WASHINGTON — The Supreme Court has taken up Sen. Ted Cruz’s effort to strike down the cap on repayment of personal loans with post-election donations, with the senator’s lawyer arguing that if he can’t be bribed for $250,000, it can’t be purchased for another $10,000 either.
Before or after the election, donors cannot write checks for more than $2,900 during an election cycle for a federal candidate.
The judges questioned whether the timing of these donations made a difference, legally and ethically. Many have embraced the Biden administration’s argument that when donors pay off a candidate’s personal debt after knowing who won, it sounds a lot like a forbidden gift.
But the Texas Republican’s attorney challenged the logic of letting candidates wipe out unlimited loans using donations that pour in before Election Day, while imposing a cap 20 days later.
“Congress effectively gives a corruption pass to the top 86 donors who max out after an election, but abruptly closes the corruption window on donor number 87,” Cruz’s attorney Charles Cooper argued for 90 minutes of argument.
The case pits money as a free speech claim against the government’s interest in curbing corruption. And it’s a fight Cruz spent $10,000 on, out of his own pocket.
Conservatives have bristled for decades at campaign spending caps. Government watchdogs view with concern the latest efforts to erode the anti-corruption provisions of the Bipartisan Campaign Reform Act of 2002, signed into law by President George W. Bush.
The Department of Justice, defending this law and the regulations of the Federal Election Commission to implement it, warned that there is in fact a great risk of corruption if donors can pour unlimited sums into the pockets of a politician after election day.
The day before his victory over Democrat Beto O’Rourke in 2018, Cruz loaned his campaign $260,000. The campaign did not need money. Cruz raised $46 million in what became the most expensive Senate race in history, though after the 2020 cycle he isn’t even in the top 10 anymore.
The Cruz campaign brought in enough money 20 days after Election Day to reimburse the senator in full: $262,800. Over the next month, all but $10,000 of the debt was paid off, in four installments ranging from $25,000 to $100,000.
In other words, according to the Justice Department, the only reason Cruz doesn’t have the money isn’t the federal campaign finance law — it’s that he chose to leave. ‘to be.
Malcolm Stewart, the United States Deputy Solicitor General, compared Cruz to a McDonald’s customer who knows the coffee is too hot and pours it anyway, in order to sue the fast-food chain for negligence.
The fact that his injury was intentional and self-inflicted, the government asserted, means Cruz does not have standing to challenge the boundary.
Across the ideological spectrum, the justices were dubious, noting that legal history is replete with plaintiffs who have submitted to constitutional infringement in order to challenge a law. Chief Justice John Roberts likened Cruz’s decision to give up $10,000 to pick this fight akin to a couple trying to buy a house to speak out against discrimination.
Whether they intend to complete the deal is irrelevant, Roberts said.
A decision is expected by the end of June.
On whether the $2,900 donor cap is enough to prevent bribery, Stewart insisted that a donation that goes directly to a candidate’s personal bottom line is a gift — though he had some hard to explain why this is only true after Election day.
“Limits on gifts to federal officials are much lower” at $2,900, he noted, because “we worry about corruption at a much lower level when the money goes into the candidate’s pocket.” .
Cruz’s attorney argued that the loan repayment cap deters candidates from lending money to their own campaigns and that such an impact infringes on First Amendment guaranteed political speech rights.
The government swept the ceiling away as, at best, a modest burden justified by anti-corruption goals. At one point, Stewart acknowledged that there was nothing magical about $250,000. It’s just a level that the FEC chose to strike a balance, a line of argument that animated much of the discussion in court.
“The candidate with $3,000 in debt is much less likely to start thinking about how he can sell his votes than the candidate with $500,000 in debt,” Judge Elena Kagan told Cruz’s attorney. So, she said, even if the first and 87th donors cut the same check for $2,900, and even if neither thought of a quid pro quo, a heavily indebted candidate might.
“I don’t know why you’re arguing that it’s like a gift,” she said. “One day, I had a loan of $10,000. The next day, I don’t. I’m $10,000 richer. Someone just donated $10,000.
Cooper pushed back.
“A repayment of a loan is not a gift,” he insisted, adding later that donations spent – whether on paying rent or advertisements or repaying a candidate’s loan – should not make no difference.
Other than the cap of $2,900 per person, “Congress has not limited post-election contributions,” Cooper noted. “Congress does not view these post-election contributions as gains.”
Senate Minority Leader Mitch McConnell, R-Ky., called the 2002 law a “constitutional wreck” from the start and immediately challenged the law. But in a 2003 decision that bears his name, he lost in the Supreme Court. He now boasts that the High Court has since dismantled the law.
The biggest blow came in 2010, with the Citizens United decision. This opened the door to super PACs and unlimited corporate spend on campaign ads. The 5-4 court sided with a conservative group that the FEC had blocked from promoting a movie accusing Hillary Clinton of corruption.
The loan repayment ceiling is only the last provision in the line of fire.
“The limit chills grassroots political discourse, especially the discourse of unknown challengers who have to spend more to be heard. And the loan repayment limit serves no legitimate government interest,” McConnell said in a friendly court filing supporting Cruz.
Watchdog groups don’t like the idea of wealthy candidates buying a Senate seat. Neither did voters, and the campaign’s history is filled with defeated candidates who dug deep into their fortunes.
The case could determine if Cruz, in choosing this fight, was not careful enough in how and when he transferred funds.
Cruz’s campaign didn’t need the money the day before Election Day and had enough funds to pay off the debt. That, the Biden administration argued, means he didn’t give the loan to fund ads or any other form of political speech, but only to lay the groundwork for this lawsuit — and that means he didn’t. could not have suffered constitutional prejudice.
The Justice Department also pointed out that Cruz hasn’t even claimed — let alone proven — that he repaid the first $250,000 using the funds raised. after Election day. At various points in the litigation, campaign officials said nothing was repaid with post-election donations and that they had not “undertaken the insane task of trying to trace what fungible dollars were used. to repay Cruz’s loans”.
Given that, according to the government, the senator could even now collect another $10,000 from his campaign account, without breaking the law.
Cruz disputes this.
As for the claim that Cruz lacks standing because he chose to waive the $10,000 by waiting more than 20 days, his attorney pointed to Plessy v. Ferguson, a landmark case that challenged split trains. in the south.
“At least since Mr. Plessy sat in the whites-only car,” the Supreme Court has recognized that sometimes the only way for a plaintiff to challenge a law is to violate it, Cooper said.