[Senate Hearing 111-621]
[From the U.S. Government Publishing Office]



 
  ``WE THE PEOPLE'' ? CORPORATE SPENDING IN AMERICAN ELECTIONS AFTER 
                            CITIZENS UNITED

=======================================================================


                                HEARING

                               before the

                       COMMITTEE ON THE JUDICIARY
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 10, 2010

                               __________

                          Serial No. J-111-79

                               __________

         Printed for the use of the Committee on the Judiciary




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                       COMMITTEE ON THE JUDICIARY

                  PATRICK J. LEAHY, Vermont, Chairman
HERB KOHL, Wisconsin                 JEFF SESSIONS, Alabama
DIANNE FEINSTEIN, California         ORRIN G. HATCH, Utah
RUSSELL D. FEINGOLD, Wisconsin       CHARLES E. GRASSLEY, Iowa
CHARLES E. SCHUMER, New York         JON KYL, Arizona
RICHARD J. DURBIN, Illinois          LINDSEY GRAHAM, South Carolina
BENJAMIN L. CARDIN, Maryland         JOHN CORNYN, Texas
SHELDON WHITEHOUSE, Rhode Island     TOM COBURN, Oklahoma
AMY KLOBUCHAR, Minnesota
EDWARD E. KAUFMAN, Delaware
ARLEN SPECTER, Pennsylvania
AL FRANKEN, Minnesota
            Bruce A. Cohen, Chief Counsel and Staff Director
                  Matt Miner, Republican Chief Counsel


                            C O N T E N T S

                              ----------                              

                    STATEMENTS OF COMMITTEE MEMBERS

                                                                   Page

Cardin, Hon. Benjamin L., a U.S. Senator from the State of 
  Maryland, prepared statement...................................    81
Cornyn, Hon. John, a U.S. Senator from the State of Texas........    18
Feingold, Hon. Russell D., a U.S. Senator from the State of 
  Wisconsin......................................................    15
    prepred statement............................................    97
Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont.     1
    prepred statement............................................   122
Sessions, Hon. Jeff, a U.S. Senator from the State of Alabama....     3
Whitehouse, Hon. Sheldon, a U.S. Senator from the State of Rhode 
  Island, politico article.......................................   203

                               WITNESSES

Kendall, Douglas T., President, Constitutional Accountability 
  Center, Washington, DC.........................................    10
Rosen, Jeffrey, Professor of Law, George Washington University, 
  and Legal Affairs Editor, The New Republic, Washington, DC.....     5
Smith, Bradley A., Chairman, Center for Competitive Politics, 
  Alexandria, Virginia and Josiah H. Blackmore III/Shirley M. 
  Nault Designated Professor of Law, Capital University Law 
  School, Columbus, Ohio.........................................     7

                         QUESTIONS AND ANSWERS

Responses of Douglas T. Kendall to questions submitted by 
  Senators Cornyn, Hatch and Sessions............................    39
Responses of Jeffrey Rosen to questions submitted by Senators 
  Cornyn, Hatch and Sessions.....................................    49
Responses of Bradley A. Smith to questions submitted by Senators 
  Sessions, Cornyn and Hatch.....................................    59

                       SUBMISSIONS FOR THE RECORD

Arnebeck, Clifford O., Jr., Columbus, Ohio, statement............    77
Clements, Jeffrey D., Clements Law Office, Concord, 
  Massachusetts, statement.......................................    83
Institute for Justice, Arlington, Virginia, political books......   103
Kendall, Douglas T., President, Constitutional Accountability 
  Center, Washington, DC.........................................   105
Law Professors Letter to Senators Leahy and Sessions, Citizens 
  United.........................................................   119
Organization for International Investment, Washington, DC, 
  statement......................................................   125
Rosen, Jeffrey, Professor of Law, George Washington University, 
  and Legal Affairs Editor, The New Republic, Washington, DC, 
  statement......................................................   129
Smith, Bradley A., Chairman, Center for Competitive Politics, 
  Alexandria, Virginia and Josiah H. Blackmore III/Shirley M. 
  Nault Designated Professor of Law, Capital University Law 
  School, Columbus, Ohio, statement and attachments..............   140


  ``WE, THE PEOPLE'' ? CORPORATE SPENDING IN AMERICAN ELECTIONS AFTER 
                            CITIZENS UNITED

                              ----------                              

                  WEDNESDAY, MARCH 10, 2010
                                       U.S. Senate,
                                Committee on the Judiciary,
                                                   Washington, D.C.
    The Committee met, pursuant to notice, at 10:08 a.m., in 
room SD-226, Dirksen Senate Office Building, Hon. Patrick J. 
Leahy, Chairman of the Committee, presiding.
    Present: Senators Leahy, Feingold, Schumer, Cardin, 
Whitehouse, Klobuchar, Kaufman, Specter, Franken, Sessions, 
Hatch, and Cornyn.

OPENING STATEMENT OF HON. PATRICK J. LEAHY, A U.S. SENATOR FROM 
                      THE STATE OF VERMONT

    Chairman Leahy. Good morning. Today's hearing is another in 
a series we have held that focus on how recent activist 
decisions by very narrow majorities on the Supreme Court affect 
the lives of hard-working Americans. We did this, of course, on 
the Lilly Ledbetter case where the Supreme Court basically said 
women could be paid less than men for the same kind of work. 
And in a case called Citizens United v. Federal Election 
Commission, five of the nine Justices acted to overturn a 
century of law designed to protect our elections from corporate 
spending. They ruled that corporations are no longer prohibited 
from direct spending on political campaigns. They extended to 
corporations the same First Amendment rights in the political 
process that are guaranteed by the Constitution to individual 
Americans.
    And I believe the Citizens United decision turns the idea 
of Government of, by, and for the people on its head. It 
creates new rights for Wall Street at the expense of the people 
on Main Street. It threatens to allow unprecedented influence 
from foreign corporations into our elections. You can imagine 
what China could do with an American subsidiary if they wanted 
to influence an election, perhaps to defeat somebody who would 
criticize the use of basically slave labor or unsafe practices 
in China. And I think Americans concerned about fair elections 
have rightfully recoiled.
    Our Constitution begins with the words, ``We, the People of 
the United States.'' In designing the Constitution, States 
ratifying it, adopting the Bill of Rights, and creating our 
democracy, we spoke of and thought of and guaranteed 
fundamental rights to the American people, not to corporations.
    There are reasons for that. Corporations are not the same 
as individual human Americans. Corporations do not have the 
same rights, the same morals, or the same interests. And 
corporations cannot vote in our democracy.
    Teddy Roosevelt proposed the first campaign finance 
reforms, limiting the role of corporations in the political 
process. Those reforms, proposed by a Republican President, 
were preserved and extended through another century of legal 
developments that followed. Eight years ago, it was these same 
values that informed bipartisan efforts in Congress, on behalf 
of the American people, to enact the landmark McCain-Feingold 
Act, and that legislation strengthened the laws protecting the 
interests of all Americans by ensuring a fair electoral process 
where individual Americans could have a role in the political 
process, regardless of their wealth.
    Six years ago, in McConnell v. Federal Election Commission, 
the Supreme Court upheld the key provisions of the McCain-
Feingold Act against a First Amendment challenge. Now, a thin 
majority of the Supreme Court, made possible by President 
Bush's appointment of Justice Samuel Alito, reversed course on 
the same question. In doing so, this activist majority 
discarded not only the McConnell decision, but ran roughshod 
over longstanding precedent, and took it upon itself to 
effectively redraft our campaign finance laws. As Justice 
Stevens noted in dissent, ``The only relevant thing that has 
changed since . . . McConnell is the composition of the 
Court.'' The Constitution has not changed. In fact, nowhere in 
Constitution do we even mention corporations.
    At the core of the First Amendment is the right of 
individual Americans to participate in the political process--
to speak and, more crucially, to be heard. That is what the 
campaign finance laws were designed to ensure--that Americans 
can be heard and fairly participate in elections. Five Justices 
overruled Congressional efforts to keep powerful, moneyed 
interests from swamping individuals' voices and interests. They 
showed no deference to Congress and little to the precedents of 
the Supreme Court.
    Now, Vermont is a small State. We have only 660,000 people. 
It is easy to imagine corporate interests flooding the airwaves 
with election ads and transforming even local elections there. 
It would not take more than a tiny fraction of corporate money 
to outspend all of our local candidates, both Republicans and 
Democrats combined. If a local city council or zoning board is 
considering an issue of corporate interest, why would the 
corporate interests not try to drown out the views of ordinary 
Vermonters, hard-working citizens though they are? I know that 
the people of Vermont, like all Americans, take seriously their 
civic duty to choose wisely on election day. Vermonters cherish 
their critical role in the democratic process. They are staunch 
believers in the First Amendment.
    Vermont, in fact, would not ratify the Constitution until 
the adoption of the Bill of Rights in 1791. I think the rights 
of Vermonters and all Americans to speak to each other and to 
be heard should not be undercut by corporate spending. And I 
fear that is exactly what will happen unless both sides of the 
aisle--both Republicans and Democrats have a stake in this, and 
they should join with the President to try to restore the 
ability of every American to be heard and effectively 
participate in free and fair elections.
    When the Citizens United decision was handed down, I said 
that it was the most partisan decision since Bush v. Gore. As 
in Bush v. Gore, the conservative activists on the Supreme 
Court unnecessarily went beyond the proper judicial role to 
substitute their own personal preferences for the law. With all 
the talk about judicial modesty and judicial restraint from the 
nominees at their most recent confirmation hearings, those 
nominees of President Bush, we have seen all a Supreme Court 
these last 4 years that has been anything but modest and 
restrained.
    I am just concerned that this case is going to open the 
floodgates for corporate spending. And in these tough economic 
times, I believe individual Americans should not have their 
voices drowned out by unfettered corporate interests. I am also 
very concerned that this decision is going to invite foreign 
corporate influence into our elections. We are in unchartered 
territory, and I am concerned about what this might do.
    Senator Sessions, please go ahead, sir.

STATEMENT OF HON. JEFF SESSIONS, A U.S. SENATOR FROM THE STATE 
                           OF ALABAMA

    Senator Sessions. Thank you, Mr. Chairman.
    I see my colleague Senator Cornyn. I know he would like to 
share a few opening comments. Maybe we could swap out on that. 
If you would think about it, I would appreciate it.
    The first thing, on Lilly Ledbetter, the Supreme Court had 
a responsibility to interpret a poorly written Congressional 
statute on the statute of limitations. They ruled the way they 
felt was correct. I think it was a decision that they could 
very well be justified. And then Congress acted promptly and 
changed it and clarified it. That is the way the system is 
supposed to work, and I do not think we should attack the 
Court's integrity basically and accuse them of being political 
agenda-oriented on that case because we may have disagreed with 
how they interpreted a rather unclear statute.
    I think Citizens United was a very important affirmation of 
a fundamental American liberty, it seems to me, enshrined in 
the First Amendment that ``Congress shall make no law'' 
infringing the right of freedom of speech. And I think the 
Court simply said an assembly of people can have the right to 
speak also. And I think the criticisms are overwrought, and it 
should not be nearly as personal as it is on the Court, and 
that this is a legitimate interpretation of the words and 
spirit of the First Amendment which favors the liberty of 
advocacy in a very clear way.
    The sacred right of free speech is enshrined in our 
Republic from the beginning and one that becomes stronger when 
we protect it even for those who we disagree with, and we have 
a tradition of that. So I think it would be a good opportunity 
today to look at it honestly and accurately and talk about the 
Supreme Court's ruling that appeared to me to be strengthening 
the First Amendment rather than constricting the First 
Amendment.
    I am concerned, though, that there has been too much 
alarmist rhetoric that has been flying around since this 
decision, and I hope that today's hearing can shed some light 
and not misrepresent the nature of the decision or impugn the 
integrity of the Justices.
    I do not think the Court is above criticism. I think they 
can be criticized. But I got to say, I was disappointed--
dismayed, really--to hear the President of the United States 
mischaracterize the decision of the Supreme Court and scold the 
members of the Court in his State of the Union address for 
something they did not do, mischaracterized the case.
    The President claimed that the decision ``reversed a 
century of law'' and ``opened the floodgates'' for special 
interests and foreign powers to ``bankroll American 
elections.'' And I do not believe that was an accurate 
statement from an individual who should know better because he 
has taught constitutional law. If you are going to challenge 
the Supreme Court in the presence where they have no 
opportunity to respond and defend themselves, you ought to be 
absolutely accurate in your criticism. They are not above 
criticism. It does not affect their independence. They have got 
a lifetime appointment. So I am not worried about their 
independence. Sometimes they wail about it. They can be 
criticized, but it ought to be honest and fair.
    I think the President was in error in a number of ways. It 
is critical for us to remember Citizens United found that 
independent expenditures, advertisements, pamphlets, books, 
documentaries produced independently from a party or 
candidate's campaign cannot be suppressed under the First 
Amendment simply because the funds for this political speech 
came from the coffers of a labor union or a corporation. 
Citizens United did not change the laws restricting corporate 
contributions to political parties or to campaigns. And let me 
say that again. It did not lift restrictions on contributions 
to political campaigns from corporations or labor unions.
    As the Court has recognized for 30 years, there is a 
difference between political campaign contributions, which 
carry a risk of a quid pro quo type corruption--and there is 
some sense of that. If you give a large amount of money to a 
candidate for their campaign, it has implications of a quid pro 
quo. But that has been held to be different from independent, 
uncoordinated expenditures by individuals, advocacy groups, or 
other associations who wish to make their views heard to the 
American people even before an election. When do you want to 
speak out if it is not before an election?
    So the President's charge right there before all the 
American people that the Court had opened the door to special 
interests, bankrolling elections, I think was very misleading. 
It is not about independent--it is about independent political 
speech, not about filling the campaign coffers of a party or a 
candidate.
    Second, it did not reverse a century of law because there 
was no law limiting independent expenditures until 1947, when 
Congress passed the Labor-Management Relations Act. That Act 
was passed over the veto of our Democratic President Harry 
Truman who warned that the law was ``a dangerous intrusion on 
free speech.'' So critics of the Citizens United decision like 
to point to the Tillman Act of 1907 as the first campaign 
finance restriction, but the Tillman Act barred contributions; 
it did not bar independent political speech funded by labor 
unions or corporations. Citizens United did reverse the 1990 
decision in Austin, but the majority opinion and the 
concurrence by Chief Justice Roberts clearly explained the 
Austin decision itself was an aberration. It was a departure 
from the Court's earlier First Amendment cases and a case based 
on a legal theory really that the Obama administration 
attorneys could not bring themselves to defend, really.
    Third, the President's statement and accusations by others 
who have echoed him claim that the Supreme Court made the 
political system vulnerable to independence from foreign 
corporations, but the Court explicitly noted in Citizens United 
it was not changing the Federal law that already bans foreign 
corporations from participating in the Federal process.
    The constitutional issues identified by the Court I do not 
think should surprise us. Many of us will recall that we have 
spent years debating campaign finance reform. A number of our 
members offered a constitutional amendment to amend the First 
Amendment, to restrict the First Amendment, in order to 
explicitly allow Congress to pass these kind of spending limits 
on advocacy and politics. And pretty soon that was all voted 
down, and we have not heard from that again, thank goodness. 
But in a way, this is a similar thing to ask the Court to 
affirm a statute that does the same thing. And the Court was 
worried about it.
    As I said at the time that amendment was offered, it was an 
astounding, a thunderous, a remarkable change in policy for 
America. And I believed it then, and I think in the long run we 
are better off allowing this cauldron of competing interests to 
express themselves than to create a Government power to pick 
and choose what group of people can express themselves in a 
campaign.
    So, Mr. Chairman, I do not know, maybe I am wrong about 
this. We have got some great witnesses today. Let us talk about 
it. But I absolutely believe that this is not the kind of open-
and-shut question people say. At best, the critics ought to 
acknowledge this is a close call. And, in fact, I think they 
would have to admit that if the Court had ruled otherwise, the 
power of people to collectively participate in campaigns and 
speak out freely in America would have been constrained. 
Therefore, I think the Court did right. Thank you.
    Chairman Leahy. Well, let us give the panel then a chance 
to respond. We will start with Professor Jeffrey Rosen who 
teaches constitutional law at George Washington University. He 
has authored several books on the Supreme Court. He is Legal 
Affairs editor for The New Republic.
    Mr. Rosen, good to have you here.

STATEMENT OF JEFFREY ROSEN, PROFESSOR OF LAW, GEORGE WASHINGTON 
    UNIVERSITY, AND LEGAL AFFAIRS EDITOR, THE NEW REPUBLIC, 
                         WASHINGTON, DC

    Mr. Rosen. Thank you very much, Senator Leahy and members 
of the Committee. Thank you for inviting me to testify in this 
important hearing.
    The 5-4 ruling in Citizens United has been strongly opposed 
by Americans of both political parties: last month, in a 
Washington Post-ABC News poll, 80 percent of respondents said 
they opposed the Court's decision to allow unregulated 
corporate spending in general elections, with relatively little 
difference between Republicans and Democrats. That is not a 
surprise during a time of financial crisis when the influence 
of money in politics--Justice Louis Brandeis called it ``our 
financial oligarchy''--is the most pressing political question 
of the day.
    Brandeis, who denounced the ``curse of bigness'' that led 
large corporations to take risks with other people's money, and 
also thought that the purpose of the First Amendment was to 
make men and women free to develop their faculties--not 
corporations but men and women--would not have approved of the 
Citizens United decision, and his prescient book ``Other 
People's Money and How the Bankers Use It'' makes that clear.
    You asked me to testify about the constitutional 
implications of the decision. Unfortunately, the implications 
are not encouraging.
    Senator Sessions, you ask critics to acknowledge that this 
is a close case, and you express concern about people impugning 
the integrity of the Court. I agree it is a close case. I agree 
that many civil libertarian liberals support the result. And I 
believe that the Justices made their decision in good faith. It 
was a principled decision.
    What it was not is a restrained decision. It was not 
restrained by any measure of restraint that the Justices of the 
Roberts Court have embraced. It was precisely the kind of 
divisive and unnecessarily sweeping decision that Chief Justice 
Roberts pledged to avoid in his confirmation hearings and 
after, when he said he would try to promote narrow, unanimous 
opinions, rather than deciding hotly contested questions by 
ideologically polarized, 5-4 votes.
    Chief Justice Roberts laid out this vision shortly after he 
took office. He did it at a commencement speech at Georgetown 
University Law Center and in interviews with several people, 
including me, and he said that he was concerned that his 
colleagues were acting more like law professors than members of 
a collegial court. He said this was bad for the Court and bad 
for the country in a polarized age. And he said he would 
embrace the vision of his greatest predecessor, John Marshall, 
by trying to promote narrow, unanimous opinions.
    I was impressed by the Chief Justice's concern about the 
bipartisan legitimacy of the Court and have no doubt that he 
meant what he said. I watched with interest his efforts to 
promote unanimity over the past few terms, and he met with 
mixed success. In the 2007 term, the number of 5-4 decisions 
soared to 33 percent, a 10-year high. It dipped up and down in 
subsequent years. But the most striking area in which Chief 
Justice Roberts has been able to achieve a relative measure of 
unanimity is in cases affecting business interests which now 
represent 40 percent of the Court's docket. Seventy-nine 
percent of these cases are decided by margins of 7-2 or better, 
and the U.S. Chamber of Commerce, which represents the unified 
interests of American business, has had remarkable success 
before the Roberts Court during the past few years. In 2006 the 
Chamber's litigation center filed briefs in 15 cases and won 13 
of them, the highest percentage of victories in the center's 
13-year history.
    So this was the record before Citizens United, divisive 
decisions, 5-4, in cases involving affirmative action, voting 
rights, abortion, campaign finance, and religion, and relative 
unanimity in these business cases.
    Citizens United is disappointing, Senator Sessions, even to 
those critics like me who acknowledge that it is principled, 
because it was so unnecessary. You could have protected the 
free speech rights of producers of ``Hillary: The Movie'' by 
holding that Congress never intended to regulate video on 
demand or groups with minimal corporate funding. But the Court 
chose not to take that narrow route. It is a broad, sweeping 
opinion, much of the kind that Chief Justice Earl Warren might 
have issued. It is unconnected to arguments about 
constitutional original understanding, which my colleague Doug 
Kendall will discuss, the traditions of Congress, and it is 
rather radical in uprooting precedents that date back for more 
than a century.
    Why should the public care that the Roberts Court now seems 
willing to impose these ideologically divided, constitutionally 
polarizing opinions rulings? It is because when the Court tries 
to challenge the public on matters of economic justice that the 
public cares intensely about, it often provokes backlashes that 
can harm the Court and the country. We know this from the 
experience during the 1930s, and there is a serious question 
about whether that historical error will be repeated. It is 
impossible at the moment to tell precisely what the future will 
bring. I still continue to hope that Chief Justice Roberts has 
enough political savvy to avoid this backlash, but there is no 
doubt that the stakes could not be higher. His success or 
failure will turn on his ability to make good on his promise of 
narrow, unanimous decisions. We have seen narrow conservative 
majorities strike down economic regulations in the name of 
corporate rights before, and it always ends badly for the 
Court.
    Thank you so much.
    [The prepared statement of Mr. Rosen appears as a 
submission for the record.]
    Chairman Leahy. Thank you very much, Professor Rosen.
    Next we have Bradley Smith, Professor Bradley Smith, who 
teaches law at Capital University Law School in Ohio. He served 
on the Federal Elections Commission and is currently Chairman 
of the Center for Competitive Politics.
    Professor Smith, thank you for taking the time. Please go 
ahead.

STATEMENT OF BRADLEY A. SMITH, CHAIRMAN, CENTER FOR COMPETITIVE 
  POLITICS, ALEXANDRIA, VIRGINIA, AND JOSIAH H. BLACKMORE II/
     SHIRLEY M. NAULT DESIGNATED PROFESSOR OF LAW, CAPITAL 
             UNIVERSITY LAW SCHOOL, COLUMBUS, OHIO

    Mr. Smith. Thank you, Chairman Leahy, Ranking Member 
Sessions, and members of the Committee. I appreciate the 
opportunity to be here this morning.
    Rarely does a decision provoke as much--I cannot use 
another word but ``hysteria'' as Citizens United. For example, 
many States which have long allowed unlimited corporate 
spending--Vermont is one of those States--have suddenly swept 
in, in great alarm in their legislature, to say, ``Oh, now we 
must do something.'' A month ago--well, I guess I should say 2 
months ago, nobody in Vermont was clamoring to change the 
State's election law to prevent unlimited corporate spending in 
campaigns. Now because the Supreme Court comes down merely 
saying, ``Vermont, this case does not affect you at all,'' the 
people, the legislature of Vermont seems to be freaking out, 
for lack of another word.
    Chairman Leahy. Professor Smith--and this will come out of 
my time--why don't you let me talk about the reactions of the 
Vermont Legislature? I think I understand it one heck of a lot 
better than you do.
    Mr. Smith. My point, Mr. Chairman, is that there has been a 
great deal of reaction by people, and I could use another 
State. I could use Maryland if you would prefer.
    Chairman Leahy. These are a group of very hard-working 
citizen legislators. They do not freak out, to use your 
expression. This is very much of a typical, far more taciturn 
New England legislature. We do not freak out, to use your term.
    Mr. Smith. Senator, I have been called here, I think, to 
offer my expert opinion. In my expert opinion, they are 
freaking out.
    Now, to continue on, let us talk about where else we stand 
here. This decision was one that is clearly correct, and 
Citizens United had to win the case, and pretty much everybody 
agrees with that. All you have to do to come to that conclusion 
is look at what the position of the U.S. Government was. It was 
the position of the U.S. Government that under the Constitution 
it could prevent a publisher, such as Random House or the Free 
Press or Simon and Schuster, from publishing a 500-page book 
containing even one line advocating the election or defeat of a 
candidate. I am not sure that many people really want to defend 
that position.
    It was the position of the U.S. Government that it could 
prevent a corporation, such as Amazon or Barnes & Noble, from 
using technology for Kindle and Nook to distribute books. I do 
not think many people think that is a correct interpretation of 
the First Amendment.
    It was the position of the U.S. Government that it could 
prevent a union from hiring a person to write a book, maybe 
something like ``Why Working People Should Support the Obama 
Agenda,'' and that was struck down or not allowed by the Court 
to have that kind of agenda in the Court.
    It was proposed, of course, that you could limit the 
discrimination of Citizens United's movie, and I think, again, 
that is something that people clearly disagreed with. In fact, 
when we actually look at what the public feels and asks them 
specifically do they agree with any of those conclusions that 
the Government actually argued in this case, as opposed to 
asking them sort of a loaded question--Do you think 
corporations should spend unlimited sums?--if we actually asked 
them, by a 3-1 majority, as we did in a poll at Citizens 
United--or I mean at the Center for Competitive Politics, we 
found that by a 3-1 margin they agreed that the company should 
be able to air ads. By a 3-1 margin, they agreed that they 
should be able to run movies by video on demand technology.
    In fact, there was much more support for Citizens United's 
position in this case than there was when we asked them if you 
should censor the press, in which 30 percent favored censoring 
the press, but only 17 percent favored censoring Citizens 
United from distributing its movie.
    So you are playing with fire when you start saying--working 
up hysteria about people participating in these things. 
Animosity toward the institutional press, which I think 
everybody thinks must be protected, is much, much higher.
    Now, in terms of the activism of the Court's decision, 
there is a problem with activism, and it comes from the Court's 
dissenters. The Court's dissenters would have swept away 200 
years of precedent. We have quotes in Mr. Kendall's testimony 
and I have quoted from Dartmouth College v. Woodward about how 
corporations are artificial beings and exist only in the 
contemplation of law. That is cited all the time now. Let us 
remember, Dartmouth College v. Woodward found in favor of 
corporate rights. It is remember, it is still included in law 
books precisely because it is an affirmation of the power of 
citizens against the Government, not an affirmation of 
Government power to regulate people simply because the forum in 
which they choose to associate--and those association rights 
are very important here--is a corporate forum.
    And the dissent offers no principled basis for how it would 
distinguish. Obviously, corporations have many rights. I do not 
think that anybody on the panel--I hope--believes that you 
could simply take corporate property without providing them 
with due process. I hope you do not think that you can just go 
to Capital University, which is a corporation, and take over 
our dorms and quarter soldiers there because we are a 
corporation and we have no rights. Clearly, corporations have 
rights, and the question is: What rights do they have? And 
individuals, I think, have a right to gather and to speak about 
issues that are important to them.
    Many people on this panel attack corporations. Many people 
in the public attack corporations. And the citizens who own 
those corporations have a right to speak in return. And the 
dissenters in this case would have overturned over 100 years of 
precedent and dozens and dozens of cases to get there.
    So let us stay focused on what is really at stake, and I 
think if we do that, we will see that this was a very, very 
rational decision, one that almost everybody would agree with 
the specific holding. If it went too far in certain small 
particulars, it is fairly easy to do legislative fixes on those 
particulars.
    Thank you very much.
    [The prepared statement of Mr. Smith appears as a 
submission for the record.]
    Chairman Leahy. Thank you very much, Mr. Smith, and I will 
be interested in seeing if anybody in the Vermont Legislature 
cares to see how a professor at Capital University Law School 
feels about their reactions.
    Doug Kendall is the Founder and President of the 
Constitutional Accountability Center. He has co-authored 
several books and articles about federalism and the courts.
    Please go ahead, Mr. Kendall.

  STATEMENT OF DOUGLAS T. KENDALL, PRESIDENT, CONSTITUTIONAL 
             ACCOUNTABILITY CENTER, WASHINGTON, DC

    Mr. Kendall. Thank you, Chairman Leahy, for holding this 
important hearing on the Constitution and the Citizens United 
ruling and for inviting me to testify.
    I am the President of Constitutional Accountability Center, 
a non-profit think tank, law firm, and action center dedicated 
to the Constitution's text and history. The center is releasing 
today a report entitled ``A Capitalist Joker: The Strange 
Origins, Disturbing Past, and Uncertain Future of Corporate 
Personhood in American Law,'' which examines the Constitution's 
text and history and the Supreme Court's treatment of 
corporations from the founding era to the Court's ruling in 
Citizens United.
    The Constitution's text reflects a fundamental difference 
between corporations and the ``We the People'' identified in 
the Preamble of the Constitution. As artificial entities, it is 
awkward, if not nonsensical, to describe corporations engaging 
in the ``freedom of speech,'' practicing the ``free exercise'' 
of religion, ``peaceably . . . assembl[ing],'' or ``keep[ing] 
and bear[ing] Arms.''
    The debate about how to treat corporations--which are never 
mentioned in the Constitution's text, yet play an ever-
expanding role in American society--has raged since the 
founding era. The Supreme Court's answer to this question has 
long been a nuanced one: Corporations can sue and be sued in 
Federal courts and they can assert certain constitutional 
rights, but they have never been accorded all the rights that 
individuals have, and have never been given rights of political 
participation.
    The Court, under Chief Justice John Marshall and many times 
since, has emphasized that because corporations are artificial 
entities and receive special privileges, such as perpetual life 
and limited liability, they are subject to greater regulation 
by the State. Only once before, during the darkest days of the 
Lochner era, has the Supreme Court seriously entertained the 
idea that corporations are entitled to the same constitutional 
rights enjoyed by ``We the People.'' And even in the Lochner 
era, these equal rights were never extended to the political 
process.
    The idea of equal constitutional rights for corporations 
has a truly bizarre origin. In the 1886 case of Santa Clara v. 
Southern Pacific Railroad Company, the Supreme Court reporter 
decided to include in his published notes a remark by Chief 
Justice Waite to the effect that corporations were persons 
within the meaning of the Constitution's Equal Protection 
Clause. Through this highly irregular move, the idea that 
corporations were persons was introduced into American law.
    Eleven years later, in Gulf Railroad v. Ellis, the Court 
cited Santa Clara in holding that ``a State has no more power 
to deny to corporations the equal protection of the law than it 
has to individual citizens.'' This ruling, combined with other 
important rulings that same year, ushered in the Lochner era, a 
period today almost universally condemned as one of the darkest 
eras in Supreme Court history.
    In 1937, the Supreme Court recognized its errors, and the 
Lochner era's constitutional revolution came crashing to a 
halt. Virtually every aspect of the Lochner era's protection of 
corporate constitutional rights was repudiated by the Court, 
with the Court ultimately dismissing the idea of equal rights 
for corporations unanimously as ``a relic of a bygone era.''
    In the face of these losses, corporations started 
aggressively fighting back. In 1971, Lewis Powell--a Virginia 
corporate lawyer who would soon be nominated to the Supreme 
Court--wrote a now famous memorandum to the Chamber of Commerce 
advising that corporations look to relief in the courts, noting 
that ``the judiciary may be the most important instrument for 
social, economic, and political change.''
    Powell's strategy started to come to fruition just 7 years 
later in First National Bank of Boston v. Bellotti, when 
Justice Powell authored a 5-4 ruling for the Supreme Court that 
struck down limits on a corporation's ability to oppose ballot 
initiatives under the First Amendment.
    Though deeply problematic, Bellotti was expressly limited 
to ballot initiatives, and two subsequent rulings held that the 
Constitution does not grant corporations the right to spend 
unlimited amounts of money to favor the candidates of their 
choice.
    Citizens United wiped these later rulings off the books, 
and while the Citizens United majority offered reasons for its 
decision, none of them is persuasive or comes close to 
justifying the momentous changes in constitutional law ushered 
in by its opinion.
    Corporations do not vote. They cannot run for office, and 
they are not endowed by the Creator with inalienable rights. We 
the people create corporations, and we provide them with 
special privileges that carry with them restrictions that do 
not apply to living persons. These truths are self-evident, and 
it is past time the Supreme Court got this right.
    Thank you.
    [The prepared statement of Mr. Kendall appears as a 
submission for the record.]
    Chairman Leahy. Thank you very much.
    Mr. Kendall, let me just follow up on this. Justice Sandra 
Day O'Connor recently spoke about the risks posed to our 
independent judiciary by the millions of dollars flowing into 
State judicial campaigns. Last year, the Court seemed to share 
that view of the potential massive corporate spending to 
distort elections by handing down a case called Caperton v. 
Massey. In fact, John Grisham wrote a book that sort of 
referred to that.
    In that case, Justice Kennedy wrote that the risk of bias 
due to campaign contributions in a State judicial election 
meant that the judge was wrong not to recuse himself from 
deciding a case involving a defendant who spent $3 million to 
elect him to the bench. I found it interesting. We do not elect 
judges in Vermont. Our State Legislature is pretty staid and 
conservative, and it allows them to be appointed with consent 
by the Governor.
    Why do you believe the Supreme Court only months later in 
Citizens United did not apply these same concerns and obvious 
logic to corporate spending? It just seemed after Caperton it 
ruled differently.
    Mr. Kendall. I agree, Senator Leahy. And what I actually 
find most disturbing about the ruling in Caperton is that the 
four dissenting Justices actually believed that there was no 
problem with the extreme factual circumstances, there was no 
violation of the Due Process Clause in that case.
    I think Justice Kennedy was obviously the swing vote in 
Caperton and Citizens United, and I think what he would say is 
that there is a difference between the obligations of a judge 
to recuse under the Due Process Clause and the First Amendment 
rights of corporations to spend unlimited amounts in elections. 
But I do not think those two issues can be separated that 
easily. The reason the judge has an obligation to recuse is 
because of how much money the corporation is spending in the 
election, and I think the reasons for recusal also support the 
legislature's decision in States around the country to limit 
corporate campaign expenditures in judicial elections. And the 
great irony of the pattern that you reflect where the Court 
requires recusal in the Caperton case and strikes down limits 
on corporate campaign expenditures in elections in States 
around the country is--the Court is basically saying there is a 
huge problem here, but you, Congress, you, States across the 
country, cannot do anything about it.
    Chairman Leahy. It is interesting, because she was on the 
Court, I believe 6 years ago, when the McCain-Feingold Act's 
restrictions on corporate campaign spending were declared 
constitutional. Now she is off, and so 6 years later, basically 
we have a different answer.
    I am wondering what this does for the ability of State and 
local governments to police their own elections. We have 24 
States that have laws restraining corporate spending in 
elections. Some of these laws date back 100 years. Others have 
laws that they allow corporate spending, but they restrict the 
amount that can be spent.
    Are these laws all called into question now?
    Mr. Kendall. I think they are called into question, Senator 
Leahy. I think that is one of the dramatic impacts of this 
ruling. And I think as you mentioned in your opening statement 
and Justice Stevens said in dissent, the Constitution has not 
changed in the last 7 years, the law has not changed. The only 
relevant thing that has changed is the membership of the Court. 
And it is really more dramatic than what has happened over the 
last 7 years.
    If you take and put side by side the Supreme Court's 
majority opinion in Citizens United and the ruling by a 
unanimous Court written by Justice Rehnquist in a 1982 case 
called FEC v. National Right to Work Committee--which is a case 
that upheld limits on the ability of corporations to collect 
donations for PACs. If you put those two opinions side by side, 
I think what you see is that not a single member of the Court 
in 1982 would have signed on to the majority ruling in Citizens 
United today, which is how dramatically the Court has changed 
on these issues.
    Chairman Leahy. Well, in fact, on that, Professor Rosen has 
in his book, ``The Most Democratic Branch''--you argue that the 
judiciary more than any other branch of Government most 
reflects the views of mainstream Americans. Would Citizens 
United be consistent with that?
    Mr. Rosen. It is not consistent, Senator Leahy. It seems 
ironic that the Court tends over history to reflect rather than 
challenge the constitutional views of the majority of 
Americans. But that is the case. There is a wonderful new book 
by Barry Friedman, ``The Will of the People,'' that makes this 
case in even greater detail.
    What is so striking about the history is on the very few 
occasions when the Court has challenged the views of the 
majority of Americans on things they care intensely about, it 
has often provoked backlashes that necessitated judicial 
retreat. That was the lesson of the Dred Scott decision before 
the Civil War. It is the entire lesson of the legacy of the 
progressive era in the 1930s when a narrow group of five 
conservative Justices thought they could impose this contested 
vision of corporate rights on the country, provoking President 
Roosevelt's court-packing threat and the judicial retreat. And 
that is what makes Citizens United such an outlier. Eighty 
percent opposition shared similarly by Republicans and 
Democrats? This is very, very unusual for the Supreme Court.
    Now, Mr. Smith has his own poll which shows more 
favorability, but he did not ask the relevant question. You did 
not ask, Mr. Smith, ``Do you support lifting all Government 
limitations on corporate spending from general treasury funds 
in U.S. elections? '' And on that proposition, it is not a 
surprise that the public is opposed to this because it so goes 
against this strong strain in our history. Doug Kendall's 
report is eloquent about how the suspicion of monopolies is 
deeply rooted in our history--and this is another important 
distinction. It is not opposition to all corporate forms. It is 
big money, the curse of bigness. It is investment banks and 
Exxon. That is what people like Louis Brandeis and Theodore 
Roosevelt were concerned about. Franklin Roosevelt was 
concerned about it. And the American people are obviously 
centrally concerned about this during a time of economic 
crisis.
    So for all those reasons, Senator Leahy, this is not 
consistent with the general sensitivity of the Court to the 
views of the American people.
    Chairman Leahy. Thank you, and my time has expired, and I 
yield to Senator Sessions.
    Senator Sessions. Well, Mr. Rosen, when you come to 
fundamental rights such as free speech, surely you would not 
contend that we ought to run a poll to decide how that is done. 
I think 80-plus percent believe that the act of burning the 
American flag is not speech and thinks that the Supreme Court 
was wrong on that. And the free speech advocate group on the 
Court was the same one basically that voted for this, with some 
exceptions, I suppose.
    I will ask Mr. Kendall and Mr. Rosen this. In Mr. Smith's 
written testimony for today, he noted that the Obama 
administration in this case, in their arguments before the 
Court, took the position that the Federal Government and/or the 
States could prevent a corporate publishing house, such as 
Simon and Schuster, from publishing or distributing a book if 
that book contains a single sentence opposing a candidate for 
political office. Mr. Smith states in his testimony that he 
would like to know whether the other members of the panel 
agree.
    So I guess I would ask you. Do you think that if your view 
of the First Amendment was in place that the Solicitor 
General's Office for the Obama Department of Justice is correct 
and that you would favor the ability of the Government to limit 
those kind of publishing events?
    Mr. Rosen. Well, I certainly would not, Senator Sessions, 
and I do not think that the Obama administration would either. 
It seemed to me that in the oral argument Solicitor General 
Elena Kagan explicitly distinguished books and media from the 
questions at issue in this case and resisted the hypotheticals 
about banning books.
    But one thing is clear, Senator. It would have been easy 
for the Roberts Court to carve out an exception that would have 
completely protected books and the media and avoided all of the 
parade of horribles that Mr. Smith makes in his----
    Senator Sessions. Well, I do not know. If you----
    Mr. Rosen [continuing]. Testimony.
    Senator Sessions. If a corporation cannot produce a movie, 
why can't--if they can be prohibited from producing a movie, 
why can't they a book? Mr. Kendall----
    Mr. Rosen. Could I just say--respond to----
    Senator Sessions. Wasn't that the whole point of the first 
oral argument? When that question was raised and the Solicitor 
General admitted it contained--it could constrain the 
publishing of books by Simon and Schuster or any other group, 
that that is what caused the Court to have a new argument and 
to state explicitly they were concerned about the Austin case?
    Mr. Rosen. In the second argument, the Solicitor General 
explicitly responded to that. She disavowed a desire to ban 
books. And Justice Stevens charges in his dissent that the only 
reason the Court asked for re-argument was because it was 
determined to overrule Austin, that it was really reaching out 
for this question on its own.
    Senator Sessions. Professor Kendall.
    Mr. Kendall. There is a hard, narrow question about whether 
the specific 90-minute documentary, which is fairly viewed as a 
90-minute campaign ad against Hillary Clinton, was covered 
within the act. And if the Court had simply ruled on the basis 
that it was not, I think that we would not be here. We would 
not be having this argument.
    Senator Sessions. But isn't it true that a ruling on that 
matter--I just would like to ask a follow-up legitimately with 
him. Isn't it true that that implicated, though, these other 
questions? It would be difficult to separate that issue from 
the one the Court ultimately decided. Surely you would agree 
that implicated those issues significantly.
    Mr. Kendall. Right, but I think that Justice Stevens in 
dissent has a very good response about why the ruling, a ruling 
that permits regulation of that particular attack ad does not 
open up the floodgates to regulation of every book or every 
film.
    Senator Sessions. Well, that was Mr. Stevens' view, but 
five did not agree.
    Mr. Smith, would you comment on that?
    Mr. Smith. If I could just address that briefly, a couple 
things.
    First, Solicitor General Kagan at re-argument said, as 
Professor Rosen said, she denied the desire to ban books. But 
she did not deny the authority to ban books. And she did say, 
``Well, we regulate pamphlets.'' I do not know if this is a 
pamphlet or a book, and I do not know at what stage it becomes 
a book and at which stage it is a pamphlet that can be 
prohibited. And that was the Government's position in briefing 
as well. This was not--you know, Deputy Solicitor General 
Stewart was not speaking out of school.
    Second, it is not clear to me that it is easy to make these 
distinctions. Notice that none of the dissenting Justices 
actually was willing to concur in the judgment on any of these 
more narrow grounds. All of them said, ``Yeah, they can't do 
it,'' period. And I think there was some realization there that 
such a scheme would be very unstable and not likely to hold up.
    But at a minimum, what you have is overkill. Statutes 
provide overkill responses. So when you have statutes 
attempting to totally ban this type of corporate speech, you 
may get a Supreme Court ruling that says, no, you cannot do 
that.
    Congress might be able to come back in and say--you know, 
the early laws, we have talked about some. Elihu Root talked 
about corporate contributions, big corporations, as Professor 
Rosen notes, contributing amounts that in today's dollars would 
be well in excess of $1 million. But I suppose if Congress did 
some serious finding to show a measure of corruption and had a 
limit on corporate expenditures up in the realm of $2 million 
supported by this type of fact finding about the corruption 
there, and a narrowly tailored response, in other words, that 
it could hold up. But you cannot just go and say every 
nonprofit corporation, every nickel-and-dime small business in 
the country is absolutely prohibited. That is not a narrowly 
tailored solution that is satisfactory to abridge First 
Amendment rights.
    Senator Sessions. My understanding is that Solicitor 
General Kagan said with regard to that issue, ``We haven't done 
that yet.'' And she said, ``The author would have a good claim 
if he wanted to sue.'' In other words, she thought that if an 
author was stopped from publishing their book or so forth, that 
they would have to sue to defend their rights, at least. Thank 
you for the good panel we have.
    Senator Hatch. Mr. Chairman, I have to be necessarily 
absent, so I would like to submit my questions in writing to 
all three, if I can.
    Chairman Leahy. Of course, and we will keep the record open 
for the rest of the day for any further questions and also any 
statements anybody wishes to make on both sides.
    [The questions of Senator Hatch follow:]
    Chairman Leahy. Senator Feingold.

STATEMENT OF HON. RUSSELL D. FEINGOLD, A U.S. SENATOR FROM THE 
                       STATE OF WISCONSIN

    Senator Feingold. Mr. Chairman, I, of course, particularly 
thank you for holding this hearing. The Citizens United 
decision was a tragic mistake. A mistake because the Court 
reached out to decide constitutional questions that were not 
necessary to decide the case and not raised or addressed by the 
courts below. Tragic because the Court damaged its own 
reputation and integrity by reversing precedents unnecessarily 
and, most important, because it opened the door to a political 
system that, more than ever, can and likely will be dominated 
and distorted by corporate wealth.
    The Court showed a remarkable ignorance of how campaign 
money can affect legislative decisions. Just last term the 
Court held in the Caperton case that a State judge should have 
recused himself because one party to a case had made large 
independent expenditures to elect him. Yet somehow the Court 
concluded in Citizens United, ``[I]ndependent expenditures, 
including those made by corporations, do not give rise to 
corruption or the appearance of corruption.'' And, incredibly, 
the Court even cast doubt on one of the central holdings in 
Buckley v. Valeo--that Congress can enact campaign finance laws 
not only to prevent actual corruption but also to prevent the 
appearance of corruption. The Court said in Citizens United, 
``That speakers may have influence over or access to elected 
officials does not mean that those officials are corrupt. And 
the appearance of influence or access will not cause the 
electorate to lose faith in this democracy.''
    No matter what their political persuasion, all Members of 
Congress strive all the time to show their constituents that no 
one has influence over them and that no group has special 
access. The idea that these appearances have no effect on the 
confidence that the electorate has in us and in our democracy 
is naive, to put it mildly.
    What is perhaps most disturbing is that the Court made 
these pronouncements without allowing any opportunity at all 
for a factual record to be developed. When it considered a 
facial constitutional challenge to the McCain-Feingold bill, 
the Court had before it an enormous legislative record 
developed over many years on the corrupting influence of soft 
money, along with a huge amount of discovery taken in the case 
itself. The Citizens United Court overturned a century of 
Federal and State law without considering such a record. The 
participation of the over 20 States whose laws were essentially 
thrown out in this case was limited to a single amicus brief. I 
simply do not understand why the majority felt that it was 
justified in taking this tremendous shortcut.
    Now, we are in a period of great political turmoil, and the 
American people are expressing their opinions forcefully. They 
are rightfully demanding that their elected representatives 
listen to them and respond to their views and their needs. I 
think it is for that reason that so many people are baffled and 
angered by the Court's decision. The people I talk to in 
Wisconsin do not want elected officials to be more responsive 
to corporations. They do not think that corporations have too 
little power in our legislative process or that they need to be 
able to spend freely to elect a legislature that will do their 
bidding. They want a Government ``of the people, by the people 
and for the people,'' as Abraham Lincoln famously put it in the 
Gettysburg Address. In its haste to impose its own skewed 
vision of the First Amendment, where a corporation has the same 
rights of political expression as a person, the Supreme Court 
seems to have forgotten that bedrock principle.
    Mr. Kendall and Professor Rosen, Professor Smith says in 
his testimony, ``While corporations do not have the ability to 
exercise, as corporations, all constitutional rights, they have 
long been recognized as able to assert constitutional rights 
where doing so is necessary to preserve the rights of the 
corporate members or shareholders. Thus, when a corporation 
asserts a right to speak, it is really the members of the 
corporation asserting a right to associate and to speak as a 
group.''
    What do you think of that statement? And then I will let 
Professor Smith have a chance to respond. Professor Rosen.
    Mr. Rosen. Thank you, Senator, for that eloquent statement.
    I do not mean to plug Justice Brandeis too much today, but 
he was our greatest theorist both of free speech and of the 
dangers of corporate power in American life, and he would have 
strenuously resisted Mr. Smith's statement. In ``The Curse of 
Bigness,'' he talks about how huge corporations--investment 
banks, mostly -cannot possibly be an amalgam of the expressive 
interests of their members because they are so complicated that 
the people in charge do not even understand the risks that they 
are taking. They take these huge risks with other people's 
money. They end up not serving the public interest but their 
own interests. And that is why Brandies wanted taxation to 
break up these huge corporations, and his entire vision of free 
speech emphasized the idea that individuals have a duty to 
develop their faculties. Participation is a public duty. So his 
vision of the First Amendment, unlike the one Senator Sessions 
embraced, was that laws that promote public deliberation, far 
from threatening the First Amendment, actually serve it.
    And then, finally, he was very keen on disclosure. Sunlight 
is the best disinfectant, electric light the best policeman.
    So for all these reasons, he would have completely resisted 
and rejected the idea that a corporation actually meaningfully 
expresses the political views of its individual members. He 
wanted to protect small businesses and minority shareholders, 
and it is his vision, far more than that of Mr. Smith, that 
really represents the great American free speech tradition.
    Senator Feingold. Thank you so much.
    Mr. Kendall.
    Mr. Kendall. Well, I think, Senator Feingold, you know 
better than anyone in the world that the campaign finance 
system in this country is actually not blunderbuss like Mr. 
Smith describes it, but actually quite nuanced and so it allows 
the speech of individuals that are parts of corporations, it 
allows corporations to form PACs and have voluntary donations 
to the PACs, which allows the corporation itself to speak to a 
degree. And the idea that corporations, these large 
corporations, are simply associations of citizens gathering 
around to express political expression just belies their very 
nature. We create corporations as an engine of economic growth. 
We give them a fiduciary duty to advance the profits of the 
corporations. Most people invest simply to make money--and to 
describe that as this core political association I think is 
just to belie the nature of corporations and the history of our 
treatment of them.
    Senator Feingold. Thank you.
    Professor Smith.
    Mr. Smith. Thank you, Senator. I appreciate your giving me 
an opportunity to comment on this as well.
    One of the focuses, of course, here today that we keep 
hearing is large corporations, large corporations, large 
corporations. And as I just indicated, one of the problems with 
having sort of a blunderbuss statute that prohibits all 
corporations from doing any political spending from dollar one 
is that you get a response that also goes to the opposite sort 
of extreme.
    Most corporations in America, of course, are small 
corporations, and many, many, many of them, like Citizens 
United, are nonprofit corporations that are specifically 
organized truly for speech. And most corporations are too small 
to support a PAC and pay the administrative costs of a PAC, and 
they do not have enough people to solicit to even have money in 
the PAC to speak. But they have interest.
    For example, in the recent Senate race in Massachusetts, 
there was a little wine distributors that distributes wine 
through the mail that sent a notice out to people saying, ``We 
think you should vote against one of the candidates in that 
election because that candidates wants to tax wine shipments 
through the mail.'' This is a classic case where it is of 
interest to the consumers of that company, it is of interest to 
the shareholders and the owners of that company, and it is in 
their interest to speak not as individuals but as a corporation 
to something that directly threatens the economic purposes for 
which they have joined together. And we allow corporations to 
do that kind of speech all the time under the business judgment 
rule.
    And it goes beyond just pure political speech. It includes, 
for example, charitable giving to controversial groups like 
Planned Parenthood, or even the Boys Scouts now are often 
controversial. It allows clearly commercial ads. Some of you 
may have seen the Audi Green Police ad during the Super Bowl, 
and if you did not, go to YouTube and watch it. It basically 
portrays environmentalists as being sort of a bunch of petty 
little neo-Nazi sorts. And I am not sure that a lot of 
shareholders of Audi really were pleased with that perhaps if 
they were also members of environmental groups. But that is 
what the business judgment has historically allowed.
    So, again, the problem is this sort of blunderbuss statute 
rather than anything that is narrowly tailored to address First 
Amendment concerns based on clear findings of a problem with 
independent expenditures of that type, and that might change 
the analysis here.
    Chairman Leahy. Senator Cornyn.

STATEMENT OF HON. JOHN CORNYN, A U.S. SENATOR FROM THE STATE OF 
                             TEXAS

    Senator Cornyn. Thank you, Mr. Chairman.
    Mr. Chairman, I think that both sides of this debate have 
good intentions, and I wish there was a way we could limit the 
impact of unlimited money affecting elections. But, frankly, I 
think what started from good intentions in 2002 to try to limit 
the impact of money in politics has been an abysmal failure.
    I would just cite the point that in 2008 President Obama 
raised $740 million, a new record, which was twice as much 
money as was raised by Senator Kerry and President Bush in 
2004. In the two Presidential elections since the campaign 
finance reform legislation passed, the candidates have raised 
more and spent more than the candidates in the seven previous 
Presidential elections combined.
    And I remember what happened, for example, in the most 
recent special election in Massachusetts. There were 13 
different organizations and entities spending money for and 
against the candidates in that campaign toward the end. 
Thirteen. So to Mr. Kendall's point that there are PACs, there 
are 527s, there are 501(c)(4), there are legal entities through 
which individuals and corporations and other concerned citizens 
can contribute money to engage in the political process, I 
think we have seen an unprecedented amount of money go into 
political campaigns.
    My own view has evolved over time because I think now what 
we need more than anything else is greater transparency and 
accountability, because I am not convinced that we can stick 
our finger back in the dike. I think the dike is not only 
leaking, but it has exploded. And as we have seen in other 
areas of free speech, the solution for this is not less speech 
but, I think, more speech to get everyone's voices and views 
out into the public square and to allow the voters to do the 
best they can to try to understand the issues, the 
qualifications of candidates, and then make a choice informed 
by whatever actor, whatever speaker that they choose or that 
they find more persuasive.
    I really think the carve-out that was created in the 
McCain-Feingold legislation in 2002 demonstrates the weakness 
of the argument that corporations somehow do not have free 
speech of First Amendment rights. Indeed, the New York Times 
corporation and the Washington Post corporation appropriately 
have all the free speech rights that are conferred by the 
Constitution of the United States, the First Amendment. We 
would not have it any other way.
    But why would Congress have the authority to suppress the 
free speech rights of one corporation when another corporation 
has a complete right to express their views to advocate for and 
against a candidate in an election?
    Indeed, I think I find myself aligned with some of Mr. 
Smith's arguments with regard to the hysteria with which this 
decision has been greeted. I do not think there is going to be 
any Fortune 500 corporations that are going to spend money 
advocating for or against candidates in elections because they 
have to be worried about their shareholders; and if they are 
wasting corporate money, they may subject themselves to a 
breach-of-fiduciary duty lawsuit. I think they are going to be 
entirely circumspect about that sort of activity.
    On the other hand, I do think that there are organizations 
like the NRA, the NAACP, the Sierra Club--let us say, for 
example, a nonprofit corporation was concerned about the 
tragedy of homelessness in America. Why in the world couldn't 
they--if they adopted the corporate model of doing business, 
why couldn't they advocate for or against candidates who 
supported or failed to support their agenda of dealing with the 
tragedy of homelessness? If there are organizations of people 
who want to band together in a nonprofit corporation to speak 
out against reckless spending in Washington and the 
accumulation of huge deficits and the failure to meet our 
unfunded Federal liabilities, why shouldn't they be able to 
band together as a corporation, as a sole proprietorship, as a 
partnership, any other format to do that?
    So I think, Mr. Smith, if I could just ask you, what is the 
answer in terms of the huge volumes of money being spent 
largely in a non-transparent and opaque way by people who have 
enough resources to hire lawyers to create 527s, PACs, 
501(c)(4)s, where should we draw that line?
    Chairman Leahy. And, Mr. Smith, I try to extend as much 
help and courtesy to members here. Even though Senator Cornyn's 
time has expired, please go ahead.
    Mr. Smith. I will try to be very brief. Obviously, it is a 
very complex question. My own view, which is expressed in 
numerous writings is that the complexity of the law makes it 
harder and harder for average citizens to participate. You 
know, the joke is if you want to run for Congress, but even if 
you want to try to influence your Congressman and organize a 
group, you have to immediately hire a lawyer.
    The really big corporations can get around it because they 
can hire the consultants and the lobbyists and the lawyers who 
know how to work the system, the accountants and so on. And we 
also need to bear in mind that large corporations, of course, 
spend far more money lobbying than they spend on campaign 
contributions. And so one of the odd effects of allowing 
corporations to directly make campaign expenditures is that it 
would actually be a little bit equalizing; that is, a car 
dealer may not be able to afford a lobbyist in Washington, but 
he can put $25,000 in expenditures out in a race.
    So regulation here, as it often does, tends to harm the 
small players, whereas the big actors can cope with it.
    Chairman Leahy. Thank you very much.
    If Senator Whitehouse does not mind, I am going to put into 
a record an op-ed piece that he wrote for Politico on this 
issue. And hearing no objection----
    [Laughter.]
    Chairman Leahy. It will be made part of the record.
    [The op-ed appears as a submission for the record.]
    Chairman Leahy. Senator Whitehouse, please go ahead, sir.
    Senator Whitehouse. Thank you very much, Chairman.
    We have been discussing this decision as an ideological 
exercise, but, Professor Rosen, in your testimony, you also 
point out that there is a pattern that has developed over at 
the Supreme Court, and I happen to agree with you. The pattern, 
I think, is beyond distinct. It is now unmistakable. And it is 
that where corporate interests are involved, the corporation is 
highly likely to win. And where issues that are part of the 
core Republican ideology are involved, the Court becomes 
unhesitant about taking its 5-4 majority to take broad leaps--
brand-new constitutional rights to own guns, brand-new 
constitutional rights of corporations to spend unlimitedly--
that had never been noticed before and indeed often had 
overruled substantial settled precedent.
    My question is: At what point should the Court lose the 
benefit of the doubt that these are each independent on the 
merits decisions as the evidence piles up and piles up and 
piles up that when the outcome actually comes down, it is the 
Republican ideology and the corporate benefit that appear 
almost now reflexively to be the winners?
    Mr. Rosen. Senator, the question of when should the Court 
lose the benefit of the doubt is one that I have struggled with 
personally. I had this interview with Chief Justice Roberts 
where he laid out this very appealing bipartisan vision, and I 
was very galvanized by it. I wanted to give him the benefit of 
the doubt. Some people thought I was too charmed by him. I came 
home from the interview, and my wife decided I developed a 
``man crush'' on Chief Justice Roberts.
    [Laughter.]
    Mr. Rosen. Which is just false. I just deny that. It did 
not happen at all.
    But, nevertheless, you know, I spent 3 years, benefit of 
the doubt----
    Chairman Leahy. I would note in my years on this Committee, 
that is the first time that expression has been used here. 
Please go ahead.
    [Laughter.]
    Mr. Rosen. Thank you. I try to do my best. Precedents are 
sometimes important to overturn.
    So, you know, I have been giving him the benefit of the 
doubt for 3 years. But when this decision was so easy to avoid 
and could have been decided on narrower grounds, it is hard to 
continue that benefit of the doubt.
    Now, one thing I want to say, these pro-business decisions 
are not--there is nothing corrupt about them. And, remember, 
they are joined by Democratic as well as Republican Justices. 
They are 7-2 or unanimous.
    Senator Whitehouse. In some cases.
    Mr. Rosen. In some cases.
    Senator Whitehouse. In some cases it is the 5-4 bare 
majority working its will.
    Mr. Rosen. That is true, too.
    I think you would have to say there are very few economic 
populists on this Court, and these Justices share a suspicion 
of regulation by litigation. But in the end, as you say, if the 
pattern just continues, it is the 13th chime of the clock, at 
some point you are going to have to say regardless of what is 
in their mind--and no doubt they are deciding things in good 
faith to the best of their ability--you would have to say the 
pattern is so unmistakable that Congress has a right to object.
    Senator Whitehouse. And with respect to the pattern, one of 
the things that most concerned me about the Citizens United 
decision was not actually in the decision itself but in Justice 
Roberts' opinion, in which he said--and I will be asking this 
to you, Mr. Smith. He said that stare decisis effect is 
diminished ``when the precedent's validity is so hotly 
contested that it cannot reliably function as a basis for 
decision in future cases . . . '' And he went on to say that 
``the simple fact that one of our decisions remains 
controversial does undermine the precedent's ability to 
contribute to the stable and orderly development of the law.''
    I read that as the Chief Justice putting the rest of the 
Court on notice that a persistent attack on existing precedent 
by his 5-4 majority should as a matter of law be allowed to 
undermine settled precedent by virtue of the hot contest that 
they maintain against settled precedent.
    Is it your view that precedent, once settled, is indeed 
settled? Or would you accept the notion that an activist group 
of a Court by consistently attacking precedent have a 
legitimate means of undermining it for future cases rather than 
accepting it as the law of the land?
    Mr. Smith. Thank you, Senator. You know, I cannot speak for 
Justice Roberts, but I think, you know, my understanding or my 
sense would be that his point is that where a case has never 
been broadly settled or broadly, that is to say, agreed on by 
the Court--it has always been viewed as a close call--that 
precedent simply has less force. So Austin was a close decision 
itself. I believe it was 6-3 at the time. Austin itself seemed 
to undercut, to work against prior precedents. Austin really is 
out of step with most of the Court's campaign finance 
jurisprudence. And even academics in the field who have long 
thought Austin is correct have recognized that its reasoning is 
really out of step with Buckley and Bellotti and other cases. 
And the same is true for McConnell, which was 5-4.
    So I presume his argument is that simply unlike a case 
like, say, Miranda where it really does become fixed over time 
and Justices constantly reaffirm it, some things are up in the 
air. I do not know.
    I will say this: On the area of campaign finance, 
ultimately what you have here are two very conflicting visions, 
and I do not mean to say that--I mean, it obviously is clear 
which side I come down on. I do not mean to say that they are 
illegitimate considerations, but you have one group of Justices 
who essentially see that one of the problems in American 
democracy right now is too much speech by particular types of 
actors, that they have too much influence and that this 
influence is corrupting and that it clogs up the process and it 
gives special interests too much power. And you have got 
another group who believe that the problem is too little 
speech, that regulations of speech clog up the process and give 
special interest too much power. And they cannot both be 
correct, and they are going to be at odds, and we are going to 
have, I think, a lot of continuing 5-4 decisions in this area.
    Senator Whitehouse. Well, my time has expired so I should 
end this.
    Mr. Smith. Thank you.
    Senator Whitehouse. But I do think it is regrettable that 
the five-member majority of the Supreme Court found as a fact 
on that question, because I do not think it is appropriate for 
Supreme Courts to be finding things as a fact, particularly 
without a record, and indeed particularly with a record as to 
the contrary.
    Thank you.
    Chairman Leahy. Thank you very much.
    Senator Klobuchar.
    Senator Klobuchar. Thank you very much.
    I am just trying to bring this down a little to where my 
constituents are, who I will say, Mr. Smith, are ``freaking 
out''--we have gotten hundreds of letters about this--and I 
think for good reason.
    We have just endured in this country and are only beginning 
to recover from a financial crisis that occurred, I think in 
part, because certain interests for many years were allowed to 
trump the interests--it is Wall Street trumping Main Street in 
this country. Loopholes were left open. People were put in 
place that did not make the kind of decisions they were 
supposed to make. And, understandably, regular citizens are 
wondering if their voices have just been completely squelched, 
if some interests in this country have a megaphone and they can 
do nothing except write a letter to their representative in 
Washington. And it is a major problem.
    I also want to inject some reality of what it is really 
like when you raise money. When I started out, I did not know 
anyone in Washington to raise money. I went in a little room 
for hours a day and called and tried to get $500, $1,000. I did 
in this process set an all-time Senate record of raising 
$17,000 from ex-boyfriends. No one has met that yet.
    [Laughter.]
    Senator Klobuchar. But I called everyone I knew, and that 
is how I started, and I think that is what people want from 
their elected officials. And it is far from, as Senator Cornyn 
pointed out, a perfect system. But the last thing I want to do 
is to make it worse.
    And when I hear these numbers--I think this was in your 
testimony, your written testimony, Mr. Kendall. You said that 
in 2008 ExxonMobil generated profits of $45 billion, and with a 
diversion of even 2 percent of these profits to the political 
process, this one company could have outspent both Presidential 
candidates and fundamentally changed the dynamics of the 2008 
election.
    Goldman Sachs just this year gave $16.2 billion--this is 
this year--in bonuses, and Senator Cornyn noted that Barack 
Obama raised $740 million. Well, one company's bonuses alone is 
twice that amount. I mean, this is what--more than twice that 
amount, $740 million. Is that what it is? I mean, it is an 
infinitesimal amount compared to one company's bonuses that is 
going out there. So that is what I am worried about.
    We can talk all we want about what the Court has done here 
and the process of the Court, but I am more interested in 
fixing this. And I guess my first question--Senator Schumer is 
working on a bill--is just how we fix this. And one of the 
ideas here is to have more transparency, to require 
shareholders to vote before a corporation spends any money in 
favor of a candidate, require significant additional paper 
trails to ensure that shareholders can trace how corporate 
dollars are being spent on elections. I guess I would ask you 
first, Mr. Rosen: Would this work? Also, what do you think 
about this idea of opening--does this decision potentially open 
the door to allow foreign corporations that have American 
subsidiaries to have an outsize influence over American 
elections? Or are there some things we can do to fix that?
    Mr. Rosen. Thanks very much, Senator. The question of 
disclosure is going to be hotly contested, and if you pass 
Senator Schumer's bill, that will be challenged in the Court as 
another violation of the First Amendment. And in the Citizens 
United case, Justice Thomas has a dissent where he says that he 
thinks that disclosure violates the rights of anonymous speech. 
He was alone in that regard, but there is a serious question, 
as you will see from Mr. Smith's testimony, about whether the 
same five-member majority would have some question about 
disclosure requirements.
    I want to cite Justice Brandeis again because he is the 
greatest free speech thinker, and he was often in favor of 
disclosure. During the time that he wrote ``Other People's 
Money,'' the same concerns about huge bonuses, underwriting 
commissions, and unfair treatment of investment bankers existed 
as exist now, and Brandies thought that disclosure, sunlight, 
forcing people to disclose their bonuses and the underwriting 
Commissions, would lead to reaction and accountability and 
basically disclosure is the way to go.
    Senator Klobuchar. OK. So you think there might be trouble 
with transparency. This idea with the foreign corporations, is 
there something we can do with that?
    Mr. Rosen. You know, this is a technical question which I 
could give a shot to, but I think I am not going to free-lance 
on it.
    Senator Klobuchar. OK. Mr. Smith, you talked about your 
poll. Did you ever ask in your poll if the American people 
think a corporation should be a person for purposes of the 
First Amendment?
    Mr. Smith. No.
    Senator Klobuchar. Thank you.
    Mr. Kendall, any ideas for how we can fix this decision?
    Mr. Kendall. Well, I think the rest of my testimony and my 
concerns that the Court's sweeping ruling in this case is not 
easy to fix, and that there are implications beyond what the 
Court holds in this case. If you look at the dissenting 
opinions by Justices Kennedy, Scalia, and Thomas in prior 
cases, they suggest that contributions directly to candidates 
would be unconstitutional. So we do not know if that has five 
votes on the Court right now, but it is certainly in play. And 
I think while the Court says, ``Oh, we are not talking about 
foreign companies here,'' the thrust of the ruling, which is 
that you cannot distinguish between corporations and 
individuals, would arguably, you know, put those restrictions 
in jeopardy.
    Senator Klobuchar. The restrictions on individual 
contributions?
    Mr. Kendall. The Court says there is no distinction between 
the speaker, and that is a sweeping holding, which, as Justice 
Stevens said, if taken seriously, would mean Tokyo Rose gets 
the same protection as General MacArthur, which is absurd.
    Senator Klobuchar. There is a lot of emphasis on the 
testimony about how 28 States already allow corporate 
contributions in their State elections. Our State does not, and 
I think it has been a blessing. We have also some good matching 
fund laws that allows for people to not have to raise as much 
money for State legislative races. So will this decision 
potentially also intercede in those State races as well, the 
ability of States to ban corporate money?
    Mr. Kendall. I think it will, and I think the problem and 
the thing we do not know is exactly how corporations are going 
to respond to the idea now that they have First Amendment 
rights to spend unlimited amounts to influence candidate 
elections, which is something we have never had in this 
country. And I think the idea that Exxon has not spent billions 
of dollars so far, while it may be true----
    Senator Klobuchar. They have not had that opportunity.
    Mr. Kendall.--they have not had the opportunity. And we do 
not know how corporations are going to respond to this, but the 
idea that they are equal to individuals in terms of First 
Amendment rights and have exactly the same protection is one 
that could have broad ramifications in our campaigns.
    Senator Klobuchar. Thank you very much. I have gone over my 
time.
    Thank you, Mr. Chairman.
    Chairman Leahy. Senator Franken.
    Senator Franken. Thank you, Mr. Chairman, for calling this 
critical hearing.
    My office has received 220 letters just on the Citizens 
United decision, and it might surprise Mr. Smith that by last 
night's count, 204 of those 220 Minnesotans were opposed to the 
decision. So this is something my constituents are really 
worried about. And when you said that you had done a poll--you 
have heard of Freud, haven't you? I really find the results 
very unpersuasive considering the questions that you asked.
    Now, Mr. Smith, after the Citizens United decision, 
responding to those concerned Americans and Minnesotans, I 
introduced a bill called the American Elections Act. It said 
that if a foreign national has a controlling share of a 
company, that company should not be spending unlimited amounts 
in America. And it looks like Senator Schumer may include this 
provision in his own Citizens United bill.
    Now, you criticized this in your written testimony. You 
said, and I quote, ``A provision to ban companies with more 
than 20 percent `foreign' ownership would only restrict the 
rights of U.S. nationals to associate for political involvement 
because of a non-controlling foreign shareholder.''
    Now, let me underscore that you are saying that 20-percent 
ownership does not constitute control. Is that right?
    Mr. Smith. Yes.
    Senator Franken. Yes. So let us look at how the law 
actually defines a controlling share, because you said rather 
confidently to the Chairman that you are here to share your 
expertise. So let us look at how States define a controlling 
shareholder.
    Yes or no, please. Do you know how Delaware, the leading 
State for corporate law, defines a controlling shareholder?
    Mr. Smith. No, I do not, nor do I think it is relevant to 
the question of whether control----
    Senator Franken. I asked you to respond yes----
    Mr. Smith. Well, the question is----
    Senator Franken.--or no, sir, and you said no, you do not--
--
    Mr. Smith. Then the question is whether you actually want 
serious answers or whether you are engaged in a little 
showmanship. If it is the latter, I will accept that.
    Chairman Leahy. All right. Mr. Smith----
    Senator Franken. Sir----
    Chairman Leahy.--that ranks with your putdown of the 
Vermont Legislature. Please, Senator Franken, go ahead.
    Senator Franken. Sir, you answer me yes or no that 20-
percent ownership does not constitute control. I think it is 
important that the State of Delaware says it is.
    Now, do you know, for example, what the State I represent, 
the State of Minnesota, what we define as a controlling 
shareholder?
    Mr. Smith. Mr. Franken, Senator Franken, laws are written 
for different purposes, and they are defined for different 
purposes. So a law that is written for one purpose is not 
necessarily applicable to another purpose, that is, the law----
    Senator Franken. Well, this purpose is to decide what a 
controlling interest is. They have not written what a 
controlling interest is for election law because we have had 
100 years of precedents that corporations cannot give in 
campaigns.
    Mr. Smith. Then it would----
    Senator Franken. But there is a reason that there is no law 
for this. Now, I asked you to answer yes or no, but you get the 
picture.
    Now, the fact is that 32 States that define control with a 
number, 31 of them define it as 20-percent ownership or less, 
most of them less. And without objection, I would like to 
submit a copy of these States' statutes for the record.
    Chairman Leahy. Without objection.
    [The information appears as a submission for the record.]
    Senator Franken. So while you assert that 20 percent is not 
control, if a foreign entity owns 20 percent of a company, 31 
of 32 States who define what control is do. And I think that is 
very important.
    Venezuela owns Citgo. Are we going to have Citgo putting 
billions of dollars into our elections?
    Mr. Smith. The answer would be no.
    Senator Franken. And why would that be, sir?
    Mr. Smith. Do you actually want me to answer this? OK. 
First, the law prohibits foreign nationals from contributing 
any money or spending any money in any U.S. election. Under the 
FEC's----
    Senator Franken. Wait. We have a statute that bans direct 
or indirect giving by foreign nationals, but this law is vague, 
it is out of date. Under Citizens United, it still allows a 
foreign-controlled subsidiary to spend unlimited amounts in our 
elections.
    Now, you just said the law prohibits foreign nationals from 
participating in giving, but it does not.
    Mr. Smith. Now, the law allows as U.S.-incorporated and 
U.S.-headquartered company--that is, a U.S. company which is a 
subsidiary or which has foreign ownership--and, of course, U.S. 
citizens have great ownership in many foreign companies as 
well--to make--a U.S. company, in other words, can make 
expenditures in races.
    Now, nobody believes that the 2 U.S.C. 441(b) was passed in 
order to prevent foreign corporations from participating. If 
this is a particular interest of Congress, then it may be 
something that Congress can address with a narrowly tailored 
solution. But I would also note that FEC regulations, which, of 
course, as you know, have the force of law, prohibit any 
foreign national from being involved in any decision that a 
corporation might make.
    Senator Franken. Well, if the foreign national owns 20 
percent, they are not going to have any influence over this, 
that the people in the room making this decision are not going 
to know this?
    Justice Kennedy explicitly reserved judgment on whether or 
not there is a compelling interest to limit foreign individuals 
or associations from influencing our Nation's political 
process, and you know that.
    Mr. Smith. Yes, I do.
    Senator Franken. In fact, Justice Kennedy assumed for the 
sake of argument that such an interest does exist----
    Chairman Leahy. Senator Franken.
    Senator Franken. My time has expired. Thank you.
    Chairman Leahy. Senator Cardin.
    Senator Cardin. Mr. Chairman, thank you very much. This has 
been a very interesting hearing.
    I think you all would understand that the people of 
Maryland, whenever I go around my State, they are very 
interested in the way we conduct financed campaigns. It is a 
subject that they have very strong views about. They think the 
campaigns are too long. They think they are too expensive. And 
they think that the way that we finance campaigns is corruptive 
to our political system. And I agree with the way Marylanders 
feel about that, and this is all before the Citizens United 
case.
    Every 2 years, we find elections becoming longer and more 
expensive, and more special interest dollars are finding their 
way into the system. That is, again, before the Citizens United 
case.
    Marylanders want fundamental change in the way that we 
finance campaigns in this country, and I want fundamental 
change. And I guess my concern is, Professor Rosen, when we 
mention some of the ways that perhaps we could counter the 
Citizens United, you raised concerns as to whether any of those 
could withstand the challenge of the make-up of this Court.
    And as I look at additional challenges that are likely, it 
seems to me that this Court is going to move us in a 
direction--the wrong direction, the opposite direction of which 
we need to do, and that is fundamental reform in the way that 
we conduct elections.
    It is Congress' responsibility to set up the system for 
fair and open elections in the United States. It is not the 
Court's responsibility to do that. It is clearly the Court's 
responsibility to make sure that we are consistent with our 
Constitution. But it is Congress' responsibility to develop the 
nuts and bolts on how we conduct elections in this country.
    And I guess my concern is--and this is a very reluctant 
conclusion I am coming to. It is, I guess, my conclusion that 
with the make-up of this current Court it is unlikely that we 
can pass the type of laws that can make the fundamental changes 
that the people of Maryland would like to see us make and that 
I agree with them that we need in order to protect the 
integrity of our system on electing our public officials.
    So I come to the conclusion that we have to seriously 
consider amending the Constitution of the United States in 
order to deal with this issue, and I would like to get the 
panelists' views as to whether you believe--if you agree with 
the people of my State and their Senator that we need 
fundamental change, can we do it by legislation? Or will it 
require amending the Constitution? Professor Rosen, I will let 
you go first.
    Mr. Rosen. Senator, you express so well the frustration 
that Congress should feel in the face of uncertainty about 
whether it can pass these reforms. And it is striking--this is 
why the debate about activism is important. Conservatives said 
for 40 years that judges should interpret the law, not make it, 
and should defer to Congress about contested constitutional 
questions. So the fact that there is uncertainty about how the 
Court will treat these reforms--and I should stress when I say 
this majority might not uphold them, I am not saying that they 
should not uphold them. I think they are constitutional. But it 
is not a clear case.
    A constitutional amendment? Well, that is always a great 
thing to propose, and if the intensity of public opposition to 
this decision is so strong, perhaps it is not implausible that 
it might proceed. But you know better than anyone, Senator, how 
hard it is to pass an amendment even with public support.
    Senator Cardin. Let me make it clear. I am going to work 
with my colleagues here on legislation because a constitutional 
amendment takes a lot of time. But I think we need to seriously 
consider whether there has been a fundamental shift in who 
determines how elections are conducted in the United States. 
The Congress expressed its view. The Supreme Court knocked it 
down. And I really do not understand the basis of their 
opinion, but I must express the Supreme Court is the arbiter on 
the Constitution. Therefore, there is a fundamental flaw. The 
only way it appears to me that we may be able to correct it is 
through a constitutional amendment.
    Mr. Smith, I welcome your thoughts on this. I think we all, 
all three of you would agree it is up to Congress to determine 
the fundamental structures of how elections are conducted in 
this country.
    Mr. Smith. Senator, I would say that, yes, I think the kind 
of major changes that I think you are thinking about would 
require a constitutional amendment. I do think that there are 
some actions that Congress can take, that it may want to take, 
that it feels would improve the process that would be okay 
within Citizens United. I do not like to use the phrase ``fix 
Citizens United'' because I think it is fine. But if you want 
to use the phrase ``fix Citizens United,'' I think there are 
some things you could do.
    And I would also urge members to consider responses that--
for example, lifting the limits on party and candidate 
coordinated expenditures, because right now, for example, 
parties which can only raise hard money cannot coordinate, so 
if a corporation spends a lot, it is hard for the candidate to 
raise money, but the party may be able to.
    Senator Cardin. But that just puts more money into the pot. 
Believe me, there is enough money in the pot.
    Mr. Kendall, very quickly, because my time is----
    Mr. Kendall. Sure. I agree with everyone you said. I think 
that there are problems that Citizens United creates that 
Congress will have a very difficult time fixing. I think that 
the only way this gets truly fixed is if the Supreme Court 
reverses course again or if we pass an amendment to fix it.
    I do think that there are some things that this body is 
already considering that would help and that would probably 
withstand scrutiny. I hope that is true.
    Senator Cardin. Thank you, Mr. Chairman.
    Senator Specter. [Presiding.] Thank you, Senator Cardin.
    Senator Kaufman.
    Senator Kaufman. Yes, I would just like to make a few 
comments.
    First off, I am not freaked out on this, but I am very, 
very concerned--I mean, I cannot think of anything that 
happened recently that has caused me more concern than this 
decision. And I am not running for re-election so it is not 
some populist speech or anything else. It just in so many 
different ways affects me, and I think sitting here and 
listening this morning, it does--I teach a course at Duke Law 
School, and I taught it for 20 years in the Congress. And we 
spend time with some very smart students going through the 
election law. And I have a more and more difficult time--
Senator Cornyn is right. It is very difficult, the system that 
we have now, and the money is growing. I do not know what I 
would say to them this year, because--and I mean this with all 
respect, Mr. Smith. This is a blunderbuss. This is taking a 
system that, while not--the only disagreement I have with 
Senator Cornyn is I hate to think what the numbers would have 
been in the last couple elections without McCain-Feingold. I 
mean, you look at what is going on, I mean, it just would have 
been absolutely, in my mind, you know, incredible. And a lot of 
them have been caused, frankly, by the Supreme Court rulings 
before this one, and it was caused by people--and we sit and 
listen to these discussions--that are really, really, really 
smart people and really, really, really know a lot about the 
law and know nothing about campaign financing and refuse to 
lean on the Congress and what the Congress thinks and what the 
Congress found as facts in making the decisions.
    It is sort of like advertising. Everybody thinks they are 
an expert on advertising. Everybody thinks they are an expert 
on campaigns. ``After all, I see the campaign ads. I know what 
is going on.''
    But when you sit with the students and you go through it, 
while this thing did generate more money, it was an incredible 
effort trying to deal with legitimate concerns the Supreme 
Court addressed in Buckley v. Valeo, but on about free speech, 
which we are all concerned about. But to take a blunderbuss and 
blow the whole thing into next year, to say that corporations 
now can spend from--as Senator Klobuchar said--I mean, Goldman 
Sachs has a lot of interest and expressed--and I am concerned 
about small business people. But small business people, by and 
large, they can contribute their own. They can get it done. 
This is not about small business. It really is not. This is 
about very, very, very big business because this is about very, 
very, very big money.
    So, anyway, I think this is--and I do not think there are 
ways out. I mean, Senator Cornyn said he is interested in 
transparency. I spend a lot of time on this law. I do not know 
how we get transparency based on Mr. Smith's definition of what 
this ruling means, because corporations, they are very, very 
smart. ExxonMobil, if they decided to put $1 million into a 
campaign, $5 million, $10 million into a campaign, they are not 
going to do it. It is going to be the Committee for Clean 
Government that they are going to give to one of their 
subsidiaries. No one is ever going to know where the money 
comes from. You can pick up the Hill magazine or Roll Call or 
Politico, and you will see page after page after page of ads 
trying to influence the election where no one who it is that is 
involved.
    Now, I do not see how we can get to that based on Mr. 
Smith's analysis of the law and sections of the ruling. That is 
why I am so concerned.
    Now, one other thing I just want to spend a minute and talk 
about is judicial activism because we hear a lot about judicial 
activism, and the Ranking Member and I have had a number of 
discussions.
    Professor Rosen, you and Mr. Kendall both talk about 
Citizens United as an activist decision. Can you explain that 
in the context of judicial activism as we know it over the 
last, say, 15 years?
    Mr. Rosen. Thanks for that question, Senator. As you know, 
activism is a hotly contested term. It is in the eye of the 
beholder. Everyone has his own definition. This decision is 
activist by any definition of activism, so let us take the 
different definitions, and they point in different directions.
    First, deference to text and original understanding of the 
Constitution. As Mr. Kendall shows, this is not deferential to 
the history and ignores the text's distinction between the 
Press Clause and the Free Speech Clause.
    Second, deference to precedent. As you suggested, this is a 
blunderbuss to precedent.
    Third, deference to history and tradition. This uproots 
decades of tradition and legislation dating back to the 
progressive era.
    And then, finally, pragmatic considerations, many people 
think irrelevant. This is highly unpragmatic and refuses to 
defer to Congress in the face of uncertainty.
    So it is not that it is unprincipled. Again, Earl Warren 
could have written this decision. And Justice Kennedy is not a 
restrained Justice, so that is fine for him. But the other 
members of the conservative majority care a lot about 
restraint. They say they are minimalists. This is why it is 
important--Chief Justice Roberts said in his hearings, ``I am a 
bottom-up rather than a top-down judge. I want to move 
incrementally.'' The fact that he did not do that even though 
he could have is what makes this so activist and what makes it 
so troubling.
    Senator Kaufman. Mr. Kendall?
    Mr. Kendall. I think Professor Rosen did a tremendous job 
of explaining my points. The one other point that I would make 
is Chief Justice Roberts goes through the factors of stare 
decisis, and one of the things he relies most heavily on is 
this tension between Bellotti and Austin, which are these two 
earlier rulings, and he completely ignores the fact that--and 
Justice Stevens points this out very skillfully in the dissent. 
He ignores the fact that there is a footnote in Bellotti that 
expressly leaves open the issue addressed by Austin. And so if 
you look at those two opinions, they really can be put together 
and make total sense together, and that is where the Court's 
rulings were, and yet the Court came back in Citizens United 
and found a problem where it really did not exist, and I think 
that is one definition of activism.
    Senator Kaufman. I have felt for many years that judicial 
activism is in the eye of the beholder, that, you know, if it 
is going your way, it is not judicial activism, if it is not--I 
think that has kind of put that to rest. I think we can have 
judicial activism on the left side of the spectrum, and we can 
have judicial activism on the right side of the spectrum.
    Thank you very much, Mr. Chairman.
    Senator Specter. Thank you, Senator Kaufman.
    Professor Rosen, your testimony, your written testimony is 
very critical of Chief Justice Roberts. Among other things, you 
say it is precisely the kind of divisive and unnecessarily 
sweeping decision that Chief Justice Roberts pledged to avoid 
in his confirmation hearings.
    When he testified on confirmation, he spoke very strongly 
against a ``jolt to the legal system'' and amplified by saying 
that it is not enough that the prior decision was wrongly 
decided, but you ought to look to other factors like settled 
expectations, the legitimacy of the Court, whether the 
precedent has been eroded by subsequent developments. And he 
was also very emphatic in his confirmation hearings about 
deference to Congressional fact finding. He said the reason--
well, let me pause there and ask you some questions.
    Do you think this case was a jolt to the legal system?
    Mr. Rosen. The Citizens United case certainly was, Senator, 
for the reasons that you and your colleagues have explained 
very eloquently.
    Senator Specter. Could you fathom more of a jolt to the 
legal system than this decision, 100 years corporations cannot 
engage in political advertising?
    Mr. Rosen. It is very disruptive, Senator.
    Senator Specter. How do you square that very forceful 
testimony with this very sweeping overruling of 100 years of 
law?
    Mr. Rosen. Senator, I have thought about that long and hard 
because, as I say, I do respect Chief Justice Roberts and his 
vision. There is one sentence in his concurring opinion that 
perhaps is the most revealing on this score. He says, ``We 
cannot embrace a narrow ground of decision simply because it is 
narrow. It must also be right.'' And that confidence that this 
was the right decision obviously is what motivated him to join 
here, and that must have been what was in his mind. But that 
vision that he alone knows what is right is not the vision that 
he embraced in his confirmation hearings. He embraced the 
vision of Justice Holmes who said the Constitution is made for 
people of fundamentally different points of view.
    Senator Specter. Professor Rosen, in light of the limited 
time, let me move to another issue. Chief Justice Roberts at 
his confirmation hearing said this with respect to 
Congressional fact finding. He said, ``The reason that 
Congressional fact finding and determination is important in 
these cases is because the courts recognize that they cannot do 
that. Courts cannot have, as you have said, whatever it was, 
the 13 separate hearings before passing particular legislation. 
Courts, the Supreme Court, cannot sit and hear witness after 
witness in a particular case and develop that kind of a record. 
Courts cannot make the policy judgments about what type of 
legislation is necessary in light of the findings that are 
made. We simply do not have the institutional expertise or the 
resources or the authority to engage in that type of a process. 
So that is the sort of a basis for the deference to the fact 
finding that is made. It is institutional competence. The 
courts do not have it. Congress does. It is constitutional 
authority. It is not our job. It is your job. So the defense in 
Congressional findings is an area that has a solid basis.''
    Now, in the voting rights case, although decided on 
narrower grounds, Chief Justice Roberts was very dismissive of 
the vast record that was compiled in this room on the voting 
rights case, saying, ``They are too sweeping''--''they are 
sweeping far more broadly than they need to in addressing the 
intentional discrimination under the 15th Amendment.''
    Now, how does that statement by Chief Justice Roberts of 
the oral argument square with the vast deference he articulated 
for Congressional fact finding?
    Mr. Rosen. Senator, I agree with you that it is troubling. 
The voting rights case was one where Chief Justice Roberts did 
come up with a narrow grounds of decision. He invented an idea 
that Congress had not anticipated and said that electoral 
districts could bail out of preclearance. But he did not have 
to question Congress' fact finding there. Justice Souter said 
they should have found there was no standing to bring the suit. 
That would have been far more respectful of Congress, and I 
think you have long focused on this Senator. You are right to 
question this.
    Senator Specter. Professor Rosen, what is the value of 
confirmation hearings if you have those statements at 
confirmation by a nominee and these kinds of decisions?
    Mr. Rosen. Senator, you are right to ask that question, and 
it was not just in his confirmation hearings that he said this. 
He said this in speeches and interviews afterwards.
    Senator Specter. I know I am right to ask that question. 
What I would like is an answer.
    Mr. Rosen. Well, you will have to ask Chief Justice Roberts 
that, but I think you are right to note the tension between 
what he said in his hearings and his performance on the Court.
    Senator Specter. Somebody send for the Chief Justice.
    Mr. Rosen. I am sure he will be glad to come down on a 
moment's notice.
    Senator Specter. Well, my time is up. A second round, 
Senator Sessions.
    Senator Sessions. Thank you, Senator Specter.
    Chief Justice Roberts did a fabulous job when asked about 
stare decisis in his hearing, and he explained what the 
standards were classically understood to be the basis for 
overturning prior decisions. And I think his opinion indicates 
he felt it fell within that range, and he never said that he 
was going to defer to Congressional decisions on constitutional 
questions that violated the Constitution. And we violate it 
regularly around here, in my opinion, and I predicted this case 
violated the First Amendment--this legislation when it passed, 
and so did a lot of other people. We knew this was at the very 
edge and really thought it was over the edge of what the First 
Amendment would allow the Government to prohibit. And so I do 
not know.
    I do say this: that it does appear to me that the case did 
implicate big issues. It was hard to decide this on a strictly 
narrow basis. You could have done so perhaps, but if we were 
proceeding under matters that, fairly considered, violation the 
constitutional right of a group of people to speak out, then 
doesn't the Supreme Court, Mr. Smith, have a right to say no, 
and even if Congress in its wisdom thought it was legitimate in 
doing so?
    Mr. Smith. Well, again, I think when precedent should be 
overturned is a complex question, but what I would say about 
this case is, for example, suppose the Court had said that 
while the statute did not really intend to cover video on 
demand transmissions, first, that would have done some abuse to 
the statute because the statutory language pretty clearly does 
cover it. But they could have argued that in some way.
    The next question would have been, the next case would have 
come up, which is, OK, can you ban a book, can you ban a 
pamphlet or whatever have you. If you ban a book in the next 
one and the Court said, no, you cannot ban a book, they would 
have gone to a pamphlet.
    Similarly, you know, if you look at the various other 
grounds that have been offered, like, well, what if--Citizens 
United in a nonprofit. Well, what about the fact that they 
accepted contributions from for-profit companies? And then 
people would say, ``Well, if it was a de minimis amount.'' And 
the next case would be, ``Well, what is a de minimis amount?''
    In other words, I think what the Court recognized in this 
case and I think one reason none of the dissenters would 
actually concur in the judgment on any of these grounds is 
because doing so would not have led to a stable system. It just 
would have put off a series of complex questions, and it would 
have further rewarded, again, the lawyers, the consultants, the 
lobbyists who know how to game the system and know exactly what 
you can do and what you cannot. So I think that a sweeping 
decision----
    Senator Sessions. Well, along that line, I believe the 
Chief Justice--someone noted that none of the dissenters 
proposed a narrow ground. They took a constitutional view of 
it, apparently, and so we had, didn't we, Mr. Rosen, a 
constitutional difference of opinion?
    Mr. Rosen. Justice Stevens addresses that in his dissent, 
Senator, and he says it is common for lawyers to argue in the 
alternative. It is possible if the Chief Justice had actually 
in good faith embraced this narrower ground, the dissenters 
might have changed their mind, just as they did in the voting 
rights case where they embraced a reading of the statute that 
they might not have chosen as a primary matter, but were 
willing to take as a compromise.
    Senator Sessions. It is possible, but it is also possible 
that he had two different views of what the Constitution says, 
it seemed to me. And I think it is a big issue, and sometimes 
you just have to decide those questions.
    I do think that the----
    Mr. Kendall. Senator, if I may?
    Senator Sessions. Yes.
    Mr. Kendall. I think the best way to describe what this 
case was about was the way Citizens United initially litigated 
it. They did not challenge the 1947 statute. They put the 
challenge to Austin as a total afterthought in their briefs. It 
was only when the Court came back and said, no, let us brief 
specifically whether Austin should be overturned that Mr. Olson 
focused on that question. So you are saying it raised big 
questions, but it raised big questions only because the Court 
changed the question on the litigants. And I think the----
    Senator Sessions. But Citizens United had an interest in 
winning the case, and they did raise the other issues, but 
really the case took on a different dimension when the 
Solicitor General made arguments that indicated that she 
believed books published before an election could be banned, 
that the U.S. Congress has the power to ban the publishing of 
books. And this is a big deal. It implicates the First 
Amendment, and it would be the first time in the history of the 
Republic, would you not agree, that the courts or the Congress 
had ever banned the publishing of a book?
    Mr. Kendall. Again, I do not think that was Solicitor 
General Kagan's position. It was Malcolm Stewart who initially 
argued it, and I do not know how that changes--I mean, again, 
the narrow question of whether the specific 90-minute attack ad 
was within the campaign finance is a fairly narrow question 
that was litigated on that ground. The questions that the 
Justices asked the SG's office and the implications that it got 
into, it is really about the way the case is handled by the 
Court, not about what the question presented by Citizens United 
and fairly within the briefing of the initial case----
    Senator Sessions. Well, she said in her argument, later I 
guess, ``We haven't done that yet,'' but indicated that there 
might be a possibility it could be done and that an author 
would--they could always fight it in court.
    Mr. Kendall. I think what she was saying is that we haven't 
done it and we won't do it, and if there was--if we did it, it 
could be challenged.
    Senator Sessions. I thank you. It is a great discussion, an 
important issue, and all of you have made good points. And I 
would say, Mr. Smith, Senator Leahy is going to defend his 
Vermont Legislature.
    [Laughter.]
    Senator Sessions. As he did ably.
    Mr. Chairman, good to be with you.
    Senator Specter. Thank you, Senator Sessions.
    Senator Kaufman.
    Senator Kaufman. Yes. The Ranking Member is quite eloquent 
in these, but I think with all due respect, even superficial 
knowledge would see that this was not going to be decided on--
when he got to the point in the oral argument, this was not 
going to be a case decided on narrow arguments. So I think it 
is reasonable to believe that the minority knew what was coming 
and acted accordingly. That is just--everybody has got a right 
to their opinion, but that is kind of my opinion.
    Senator Sessions. Well, no, I think that is why they asked 
for new argument, and they made it publicly clear and allowed 
the debate to go forward on a larger basis. Rightly or wrongly, 
that is what they did.
    Senator Kaufman. I would not want to miss this opportunity 
to follow up on both Senator Whitehouse and separate comment by 
Senator Klobuchar. One was Senator Whitehouse talking about the 
pro-business bent of the Court.
    Sitting here listening, you would say, well, they 
overturned this one case, and it was a 100-year precedent, and, 
wow, you know, they have been doing this kind of on a regular 
basis, haven't they, in the business area? And the one that 
comes in common that Senator Whitehouse has, they all seem to 
benefit business. So, Professor Rosen, Mr. Kendall, could you 
kind of talk about the business activism part of this case?
    Mr. Rosen. The statistics in recent years are really 
striking. When you look at the 46 business cases before the 
Roberts Court in which the Chamber of Commerce participated, 
the majority of them go the Chamber's way in areas ranging from 
punitive damages, preemption, False Claims Act, securities, and 
antitrust cases.
    If you want some more stats, they are striking. The Court 
accepts less than 2 percent of the petitions it receives every 
year. The Chamber of Commerce's petitions were granted at the 
rate of 26 percent, and with a success rate for those of 75 
percent. So the claim that this is a pro-business Court is 
increasingly hard to dispute.
    Senator Kaufman. A pro-business activist Court.
    Mr. Rosen. A pro-business activist----
    Senator Kaufman. In terms of Leegin, where they overturned 
96 years of antitrust law, Exxon, so there is a constant theme 
that goes through. It is not just this case where they 
overturned 100 years of precedent.
    Mr. Rosen. That is right, Senator.
    Senator Kaufman. Mr. Kendall? Mr. Smith?
    Mr. Kendall. I think your concern is entirely valid. I 
think it traces from a 40-year effort by the Chamber to take 
advantage of what Justice Powell said was an opportunity for 
corporations in the Court. If you look at some of the recent 
cases that the Chamber and corporations have funded a 
tremendous amount of research on, things like attacking jury 
verdicts--there are few things that mattered more to James 
Madison than the jury trial, civil and criminal jury trials, 
and yet corporations have aggressively taken on the idea that 
there should be a trial for anything and tried to advance the 
idea that everything should be handled by arbitrators that 
typically they hire.
    And so it has really been an assault on one of the most 
essential values of our Framers and the Constitution itself, 
and that has had tremendous success. They have won just about 
every case expanding this Federal Arbitration Act from 
something that was intended to be a fairly narrow statute into 
something that throws just about every business case out of the 
Federal courts entirely.
    Senator Kaufman. Let me ask another question, and that is, 
you know, I think most of us think that based on the recent 
financial meltdown, the incredible pain it has caused to so 
many people, I think there is total agreement on that. I think 
most people think that part of that was caused by, as Alan 
Greenspan said, a self-regulation that did not work, that he 
was dismayed about, and that a major part of it was 
dismembering of the rule of laws and regulations we put in 
place, laws we put in place after 1929, from Glass-Steagall to 
setting up the SEC to the uptick rule to all the things that we 
put in place in a period of just slowly but surely under both 
administrations dismembering this. And I think most people 
think that we have to go back to have more regulation--not 
overregulation but more regulation.
    Looking at the Supreme Court, what are the prospects that 
someone that is going to sit here and have to try to deal with 
this and write laws that whatever we do in the regulatory area 
could be overturned by this Court?
    Mr. Rosen. Senator, this is a very serious question, 
obviously. The Troubled Asset Relief Program has already been 
challenged by libertarian organizations, and that will work its 
way up to the Supreme Court, and other of the regulations that 
you mentioned will be challenged as well.
    Will this Court give a full-scale assault against these 
regulations in the way that the pre-New Deal Court did? 
Predictions are not worth much. I would doubt that they would 
go that far, largely because of the most conservatives on the 
Roberts Court, you could call them pro-business rather than 
libertarian conservatives. Only Justice Thomas might really 
believe that the post-New Deal regulatory state is 
unconstitutional.
    But that does not mean that they could not strike down a 
whole lot of stuff and do a lot of damage. Later this term, 
they are going to decide whether the Public Company Accounting 
Board to create----
    Senator Kaufman. Right.
    Mr. Rosen. You know, whether that is unconstitutional. Lots 
of people think--the betting is that that might well fall.
    One of the striking lessons of history is it only takes a 
couple of really activist decisions to tar a Court as pro-
business and activist in the eye of history. The New Deal Court 
upheld as much as it struck down. It upheld FDR's gold policy. 
It upheld the Tennessee Valley Authority by a vote of 8-1. But 
we remember the decision striking down the NRA and other 
aspects of the regulatory state.
    So this Court is on very dangerous ground, and just a small 
misstep, even a few more decisions like this, could galvanize 
the populist outcry against Citizens United into much broader 
discontent with the Court, and the question of how Congress 
will respond will be just as urgent and serious nowadays as it 
was in the 1930s.
    Senator Kaufman. Thank you very much, Mr. Chairman.
    Senator Specter. Thank you, Senator Kaufman.
    Without objection, a statement from Senator Feinstein will 
be entered into the record.
    [The prepared statement of Senator Feinstein appears as a 
submission for the record.]
    Senator Specter. Professor Kendall, I ask you the same 
question I asked Jeffrey Rosen, Professor Rosen. How would you 
square Chief Justice Roberts' confirmation testimony that he 
would not jolt the system with the holding in Citizens United?
    Mr. Kendall. Senator Specter, I share your concerns about 
it. My organization, which is a progressive legal organization, 
supported John Roberts, to a great deal of criticism from my 
progressive friends, based on his testimony, which I found 
inspiring and spoke to me as a lawyer, and I thought as 
somebody who I had litigated around John Roberts in a case, I 
had seen him at work. I had hoped that he would be the Chief 
Justice that Jeffrey Rosen speaks of him being.
    And so to see a ruling like this, which really does fly in 
the face of so many things that he testified about and so many 
things that he said he would be as Chief Justice, both in his 
hearings and in his interviews, really does throw many of those 
hopes to the wind. And I think it is----
    Senator Specter. Professor Kendall, how about his broad 
testimony at confirmation about Congressional fact finding and 
the deference, because only Congress can find the facts, and 
then his dismissive attitude about it in the oral argument in 
the voting rights case?
    Mr. Kendall. Right. I would like to take issue with what 
Senator Sessions said, which is this is just a finding about 
whether it is constitutional. The Supreme Court has very clear 
guideposts as to when Congress can limit speech if it requires 
them to meet strict scrutiny, and you have to show a compelling 
interest.
    What the Court did and one of the things we have not talked 
about much was what the Court did in Citizens United is really 
change the goalposts and change the definition of what is a 
compelling interest. And so it basically threw out--you know it 
changed on this body what it had to show and said, oh, all of 
this evidence of an appearance of corruption is not good 
enough, you have to show basically quid pro quo corruption.
    And so the Court just basically dismissed all of the fact 
finding and said it was not relevant and said you have not met 
our burden. And it really has changed the goalposts and 
dismissed the evidence that you assembled over years of 
hearings.
    Senator Specter. Professor Kendall, what is the value of 
our confirmation hearings if we rely upon testimony we will not 
jolt the system and it has been exactly the contrary, we are 
going to be deferential to Congress and it is dismissive? What 
is the value of the confirmation hearing?
    Mr. Kendall. I think, unfortunately, the confirmation 
hearing has become a kabuki dance in certain respects, and you 
said this before, Senator Specter. It is a very large problem.
    Senator Specter. Professor Smith, you say, ``Congress 
should abandon any attempt to circumvent the Citizens United 
decision.'' What about some limitation, such as the--eight of 
the Justices, with only Justice Thomas being on the other side, 
said that there could be a requirement of disclosure on 
corporate campaign-related expenditures. Any problem with that?
    Mr. Smith. Senator, no, I think obviously clearly the Court 
has upheld disclosure rules and so on. The point that I was 
trying to make there is that reaction by Congress and by State 
legislators needs to be aimed at the actual problem, and what 
we see in many of the proposals that I have seen just tossed 
around are proposals that seem pretty clearly intended to try 
to stop corporations from using their rights. And as you now, 
the Court has long held that you cannot do indirectly what you 
cannot do directly.
    So there may be some things like added disclosure. There 
may be something that could be done to make a more refined 
foreign corporation law or, you know, subsidiary law that might 
be possible. But, again, they should not be subterfuge to just 
try to stop corporations from speaking as they are allowed to 
do under the decision.
    Senator Specter. Professor Rosen, what do you think 
Congress could do consistent with the case?
    Mr. Rosen. Senator, my view of the First Amendment issue is 
broad, so I think you should do whatever you please. And the 
fixes will be challenged. Disclosure will be challenged. The 
limits on foreign corporations will be challenged. But I hope 
that this Court will be more restrained in those future cases 
than it was in Citizens United and will uphold whatever fixes 
you pass.
    Senator Specter. What is your optimism based on?
    Mr. Rosen. In this business, I long got out of the habit of 
making predictions, but I guess since you ask, Senator--it is a 
serious question. I have enough faith in the fact that Chief 
Justice Roberts thinks that he is being incremental and picking 
and choosing his battles that he will not follow this 
blunderbuss with another one.
    Senator Specter. You think he thinks this is incremental, 
Professor Rosen?
    Mr. Rosen. Senator, I guess he would not think that this 
decision is incremental, but he would think that its breadth is 
required by the Constitution, and I would hope that in other 
cases he would be less confident that he knows the right answer 
than he did in this one.
    Senator Specter. Professor Kendall, what would you suggest 
by way of legislative changes not inconsistent with the case?
    Mr. Kendall. We do not, my organization does not support 
any particular legislations. We have not taken a position on 
them. I think that some of the disclosure laws, some of the 
enhanced limits on foreign corporation contributions should be 
upheld by the Court and I think would help----
    Senator Specter. What kind of limits?
    Mr. Kendall. I do not really have the specifics of the 
legislation in hand enough to speak knowledgeably about that.
    Senator Specter. If you have any suggestions, Professor 
Kendall, Professor Rosen, we would be interested in receiving 
them.
    Mr. Rosen. Thank you, sir.
    Mr. Kendall. Thank you, Senator.
    Senator Specter. Even your suggestions, Professor Smith, if 
you have any that you would care to share.
    That concludes our hearing. Thank you very much, gentlemen.
    [Whereupon, at 12:10 p.m., the Committee was adjourned.]
    [Questions and answers and submissions for the record.]
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