🌅 How to Ban Money in Politics

SOURCE

Pew Research Center

WHAT TO KNOW

• Earlier this month, Hawaii Governor Josh Green signed SB 2471 into law. The bill—which flew through the state’s legislature on votes of 24-0 in the Senate and 50-1 in the House—bans all corporations that do business in the state from spending money or contributing anything of value to influence elections or ballot measures. Green’s signature makes Hawaii the first state to take on Citizens United, the 2010 Supreme Court decision that granted corporations the right to spend unlimited amounts of money on elections based on corporations’ so-called “speech” rights. More than a dozen other states are contemplating efforts similar to Hawaii’s. The proposals will likely be popular: a 2023 survey by the Pew Research Center found 72% of U.S. adults think there should be limits on the amount of money individuals and corporations can spend on elections, including 71% of Republicans and 76% of Democrats.

WHY IT MATTERS

• Hawaii’s new law, which will certainly face legal challenges, is modeled on the Corporate Power Reset (CPR), a legal framework that bans corporations and other non-human entities from spending on elections or ballot measures by specifically removing that power granted under state law. The CPR essentially attempts to sidestep the right found in Citizens United by not granting artificial entities the power to spend on elections or ballot measures in the first place. It’s a narrow distinction, however, it’s also one supported by more than 200 years of case law. In an 1819 decision, Supreme Court Justice John Marshall defined corporations as “artificial beings” that exist “only in contemplation of law,” finding corporations therefore possess “only those properties” granted by law. Put differently, corporations and other non-human entities only have the powers states say they have (e.g., to own property, enter contracts, bring lawsuits, etc.), and expressly do not have the powers states say they don’t have. The Constitution’s Tenth Amendment also expressly reserves powers not listed in the Constitution—like the power to create and regulate corporations—to the states. The principle that states, not the federal government, have authority over the powers assigned to corporations has never been superseded, and is why each state can have different corporate laws, resulting in some jurisdictions, like Delaware, becoming far more popular for incorporation than others.

CONNECT THE DOTS

• The 5-4 decision in Citizens United opened the floodgates to money in modern American politics. In 2024, $14.8 billion was spent on federal elections, astronomically more than the amount spent on elections in other countries. The 2024 election also included a record $1.9 billion from dark money groups, which aren’t required to disclose their donors. Since Citizens United, dark money groups have spent at least $4.3 billion on federal elections.