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What Ted Cruz’s victory means on the Supreme Court

In 2018, Ted Cruz spent nearly $40 million to maintain his Senate seat against challenger Beto O’Rourke. O’Rourke’s campaign spent twice as much.

The day before the Texas vote, Cruz loaned his campaign $260,000. It was an odd — and seemingly unnecessary — gesture: the campaign’s final report showed it ended up with $263,000 in cash.

Still, Cruz did not act irrationally. He prepared the ground for a challenge of his own, an attack on the shaky remnants of the McCain-Feingold Campaign Finance Act of 2002.

This law, better known as the Bipartisan Campaign Reform Act, or BCRA, restricted how campaigns could repay candidate loans. A campaign has 20 days to fully repay such loans. After this period, it cannot repay more than $250,000.

By the time Cruz’s campaign finished repaying, the deadline had passed. So his campaign committee only paid $250,000 of the loan and owed $10,000 — which Cruz then sued in federal court to recover, arguing that the statute’s provision violated his First Amendment rights. This sparked a more than three-year legal battle with the Federal Elections Commission, which ended in Monday’s Supreme Court ruling.

Cruz had carefully set the amount of his loan so that a legal defeat would only cost him $10,000. But he won. And his victory put another hole in a law already shredded by previous decisions involving the FEC citizens united (ruled by the Supreme Court in January 2010) and Speechnow.org (decided by the DC Circuit two months later citizens united).

Federal Electoral Commission against Cruz now joins the list and pushes the BCRA further towards nullity. The majority opinion, written by Chief Justice John Roberts, dismissed the credit freeze as an undue burden on candidates’ freedom of expression. Since the fall of 1976 Buckley versus Valeo, candidates were allowed to spend unlimited amounts on their own campaigns. So what possible justification could there be for limiting the amount they can lend? argued Roberts. Simply limiting the terms on which such loans can be repaid unconstitutionally restricts a candidate’s right to political expression.

In her eloquent dissent, Judge Elena Kagan suggested a response:

Political donations that flow into a candidate’s own pocket after he has been elected to office pose a particular risk of corruption. The candidate has a more than usual interest in receiving the money (to supplement their personal finances) and is now in a position to give something in return.

The majority dismissed this concern as a suspicion, taking comfort in the fact that restrictions on political donations remained in place as sufficient protection against corruption or the appearance of corruption.

The big winners from the Cruz Decision are candidates rich enough to write themselves a big check, but not rich enough to afford to say goodbye to the money forever. A true billionaire might not bother to reclaim a campaign loan, but a humble multimillionaire might want or need to. So, big day for her.

In addition, it is doubtful whether this case really represents a milestone in itself. Rather, it is part of a larger restructuring of campaign finance since 2002, the biggest change of which has been the rise of the Super PAC.

Once upon a time, the most important players in any election were the campaigns themselves. They collected money and spent it under the direction of candidates and their campaign managers. The Supreme Court’s anti-BCRA rulings have redistributed the spending power of the campaigns to the super PACs, who can raise and spend on a larger scale than almost any candidate. Not only are Super PACs independent of campaigns, but they are also expressly prohibited from aligning themselves with campaigns. The rule mandating a separation of candidates and super PACs requires a great deal of careful administration between the two supposedly non-communicating parts of a campaign, otherwise a candidate can be reduced to something of a mere spectator at his or her election.

Even so, the rule can have strange implications. For example, Super PACs will now publish negative poll information worldwide for their preferred candidate to legally read. In February of this year, for example, the Super PAC supporting JD Vance’s Ohio senator nomination released a 98-page PowerPoint presentation documenting how badly Vance was hurt by the Club for Growth’s allegations of attack against him as a Never Trumper . A campaign wouldn’t normally want to admit that. But the information shared proved useful. Vance’s supporter Peter Thiel had parted ways with the Super PAC, to which he gave $10 million last year, so that he could continue to serve as an advisor to the Vance campaign. Alarmed by the public disclosure of research he had funded but could not read privately, Thiel was able to make the most of his status as a campaign adviser by helping secure a late endorsement for Vance from ex-President Donald Trump. Confirmation came on April 15, and Vance won the primary three weeks later.

The literary power of Kagan’s dissent won out Cruz decision a lot of attention. But that can be a mistake. In the 2020s, the big news in campaign finance isn’t what’s happening inside campaigns, but what’s happening outside and around campaigns. As so often in the history of US campaign finance, the unintended effects of reforms stifle intended ones.

In a world of enormously potent and enormously unregulated super-PACs, the FEC’s old focus on policing campaigns is perhaps outdated, even counterproductive. The question for today might be: How do we reinstate and reinstate candidates in charge of their campaigns instead of allowing them to take refuge in the denial of mysterious, overly powerful super PACs?

In an election campaign, at least you know who is answering to whom. That might not be much. But it’s better than the world we’ve built since McCain-Feingold became law.

https://www.theatlantic.com/ideas/archive/2022/05/ted-cruz-supreme-court-campaign-finance/629899/?utm_source=feed What Ted Cruz’s victory means on the Supreme Court

Jessica MacLeish

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