anonymous political speech – goes part and parcel with the First Amendment. If Citizens United continues to stand and corporate entities are to be considered persons for the purpose of political speech, its precedent will result in court challenge to DISCLOSE Act on at least this ground, if no others.

</irony >

1In a free-market one always is. Energy production and distribution is very expensive; their markets are dominated by big players and are rarely free. But at least one knows.