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First National Bank of Boston v. Bellotti, 435 U.S. 765 (1978), was 1978 Supreme Court case in which the court decided that corporations and unions have a First Amendment right to make contributions to ballot initiative campaigns. The ruling came in response to a Massachusetts law that prohibited corporate donations in ballot initiatives unless the corporation's interests were directly involved. In 1976, when several corporations, including the First National Bank of Boston, were barred from contributing to a referendum regarding tax policy, they appealed to the Supreme Court. In November 1977, the Supreme Court heard arguments, and in April 1978, they ruled 5-4 against the Massachusetts law. States could no longer impose specific regulations on donations from corporations or labor unions, and in response several states changed their campaign finance laws. While the Bellotti decision did not directly affect federal law, it has been cited by other Supreme Court cases such as McConnell v. Federal Election Commission and Citizens United v. Federal Election Commission.


Effects on Policy[edit]

Effects on Legislation[edit]

While the First National Bank of Boston v. Bellotti ruling set a precedent for allowing corporate spending in elections, it did not directly lead to federal campaign law changes because of its narrow focus.[1][2] The Bellotti decision was focused on state referenda not the election of candidates. [3][4]

In April 1978, when the Supreme Court decided on the First National Bank of Boston v. Bellotti case, 31 states had laws regulating corporate spending on ballot initiatives.[5][6][7] However, not all of these state laws were annulled by the Supreme Court ruling. Universal caps on donations for ballot initiatives as well as specific bans aimed to prevent "undue" corporate influence on referenda were still considered constitutional.[8] Of these 31 states, 18 of them, including Massachusetts, had laws that would be considered unconstitutional after the Bellotti decision. [9]

In the aftermath of Bellotti, several states changed their laws relating to spending on referenda.[10] In 1981, Iowa's state legislature updated their campaign finance laws to state,

“It is unlawful for any insurance company, savings and loan association, bank, and or corporation… to contribute any money, property, labor, or thing of value, directly or indirectly, to any committee, or for the purpose of influencing the vote of any elector, except that such resources may be so expended in connection with a ballot issue, however all such expenditures are subject to the disclosure requirements of this chapter.” [11]

Montana had previously banned all corporate donations for or against ballot issues.[12][13] In October of 1978, this law was overturned by the Court of Appeals for the Ninth Circuit using First National Bank of Boston v. Bellotti.[14][15]

On December 23rd, 1986 the General Court of Massachusetts approved a series of changes to its campaign finance laws, and only then officially changed the law governing corporate spending on ballot initiatives.[16] In “An Act Further Regulating Political Campaign Financing,” the General Court stated that they were “striking out” Chapter 55, Section 8, the law annulled by the Bellotti decision.[17] Furthermore, a new §8 law was written that in part stated,

“No person or persons, no political committee, and no person acting under the authority of a political committee, or in its behalf, other than a political committee organized on behalf of a ballot question campaign…shall solicit or receive from such corporation or such holders of stock any gift, payment, expenditure, contribution or promise to give, pay, expend or contribute for any such purpose.” [18]

Effects on Referenda[edit]

Scholars are split on whether the First National Bank of Boston v. Bellotti decision has had an overall effect on the ballot initiative process. Some scholars believe that with out any regulations on corporate spending on ballot initiatives, corporations have the potential to donate much more on these campaigns than individuals or citizens groups. [19][20][21] Due to this advantage, some scholars maintain that corporations have undue sway over referendum and thus policy outcomes. [22][23][24][25][26] One such way corporations can use money to sway voters is through advertising and spreading information about propositions.[27][28] For example, a California ballot initiative, Proposition 37 from 2012, attracted a disproportionately high level of spending from corporations. [29] The proposition would mandate that all foods containing genetically modified organisms would have to be labeled as such. Corporations including Monsanto and DuPont spent $45 million dollars against Prop 37, which was five times more than the money spent by supporters of the proposition.[30] [31] The proposition was defeated by a margin of 51% to 48%[32], a result that left many pro-Prop 37 groups blaming unfair financing as the reason for the defeat.[33][34]

Still, other political scientists disagree and believe there is no definitive evidence that links corporation donations to referendum results. [35][36][37][38] For example in California, the campaign around Proposition 188, a ballot initiative that aimed to curb bans on smoking,[39] is another example of unequal spending between corporations and others.[40] Businesses spent over $19,000,000 in favor of Prop 188, while non-businesses spent less than $2,000,000 in opposition.[41] [42] Nonetheless, in this case, voters ultimately voted against Proposition 188. [43][44] Similarly, the gambling industry in California has spent tens of millions of dollars since 1912 on referendums regarding gambling rules. However, in this time period, only 25% of the referendums they supported monetarily were passed. [45]

References[edit]

  1. ^ John Nichols and Robert W. McChesney, Dollarocracy (New York: Nation Books, 2013), 86.
  2. ^ Robert L Kerr, "Subordinating the Economic to the Political: The Evolution of the Corporate Speech Doctrine," Communication Law & Policy 10 (2005): 63, accessed March 19, 2014.
  3. ^ John Nichols and Robert W. McChesney, Dollarocracy (New York: Nation Books, 2013), 86.
  4. ^ Robert L Kerr, "Subordinating the Economic to the Political: The Evolution of the Corporate Speech Doctrine," Communication Law & Policy 10 (2005): 63, accessed March 19, 2014.
  5. ^ Robert L Kerr, "Subordinating the Economic to the Political: The Evolution of the Corporate Speech Doctrine," Communication Law & Policy 10 (2005): 71, accessed March 19, 2014.
  6. ^ Library of Congress, Analysis of Federal and state campaign finance law, summaries (Washington DC: Library of Congress, 1977).
  7. ^ Allen K. Easley, "Buying Back the First Amendment: Regulation of Disproportionate Corporate Spending in Ballot Issue Campaigns" Georgia Law Review" 17 (1983): 681.
  8. ^ P Lansing and G.M. Sherman, “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkely California,” The Journal of Corporation Law 8 (1982): 96, accessed March 19, 2014.
  9. ^ Warren Weaver Jr., “Justices, 5-4, Allow Corporate Spending for Issues on Ballot,” New York Times, April 27, 1978, accessed March 17, 2014.
  10. ^ P Lansing and G.M. Sherman, “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkely California,” The Journal of Corporation Law 8 (1982): 97, accessed March 19, 2014.
  11. ^ Iowa Acts, Chapter 35, Section 14, Iowa Legislature (1981).
  12. ^ P Lansing and G.M. Sherman, “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkely California,” The Journal of Corporation Law 8 (1982): 97, accessed March 19, 2014.
  13. ^ §23-4744, Revised Code of Montana (1947).
  14. ^ P Lansing and G.M. Sherman, “Evolution of the Supreme Court's Political Spending Doctrine: Restricting Corporate Contributions to Ballot Measure Campaigns after Citizens against Rent Control v. City of Berkely California,” The Journal of Corporation Law 8 (1982): 97, accessed March 19, 2014.
  15. ^ C&C Plywood Corporation v. Hanson, 583 F.2d 421 (9th Cir. 1978).
  16. ^ An Act Further Regulating Political Campaign Financing, Chapter 631, Section 5, General Court of Massachusetts (December 23, 1986), The State Library of Massachusetts DSpace.
  17. ^ An Act Further Regulating Political Campaign Financing, Chapter 631, Section 5, General Court of Massachusetts (December 23, 1986), The State Library of Massachusetts DSpace.
  18. ^ An Act Further Regulating Political Campaign Financing, Chapter 631, Section 5, General Court of Massachusetts (December 23, 1986), The State Library of Massachusetts DSpace.
  19. ^ Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 85.
  20. ^ Reid Wilson, “Initiative Spending Booms Past $1 Billion as Corporations Sponsor Their Own Proposals,” The Washington Post, November 8, 2013, accessed March 18, 2014.
  21. ^ David R. Lagasse, “Undue Influence: Corporate Political Speech, Power and the Initiative Process,” Brooklyn Law Review 61 (1995):1349, accessed April 4, 2014.
  22. ^ David R. Lagasse, “Undue Influence: Corporate Political Speech, Power and the Initiative Process,” Brooklyn Law Review 61 (1995):1349, accessed April 4, 2014.
  23. ^ Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 85.
  24. ^ Thomas Stratmann, The Effectiveness of Money in Ballot Measure Campaigns,” Southern California Law Review 78 (2004): 104, accessed March 16, 2014.
  25. ^ David S. Broder,Democracy derailed: initiative campaigns and the power of money (New York: Harcourt, 2000)
  26. ^ Thomas E. Cronin, "'Direct Democracy: The Politics of Initiative, Referendum, and Recall' (Cambridge: Harvard University Press, 1999), 109.
  27. ^ Daniel H. Lowenstein, “Campaign Spending and Ballot Propositions: Recent Experience, Public Choice Theory and the First Amendment,” UCLA Law Review 29 (1982): 562, accessed April 4, 2014.
  28. ^ David R. Lagasse, “Undue Influence: Corporate Political Speech, Power and the Initiative Process,” Brooklyn Law Review 61 (1995):1375, accessed April 4, 2014.
  29. ^ Reid Wilson, “Initiative Spending Booms Past $1 Billion as Corporations Sponsor Their Own Proposals,” The Washington Post, November 8, 2013, accessed March 18, 2014.
  30. ^ Amy Westervelt, “With California Prop Defeated, GMO Labeling Proponents Look to Farm Bill,” Forbes, November 13, 2012, accessed March 18, 2014.
  31. ^ Suzanne Goldenberg, “Prop 37: food companies spend $45m to defeat California GM label bill,” The Guardian, November 5, 2012, accessed April 4, 2014.
  32. ^ Statewide Summary by County, Propositions 30-40 California General Election Results, November 6, 2012, accessed April 4, 2014.
  33. ^ Amy Westervelt, “With California Prop Defeated, GMO Labeling Proponents Look to Farm Bill,” Forbes, November 13, 2012, accessed March 18, 2014.
  34. ^ “Right to Know Election Statement,” Right to Know, 2013, accessed April 4, 2014.
  35. ^ “What Impact Does Money Have in the Initiative Process?,” Initiative & Referendum Institute at the University of Southern California, 2013, accessed March 19, 2014.
  36. ^ Bernard Grofman, “Contribution and Spending Limits for Initiatives or Other Ballot Propositions,” Southern California Law Review 78 (2005): 103, accessed March 16, 2014.
  37. ^ Allen K. Easley, "Buying Back the First Amendment: Regulation of Disproportionate Corporate Spending in Ballot Issue Campaigns" Georgia Law Review" 17 (1983): 694.
  38. ^ Thomas Stratmann, The Effectiveness of Money in Ballot Measure Campaigns,” Southern California Law Review 78 (2004): 101-124, accessed March 16, 2014.
  39. ^ “Decision '94 / Special Guide to California's Elections: Propositions: 188: Regulates Smoking Statewide: What It Is?,” Los Angeles Times, October 20, 1994, accessed March 19, 2014.
  40. ^ Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 85.
  41. ^ Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 86.
  42. ^ Dan Morain, “California Elections : The Propositions : Funds Fuel Prop. 187 Fight; Tobacco Gives Millions to Prop. 188,” The Los Angeles Times, October 29, 1994, accessed April 5, 2014.
  43. ^ Anthony Gierzynski, Money Rules (Oxford: Westview Press, 2000), 86.
  44. ^ Dan Morain and Virginia Ellis, "California Elections / Propositions: Voters Approve 'Three Strikes' Law, Reject Smoking Measure: Proposal for government-run health care system, gasoline tax to fund rail projects are also defeated," The Los Angeles Times, November 9, 1994, accessed April 5, 2014.
  45. ^ “What Impact Does Money Have in the Initiative Process?,” Initiative & Referendum Institute at the University of Southern California, 2013, accessed March 19, 2014.
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