FEC Closes First 'Millionaire' Cases

The FEC has recently closed the first enforcement cases to arise under the Millionaire's Amendment from the Bipartisan Campaign Reform Act (commonly referred to as McCain-Feingold or BCRA). The fines in these two cases are signficant, $40,000 and $14,000 in civil penalties. I would like to see a challenge by either of these candidates to the constitutionality of the millionaire's amendment.

A challenge to the provisions of BCRA was brought in the McConnell v. FEC case, but the claim was dismissed because no plaintiff had standing to sue on the issue since no one had been penalized by the application of the amendment. These two cases now clearly have plaintiffs who can sue on the issue.

I wrote a short paper on the Millionaire's amendment in law school, making the argument that the Millionaire's amendment is unconstitutional. I think the law is unconstitutional on two grounds, equal protection and the differences in-kind standard from the Shrink Missouri decision.

Due to the necessary page limit of the paper, I focused only the differences in kind. Under certain triggering conditions, a candidate facing someone who contributes enough money from personal funds (the House limit is $350,000 and the Senate limit varies with population), then their opponent may raise funds under increased contributions limits from individuals to achieve partity with the self-funded candidate. In some cases these limits can be six times teh normal contribution limit for individuals. The normal contribution limit for individuals is now $2,100 dollars under the millionaire's amendment, the limit become $12,600. Now the Supreme Court in Shrink Missouri did not define exactly what "differences in kind" meant, but a common sensical approach would say that there is a signficant difference in kind between $2,100 and $12,600.

But the unconstitutionality does not stop there. Buckley established the premise that campaign finance regualtion is constitutional in order to prevent corruption or the appearance of corruption. Under that guise, the Court held that a limit of $1,000 per individual per election was appropriate to prevent corruption of hte candidate receiving hte contribution. BCRA increased the limit to $2,000 per person per election and indexed the limit for inflation. If these limits are considered lawful to prevent corruption, how then does a contribution limit of $12,600 as compared to $2,100 not raise issues of the appearance of corruption. The universe of people able to contribute $12,600 is quite finite and certainly a candidate would be more beholden to someone who ponies up such cash in a pinch than other contributors. While there may not be actual corruption, the appearance of corruption is certainly strongly suggested.

Aside of issues of differences in-kind and the appearance of corruption, a much stronger argument for the unconstitutionality of the Millionaire's Amendment is an equal protection argument. As noted above, if certain triggers are met, the candidates in a given race will be operating under different rules. I say again, the fundraising rules for candidates in the same race would be markedly different. While I may be only a recent graduate of law school, such a fact is prima facie evidence to me of a equal protection claim. Former Senator Fred Thompson raised this issue directly during the Senate debate on BCRA. A major point of the campaign finance rules is to ensure consistent rules for everyone--rules known to everyone in advance. But the invokation of the Millionaire's Amendment provisions by a candidate changes the rules of the game in mid-stream.

Now one can argue about the propriety of money in the system and whether the rules of the game should be changed (as I have argued before). But the Millionaire's Amendment's practical aspects are also troubling, although practical aspects are a poor legal argument. The practical effect of the amendment is an incumbent protection measure since the candidates most likely to self-fund are challengers.

However, regardless of the practical effect, there is a clear legal argument for the invalidation of the Millionaire's Amendment and now there are plaintiffs to bring the suit. If any one of the potential plaintiffs reads this post, although I have not been sworn in teh bar yet, I would love to work on this case. (Shameless plug for employment--sorry).

FEC Closes First 'Millionaire' Cases