Court weighs millionaires

The Supreme Court heard arguments Tuesday in a challenge to a campaign finance law that allows candidates to receive higher contributions when their wealthy opponents are funding their own races.  
The so-called millionaire’s amendment was added to the 2002 Bipartisan Campaign Reform Act as an attempt to help candidates stay competitive and prevent self-funded candidates from simply buying their way into Congress.

{mosads}Jack Davis, a wealthy industrialist from New York, filed the suit against the Federal Election Commission (FEC) nearly two years ago when he was running against Rep. Tom Reynolds (R-N.Y.) in a tight contest. Davis, a Democrat, also had challenged Reynolds in 2004 and is running for the seat Reynolds, who is retiring, is leaving behind.

During oral arguments before the high court Tuesday, Davis’s lawyer said the law impinges on free speech protections in the Constitution.

“Political expression is at the core of the First Amendment,” said the lawyer, Andrew Herman.

Justice Antonin Scalia appeared to agree, noting that he is “deeply suspicious” of the millionaire’s amendment, implying that he believes it gives incumbent lawmakers an unfair advantage.

“Trust our incumbent senators and representatives to level the playing field for us?” he asked incredulously.

Davis argues that incumbent members of Congress, especially those in senior positions or key committee slots, already have an inherent advantage over challengers because they can easily collect cash from special interests trying to influence them.

But Chief Justice John Roberts appeared to take the opposite tack at the onset of the day’s arguments.

“There is no restriction whatsoever on the wealthy candidate. He can spend as much of his money as he wants,” Roberts said.

Davis spent $2.2 million of his personal fortune in the 2006 loss. Reynolds, who was chairman of the National Republican Congressional Committee at the time, vastly outspent him but did not rely on the millionaire’s amendment’s allowance for increased contributions to do so. In fact, the millionaire’s amendment didn’t apply to Reynolds because he raised enough money on his own that it was not triggered.

There is a provision in the amendment that provides a formula to “determine whether an opposing candidate has spent sufficient personal funds in comparison to the amounts raised by the campaigns to trigger increased contribution limits.”

{mospagebreak}In defending the amendment, U.S. Solicitor General Paul Clement, who was arguing on behalf of the FEC, seized on the fact that Reynolds didn’t use the amendment.

“This is an odd sort of First Amendment case,” Clement remarked.

Although it didn’t apply in the Reynolds case, dozens of candidates may decide to take advantage of it this year. More than 20 candidates so far this cycle have informed the FEC that they plan to delve into their personal fortunes to fuel their campaigns, including the two candidates who ran for former Speaker Dennis Hastert’s (R-Ill.) seat for a combined total of nearly $5 million in self-funding.

{mosads}The Supreme Court’s decision is expected before July.

Several provisions in the underlying 2002 campaign finance law, sponsored by Sens. John McCain (R-Ariz.) and Russ Feingold (D-Wis.), have faced court challenges. In 2003 the Supreme Court upheld most of the law, but last year the court’s conservative majority struck down a provision limiting corporate- and union-financed TV ads. Some critics of the law considered that decision a harbinger for more critical decisions concerning federal campaign finance limitations.

In House races the law is triggered when candidates spend $350,000 or more of their own money.

Their opponents can then exceed a $2,300 limit on contributions from individuals, in some instances more than doubling that cap. The law also allows a political party to spend unlimited amounts of money to boost a candidate facing a wealthy opponent. The Senate provisions are more complicated, but the same theory of attempting to level the playing field in terms of fundraising applies.

Justice Anthony Kennedy said that aspect of the law bothered him because it appears to give a preference to “one kind of speech over another, and we simply do not do that.”

Since the measure has been in effect, the FEC argues that only six incumbents were eligible to receive larger contributions because of the amendment, while more than 100 challengers faced wealthy incumbents who delved into their personal fortunes and triggered the provision.

A three-judge court in Washington upheld the provision, arguing that Davis failed to show the millionaire’s amendment had impinged on his free speech rights.

Davis has vowed to spend up to $3 million of his own money in his third bid for the seat in New York’s 26th congressional district.

He faces a primary challenge from retired Army captain and substitute teacher Jonathan Powers and lawyer Alice Kryzan. Because Reynolds is retiring, they will be facing a yet-to-be-determined Republican. 

 Self-funders Chart  (PDF)