In a narrowly-held decision that could have a significant impact on the 2010 mid-term elections, the Supreme Court has ruled that restrictions on political spending by corporations and unions are unconstitutional. The 5-4 decision in Citizens United v. FEC (pdf) reverses the Court’s opinion in Austin v. Michigan Chamber of Commerce and parts of McConnell v. FEC that upheld restrictions on such spending to endorse or oppose political candidates. The matter was brought by Citizens United, a conservative nonprofit group that sought to release a documentary critical of then-Senator and presidential candidate Hillary Rodham Clinton during the 2008 campaign. Citizens United challenged Federal Election Commission (FEC) rules that implemented the portions of the Bipartisan Campaign Reform Act (commonly known as the McCain-Feingold Act) that prohibits the broadcast or transmission of “electioneering communications” sponsored by corporations and unions close to elections. The U.S. District Court for the District of Columbia disagreed with Citizens United, ultimately siding with the FEC. On appeal, the Supreme Court initially heard arguments in March of 2009, but ordered a re-argument on whether the campaign finance restrictions violate the free speech clause of the First Amendment, and whether the aforementioned campaign finance cases should be overruled. In deciding these two issues in the affirmative, Justice Anthony Kennedy reasoned: “political speech must prevail against laws that would suppress it, whether by design or inadvertence,” and that “there is simply no support for the view that the First Amendment, as originally understood, would permit the suppression of political speech by media corporations.”

In a long and vigorous dissent, Justice John Paul Stevens emphasized that the “conceit that corporations must be treated identically to natural persons in the political sphere is not only inaccurate but also inadequate to justify the Court’s disposition of this case,” adding “[o]ur lawmakers have a compelling constitutional basis, if not also a democratic duty, to take measures designed to guard against the potentially deleterious effects of corporate spending in local and national races.”

The result of this decision is sure to be felt in the coming months as the nation prepares for the fall elections. A substantial amount of money will no doubt be spent by both corporations and unions on media campaigns for and against particular candidates.