Stephen Colbert's "Hail to the Cheese" Presidential Candidacy:
Why the Comedian's Campaign Raises Serious Questions about the Role of Corporate Money In Elections

By RICHARD L. HASEN
Friday, Nov. 09, 2007

I'm as amused as the next guy by Stephen Colbert's "Hail to the Cheese" candidacy for President of the U.S., which appeared to have been "sponsored" by Doritos and which was promoted on his Comedy Central cable show, "The Colbert Report." Colbert's routine is certainly funny, but it also raises some serious questions about the appropriate role of corporate money in the election process.

It remains to be seen whether Colbert's campaign will be revived following both the writers' strike and the rejection of his candidacy by the South Carolina Democratic Party. However, if the campaign endures, it could help hasten the rise of unlimited corporate spending in election campaigns.

The Relevant Corporate Funding Law, and Its Important Exception

Here's the relevant law: A corporation cannot fund the express advocacy of a candidate for federal office out of its treasury funds. So Pepsico, the maker of Doritos, could not, for example, run a newspaper ad saying "Vote for Colbert for President." (The same rule applies to labor unions and their treasuries.) Thus, the funding for corporate election spending has to come from its political action committee (PAC). Corporate PACs can only solicit a small group of people (including the corporations executives and shareholders) and can accept and make contributions of no more than $5,000. Indeed, it has been recently reported that Pepsico in fact paid nothing to be featured prominently in Colbert's campaign.

While Pepsico wasn't spending any money to support Colbert's candidacy, it appeared that Viacom, the corporate owner of Comedy Central, was doing so.

This spending appeared to run afoul of the corporate spending limit. But, under an exemption, corporations can spend treasury funds on "any news story, commentary, or editorial distributed through the facilities of any broadcasting station, newspaper, magazine, or other periodical publication, unless such facilities are owned or controlled by any political party, political committee, or candidate." This is the rule that, for example, allows the Tribune Company, the corporation which owns the Los Angeles Times, to endorse a candidate (maybe even Colbert) for President.

Does promotion of Colbert's candidacy by Viacom fall into the exception? It's not completely clear. First, since Colbert the candidate is also an executive producer and writer on the show, that may make him in control of the "facility" for purposes of the campaign finance law. Second, it's not clear whether the promotion of the candidacy on his show--which is essentially a satire in which Colbert, always in character, plays a buffoonish Bill O'Reilly-like conservative talk show host---counts as a "news story," "commentary" or "editorial." Does schtick count as commentary? These are not easy legal questions to answer, given existing Federal Election Commission and court rulings.

It's tempting to say that this is all a joke, and we should not take any of this seriously. Yet we live in an age where political views and positions are shaped, for many, by "The Colbert Report" and "The Daily Show." Moreover, Colbert set an important precedent by collecting signatures to appear on the South Carolina ballot though a website (colbert08.org), which he promoted on his show. If he can do it, what happens if Bill O'Reilly or Keith Olbermann next decides to promote a website to help his run for Congress on his show?

Looking to the Purposes of the Ban and the Exemption Helps Clarify the Issue

In thinking about these legal questions, it is useful to consider the purpose of both the ban on the spending of corporate treasury funds on federal elections, and the exemption on spending by media corporations.

To begin, the Supreme Court has said that the government may limit corporate spending in elections because corporate money can have a corrosive and distorting effect on the electoral process, in light of the reality that corporations can spend funds in a way that is quite out of proportion with the interests they represent in society. However, media corporations serve a valuable function in educating the public about issues and spurring vigorous debate. Thus, the Court has said that it is consistent with the First Amendment both to limit corporate spending, and to craft an exemption for media corporations.

Colbert is not the first to test the line between the corporate treasury ban and the exemption. For example, the National Rifle Association, a non-profit corporation that takes funds from for-profit corporations, can't use its treasury funds to pay for ads advocating the election or defeat of federal candidates. However, it has started a satellite radio station, NRANews, and has taken advantage of the media exemption. Similarly, television stations considered whether they could show a Michael Moore documentary on the Bush Administration during the period just before the 2004 presidential election. And the FEC recently decided that online-only corporate-owned magazines like Slate, and corporate-owned blogs like DailyKos or RedState, are entitled to the media exemption.

Might the Ban on Corporate Spending Someday Be Abolished?

In the end, it seems we want to have our Doritos and eat them too: We want to limit corporate money in the electoral process, but also protect the freedom of the press through a media exemption. The line may lead to absurd line-drawing problems as in the case of The Colbert Report, but it is a line that will have to be drawn periodically, if we want to keep both of these principles in our law.

Some people, however, advocate simply junking the corporate-spending ban. They believe that it is a First Amendment violation to limit the spending of corporate money on the electoral process. If General Motors wants to write a $100 million check to a presidential candidate, they say, that should be just fine, and the Supreme Court's earlier decision upholding limits on corporate campaign funding should be overruled.

One day soon, the argument to allow unlimited corporate campaign spending could get a hearing before the Supreme Court. And the Court, with its two new conservative justices, Chief Justice Roberts and Justice Alito, could well be amenable to overturning existing precedent. Thus, while Stephen Colbert's intent may be to amuse us all, the ones who may be laughing last are those who are eager to see corporate money pour into federal election campaigns.


Richard L. Hasen, the William H. Hannon Distinguished Professor of Law at Loyola Law School, Los Angeles, writes the Election Law Blog.