Supreme Court rules for Senator Cruz in campaign finance case

Sen. Ted Cruz, R-Texas, speaks during a campaign event for Republican nominee David McCormick at the U.S. Senate in Pennsylvania in Lititz, Friday, May 13, 2022. (AP Photo/Matt Rourke)

Sen. Ted Cruz, R-Texas, speaks during a campaign event for Republican nominee David McCormick at the U.S. Senate in Pennsylvania in Lititz, Friday, May 13, 2022. (AP Photo/Matt Rourke)

PA

The conservative Supreme Court majority on Monday sided with Republican Senator Ted Cruz of Texas and struck down a provision of federal campaign finance law, a decision that a dissenting judge said risks “discrediting more” American policy.

The court, by a 6-3 vote, said the provision Cruz challenged limiting repayment of candidates’ personal loans to their campaigns violates the Constitution. The decision comes as campaigning for the 2022 midterm elections heats up.

Chief Justice John Roberts wrote for the majority that the provision “burdens basic political discourse without proper justification”.

The Biden administration had championed it as an anti-corruption measure, but Roberts wrote that the government had been unable to show that the provision “served a permissible anti-corruption purpose, rather than the impermissible purpose of just limit the amount of money in politics”.

Judge Elena Kagan disagreed, writing that for two decades the provision controlled “twisted exchanges.” Kagan said in a dissent for herself and the two other liberals on the court that the majority, in striking down the provision, “gives the go-ahead to any sleazy deals Congress has seen fit to shut down.” She said the decision “can only further discredit the political system of this country”.

In an emailed statement, Cruz’s attorney, Charles Cooper, said the ruling “is a victory for the First Amendment guarantee of free speech in the political process.”

The case involved a section of the Bipartisan Campaign Reform Act of 2002, commonly known as the McCain-Feingold Campaign Finance Act. The provision stated that if a candidate lends their campaign money before an election, the campaign cannot repay the candidate more than $250,000 using the money collected after Election Day. The provision stated that loans could still be repaid with money raised before the election.

Cruz, who has served in the Senate since 2013 and unsuccessfully ran for president in 2016, loaned his campaign $260,000 the day before the 2018 general election in a bid to challenge the law.

Cruz spokesman Steve Guest said in an emailed statement that the senator was “gratified” by the decision, which he said would “help reinvigorate our democratic process by allowing challengers to face and to more easily defeat career politicians”.

The decision is the most recent since Roberts became chief justice in 2005, in which conservatives overturned limits imposed by Congress on raising and spending money to influence elections. This includes the 2010 Citizens United decision, which opened the door to unlimited independent spending in federal elections.

Kagan, in his dissent, described an outcome now that the most recent provision has been struck down. A candidate could loan his campaign $500,000 and, after winning, use donor money to pay it back in full, she said. The grateful politician could then respond to donor money with “friendly legislation, maybe prized appointments, maybe lucrative contracts,” she wrote. “The politician is happy; donors are happy. The only loser is the public. It inevitably suffers from government corruption.”

At another point, she said: “It doesn’t take any political genius to see the heightened risk of corruption – the danger of ‘I’ll make you richer and you’ll make me richer’ arrangements between donors and office holders.”

Roberts, however, noted in his majority opinion that individual contributions to candidates for federal office, including those made after the candidate has won the election, are capped at $2,900 per election.

“The dissent’s dire predictions about the impact of today’s ruling eliminate the fact that the contributions at issue remain subject to these requirements,” he wrote. He pointed out that most states “do not place limits on the use of post-election contributions to repay candidate loans.”

Cruz had argued that the provision made candidates think twice before lending money, as it greatly increased the risk that any candidate loan would never be fully repaid. A lower court had agreed that the provision was unconstitutional.

The case may be more directly important to federal election candidates who wish to make large loans to their campaigns. But the administration, which declined a request for comment following the ruling, also said that in the past the vast majority of candidate loans have been under $250,000 and therefore the provision challenged by Cruz didn’t apply.

The government said that in the five election cycles before 2020, Senate candidates made 588 loans to their campaigns, about 80% of them less than $250,000. Candidates for the House of Representatives have made 3,444 loans, nearly 90% of them for less than $250,000.

The case is Federal Election Commission v. Ted Cruz for the Senate, 21-12.

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