Mr. Chairman, distinguished members of the committee:
My name is Roger Pilon. I am a senior fellow at the Cato Institute and the director of Cato’s Center for Constitutional Studies.
I want to thank you Mr. Chairman for inviting me to testify on the important question of whether the federal election campaign finance reforms that have been under consideration this year in Congress are constitutional. I regret to say that too many in Congress have raised that question—when they have raised it at all—almost as an afterthought.
That is a striking statement about political life in America today, of course. In a constitutional republic such as ours, where the Constitution not only authorizes but limits government, one should expect constitutional questions to come first. Those questions are: (1) Does Congress have the power to do what some among it want done? and (2), If so, can that be done consistent with the rights of the American people? Those questions will guide my analysis here.
Plainly, in Article I, section 4, and Article II, section 1, the Constitution authorizes Congress to regulate federal elections. But, just as plainly, that regulation must conform to restraints imposed by the First Amendment to the Constitution. And here, the Supreme Court has said repeatedly that, under the First Amendment, campaign contributions and expenditures are protected speech.
Thus, more precisely, the Court has said that regulations of political contributions and expenditures will be upheld only if they achieve a compelling governmental interest by the least restrictive means—the most difficult of constitutional hurdles. Recently, the Cato Institute published two studies—one by Professor Lillian R. BeVier of the University of Virginia School of Law,  the other co-authored by attorneys Douglas Johnson of the National Right to Life Committee and Mike Beard of the Coalition to Stop Gun Violence —both of which conclude that the campaign finance reform proposals currently before Congress will not pass constitutional muster. Because I find the arguments and conclusions of those studies compelling, I will simply summarize them here.
Modern federal election campaign finance regulation stems from the Federal Election Campaign Act of 1971 (FECA), as amended in 1974.  Two years later, in the landmark case of Buckley v. Valeo,  the Supreme Court struck down many of the 1974 revisions as impermissible under the First Amendment.
Since then the Federal Election Commission (FEC) has fought to close the perceived “loopholes” created by Buckley. In response, the Court has repeatedly held that the First Amendment is not a loophole.  Most recently, the Court held 7 to 2 in Colorado Republican Federal Campaign Committee v. FEC  that independent expenditures by political parties cannot be limited by Congress. Then in April of this year, as if to underscore the long series of cases since Buckley, the Fourth Circuit took the extraordinary step of ordering the FEC to pay the legal fees incurred by the Christian Action Network in defending itself from an FEC lawsuit. 
Yet despite that string of cases, now spanning more than two decades,  many in Congress persist in believing that they have the power to restrict what the First Amendment was plainly written and meant to protect. Thus, it is worth examining, if only in outline, just why the Constitution does not permit such restrictions. 
The Buckley Framework
As the Court held in Buckley, to be constitutional, campaign finance regulations must not violate basic principles of political freedom and free political speech recognized and protected by the First Amendment. The plaintiffs in Buckley had challenged FECA’s stringent limitations on the amounts of money individuals could contribute to and spend on campaigns for federal office and the act’s provisions for public funding of presidential candidates who agreed to abide by spending limits during their campaigns. The Court sustained the provisions for public funding of presidential campaigns and the contribution limitations. It invalidated the expenditure limitations.
A “major purpose” of the First Amendment, the Buckley Court said, was “to protect the free discussion of governmental affairs.” In that regard, contribution and expenditure limitations “operate in an area of the most fundamental First Amendment activities.”  Thus, limitations are subject to strict judicial scrutiny: they must serve a “compelling state interest” employing the “least restrictive means.”
Applying that strict standard of review, the Buckley Court distinguished limits on contributions to campaigns and limits on expenditures by citizens and candidates. Contribution limits, said the Court, entail “only a marginal restriction on the contributor’s ability to engage in free communication”  because “the transformation of contributions into political debate involves speech by someone other than the contributor.”  Expenditure limits, by contrast, “represent substantial rather than merely theoretical restraints on the quality and diversity of political speech.” 
Whether that distinction will itself withstand strict scrutiny has been a matter of no small debate. In fact, in the recent Colorado case, Justice Thomas joined the many critics who would give contributions the same protection expenditures enjoy. Thus, the Court may one day revisit its distinction. In the meantime, it has upheld contribution limitations if their purpose is the compelling one of preventing corruption—“the attempt to secure a political quid pro quo from current or potential officeholders” —or the appearance of corruption. In fact, the Court has since said that preventing corruption or the appearance of corruption remains the “single narrow exception to the rule that limits on political activity” are contrary to the First Amendment. 
Applying Buckley to Current Proposals
Since the Buckley Court agreed unanimously that campaign finance regulations implicate protected First Amendment rights, the basic questions in applying Buckley and its progeny are whether the interests the government asserts by way of justifying a given measure are compelling and whether the least restrictive means have been employed to secure those interests. Although applying “strict scrutiny” to the proposals presently before Congress is not an exact science, the result of doing so should be relatively clear: if Congress enacts the measures now before it, the Court is not likely to uphold them. Let us look briefly at those measures, treating them generically.
The PAC Ban. Those who advocate banning Political Action Committees, or “PACs,” ordinarily invoke vague concerns about “big money” and “special interests,” the implication being that such PACs unduly influence elections in order to advance their own narrow ends. Never mind that PACs arose in the first place as a result of the 1974 FECA restrictions; never mind also that empirical studies show that such contributions rarely buy elections, much less the votes of incumbents once in office:  the rationales given by PAC ban advocates simply do not amount to the prevention of corruption as the Court has strictly defined it—a financial quid pro quo, dollars for political favors. Moreover, even if a PAC ban could be justified as serving a compelling governmental interest along the lines the Court has established, the means employed, far from being narrowly tailored, are grossly overinclusive. In a word, people and organizations have a right to join together to enhance their political voices. Prohibiting such activities strikes at the very heart of the First Amendment.
The PAC Ban Fallback. Assuming that a PAC ban would be found unconstitutional, reformers have advocated a number of fallback proposals, including lowering the permissible amount of PAC contributions from $5,000 to $1,000 per election and prohibiting PAC contributions that raise a candidate’s PAC receipts above 20 percent of campaign expenditure ceilings. Here too, however, the same constitutional infirmities arise. Lowering PAC contributions allegedly serves the same interests as eliminating them, yet in neither case are those interests compelling. Moreover, the means are again not narrowly tailored. Indeed, it is difficult to identify any interest—other than incumbency protection—that is served by making it more rather than less difficult for candidates to raise money.
It should be noted, however, that the Buckley Court, even as it upheld the particular contribution limits at issue, “cautioned … that if the contribution limits were too low, the limits could be unconstitutional.”  Many have argued that the current $5,000 limit, upheld in 1976, has long been too low to be any longer constitutional.
Finally, the attempt to redefine “independent expenditure”—and, in particular, to redefine “express advocacy” so as to include any and all partisan communications—runs flatly counter to the Buckley Court’s explicit effort to immunize issue advocacy from regulation or restriction: “So long as persons or groups eschew expenditures that in express terms advocate the election or defeat of a clearly identified candidate, they are free to spend as much as they want to promote the candidate and his views.” 
“Voluntary” Spending Limits. Because mandatory spending limits face an impenetrable constitutional wall, reformers have proposed various “voluntary” limits that a candidate would abide by in exchange for such benefits as “free” or reduced-rate television time, reduced mailing rates, raised contribution or expenditure ceilings, and the like—all in the name of “leveling” the playing field. The Court has given such proposals short shrift. Indeed, the Eighth Circuit recently noted when evaluating analogous state provisions that one is “hard-pressed to discern how the interests of good government could possibly be served by campaign expenditure laws that necessarily have the effect of limiting the quantity of political speech in which candidates for public office are allowed to engage.”  Far from leveling the playing field, such limits only enhance the already substantial advantages of incumbency.
Limits on “Soft Money”. The recent distress of reformers over “soft money”—money contributed to political parties for other than candidate-oriented advertising—is rooted in the belief that such contributions, because they are unlimited, invite a wholesale evasion of contribution limits now in place. They do. Indeed, such evasion is exactly what one would expect to find when people are prohibited from contributing in more direct ways to candidates of their choice. The solution to the problem of evasion, however, is not to ban or limit soft money—which would be patently unconstitutional—but to eliminate or at least raise the limits on direct contributions.
Because soft money, under present arrangements, goes to parties, not candidates, there is no possibility of the kind of quid-pro-quo corruption that alone justifies limits. Thus, any attempt to limit such contributions would not pass even the threshold test the Court has set. Indeed, such limits would strike at the very core of the First Amendment. People contribute to political parties, after all, to advance the ideas for which the parties stand and to encourage and support the political speech that parties promote. If those efforts were thwarted—not to prevent quid-pro-quo corruption but to eliminate the “appearance” of corruption—the First Amendment would be utterly eviscerated. The “appearance” can be addressed more directly—by eliminating its source in the present law.
So without constitutional merit is the attack on soft money, in fact, that four justices in the recent Colorado case went so far as to say that, given the practical identity of interests between party and candidate during an election, the corruption-prevention rationale for sustaining limitations on contributions did not support any limits on party spending, whether coordinated with the candidate or not. Although present law makes coordinated spending illegal, Justice Thomas pointedly questioned the rationale for that restraint: “What could it mean for a party to ‘corrupt’ its candidate or to exercise ‘coercive’ influence over him.”  In sum, soft money is not the problem. The present law is the problem.
Issue Advocacy. Proposals to limit speech that does not “in express terms advocate the election or defeat of a clearly identified candidate for federal office” are constitutionally infirm for the same reason that the soft-money ban is infirm: they would regulate—and thus unacceptably chill—core political speech about the merits of policies and the proper resolution of public issues without a corruption-prevention rationale for doing so. To the objection that issue advocates exercise “undue influence,” the answers are, that is their right, and we have no measure of just how much influence is “due.”
Of late, however, those who would expand current law to cover advocacy ads that do not expressly urge support or defeat of a candidate have sought refuge in a case the Ninth Circuit decided in 1987, FEC v. Furgatch.  That is a dubious shelter, however, for Furgatch was, by the circuit’s own reading, a “very close call.”  Moreover, its holding that a non-candidate’s campaign communication can amount to prohibited “express advocacy” for or against a candidate without having used the Buckley buzz words—“vote for,” “defeat,” etc.—is hardly inconsistent with Buckley. The issue in Furgatch was simply whether, under its facts, the advocate was engaged in “express” advocacy, even though he did not use the “express” words mentioned in Buckley. To read the case as inconsistent withBuckley—and thus as opening the door to overturning Buckley—is grasping at straws, straws that are not even there.
Thus, for these many reasons, here only outlined, the effort to further restrict the financing of federal election campaigns is not likely to survive a constitutional test. The Framers wrote and the founding generation ratified the First Amendment to ensure free and robust political debate. They did not want it restricted by artificial limits on the means that are necessary for such debate—financial support. Far worse than the corruption of money is the corruption of politics. Yet that is what further limits would ensure, as our present limits already have.
 Lillian R. BeVier, “Campaign Finance ‘Reform’ Proposals: A First Amendment Analysis,” Cato Policy Analysis No. 282, Sept. 4, 1997.
 Douglas Johnson and Mike Beard, “ ‘Campaign Reform’: Let’s Not Give Politicians the Power to Decide What We Can Say about Them,” Cato Briefing Paper No. 31, July 4, 1997.
 2 U.S.C. § 431 et seq. (amended 1974).
 424 U.S. 1 (1976).
 See James Bopp, Jr., and Richard E. Coleson, “The First Amendment Is Not a Loophole: Protecting Free Expression in the Election Campaign Context,” 28 University of West Los Angeles Law Review 1 (1997).
 116 S. Ct. 2309 (1996).
 FEC v. Christian Action Network, Inc., 110 F. 3d 1049 (4th Cir. 1997).
 See, e.g., First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978); California Medical Association v. FEC, 453 U.S. 182 (1981); FEC v. National Right to Work Committee, 459 U.S. 197 (1982); FEC v. National Conservative Political Action Committee, 470 U.S. 480 (1985); FEC v. Massachusetts Citizens for Life, Inc. 479 U.S. 238 (1986); Austin v. Michigan Chamber of Commerce, 494 U.S. 652 (1990); FEC v. Colorado Republican Federal Campaign Committee, 116 S.Ct. 2309 (1996).
 The analysis that follows draws heavily upon the study by Professor BeVier, note 1 above.
 Buckley, at 14 (quoting Mills v. Alabama, 384 U.S. 214, 218 (1966).
 Id. at 20.
 Id. at 21.
 Id. at 19.
 Id. at 26.
 Citizens Against Rent Control v. Berkeley, 454 U.S. 290, 296 (1981).
 See Bradley A. Smith, “Campaign Finance Regulation: Faulty Assumptions and Undemocratic Consequences,” Cato Policy Analysis No. 238, pp. 8-11, Sept. 13, 1995, and the citations therein.
 Carver v. Nixon, 72 F.3d 633, 637 (1995) (citing Buckley at 30).
 BeVier, note 1 above, at 12 (citing Buckley at 45).
 Shrink Missouri Government PAC v. Maupin, 71 F.3d 1422, 1426 (8th Cir. 1995).
 Colorado at 2330-31.
 807 F.2d 857 (9th Cir. 1987).
 Id. at 861.