Arizona's Campaign Finance Law and Matching Funds: Oral Argument Analysis

Arizona Free Enterprise Club v. Bennett and McComish v. Bennett, consolidated cases challenging Arizona’s statutory system of public campaign financing, were before the Supreme Court today for oral argument.

According to William Maurer, attorney for the Petitioners challenging the law, the issue before the Court is “whether the government may insert itself into elections and manipulate campaign spending to favor its preferred candidates. . . .whether the government can turn my act of speaking into the vehicle by which my political opponents benefit with direct government subsidies.”

On the other hand, Bradley Phillips, arguing for Arizona and the named Respondent, Ken Bennett, Arizona’s Secretary of State, contended that “public funding of elections results in more speech and more electoral competition and directly furthers the government's compelling interest in  combating real and apparent corruption in politics.”

The Arizona scheme, The Arizona Citizens Clean Elections Act, Ariz.Rev. Stat. §§ 16-940 et seq. (2010) includes a “Matching Funds Provision,” which is triggered when the spending of groups making independent expenditures, combined with the spending or fundraising of privately financed candidates, is more than the amount a publicly financed candidate may spend under the Act’s expenditure limits for participating candidates.

The challengers characterize such a provision as a restriction and a penalty on groups making independent expenditures and privately financed candidates.  The state argues that the provision is a subsidy.

The goal and practical effect of the scheme was subject to much disagreement. As Justice Kagan phrased it, the law would seemingly result in “more speech all the way around.” Justice Kennedy asked Maurer if it “would be a  fair characterization of this law to say that its purpose and its effect are to produce less speech in  political campaigns?,”  to which Maurer obviously agreed.  Later, Kennedy asked Phillips a question intended, he explicitly stated, “to probe this idea that this somehow does not deter independent expenditures. I frankly am tempted to believe the opposite view, so you can tell me about that.”  Phillips attempt to analogize to the deterrence that might occur when disclosure was mandated was quickly rejected by Justice Kennedy because of the longstanding different First Amendment standards regarding expenditures and disclosures.

As for the governmental purpose, Chief Justice Roberts asked William Jay, arguing for the Solicitor General in support of Respondents to agree that “under our precedents, leveling the playing field for candidates is not a legitimate State purpose?” Jay agreed, and Roberts revealed his research abilities:

Well, I checked the Citizens' Clean Elections Commission website this morning, and it says that this act was passed to, quote,"level the playing field" when it comes to running for office. Why isn't that clear evidence that it's unconstitutional?

 
Earlier, Justice Kagan was less enthusiastic about whether the government purpose was the impermissible "level the playing field" or the more acceptable "prevent corruption":

JUSTICE KAGAN: I think the purpose of this  law is to prevent corruption. That’s what the purpose  of all public financing systems are.

MR. MAURER: Your Honor, I would respectfully disagree that the purpose of this law is to prevent corruption, and I would like to read from the  executive director of the Clean Elections Commission who said that: “It cannot be disputed that the purpose of the Clean Elections Act is to equalize the playing field."

JUSTICE KAGAN: Well, Mr. Maurer, some people may use certain buzz words and other people don’t  use those buzz words, but isn’t it true that for years what public financing systems have been based upon is the idea that when there is a lot of private money floating around the political system, that candidates and then public office holders get beholden to various  people who are giving that money and make actions based on how much they receive from those people, and that’s the idea of a public financing system is to try to prevent that?

Another deeply problematic issue was whether the Arizona provision was content-neutral or discriminated against certain types of speech.   Answering Kennedy's query as to whether the law was content-neutral, Maurer argued that

the only thing that will trigger matching funds, particularly for  independent expenditure groups, is the content of the  message. If an independent expenditure group speaks in favor of a privately financed candidate, they will not trigger matching funds. If they speak against a  publicly financed candidate, they will trigger matching  funds. That not is only content-based; it is also a  rejection of the standard this Court enunciated in Citizens United that the government cannot make distinguishing burdens on the basis of an identity of a  speaker.

In response to a similar query during his argument, Phillips later stated,

the  discrimination, if you want to -- if you call it  discrimination or different treatment, is based on the  initial choices of the candidates as to how they're going to finance their campaigns. It's not based on the  content of the speech.  There's -- matching funds do not turn in any way on the ideas or the messages or the viewpoints or the subject matter of the candidate or the independent group's speech or on the identity of the speaker. It turns entirely on what choice the candidate made at the  outset. 

If the questions of the Justices are predictive, a divided Court seems likely to find Arizona's matching funds provision unconstitutional.

UPDATES: Lyle Denniston over at SCOTUSblog focuses on Justice Kennedy's comments, finding them predictive.

Howard Bashman at How Appealing collects today's commentary on the arguments.

RR