In Citizens United v. Federal Election Commission, 130 S.Ct. 876 (2010), Justice Stevens, along with Justices Ginsburg, Breyer, and Sotomayor, maintained that a ban on corporate expenditures did not constitute a complete ban on corporate speech thanks to the existence of political action committees. Id. at 942. As any corporate-savvy individual could tell you, a political action committee, or a PAC as it is endearingly called, is “[a]n organization formed by a special-interest group to raise money to contribute to the campaigns of political candidates who the group believes will promote its interests.” Black’s Law Dictionary (8th ed. 2004). Thus, the thrust of Justice Stevens’s opinion was that a corporation’s “[a]bility to form and administer separate, segregated funds . . . has provided [it] . . . with a constitutionally sufficient opportunity to engage in express advocacy.” Citizens United, 130 S.Ct. at 942 (emphasis added). He proceeded to admit, however, that the administration of a PAC “entails some administrative burden.” Id. at 943. Of course, he merely glossed over the fact that the mandatory creation of a PAC may effectively prevent a corporation from expressly advocating for, or against, a particular candidate during any given election.
On the other hand, Justice Kennedy, who delivered the opinion of the Court, recognized the burdens imposed by PAC creation and clearly delineated the reasons why PACs constitute a poor alternative choice to the allowance of independent corporate expenditures. First, Justice Kennedy noted that PACs are subject to extensive regulations that must be complied with prior to being granted the privilege to speak. Id. at 897. Second, a PAC is a separate entity from its “parent” corporation, thus a corporation is forced to expend a significant amount of time and money if it chooses to create a PAC in order to share its political views. Id.
First, merely to exist, regulations require PACs to “appoint a treasurer, forward donations to the treasurer promptly, keep detailed records of the identities of the persons making donations, preserve receipts for three years, and file an organization statement.” Id. Although these requirements seem simple enough, they are only just the beginning! PACs then must file with the FEC, depending on what election is occurring at the time, extremely detailed monthly reports outlining: “the [PAC’s] amount of cash on hand, total amount of receipts, identification of each political committee candidate’s authorized or affiliated committee making contributions, and persons making loans, . . . or any other offset in an aggregate amount of $200, . . . total sum of all contributions, operating expenses, outstanding debts . . .” Id. Last time I checked, an individual “person” with First Amendment rights did not have to “jump through all of these hoops” just to have his voice heard!
Moreover, regulations limit the sources from which a PAC’s funding may derive. According to Justice Kennedy, donations to PACs can come only from stockholders and corporate-employees. Id. at 888. In many instances, this source regulation could effectively hinder the receipt of potential contributions for use in conveyance of the corporation’s political message because PACs are unable to solicit donations from members of the general public who support their message. Limiting sources of PAC funding can thus only be classified in one way—as an infringement of corporate speech!
Although Justice Stevens admitted that PACs produce some corporate-burden, he contended that “no one has suggested that the burden is severe for a sophisticated for-profit corporation,” and that, in the instant situation, the record was silent as to how substantial a PAC burden would have been to Citizens United. Id. at 943. Is Justice Stevens thus asserting that, if a corporation provides a detailed account of the substantial or potentially prohibitive burdens it would suffer in creating a PAC, then he would agree with Justice Kennedy that PACs are not useful alternatives to independent corporate expenditures in every situation? Obviously compliance with PAC regulation has had some prohibitive impact on corporate speech as less “than 2,000 of the millions of corporations in the United States have developed [and maintained] PACs.” Id. at 897 (citing FEC, Summary of PAC Activity 1990-2006, http://www.fec.gov/press/press2007/20071009pac/sumhistory.pdf). Accordingly, the aforementioned burdens imposed by extensive PAC regulation support my second point—that the costs, both time and monetary, further produce a prohibitive effect on corporate political speech.
Without hesitation, Justice Kennedy announced that “§441b’s prohibition on corporate independent expenditures is an outright ban on speech . . . notwithstanding the fact that a PAC . . . can still speak [because] a PAC is a separate association from the corporation.” Id. at 882 (emphasis added). In other words, PACs do not literally allow corporations to speak for themselves. Id. at 897. Hence, in having to create a distinct association merely to be permitted to “speak” during a particular election, corporations expend copious amounts of time and money to comply with PAC requirements. Basically, the monetary costs of compliance with extensive PAC start-up and maintenance regulations as well as the requisite time to implement said measures (such as detailed and accurate recordkeeping mechanisms and the hiring of staff), may, in effect, deter or in some cases even prohibit corporations from expressing their views in particular elections. This is especially true if corporations underestimate the time necessary to form a PAC. Therefore, in implementing this PAC “obstacle course,” Congress has effectively restrained corporate election-campaign speech.
In conclusion, when considering the prevalent theme of Citizens United, that the “Government may not, under the First Amendment suppress political speech on the basis of the speaker’s corporate identity,” Id. at 913, PACs just do not “stack up” to placing individual-persons and corporate-persons on the “same foot.” Until the day the legislature writes otherwise, corporations are legally “persons”; consequently, a corporate-person should be subjected to no more or no less political speech regulation than its individual-person counterpart. Accordingly, if there is one premise the Citizens United opinion clarifies, it is that PACs are not political action committees; rather, they are a poor alternative choice to corporate independent expenditures.
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