Following the Citizen’s United ruling, another common misconception is that corporations and unions can contribute unlimited sums to candidates. This is incorrect. Corporations and unions cannot make direct campaign contributions, of any amount, to candidates[1]. This is a common misinterpretation of the changes which allow corporations and unions to spend unlimited amounts on independent speech which may not be coordinated with a candidate.
Recent court rulings, including the Supreme Court’s decision in Citizens United vs. FEC, allow corporations and unions to use their treasury funds to make independent expenditures without limit. These expenditures may not be made in coordination with a political candidate or campaign. This distinction is crucial. A corporation cannot give a contribution directly to a candidate from corporate treasury funds. Corporations may establish Political Action Committees in order to make political contributions, but the PAC is a legally separate entity and is funded by voluntary contributions (not corporate profits).
The Court has decided that while limiting contributions to candidates serves a significant state interest, expenditures made independent of a candidate do not pose a risk of corruption or the appearance of corruption[2]. Groups which want to make independent expenditures only (and not contribute directly to candidates) may raise unlimited funds with fewer restrictions on where those funds may come from.
[1] "How the Big Money Finds a Way In." The New York Times. 17 Sept. 2011. Web. 11 Dec. 2011. <http://www.nytimes.com/2011/09/18/opinion/sunday/how-the-big-money-finds-a-way-in.html>.
[2] "Citizens United v. Federal Election Commission." Supreme Court of the United States. 21 Jan. 2010. Web. 11 Dec. 2011. <http://www.supremecourt.gov/opinions/09pdf/08-205.pdf>.
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