In a decision with profound implications for the role of money in American campaigns, a sharply divided Supreme Court on Thursday punched a hole in the complex web of federal campaign finance laws and allowed interest groups, unions and corporations to pay for political ads.
The 5-4 decision found corporations, unions and the like should have the same rights to spend money on political ads as any person would have -- freeing those groups up to pour money into issue advertising in political races. Direct donations to individual candidates would still be forbidden.
Critics warned the very foundations of American democracy are at stake, and feared big businesses will spend so much money they will be able to pick and choose who wins elections.
But the ruling was cheered by those who said it returns the country to the core free speech precept that political speech should be protected, no matter who or what is speaking.
In stark language the court acknowledged it was overturning its own precedents, but Justice Anthony M. Kennedy, writing the majority opinion, said the justices were now returning to "ancient First Amendment principles."
"The government may regulate corporate political speech through disclaimer and disclosure requirements, but it may not suppress that speech altogether," Justice Kennedy wrote in an opinion joined by Chief Justice John G. Roberts Jr. and Justices Antonin Scalia, Samuel A. Alito Jr. and Clarence Thomas.
In apocalyptic language in his dissent, Justice John Paul Stevens called the decision an unprecedented assault on the court's principle of "stare decisis," or reliance on precedent.
"The courts ruling threatens to undermine the integrity of elected institutions across the nation. The path it has taken to reach its outcome will, I fear, do damage to this institution," Justice Stevens said.
On Capitol Hill, Sen. Charles E. Schumer, New York Democrat, and Rep. Chris Van Hollen, Maryland Democrat, immediately vowed to try to pass a bill to overturn what the ruling. They acknowledged it would be difficult, but said there could be room to attach new rules to corporate political ad spending, such as requiring shareholders to approve of the expenditures.
"This threatens the viability of our democracy. This threatens the viability of what we're all about here," Mr. Van Hollen said.
President Obama also promised to try to curb the decision.
"With its ruling today, the Supreme Court has given a green light to a new stampede of special interest money in our politics," the president said in a statement. "It is a major victory for big oil, Wall Street banks, health insurance companies and the other powerful interests that marshal their power every day in Washington to drown out the voices of everyday Americans."
The case stems from the 2008 release of "Hillary: The Movie," a 90-minute film against then-presidential candidate Hillary Rodham Clinton produced by the conservative group Citizens United. When the FEC banned Citizens United from promoting its documentary through television ads -- which it deemed corporate-funded political communication, illegal under campaign finance laws -- the filmmakers sued.
Campaign finance laws at the time forced corporations to create separate political action committees, which were bound by myriad fundraising, spending and reporting rules. Citizens United v. the Federal Election Commission has been steadily moving up the federal courts for the last two years.
Rep. Alan Grayson, Florida Democrat, called the ruling "the worst Supreme Court decision since the Dred Scott case." The 1857 Dred Scott decision held that slaves could never be citizens, nor were they entitled to constitutional protections.
All sides were still digesting the 183-page decision, issued at 10 a.m. Thursday, but those who fought to end the ban were ecstatic with the basic finding.
"The Supreme Court has restored a part of the First Amendment that had been unfortunately stolen by Congress and a previously wrongly-decided ruling of the court," said Hans A. von Spakovsky, a former Republican member of the Federal Election Commission and current senior legal fellow at the Heritage Foundation.
The ruling does not overturn laws limiting how much corporations and unions can contribute directly to a candidate, nor does it overturn the ban on so-called "soft money," the uncapped donations to political parties that had swamped the political process in the 1990s.
Thursday's ruling does underscore the importance of the court's makeup.
Seven years ago, a 5-4 majority upheld the McCain-Feingold campaign finance restrictions that helped write the rules restricting political ad spending. But with two new members appointed by former President George W. Bush and one member appointed by President Obama, the majority now ruled the other way.
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