Court Oks Ban On Firms` Political Spending

March 28, 1990|By Glen Elsasser, Chicago Tribune.Tribune Washington correspondent Steve Daley contributed to this report.

WASHINGTON — The U.S. Supreme Court on Tuesday upheld a state law prohibiting corporations, including many non-profit groups, from using their money directly to promote the election or defeat of a political candidate.

The high court ruled 6-3 that the Michigan law did not curtail political debate in violation of the 1st Amendment`s free-speech guarantee. The law does allow corporations to organize political action committees that can solicit money for political purposes.

The Michigan law, modeled after the Federal Election Campaign Act, imposes criminal sanctions on corporations that make any ``independent expenditures`` or promises of assistance to a candidate for state office. The law, similar to those in 20 other states, provides a maximum penalty of $5,000 in fines and three years` imprisonment.

Tuesday`s decision, written by Justice Thurgood Marshall, drew harsh dissents from the court`s newest justices, Anthony Kennedy and Antonin Scalia. For the first time in history, Kennedy charged, the court upheld ``a direct restriction on the independent expenditure of funds for political speech.``

``With the imprimatur of this court,`` Kennedy wrote, ``it is now a felony in Michigan for the Sierra Club or the American Civil Liberties Union or the Michigan State Chamber of Commerce to advise the public how a candidate voted on issues of urgent concern to their members.``

Kennedy`s opinion was signed by Justices Sandra Day O`Connor and Scalia.

In an unusual display of discontent, Scalia read most of his opinion from the bench.

``The object of the law we have approved today,`` Scalia said, ``is not to prevent wrongdoing but to prevent speech. . . . The premise of our system is that there is no such thing as too much speech-that the people are not foolish but intelligent, and will separate the wheat from the chaff.``

The Michigan Chamber of Commerce had challenged the law after it sought to buy a newspaper advertisement supporting a candidate for the state House in 1985. A U.S. District Court upheld the law, but the U.S. Court of Appeals in Cincinnati ruled that it violated the 1st Amendment.

In Tuesday`s decision, Marshall said the state had provided ``a compelling rationale`` for its spending restriction: to prevent corporate wealth from unfairly influencing elections. According to Marshall, Michigan sought to curb ``the corrosive and distorting effects of immense aggregations of wealth that have little or no correlation to the public`s support for the corporation`s political ideas.``

Marshall also rejected an argument that the disputed law could not be applied to ``a non-profit ideological corporation,`` such as a chamber of commerce. More than 75 percent of the chamber`s members are business corporations, Marshall said, and it could serve as a conduit for corporate political spending.

The high court also held that Michigan`s exclusion of labor unions from the spending restrictions was proper.

Labor unions, Marshall said, differ from corporations in that union members who disagree with a union`s political activities may withhold funds from these activities without losing their membership.

The Michigan Chamber of Commerce also contended that the state law violated the 14th Amendment`s equal-protection clause by exempting media corporations from its restriction.

But Marshall said that this exception ensures that ``the institutional press`` is not prevented from reporting on and publishing editorials about newsworthy events.

Richard Samp, chief counsel for the conservative Washington Legal Foundation, said the ruling means that ``the vast majority of non-profit groups`` no longer have the same 1st Amendment protections they once had.

But Howard Schloss, communications director for the Democratic Congressional Campaign Committee, said: ``This decision confirms the direction the campaign-finance process has been going since federal laws were changed in the early 1970s. If the court had gone the other way, it might have set up a situation where the federal laws would be challenged.``

Schloss said that in the welter of campaign-finance legislation pending in Congress, there is no support for reverting to the earlier system, wherein corporations could make direct and unrestricted contributions to candidates.