The United States Supreme Court significantly weakened campaign finance limitations on Monday, dismissing as a free speech violation a portion of a bipartisan 2002 statute challenged by Republican Senator Ted Cruz and billed as an anti-corruption precaution by federal officials.
Supreme Court Backs Ted Cruz, Scraps Campaign Finance Limit
In a 6-3 decision, the court determined that a $250,000 cap on the amount of money political candidates can be reimbursed for personal loans to their own campaigns after an election violated the First Amendment’s guarantee of free speech by unduly restricting political expression.
The Supreme Court ruled in favor of Sen. Ted Cruz (R-Texas) in a campaign finance dispute involving how campaigns can repay candidates’ loans.
It was the latest in a string of decisions by the conservative-majority court to ease political money regulations, citing worries about free speech.
Cruz filed a lawsuit against the Federal Election Commission over a rule that limits how political campaigns can reimburse candidates for loans they make to their own campaigns, allowing them to repay up to $250,000 in loans at any time and more than that only if repaid within 20 days after the election.
Cruz took a $260,000 loan to his campaign just before the election in 2018 and was unable to repay $10,000, so he sued to overturn the underlying regulation, claiming it violated his First Amendment rights.
The court decided that the loan repayment restriction “burdens essential political expression without reasonable explanation,” arguing that if politicians can’t be completely compensated by their campaigns, they won’t lend money in the first place.
The Biden administration argued that Cruz had standing to sue since his campaign purposefully failed to repay the whole debt on time so that he could file the lawsuit, but the court disagreed, ruling that the fact that Cruz’s issue was “willingly incurred” could not prevent him from suing.
The government’s argument that the legislation helps prevent corruption and “quid pro quo” arrangements in which a candidate is bribed was also dismissed by the justices, who said there was insufficient evidence to support that claim.
Cruz, who was originally elected to the Senate from Texas in 2012, filed a lawsuit against the Federal Election Commission (FEC), which enforces election laws, following his re-election victory against Democratic challenger Beto O’Rourke in 2018. Cruz had lent his campaign group $260,000, but the law only allowed him to recoup $250,000 from his campaign.
The judgment, according to a Cruz official, is a “resounding win for the First Amendment.” A representative for the FEC declined to comment.
The verdict disappointed Trevor Potter, head of the Campaign Legal Center, a nonpartisan organization that supports campaign finance legislation.
Further, Acting on behalf of the FEC, Democratic Vice President Joe Biden’s administration appealed a Washington-based three-judge panel’s unanimous verdict in 2021 knocking down the clause on free speech grounds.
The provision in question was part of a significant campaign finance statute that the Supreme Court has already whittled away at, including in a landmark 2010 case that permitted corporations and unions to spend limitless amounts during elections as constitutionally protected free speech.
Several elements of the 2002 Bipartisan Campaign Reform Act, known as the McCain-Feingold law after its main Senate sponsors, John McCain and Russ Feingold, have been struck down by the Supreme Court.
In ruling that the limit was not warranted in preventing corruption, Roberts agreed with Cruz’s reasoning, stating that there are existing limits on how much money people can donate during an election cycle, which is currently capped at $2,900.
The existing quo benefitted incumbents over challengers since fresh candidates are more likely to have to borrow money for their campaigns and find it more difficult to raise funds.
Cruz ran for his party’s presidential candidacy in 2016, but lost, and went on to support former President Donald Trump.