Professional Documents
Culture Documents
Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990)
Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990)
652
110 S.Ct. 1391
108 L.Ed.2d 652
Syllabus
Appellee Michigan State Chamber of Commerce (Chamber) is a nonprofit
corporation, whose bylaws set forth both political and nonpolitical
purposes. Its general treasury is funded through annual dues required of
all members, three-quarters of whom are for-profit corporations. Section
54(1) of the Michigan Campaign Finance Act prohibits corporations,
excluding media corporations, from using general treasury funds for, inter
alia, independent expenditures in connection with state candidate
elections. However, they may make such expenditures from segregated
funds used solely for political purposes. Because the Chamber wished to
use general treasury funds to place a local newspaper advertisement in
support of a specific candidate for state office, it brought suit in the
Federal District Court for injunctive relief against 54(1)'s enforcement,
arguing that the expenditure restriction is unconstitutional under the First
and Fourteenth Amendments. The court upheld the section, but the Court
of Appeals reversed, reasoning that, as applied to the Chamber, 54(1)
violated the First Amendment.
Held:
1. Section 54(1) does not violate the First Amendment. Pp. 657-666.
(a) Although 54(1)'s requirements burden the Chamber's exercise of
political expression, see FEC v. Massachusetts Citizens for Life, Inc., 479
U.S. 238, 252, 107 S.Ct. 616, 624, 93 L.Ed.2d 539 (MCFL ), they are
The District Court upheld the statute. 643 F.Supp. 397 (WD Mich.1986). The
Sixth Circuit reversed, reasoning that the expenditure restrictions as applied to
the Chamber, violated the First Amendment. We noted probable jurisdiction,
490 U.S. 1045, 109 S.Ct. 1952, 104 L.Ed.2d 421 (1989), and now reverse. II
A.
7
This Court concluded in FEC v. Massachusetts Citizens for Life, Inc., 479 U.S.
238, 107 S.Ct. 616, 93 L.Ed.2d 539 (1986) (MCFL ), that a federal statute
requiring corporations to make independent political expenditures only through
special segregated funds, 2 U.S.C. 441b, burdens corporate freedom of
expression. MCFL, 479 U.S., at 252, 107 S.Ct., at 624 (plurality opinion); id.,
at 266, 107 S.Ct., at 632 (O'CONNOR, J., concurring in part and concurring in
judgment). The Court reasoned that the small nonprofit corporation in that case
would face certain organizational and financial hurdles in establishing and
administering a segregated political fund. For example, the statute required the
corporation to appoint a treasurer for its segregated fund, keep records of all
contributions, file a statement of organization containing information about the
fund, and update that statement periodically. Id., at 253, 107 S.Ct., at 625
(plurality opinion). In addition, the corporation was permitted to solicit
contributions to its segregated fund only from "members," which did not
include persons who merely contributed to or indicated support for the
organization. Id., at 254, 107 S.Ct., at 626 (plurality opinion). These hurdles
"impose[d] administrative costs that many small entities [might] be unable to
bear" and "create[d] a disincentive for such organizations to engage in political
speech." Ibid; see also id., at 265-266, 107 S.Ct., at 631-632 (O'CONNOR, J.).
8
Despite the Chamber's success in administering its separate political fund, see,
e.g., Tr. 443 (Chamber expected to have over $140,000 in its segregated fund
available for use in the 1986 elections), Michigan's segregated fund requirement
still burdens the Chamber's exercise of expression because "the corporation is
not free to use its general funds for campaign advocacy purposes." MCFL, 479
U.S., at 252, 107 S.Ct., at 624 (plurality opinion). The Act imposes
requirements similar to those in the federal statute involved in MCFL: a
segregated fund must have a treasurer, 169.221; and its administrators must
keep detailed accounts of contributions, 169.224, and file with state officials a
statement of organization, ibid. In addition, a nonprofit corporation like the
Chamber may solicit contributions to its political fund only from members,
stockholders of members, officers or directors of members, and the spouses of
any of these persons. 169.255. Although these requirements do not stifle
corporate speech entirely, they do burden expressive activity. See MCFL, 479
U.S., at 252, 107 S.Ct., at 624 (plurality opinion); id., at 266, 107 S.Ct., at 632
(O'CONNOR, J.). Thus, they must be justified by a compelling state interest.
B
9
The State contends that the unique legal and economic characteristics of
corporations necessitate some regulation of their political expenditures to avoid
corruption or the appearance of corruption. See FEC v. National Conservative
Political Action Committee, 470 U.S. 480, 496-497, 105 S.Ct. 1459, 1468, 84
L.Ed.2d 455 (1985) (NCPAC ) ("[P]reventing corruption or the appearance of
corruption are the only legitimate and compelling government interests thus far
identified for restricting campaign finances"). State law grants corporations
special advantagessuch as limited liability, perpetual life, and favorable
treatment of the accumulation and distribution of assetsthat enhance their
ability to attract capital and to deploy their resources in ways that maximize the
return on their shareholders' investments. These state-created advantages not
only allow corporations to play a dominant role in the Nation's economy, but
also permit them to use "resources amassed in the economic marketplace" to
obtain "an unfair advantage in the political marketplace." MCFL, 479 U.S., at
257, 107 S.Ct., at 627. As the Court explained in MCFL, the political advantage
of corporations is unfair because
10
11
12
The Chamber argues that this concern about corporate domination of the
political process is insufficient to justify a restriction on independent
expenditures. Although this Court has distinguished these expenditures from
direct contributions in the context of federal laws regulating individual donors,
Buckley, 424 U.S., at 47, 96 S.Ct., at 648, it has also recognized that a
legislature might demonstrate a danger of real or apparent corruption posed by
such expenditures when made by corporations to influence candidate elections,
Bellotti, supra, 435 U.S., at 788, n. 26, 98 S.Ct., at 1422, n. 26. Regardless of
whether this danger of "financial quid pro quo " corruption, see NCPAC, supra,
470 U.S., at 497, 105 S.Ct., at 1468; post, at 702-705; (KENNEDY, J.,
dissenting), may be sufficient to justify a restriction on independent
expenditures, Michigan's regulation aims at a different type of corruption in the
political arena: the corrosive and distorting effects of immense aggregations of
wealth that are accumulated with the help of the corporate form and that have
little or no correlation to the public's support for the corporation's political
ideas. See supra, at 658-659. The Act does not attempt "to equalize the relative
influence of speakers on elections," post, at 705 (KENNEDY, J., dissenting);
see also post, at 684 (SCALIA, J., dissenting); rather, it ensures that
expenditures reflect actual public support for the political ideas espoused by
corporations. We emphasize that the mere fact that corporations may
accumulate large amounts of wealth is not the justification for 54; rather, the
unique state-conferred corporate structure that facilitates the amassing of large
treasuries warrants the limit on independent expenditures. Corporate wealth can
unfairly influence elections when it is deployed in the form of independent
expenditures, just as it can when it assumes the guise of political contributions.
We therefore hold that the State has articulated a sufficiently compelling
We next turn to the question whether the Act is sufficiently narrowly tailored to
achieve its goal. We find that the Act is precisely targeted to eliminate the
distortion caused by corporate spending while also allowing corporations to
express their political views. Contrary to the dissents' critical assumptions, see
post, at 698, 699, 706 (KENNEDY, J.); post, at 680, 682-683 (SCALIA, J.),
the Act does not impose an absolute ban on all forms of corporate political
spending but permits corporations to make independent political expenditures
through separate segregated funds. Because persons contributing to such funds
understand that their money will be used solely for political purposes, the
speech generated accurately reflects contributors' support for the corporation's
political views. See MCFL, supra, 479 U.S., at 258, 107 S.Ct., at 628.
14
III
15
The Chamber contends that even if the Campaign Finance Act is constitutional
with respect to for-profit corporations, it nonetheless cannot be applied to a
nonprofit ideological corporation like a chamber of commerce. In MCFL, we
held that the nonprofit organization there had "features more akin to voluntary
political associations than business firms, and therefore should not have to bear
burdens on independent spending solely because of [its] incorporated status."
479 U.S., at 263, 107 S.Ct., at 630. In reaching that conclusion, we enumerated
three characteristics of the corporation that were "essential" to our holding.
Ibid. Because the Chamber does not share these crucial features, the
Constitution does not require that it be exempted from the generally applicable
provisions of 54(1).
16
17
In contrast, the Chamber's bylaws set forth more varied purposes, see supra, at
656, several of which are not inherently political. For instance, the Chamber
compiles and disseminates information relating to social, civic, and economic
conditions, trains and educates its members, and promotes ethical business
practices. Unlike MCFL's, the Chamber's educational activities are not
expressly tied to political goals; many of its seminars, conventions, and
publications are politically neutral and focus on business and economic issues.
The Chamber's president and chief executive officer stated that one of the
corporation's main purposes is to provide "service to [its] membership that
includes everything from group insurance to educational seminars, and . . .
litigation activities on behalf of the business community." Deposition of E.
James Barrett, Nov. 12, 1985, p. 11. See also PR Newswire, July 21, 1989
(Chamber cosponsored the Automotive Management Briefing Seminar); PR
Newswire, May 9, 1989 (Chamber cosponsored the Michigan New Product
Awards competition); PR Newswire, June 14, 1988 (Chamber sponsored
seminar on product liability losses and lawsuits); PR Newswire, Feb. 4, 1988
(Chamber cosponsored outreach program to increase awareness of investment
opportunities in the Caribbean Basin). The Chamber's nonpolitical activities
therefore suffice to distinguish it from MCFL in the context of this
characteristic.
18
The Chamber also attacks 54(1) as underinclusive because it does not regulate
19
The Chamber also attacks 54(1) as underinclusive because it does not regulate
the independent expenditures of unincorporated labor unions.4 Whereas
unincorporated unions, and indeed individuals, may be able to amass large
treasuries, they do so without the significant state-conferred advantages of the
corporate structure; corporations are "by far the most prominent example of
entities that enjoy legal advantages enhancing their ability to accumulate
wealth." MCFL, 479 U.S., at 258, n. 11, 107 S.Ct., at 628, n. 11. The desire to
counterbalance those advantages unique to the corporate form is the State's
compelling interest in this case; thus, excluding from the statute's coverage
unincorporated entities that also have the capacity to accumulate wealth "does
not undermine its justification for regulating corporations." Ibid.
20
Moreover, labor unions differ from corporations in that union members who
disagree with a union's political activities need not give up full membership in
the organization to avoid supporting its political activities. Although a union
and an employer may require that all bargaining unit employees become union
members, a union may not compel those employees to support financially
"union activities beyond those germane to collective bargaining, contract
administration, and grievance adjustment." Communications Workers v. Beck,
487 U.S. 735, 745, 108 S.Ct. 2641, 2648, 101 L.Ed.2d 634 (1988). See also
Abood v. Detroit Bd. of Ed., 431 U.S. 209, 97 S.Ct. 1782, 52 L.Ed.2d 261
(1977) (holding that compelling nonmember employees to contribute to union's
political activities infringes employees' First Amendment rights). An employee
who objects to a union's political activities thus can decline to contribute to
those activities, while continuing to enjoy the benefits derived from the union's
performance of its duties as the exclusive representative of the bargaining unit
on labor-management issues. As a result, the funds available for a union's
political activities more accurately reflects members' support for the
organization's political views than does a corporation's general treasury.
Michigan's decision to exclude unincorporated labor unions from the scope of
54(1) is therefore justified by the crucial differences between unions and
corporations.
V
21
Because we hold that 54(1) does not violate the First Amendment, we must
address the Chamber's contention that the provision infringes its rights under
the Fourteenth Amendment. The Chamber argues that the statute treats
similarly situated entities unequally. Specifically, it contends that the State
should also restrict the independent expenditures of unincorporated associations
with the ability to accumulate large treasuries and of corporations engaged in
the media business.
22
23
Similarly, we find that the Act's exemption of media corporations from the
expenditure restriction does not render the statute unconstitutional. The "media
exception" excludes from the definition of "expenditure" any "expenditure by a
broadcasting station, newspaper, magazine, or other periodical or publication
for any news story, commentary, or editorial in support of or opposition to a
candidate for elective office . . . in the regular course of publication or
broadcasting," 169.206(3)(d). 5 The Court of Appeals did not address the
Chamber's equal protection argument because it found that the application of
54(1) to the Chamber violates the First Amendment. See 856 F.2d, at 790. The
District Court, however, appeared to hold that the media exception does not
implicate the Equal Protection Clause because "[a]ny corporation . . . may avail
itself of the exemption" by entering the news broadcasting or publishing
business. 643 F.Supp., at 405. We are persuaded, however, that a Fourteenth
Amendment analysis is necessary in this case. It is true that the exemption does
not refer expressly to "media corporations." Nevertheless, the exception will
undoubtedly result in the imposition of fewer restrictions on the expression of
corporations that are in the media business. Thus, it cannot be regarded as
neutral, and the distinction must be justified by a compelling state purpose.
24
officials elected by the people responsible to all the people whom they were
selected to serve"). The Act's definition of "expenditure," 169.206,
conceivably could be interpreted to encompass election-related news stories and
editorials. The Act's restriction on independent expenditures therefore might
discourage incorporated news broadcasters or publishers from serving their
crucial societal role. The media exception ensures that the Act does not hinder
or prevent the institutional press from reporting on, and publishing editorials
about, newsworthy events. Cf. H.R.Rep. No. 93-1239, p. 4 (1974) (explaining a
similar federal media exception, 2 U.S.C. 431(9)(B)(i), as "assur[ing] the
unfettered right of the newspapers, TV networks, and other media to cover and
comment on political campaigns"); 15 U.S.C. 1801-1804 (enacting a limited
exemption from the antitrust laws for newspapers in part because of the
recognition of the special role of the press). A valid distinction thus exists
between corporations that are part of the media industry and other corporations
that are not involved in the regular business of imparting news to the public.
Although the press' unique societal role may not entitle the press to greater
protection under the Constitution, Bellotti, supra, 435 U.S., at 782, and n. 18,
98 S.Ct., at 1418, and n. 18, it does provide a compelling reason for the State to
exempt media corporations from the scope of political expenditure limitations.
We therefore hold that the Act does not violate the Equal Protection Clause.
VI
25
26
It is so ordered.
27
28
I join the Court's opinion. As one of the "Orwellian" "censor[s]" derided by the
dissents, post, at 679 (SCALIA, J.); post, at 713 (KENNEDY, J.), and as the
author of our recent decision in FEC v. Massachusetts Citizens for Life, Inc.,
479 U.S. 238, 107 S.Ct. 616, 93 L.Ed.2d 539 (1986) (MCFL ), I write
separately to explain my views in this case.
29
30
committee." MCFL, 479 U.S., at 258, 107 S.Ct., at 628. We thus adopted the "
'underlying theory' " of FECA " 'that substantial general purpose treasuries
should not be diverted to political purposes' " and that requiring funding by
voluntary contributions guarantees that " 'the money collected is that intended
by those who contribute to be used for political purposes and not money
diverted from another source.' " Ibid. (quoting 117 Cong.Rec. 43381 (1971)
(statement of Rep. Hansen)).2
31
32
The majority today persuasively demonstrates that the situation in this case is
markedly different from that in MCFL. The Michigan State Chamber of
Commerce (Chamber) is first and foremost a business association, not a
political advocacy organization. See ante, at 661-665. The Michigan statute
advances the interest identified in MCFL in two distinct ways, by preventing
both the Chamber and other business corporations from using the funds of
other persons for purposes that those persons may not support. First, the state
law protects the small businessperson who does not wish his or her dues to be
spent in support of political candidates, but who nevertheless wishes to
maintain an association with the Chamber because of the myriad benefits it
provides that are unrelated to its political activities. See ante, at 662-663. The
bylaws state that the Chamber's "objectives and purposes" shall be in part "[t]o
analyze, compile and disseminate information on laws and regulations of
interest to the members" and "[t]o further the training and education of the
membership by means of educational materials, seminars, conventions,
34
Of course, a member could resign from the Chamber and a stockholder could
divest from a business corporation that used the Chamber as a conduit, but
these options would impose a financial sacrifice on those objecting to political
expenditures.5 See MCFL, 479 U.S., at 260, 107 S.Ct., at 629. It is therefore
irrelevant that "[t]o the extent that members disagree with a nonprofit
corporation's policies, they can seek change from within, withhold financial
support, cease to associate with the group, or form a rival group of their own."
Post, at 710 (KENNEDY, J., dissenting). Moreover, none of the alternatives
36
I do not find this underinclusiveness fatal, for several reasons.8 First, as the
dissents recognize, discussions on candidate elections lie "at the heart of
political debate." Post, at 698 (KENNEDY, J.); see also post, at 680, 692
(SCALIA, J.). But just as speech interests are at their zenith in this area, so too
are the interests of unwilling Chamber members and corporate shareholders
forced to subsidize that speech. The State's decision to focus on this especially
sensitive context is a justifiable one.9 Cf. MCFL, 479 U.S., at 258, n. 11, 107
S.Ct., at 628, n. 11. Second, in light of our decisions in Bellotti, supra,
Consolidated Edison Co. of New York v. Public Service Comm'n of New York,
447 U.S. 530, 533-535, 100 S.Ct. 2326, 2330-32, 65 L.Ed.2d 319 (1980), and
related cases, a State cannot prohibit corporations from making many other
types of political expenditures. One purpose of the underinclusiveness inquiry
is to ensure that the proffered state interest actually underlies the law. See, e.g.,
Florida Star v. B.J.F., 491 U.S. 524, 540, 109 S.Ct. 2603, 2613, 105 L.Ed.2d
443 (1989); FCC v. League of Women Voters of California, 468 U.S. 364, 396,
104 S.Ct. 3106, 3125, 82 L.Ed.2d 278 (1984). But to the extent that the
Michigan statute is "underinclusive" only because it does not regulate corporate
expenditures in referenda or other corporate expression (besides merely
commercial speech), this reflects the requirements of our decisions rather than
the lack of an important state interest on the part of Michigan in regulating
expenditures in candidate elections. In this sense, the Michigan law is not
"underinclusive" at all. Finally, the provision in Michigan corporate law
authorizing shareholder actions against corporate waste might serve as a
remedy for other types of political expenditures that have no legitimate
connection to the corporation's business. See Mich.Comp. Laws 600.3605(1)
(b) (1979);10 cf. Bellotti, supra, at 795, 98 S.Ct., at 1426.
37
38
39
40
41
* A.
42
43
The Court's opinion says that political speech of corporations can be regulated
because "[s]tate law grants [them] special advantages," ante, at 658, and
because this "unique state-conferred corporate structure . . . facilitates the
amassing of large treasuries," ante, at 660. This analysis seeks to create one
good argument by combining two bad ones. Those individuals who form that
type of voluntary association known as a corporation are, to be sure, given
special advantagesnotably, the immunization of their personal fortunes from
liability for the actions of the associationthat the State is under no obligation
to confer. But so are other associations and private individuals given all sorts of
special advantages that the State need not confer, ranging from tax breaks to
contract awards to public employment to outright cash subsidies. It is
rudimentary that the State cannot exact as the price of those special advantages
the forfeiture of First Amendment rights. See Pickering v. Board of Education
of Township High School Dist. No. 205, Will County, 391 U.S. 563, 88 S.Ct.
1731, 20 L.Ed.2d 811 (1968); Speiser v. Randall, 357 U.S. 513, 78 S.Ct. 1332,
2 L.Ed.2d 1460 (1958). The categorical suspension of the right of any person,
or of any association of persons, to speak out on political matters must be
justified by a compelling state need. See Buckley v. Valeo, 424 U.S. 1, 44-45,
96 S.Ct. 612, 646-647, 46 L.Ed.2d 659 (1976) (per curiam ). That is why the
Court puts forward its second bad argument, the fact that corporations "amas[s]
large treasuries." But that alone is also not sufficient justification for the
suppression of political speech, unless one thinks it would be lawful to prohibit
men and women whose net worth is above a certain figure from endorsing
political candidates. Neither of these two flawed arguments is improved by
combining them and saying, as the Court in effect does, that "since the State
gives special advantages to these voluntary associations, and since they thereby
amass vast wealth, they may be required to abandon their right of political
speech."*
44
The Court's extensive reliance upon the fact that the objects of this speech
restriction, corporations, receive "special advantages" is in stark contrast to our
opinion issued just six years ago in FCC v. League of Women Voters of
California, 468 U.S. 364, 104 S.Ct. 3106, 82 L.Ed.2d 278 (1984). In that
decision, striking down a congressionally imposed ban upon editorializing by
noncommercial broadcasting stations that receive federal funds, the only
respect in which we considered the receipt of that "special advantage" relevant
was in determining whether the speech limitation could be justified under
Congress' spending power, as a means of assuring that the subsidy was devoted
only to the purposes Congress intended, which did not include political
editorializing. We held it could not be justified on that basis, since "a
As for the second part of the Court's argumentation, the fact that corporations
(or at least some of them) possess "massive wealth": Certain uses of "massive
wealth" in the electoral processwhether or not the wealth is the result of
"special advantages" conferred by the Statepose a substantial risk of
corruption which constitutes a compelling need for the regulation of speech.
Such a risk plainly exists when the wealth is given directly to the political
candidate, to be used under his direction and control. We held in Buckley v.
Valeo, supra, however, that independent expenditures to express the political
views of individuals and associations do not raise a sufficient threat of
corruption to justify prohibition. Id., at 45, 96 S.Ct., at 647. Neither the Court's
opinion nor either of the concurrences makes any effort to distinguish that case
except, perhaps, by misdescribing the case as involving "federal laws
regulating individual donors," ante, at 659, or as involving "individual
expenditures," ante, at 678 (STEVENS, J., concurring). Section 608(e)(1) of
the Federal Election Campaign Act of 1971, 18 U.S.C. 608(e)(1) (1970 ed.,
Supp. V), which we found unconstitutional in Buckley, was directed, like the
Michigan law before us here, to expenditures made for the purpose of
advocating the election or defeat of a particular candidate, see 424 U.S., at 42,
96 S.Ct., at 645. It limited to $1,000 (a lesser restriction than the absolute
prohibition at issue here) such expenditures not merely by "individuals," but by
"persons," specifically defined to include corporations. See id., at 187, 96 S.Ct.,
at 712 (setting forth 591(g) of the statute). The plaintiffs in the case included
corporations, see id., at 8, 96 S.Ct., at 629, and we specifically discussed
608(e)(1) as a restriction addressed not just to individuals but to "individuals
and groups," id., at 39, 48, 96 S.Ct., at 648, "persons and groups," id., at 45, 96
S.Ct., at 647, "persons and organizations," ibid., "person[s] [and]
association[s]," id., at 50, 96 S.Ct., at 650. In support of our determination that
the restriction was "wholly at odds with the guarantees of the First
Amendment" we cited Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241,
94 S.Ct. 2831, 41 L.Ed.2d 730 (1974), which involved limitations upon a
corporation. 424 U.S., at 50, 96 S.Ct., at 650. Of course, if 608(e)(1) had been
unconstitutional only as applied to individuals and not as applied to
corporations, we might nonetheless have invalidated it in toto for substantial
overbreadth, see Broadrick v. Oklahoma, 413 U.S. 601, 611-613, 93 S.Ct. 2908,
2915-2916, 37 L.Ed.2d 830 (1973), but there is not a hint of that doctrine in our
opinion. Our First Amendment law is much less certain than I had thought it to
be if we are free to recharacterize each clear holding as a disguised
"overbreadth" determination.
46
47
The Court does not try to defend the proposition that independent advocacy
poses a substantial risk of political "corruption," as English speakers understand
that term. Rather, it asserts that that concept (which it defines as " 'financial
quid pro quo ' corruption," ante, at 659) is really just a narrow subspecies of a
hitherto unrecognized genus of political corruption. "Michigan's regulation," we
are told, "aims at a different type of corruption in the political arena: the
corrosive and distorting effects of immense aggregations of wealth that are
accumulated with the help of the corporate form and that have little or no
correlation to the public's support for the corporations's political ideas." Ibid.
Under this mode of analysis, virtually anything the Court deems politically
The Court's opinion ultimately rests upon that proposition whose violation
constitutes the "New Corruption": Expenditures must "reflect actual public
support for the political ideas espoused." Ibid. This illiberal free-speech
principle of "one man, one minute" was proposed and soundly rejected in
Buckley:
49
"It is argued, however, that the ancillary governmental interest in equalizing the
relative ability of individuals and groups to influence the outcome of elections
serves to justify the limitation on express advocacy of the election or defeat of
candidates imposed by 608(e)(1)'s expenditure ceiling. But the concept that
government may restrict the speech of some elements of our society in order to
enhance the relative voice of others is wholly foreign to the First Amendment,
which was designed 'to secure "the widest possible dissemination of
information from diverse and antagonistic sources," ' and ' "to assure unfettered
interchange of ideas for the bringing about of political and social changes
desired by the people." ' " 424 U.S., at 48-49, 96 S.Ct., at 648-649 (citations
omitted).
50
But it can be said that I have not accurately quoted today's decision. It does not
endorse the proposition that government may ensure that expenditures "reflect
actual public support for the political ideas espoused," but only the more
limited proposition that government may ensure that expenditures "reflect
actual public support for the political ideas espoused by corporations." Ante, at
660 (emphasis added). The limitation is of course entirely irrational. Why is it
perfectly all right if advocacy by an individual billionaire is out of proportion
with "actual public support" for his positions? There is no explanation, except
the effort I described at the outset of this discussion to make one valid
proposition out of two invalid ones: When the vessel labeled "corruption"
begins to founder under weight too great to be logically sustained, the
argumentation jumps to the good ship "special privilege"; and when that in turn
begins to go down, it returns to "corruption." Thus hopping back and forth
between the two, the argumentation may survive but makes no headway
towards port, where its conclusion waits in vain.
B
51
But even if the object of the prohibition could plausibly be portrayed as the
protection of shareholders (which the Court's opinion, at least, does not even
assert), that would not suffice as a "compelling need" to support this blatant
restriction upon core political speech. A person becomes a member of that form
of association known as a for-profit corporation in order to pursue economic
objectives, i.e., to make money. Some corporate charters may specify the line
of commerce to which the company is limited, but even that can be amended by
shareholder vote. Thus, in joining such an association, the shareholder knows
that management may take any action that is ultimately in accord with what the
majority (or a specified supermajority) of the shareholders wishes, so long as
that action is designed to make a profit. That is the deal. The corporate actions
to which the shareholder exposes himself, therefore, include many things that
he may find politically or ideologically uncongenial: investment in South
Africa, operation of an abortion clinic, publication of a pornographic magazine,
or even publication of a newspaper that adopts absurd political views and
makes catastrophic political endorsements. His only protections against such
assaults upon his ideological commitments are (1) his ability to persuade a
majority (or the requisite minority) of his fellow shareholders that the action
should not be taken, and ultimately (2) his ability to sell his stock. (The latter
course, by the way, does not ordinarily involve the severe psychic trauma or
economic disaster that Justice BRENNAN's opinion suggests.) It seems to me
entirely fanciful, in other words, to suggest that the Michigan statute makes any
significant contribution toward insulating the exclusively profit-motivated
shareholder from the rude world of politics and ideology.
53
But even if that were not fanciful, it would be fanciful to think, as Justice
BRENNAN's opinion assumes, that there is any difference between for-profit
and not-for-profit corporations insofar as the need for protection of the
individual member's ideological psyche is concerned. Would it be any more
upsetting to a shareholder of General Motors that it endorsed the election of
Henry Wallace (to stay comfortably in the past) than it would be to a member
of the American Civil Liberties Union that it endorsed the election of George
Wallace? I should think much less so. Yet in the one case as in the other, the
only protection against association-induced trauma is the will of the majority
and, in the last analysis, withdrawal from membership.
C
54
In Part V of its opinion, the Court accurately sets forth our longstanding First
Amendment law as follows:
55
56
The Court finds this requirement fully met for the following reason:
57
"As we explained in the context of our discussions of whether the statute was
overinclusive, supra, at 660-661, or underinclusive, supra, at 665 and this page,
the State's decision to regulate only corporations is precisely tailored to serve
the compelling state interest of eliminating from the political process the
corrosive effect of political 'war chests' amassed with the aid of the legal
advantages given to corporations." Ibid.
58
That state interest (assuming it is compelling) does indeed explain why the
State chose to silence "only corporations" rather than wealthy individuals as
well. But it does not explain (what "narrow tailoring" pertains to) why the State
chose to silence all corporations, rather than just those that possess great
wealth. If narrow tailoring means anything, surely it must mean that action
taken to counter the effect of amassed "war chests" must be targeted, if
possible, at amassed "war chests." And surely such targeting is possibleeither
in the manner accomplished by the provision that we invalidated in Buckley,
i.e., by limiting the prohibition to independent expenditures above a certain
amount, or in some other manner, e.g., by limiting the expenditures of only
those corporations with more than a certain amount of net worth or annual
profit.
59
60
The Court thus holds, for the first time since Justice Holmes left the bench, that
a direct restriction upon speech is narrowly enough tailored if it extends to
speech that has the mere potential for producing social harm. NRWC (which in
any event involved not a direct restriction upon corporate speech but a
restriction upon corporate solicitation of funds for candidates) is no authority
for that startling proposition, since it did not purport to be applying the First
Amendment narrow-tailoring requirement. The principle the Court abandons
todaythat the mere potential for harm does not justify a restriction upon
speechhad its origin in the "clear and present danger" test devised by Justice
Holmes in 1919, see Schenck v. United States, 249 U.S. 47, 49-51, 39 S.Ct. 247,
248, 63 L.Ed. 470, and championed by him and Justice Brandeis over the next
decade in a series of famous opinions opposing the affirmance of convictions
for subversive speech, see Abrams v. United States, 250 U.S. 616, 624, 40 S.Ct.
17, 20, 63 L.Ed. 1173 (1919) (Holmes, J., dissenting); Gitlow v. New York, 268
U.S. 652, 672, 45 S.Ct. 625, 632, 69 L.Ed. 1138 (1925) (Holmes, J.,
dissenting); Whitney v. California, 274 U.S. 357, 374, 47 S.Ct. 641, 647, 71
L.Ed. 1095 (1927) (Brandeis, J., concurring). The Court finally adopted their
view in 1937, see Herndon v. Lowry, 301 U.S. 242, 258, 57 S.Ct. 732, 739, 81
L.Ed. 1066; see also Bridges v. California, 314 U.S. 252, 263, 62 S.Ct. 190,
194, 86 L.Ed. 192 (1941); Thornhill v. Alabama, 310 U.S. 88, 105, 60 S.Ct.
736, 745, 84 L.Ed. 1093 (1940); West Virginia Board of Education v. Barnette,
319 U.S. 624, 639, 63 S.Ct. 1178, 1186, 87 L.Ed. 1628 (1943); Terminiello v.
Chicago, 337 U.S. 1, 4-5, 69 S.Ct. 894, 895-896, 93 L.Ed. 1131 (1949).
Today's reversal of field will require adjustment of a fairly large number of
significant First Amendment holdings. Presumably the State may now convict
individuals for selling books found to have a potentially harmful influence on
minors, Butler v. Michigan, 352 U.S. 380, 77 S.Ct. 524, 1 L.Ed.2d 412 (1957),
ban indecent telephone communications that have the potential for reaching
minors, Sable Communications of California v. FCC, 492 U.S. 115, 109 S.Ct.
2829, 106 L.Ed.2d 93 (1989), restrain the press from publishing information
that has the potential for jeopardizing a criminal defendant's right to a fair trial,
Nebraska Press Assn. v. Stuart, 427 U.S. 539, 96 S.Ct. 2791, 49 L.Ed.2d 683
(1976), or the potential for damaging the reputation of the subject of an
investigation, Landmark Communications, Inc. v. Virginia, 435 U.S. 829, 98
S.Ct. 1535, 56 L.Ed.2d 1 (1978), compel publication of the membership lists of
organizations that have a potential for illegal activity, see NAACP v. Alabama
ex rel. Patterson, 357 U.S. 449, 464, 78 S.Ct. 1163, 1172, 2 L.Ed.2d 1488
(1958), and compel an applicant for bar membership to reveal her political
beliefs and affiliations to eliminate the potential for subversive activity, Baird v.
State Bar of Arizona, 401 U.S. 1, 91 S.Ct. 702, 27 L.Ed.2d 639 (1971).
61
D
62
Finally, a few words are in order concerning the Court's approval of the
Michigan law's exception for "media corporations." This is all right, we are
told, because of "the unique role that the press plays in 'informing and
educating the public, offering criticism, and providing a forum for discussion
and debate.' " Ante, at 667 (citation omitted). But if one believes in the Court's
rationale of "compelling state need" to prevent amassed corporate wealth from
skewing the political debate, surely that "unique role" of the press does not give
Michigan justification for excluding media corporations from coverage, but
provides especially strong reason to include them. Amassed corporate wealth
that regularly sits astride the ordinary channels of information is much more
likely to produce the New Corruption (too much of one point of view) than
amassed corporate wealth that is generally busy making money elsewhere.
Such media corporations not only have vastly greater power to perpetrate the
evil of overinforming, they also have vastly greater opportunity. General
Motors, after all, will risk a stockholder suit if it makes a political endorsement
that is not plausibly tied to its ability to make money for its shareholders. But
media corporations make money by making political commentary, including
endorsements. For them, unlike any other corporations, the whole world of
politics and ideology is fair game. Yet the Court tells us that it is reasonable to
exclude media corporations, rather than target them specially.
63
Members of the institutional press, despite the Court's approval of their illogical
exemption from the Michigan law, will find little reason for comfort in today's
decision. The theory of New Corruption it espouses is a dagger at their throats.
The Court today holds merely that media corporations may be excluded from
the Michigan law, not that they must be. We have consistently rejected the
proposition that the institutional press has any constitutional privilege beyond
that of other speakers. See Bellotti, 435 U.S., at 782, 98 S.Ct., at 1418, and
cases cited. Thus, the Court's holding on this point must be put in the following
unencouraging form: "Although the press' unique societal role may not entitle
the press to greater protection under the Constitution, Bellotti, supra, at 782, 98
S.Ct., at 1418, and n. 18, it does provide a compelling reason for the State to
exempt media corporations from the scope of political expenditure limitations."
Ante, at 668. One must hope, I suppose, that Michigan will continue to provide
this generous and voluntary exemption.
II
64
I would not do justice to the significance of today's decision to discuss only its
lapses from case precedent and logic. Infinitely more important than that is its
departure from long-accepted premises of our political system regarding the
benevolence that can be expected of government in managing the arena of
public debate, and the danger that is to be anticipated from powerful private
institutions that compete with government, and with one another, within that
arena.
65
Perhaps the Michigan law before us here has an unqualifiedly noble objective
to "equalize" the political debate by preventing disproportionate expression
of corporations' points of view. But governmental abridgment of liberty is
always undertaken with the very best of announced objectives (dictators
promise to bring order, not tyranny), and often with the very best of genuinely
intended objectives (zealous policemen conduct unlawful searches in order to
put dangerous felons behind bars). The premise of our Bill of Rights, however,
is that there are some thingseven some seemingly desirable thingsthat
government cannot be trusted to do. The very first of these is establishing the
restrictions upon speech that will assure "fair" political debate. The incumbent
politician who says he welcomes full and fair debate is no more to be believed
than the entrenched monopolist who says he welcomes full and fair
competition. Perhaps the Michigan Legislature was genuinely trying to assure a
"balanced" presentation of political views; on the other hand, perhaps it was
trying to give unincorporated unions (a not insubstantial force in Michigan)
political advantage over major employers. Or perhaps it was trying to assure a
"balanced" presentation because it knows that with evenly balanced speech
incumbent officeholders generally win. The fundamental approach of the First
Amendment, I had always thought, was to assume the worst, and to rule the
regulation of political speech "for fairness' sake" simply out of bounds.
66
I doubt that those who framed and adopted the First Amendment would agree
that avoiding the New Corruption, that is, calibrating political speech to the
degree of public opinion that supports it, is even a desirable objective, much
less one that is important enough to qualify as a compelling state interest. Those
Founders designed, of course, a system in which popular ideas would
ultimately prevail; but also, through the First Amendment, a system in which
true ideas could readily become popular. For the latter purpose, the calibration
that the Court today endorses is precisely backwards: To the extent a valid
proposition has scant public support, it should have wider rather than narrower
public circulation. I am confident, in other words, that Jefferson and Madison
would not have sat at these controls; but if they did, they would have turned
them in the opposite direction.
67
Ah, but then there is the special element of corporate wealth: What would the
Founders have thought of that? They would have endorsed, I think, what
Tocqueville wrote in 1835:
68
70
Despite all the talk about "corruption and the appearance of corruption"evils
that are not significantly implicated and that can be avoided in many other ways
it is entirely obvious that the object of the law we have approved today is not
to prevent wrongdoing but to prevent speech. Since those private associations
known as corporations have so much money, they will speak so much more,
and their views will be given inordinate prominence in election campaigns. This
is not an argument that our democratic traditions allowneither with respect to
individuals associated in corporations nor with respect to other categories of
individuals whose speech may be "unduly" extensive (because they are rich) or
"unduly" persuasive (because they are movie stars) or "unduly" respected
(because they are clergymen). The premise of our system is that there is no
such thing as too much speechthat the people are not foolish but intelligent,
and will separate the wheat from the chaff. As conceded in Lincoln's aphorism
about fooling "all of the people some of the time," that premise will not
invariably accord with reality; but it will assuredly do so much more frequently
than the premise the Court today embraces: that a healthy democratic system
can survive the legislative power to prescribe how much political speech is too
much, who may speak, and who may not.
71
***
72
Justice KENNEDY, with whom Justice O'CONNOR and Justice SCALIA join,
dissenting.
74
The majority opinion validates not one censorship of speech but two. One is
Michigan's content-based law which decrees it a crime for a nonprofit corporate
speaker to endorse or oppose candidates for Michigan public office. By
permitting the statute to stand, the Court upholds a direct restriction on the
independent expenditure of funds for political speech for the first time in its
history.
75
The other censorship scheme, I most regret to say, is of our own creation. It is
value-laden, content-based speech suppression that permits some nonprofit
corporate groups, but not others, to engage in political speech. After failing to
disguise its animosity and distrust for the particular kind of political speech
here at issuethe qualifications of a candidate to understand economic matters
the Court adopts a rule that allows Michigan to stifle the voices of some of
the most respected groups in public life on subjects central to the integrity of
our democratic system. Each of these schemes is repugnant to the First
Amendment and contradicts its central guarantee, the freedom to speak in the
electoral process. I dissent.
76
77
The State has conceded that among those communications prohibited by its
statute are the publication by a nonprofit corporation of its own assessment of a
candidate's voting record. With the imprimatur of this Court, it is now a felony
in Michigan for the Sierra Club, or the American Civil Liberties Union, or the
Michigan Chamber of Commerce, to advise the public how a candidate voted
on issues of urgent concern to its members. In both practice and theory, the
prohibition aims at the heart of political debate.
79
80
Far more than the interest of the Chamber is at stake. We confront here
society's interest in free and informed discussion on political issues, a discourse
vital to the capacity for self-government. "In the realm of protected speech, the
legislature is constitutionally disqualified from dictating the subjects about
which persons may speak and the speakers who may address a public issue."
First National Bank of Boston v. Bellotti, 435 U.S. 765, 784-785, 98 S.Ct. 1407,
1420, 55 L.Ed.2d 707 (1978). There is little doubt that by silencing advocacy
groups that operate in the corporate form and forbidding them to speak on
electoral politics, Michigan's law suffers from both of these constitutional
defects.
81
First, the Act prohibits corporations from speaking on a particular subject, the
subject of candidate elections. It is a basic precept that the State may not
confine speech to certain subjects. Content-based restrictions are the essence of
censorial power. Ibid. (invalidating statute that allowed corporations to speak
on referenda issues that materially affected their business, but not on other
subjects). See also Consolidated Edison Co. of New York v. Public Service
Comm'n of New York, 447 U.S. 530, 537, 100 S.Ct. 2326, 2333, 65 L.Ed.2d 319
Second, the Act discriminates on the basis of the speaker's identity. Under the
Michigan law, any person or group other than a corporation may engage in
political debate over candidate elections; but corporations, even nonprofit
corporations that have unique views of vital importance to the electorate, must
remain mute. Our precedents condemn this censorship. See Bellotti, supra, at
784-786, 98 S.Ct., at 1420-1421; Police Dept. of Chicago v. Mosley, 408 U.S.
92, 92 S.Ct. 2286, 33 L.Ed.2d 212 (1972) (invalidating state statute that
prohibited picketing near certain buildings but allowed certain labor picketers);
Carey v. Brown, 447 U.S. 455, 100 S.Ct. 2286, 65 L.Ed.2d 263 (1980).
83
The protection afforded core political speech is not diminished because the
speaker is a nonprofit corporation. Even in the case of a for-profit corporation,
we have upheld the right to speak on ballot issues. The Bellotti Court stated:
84
"If the speakers here were not corporations, no one would suggest that the State
could silence their proposed speech. It is the type of speech indispensable to
decisionmaking in a democracy, and this is no less true because the speech
comes from a corporation rather than an individual. The inherent worth of the
speech in terms of its capacity for informing the public does not depend upon
the identity of its source, whether corporation, association, union, or
individual." 435 U.S., at 777, 98 S.Ct., at 1416 (footnotes omitted).
85
By using distinctions based upon both the speech and the speaker, the Act
engages in the rawest form of censorship: the State censors what a particular
segment of the political community might say with regard to candidates who
stand for election. The Court's holding cannot be reconciled with the principle
that " 'legislative restrictions on advocacy of the election or defeat of political
candidates are wholly at odds with the guarantees of the First Amendment.' "
Meyer v. Grant, 486 U.S. 414, 428, 108 S.Ct. 1886, 1895, 100 L.Ed.2d 425
(1988), quoting Buckley v. Valeo, supra, 424 U.S., at 50, 96 S.Ct., at 650.
B
86
The second censorship scheme validated by today's holding is the one imposed
by the Court. In FEC v. Massachusetts Citizens for Life, Inc., 479 U.S. 238, 107
S.Ct. 616, 93 L.Ed.2d 539 (1986) (MCFL ), a First Amendment right to use
corporate treasury funds was recognized for the nonprofit corporation then
before us. Those who thought that the First Amendment exists to protect all
points of view in candidate elections will be disillusioned by the Court's
opinion today; for that protection is given only to a preferred class of nonprofit
corporate speakers: small, single issue nonprofit corporations that pass the
Court's own vague test for determining who are the favored participants in the
electoral process. There can be no doubt that if a State were to enact a statute
empowering an administrative board to determine which corporations could
place candidate advertisements in newspapers and which could not, with
authority to enforce the guidelines the Court adopts today to distinguish
between the Massachusetts Citizens for Life and the Michigan Chamber of
Commerce, the statute would be held unconstitutional. The First Amendment
does not permit courts to exercise speech suppression authority denied to
legislatures.
87
The Court draws support for its discrimination among nonprofit corporate
speakers from portions of our opinion in MCFL, supra. It must be
acknowledged that certain language in MCFL, in particular the discussion
which pointed to the express purpose of the organization to promote political
ideas, id. at 263-265, 107 S.Ct., at 630-631, lends support to the majority's test.
That language, however, contravenes fundamental principles of neutrality for
all political speech. It should not stand in the way of giving full force to the
essential and vital holding of MCFL, which is that a nonprofit corporation
engaged in political discussion of candidates and elections has the full
protection of the First Amendment.
II
88
The Act does not meet our standards for laws that burden fundamental rights.
The State cannot demonstrate that a compelling interest supports its speech
restriction, nor can it show that its law is narrowly tailored to the purported
statutory end. See Bellotti, supra, 435 U.S., at 786, 793-795, 98 S.Ct., at 1421,
1424-1426. Restrictions on independent expenditures are unconstitutional if
they fail to meet both of these standards. Buckley v. Valeo, 424 U.S. 1, 96 S.Ct.
612, 46 L.Ed.2d 659 (1976); First National Bank of Boston v. Bellotti, supra;
FEC v. National Conservative Political Action Committee, 470 U.S. 480, 105
S.Ct. 1459, 84 L.Ed.2d 455 (1985) (NCPAC ); MCFL, supra. The majority
opinion cannot establish either of these predicate conditions for the speech
restriction imposed by the State.6
89
* Our cases acknowledge the danger that corruption poses for the electoral
process, but draw a line in permissible regulation between payments to
candidates ("contributions") and payments or expenditures to express one's own
91
92
93
The majority almost admits that, in the case of independent expenditures, the
danger of a political quid pro quo is insufficient to justify a restriction of this
kind. Since the specter of corruption, which had been "the only legitimate and
The evil of political corruption has been defined in more precise terms. We
have said: "Corruption is a subversion of the political process" whereby "
[e]lected officials are influenced to act contrary to their obligations of office by
the prospect of financial gain. . . ." NCPAC, supra, at 497, 105 S.Ct., at 1468.
In contrast, the interest touted by the majority is the impermissible one of
altering political debate by muting the impact of certain speakers.
95
96
"A restriction on the amount of money a person or group can spend on political
communication during a campaign necessarily reduces the quantity of
expression by restricting the number of issues discussed, the depth of their
exploration, and the size of the audience reached. This is because virtually
every means of communicating ideas in today's mass society requires the
expenditure of money." Buckley, 424 U.S., at 19, 96 S.Ct., at 634 (footnote
omitted); see also id., at 39, 96 S.Ct., at 644.
97
In Buckley and Bellotti, acting on these precepts, we rejected the argument that
the expenditure of money to increase the quantity of political speech somehow
fosters corruption. The key to the majority's reasoning appears to be that
because some corporate speakers are well supported and can buy press space or
broadcast time to express their ideas, government may ban all corporate speech
to ensure that it will not dominate political debate. The argument is flawed in at
least two respects. First, the statute is overinclusive because it covers all groups
which use the corporate form, including all nonprofit corporations. Second, it
assumes that the government has a legitimate interest in equalizing the relative
influence of speakers.
98
98
99
100 "[T]he concept that government may restrict the speech of some elements of
our society in order to enhance the relative voice of others is wholly foreign to
the First Amendment, which was designed 'to secure "the widest possible
dissemination of information from diverse and antagonistic sources," '. . . . The
First Amendment's protection against governmental abridgment of free
expression cannot properly be made to depend on a person's financial ability to
engage in public discussion." Buckley, supra, 424 U.S., at 48-49, 96 S.Ct., at
648-649 (citations omitted).
101 That those who can afford to publicize their views may succeed in the political
arena as a result does not detract from the fact that they are exercising a First
Amendment right. Meyer v. Grant, 486 U.S., at 426, n. 7, 108 S.Ct., at 1894, n.
7 (upholding First Amendment right to use paid petition circulators). As we
stated in Bellotti, paid advocacy "may influence the outcome of the vote; this
would be its purpose. But the fact that advocacy may persuade the electorate is
hardly a reason to suppress it." 435 U.S., at 790, 98 S.Ct., at 1423. The
suggestion that the government has an interest in shaping the political debate by
insulating the electorate from too much exposure to certain views is
incompatible with the First Amendment. "[T]he people in our democracy are
entrusted with the responsibility for judging and evaluating the relative merits
of conflicting arguments." Id., at 791, 98 S.Ct., at 1423; see also Meyer, supra,
at 426, n. 7, 108 S.Ct., at 1894, n. 7; Brown v. Hartlage, 456 U.S. 45, 60, 102
S.Ct. 1523, 1532, 71 L.Ed.2d 732 (1982).
102 An argument similar to that made by the majority was rejected in Bellotti.
There, we rejected the assumption that "corporations are wealthy and powerful
and their views may drown out other points of view" or "exert an undue
influence" on the electorate in the absence of a showing that the relative voice
of corporations was significant. 435 U.S., at 789, 98 S.Ct., at 1422. And even
were we to assume that some record support for this assertion would make a
constitutional difference, it has not been established here. The majority
provides only conjecture. All censorship is suspect; but censorship based on
vague surmise is not permissible in any case.
103 The Act, as the State itself says, prevents a nonprofit corporate speaker from
using its own funds to inform the voting public that a particular candidate has a
good or bad voting record on issues of interest to the association's adherents.
Though our era may not be alone in deploring the lack of mechanisms for
holding candidates accountable for the votes they cast, that lack of
accountability is one of the major concerns of our time. The speech suppressed
in this case was directed to political qualifications. The fact that it was spoken
by the Michigan Chamber of Commerce, and not a man or woman standing on
a soapbox, detracts not a scintilla from its validity, its persuasiveness, or its
contribution to the political dialogue.
104 The Court purports to distinguish MCFL on the ground that the nonprofit
corporation permitted to speak in that case received no funds from profitmaking corporations. It is undisputed that the Michigan Chamber of Commerce
is itself a nonprofit corporation. The crucial difference, it is said, is that the
Chamber receives corporate contributions. But this distinction rests on the
fallacy that the source of the speaker's funds is somehow relevant to the
speaker's right of expression or society's interest in hearing what the speaker has
to say. There is no reason that the free speech rights of an individual or of an
association of individuals should turn on the circumstance that funds used to
engage in the speech come from a corporation. Many persons can trace their
funds to corporations, if not in the form of donations, then in the form of
dividends, interest, or salary. That does not provide a basis to deprive such
individuals or associations of their First Amendment freedoms. The more
narrow alternative of recordkeeping and funding disclosure is available. See
MCFL, 479 U.S., at 262, 107 S.Ct., at 630. A wooden rule prohibiting
independent expenditures by nonprofit corporations that receive funds from
business corporations invites discriminatory distinctions. The principled
approach is to acknowledge that where political speech is concerned, freedom
responsibility, in all likelihood, will have more credibility and generate less
distrust than one funded by a PAC. PAC's are interim, ad hoc organizations
with little continuity or responsibility. The respected organizations affected by
this case have a continuity, a stability, and an influence that makes it critical for
their members and the public at large to evaluate their official policies to
determine whether the organizations have earned credibility over a period of
time. If a particular organization supports a candidate who injures its cause or
offends its ideals, the organization itself, not some intermediary committee,
ought to take the blame. It is a sad irony that the group before us wishes to
assume that responsibility but the action of the State, endorsed by this Court,
does not allow it to do so.
108 The diffusion of the corporate message produced by the PAC requirement also
ensures a lack of fit between the statute's ends and its means. If the concern is
that nonprofit corporate speech distorts the political process, it would seem that
injecting the confusion of a PAC as an intermediary, albeit one controlled and
directed by the corporation, further diffuses responsibility. Even if there were
any possibility of corruption by allowing the Michigan Chamber of Commerce
to finance the proposed advertisement supporting a candidate, it makes no
sense to argue that such a possibility would be eliminated by requiring the
disclaimer at the bottom to read "Paid for by the Michigan Chamber of
Commerce PAC" rather than "Paid for by the Michigan Chamber of
Commerce."
109 The majority relies on the state interest in protecting members from the use of
nonprofit corporate funds to support candidates whom they may oppose. We
should reject this interest as insufficient to save the Act here, just as we rejected
the argument in Bellotti, 435 U.S., at 792-793, 98 S.Ct., at 1424. See also
Consolidated Edison Co., supra, at 543, 100 S.Ct., at 2336.
110 The Court takes refuge in the argument that some members or contributors to
nonprofit corporations may find their own views distorted by the organization,
and cites our holding in Abood v. Detroit Board of Education, 431 U.S. 209, 97
S.Ct. 1782, 52 L.Ed.2d 261 (1977). Abood does not apply here, as the
disincentives to dissociate are not comparable. Bellotti, supra, at 794, n. 34, 98
S.Ct., at 1425, n. 34 (noting "crucial distinction" between union members and
shareholders). One need not become a member of the Michigan Chamber of
Commerce or the Sierra Club in order to earn a living. To the extent that
members disagree with a nonprofit corporation's policies, they can seek change
from within, withhold financial support, cease to associate with the group, or
form a rival group of their own. Allowing government to use the excuse of
protecting shareholder rights to stifle the speech of private, voluntary
structure that facilitates the amassing of large treasuries." Ante, at 660. This
proposition is not self-evident and has little or no relation to the suppression of
ideas. The reality, of course, is that some groups and organizations, particularly
those with many members, may find that the nonprofit corporate form is the
only feasible way of organizing so that they can transmit important views to the
public as a whole. Because the unincorporated association structure carries with
it a high risk of personal liability for members and operates in an uncertain legal
climate, groups often prefer to organize in nonprofit corporate form. The
corporate form provides clear rights and responsibilities and limits the liability
of members. E. Hadden & B. French, Nonprofit Organizations 12 (1987); H.
Oleck, Nonprofit Corporations, Organizations and Associations 30-31 (4th ed.
1982); M. Lane, Legal Handbook for Nonprofit Organizations 4, 22-26, 43, 5961, 124 (1980). For these reasons, in recent years the number of important
unincorporated associations has dwindled while the number of incorporated
associations has proliferated. Oleck, supra, at 31. By deciding to operate as a
nonprofit corporation rather than an unincorporated association, a group does
not forfeit its First Amendment protection to participate in political discourse.
III
115 An independent ground for invalidating this statute is the blanket exemption for
media corporations. It is beyond per-adventure that the media could not be
prohibited from speaking about candidate qualifications. The First Amendment
would not tolerate a law prohibiting a newspaper or television network from
spending on political comment because it operates through a corporation. See
Mills v. Alabama, 384 U.S. 214, 218-220, 86 S.Ct. 1434, 1436-1437, 16
L.Ed.2d 484 (1966). As Justice BRENNAN, supported by a majority of the
Court in Dun & Bradstreet, Inc. v. Greenmoss Builders, Inc., 472 U.S. 749, 105
S.Ct. 2939, 86 L.Ed.2d 593 (1985), state: "[T]he rights of the institutional
media are no greater and no less than those enjoyed by other individuals or
organizations engaged in the same activities." Id., at 784, 105 S.Ct., at 2958
(dissenting opinion, joined by MARSHALL, BLACKMUN, and STEVENS,
JJ.); id., at 773, 105 S.Ct., at 2952 (WHITE, J., concurring in judgment) ("[T]he
First Amendment gives no more protection to the press . . . than it does to
others exercising their freedom of speech"). The argument relied on by the
majority, that media corporations are in the business of communicating and
other corporations are not, is unsatisfying. All corporations communicate with
the public to some degree, whether it is their business or not; and
communication is of particular importance for non-profit corporations.
116 The web of corporate ownership that links media and nonmedia corporations is
difficult to untangle for the purpose of any meaningful distinction. Newspapers,
A requirement that the Chamber disclose the nature and extent of its political
activities, see post, at 707 (KENNEDY, J., dissenting), would not eliminate the
The Federal Election Campaign Act contains a similar exemption that excludes
from the definition of expenditure "any news story, commentary, or editorial
distributed through the facilities of any broadcasting station, newspaper,
magazine, or other periodical publication, unless such facilities are owned or
controlled by any political party, political committee, or candidate." 2 U.S.C.
431(9)(B)(i).
In MCFL, 479 U.S. 238, 107 S.Ct. 616, 93 L.Ed.2d 539 (1986), we observed
that the requirement that expenditures be made through PACs "is of course
distinguishable from the complete foreclosure of any opportunity for political
speech that we invalidated in the state referendum context in First National
Bank of Boston v. Bellotti, 435 U.S. 765, 98 S.Ct. 1407, 55 L.Ed.2d 707
(1978)." Id., at 259, n. 12, 107 S.Ct., at 628, n. 12.
We cited with approval in First National Bank of Boston v. Bellotti, 435 U.S.
765, 98 S.Ct. 1407, 55 L.Ed.2d 707 (1978), a discussion of the constitutionality
of restrictions on union contributions and independent expenditures in candidate
elections:
"[T]he ban on union political contributions and expenditures is not total but
applies only to general union funds. Contributions and expenditures made by a
separate fund financed by voluntary contributions are specifically permitted, as
are expenditures of general funds to solicit contributions to the separate fund. In
order to engage in political discussion, a union need only convince its members
that its views are sound enough to merit a contribution to a union political
Justice KENNEDY is mistaken when he suggests that by upholding the asapplied challenge in MCFL and rejecting it here, we are embarking on "valueladen, content-based speech suppression that permits some nonprofit corporate
groups but not others to engage in political speech." Post, at 695-696
(KENNEDY, J., dissenting). The mere fact that some as-applied challenges
succeed while others fail does not create a system of "speech suppression."
Whether an organization presents the threat at which the campaign finance laws
are aimed has to do with the particular characteristics of the organization at
issue and not with the content of its speech. Of course, if a correlation between
the two factors could be shown to exist, a group would be free to mount a First
Amendment challenge on that basis. Cf. Buckley v. Valeo, 424 U.S. 1, 97, n.
131, 96 S.Ct. 612, 672, n. 131, 46 L.Ed.2d 659 (1976). Neither appellee nor
Justice KENNEDY's dissent has provided any reason to believe that such a
relationship exists here.
According to Justice KENNEDY's dissent, the majority holds that "it is now a
felony in Michigan for the Sierra Club, or the American Civil Liberties Union"
to make independent expenditures. Post, at 698. This characterization is
inaccurate. Not only are those groups not part of the proceeding before us, but
the dissent has overlooked the central lesson of MCFL that the First
Amendment may require exemptions, on an as-applied basis, from expenditure
restrictions. If a nonprofit corporation is formed with the express purpose of
promoting political ideas, is not composed of members who face an economic
incentive for disassociating with it, and does not accept contributions from
business corporations or labor unions, then it would be governed by our MCFL
holding.
This very "underinclusiveness" belies the dissents' charge that the Michigan
law is a broad restriction on corporate political expression; many avenues of
communication are open to the Chamber. In addition, the segregated fund
requirement in practice has not burdened significantly the Chamber's speech
with respect to candidate-oriented expenditures. The Chamber established a
PAC in 1977 and has drawn from that fund in every election since then. The
Chamber has an eligible class of about 50,000 individuals from whom it can
solicit contributions to its PAC under the Michigan statute, and it has been quite
successful in doing so. During the 1983-1984 election cycle, the Chamber PAC
raised over $102,000, and its projected resources for the 1986 primary and
general elections amounted to more than $140,000. See App. in No. 86-1867
(CA6), pp. 164, 184. The District Court found that "the record in this case
amply demonstrates that the Chamber PAC frequently makes independent
expenditures to influence political elections, and those efforts have been
tremendously successful in electing Chamber PAC endorsed candidates." App.
to Juris.Statement 66a-67a.
1141 (1961). Rather than assuming that an employee accepts as "the deal,"
post, at 686, that the union will use his dues for any purpose that will advance
the interests of the bargaining unit, including political contributions and
expenditures, we have determined that "the authority to impose dues and fees
[is] restricted at least to the 'extent of denying the unions the right, over the
employee's objection, to use his money to support political causes which he
opposes,' . . . even though Congress was well aware that unions had historically
expended funds in the support of political candidates and issues." Ellis v.
Railway Clerks, 466 U.S. 435, 447, 104 S.Ct. 1883, 1891, 80 L.Ed.2d 428
(1984) (quoting Street, supra, 367 U.S., at 768, 81 S.Ct., at 1796) (emphasis
added).
Given the extensive state regulation of corporations, shareholder expectations
are always a function of state law. It is circular to say, as does Justice SCALIA,
that if a State did not protect shareholders, they would have no expectation of
being protected, and therefore that the State has no legitimate interest in
protecting them. Justice SCALIA concedes, as he must, that an expenditure
"not plausibly tied to [a corporation's] ability to make money for its
shareholders" can be prohibited. Post, at 691. But States have always been
permitted to define what qualifies as "plausibly tied" to the corporation's
purpose of making money, i.e., what qualifies as "corporate waste," see Rogers
v. Hill, 289 U.S. 582, 591-592, 53 S.Ct. 731, 735, 77 L.Ed. 1385 (1933),
including wasteful speech, see Bellotti, 435 U.S., at 795, 98 S.Ct., at 1426; Cort
v. Ash, 422 U.S. 66, 84, 95 S.Ct. 2080, 2090, 45 L.Ed.2d 26 (1975). I believe it
entirely proper for a State to decide to promote the ability of investors to
purchase stock in corporations without fear that their money will be used to
support candidates with whom they do not agree.
9
10
The Court's assertion that the Michigan law "does not impose an absolute ban
on all forms of corporate political spending," ante, at 660, is true only in a
respect that is irrelevant for purposes of First Amendment analysis. A
corporation is absolutely prohibited from spending its own funds on this form
of political speech, and would be guilty of misrepresentation if it asserted that a
particular candidate was supported or opposed by the corporation. This is to say
that the corporation as a corporation is prohibited from speaking. What the
Michigan law permits the corporation to do is to serve as the founder and
treasurer of a different association of individuals that can endorse or oppose
political candidates. The equivalent, where an individual rather than an
association is concerned, would be to prohibit John D. Rockefeller from
making political endorsements, but to permit him to form an association to
which others (though not he himself) can contribute for the purpose of making
Section 6 provides:
"Sec. 6. (1) 'Expenditure' means a payment, donation, loan, pledge, or promise
of payment of money or anything of ascertainable monetary value for goods,
materials, services, or facilities in assistance of, or in opposition to, the
nomination or election of a candidate, or the qualification, passage, or defeat of
a ballot question. . . .
"(2) Expenditure includes a contribution or a transfer of anything of
ascertainable monetary value for purposes of influencing the nomination or
election of any candidate or the qualification, passage, or defeat of a ballot
question.
"(3) Expenditure does not include:
.....
"(c) An expenditure for communication on a subject or issue if the
communication does not support or oppose a ballot issue or candidate by name
or clear inference or an expenditure for the establishment, administration, or
solicitation of contributions to a fund or independent committee.
"(d) An expenditure by a broadcasting station, newspaper, magazine, or other
periodical or publication for any news story, commentary, or editorial in
See n. 2, supra.