Media corporations and campaign finance exemptions Under federal campaign finance law, corporations and unions are prohibited from directly spending funds on advertisements expressly advocating the election or defeat of candidates for federal office. Instead, corporations or unions must set up a separate PAC (with limits on who may be solicited to contribute) to fund such advertisements. Under the new BCRA (whose constitutionality is currently being considered by the Supreme Court), this separate PAC requirement for corporations and unions was extended to broadcast advertisements 60 days before a general election (or 30 days before a primary), featuring a candidate for federal office, and targeted at the relevant electorate. (This is one of the ways that BCRA seeks to close the "issue advocacy" loophole.)
Many critics of campaign finance regulation point to the exemption in these laws for newspaper (and broadcast) articles, editorials, and commentaries. The argument goes: why should General Motors be stopped from running an ad saying "Vote for Bush," but Rupert Murdoch need not be? In the Austin case, the Supreme Court rejected the argument that it would be an equal protection violation to treat media corporations different from other corporations. The Court wrote:
The media exception insures that the Act does not hinder or prevent the institutional press from reporting on, and publishing editorials about, newsworthy events. A valid distinction thus exists between corporations that are part of the media industry and other corporations that are not involved in the regular business of imparting news to the public. Although the press' unique societal role may not entitle the press to greater protection under the Constitution, it does provide a compelling reason for the State to exempt media corporations from the scope of political expenditure provisions.
Austin, 494 U.S. at 667-68.
The argument resurfaced at the oral argument in BCRA, with Justice Scalia leading the charge. At issue is the BCRA provision that would not allow General Motors to run a broadcast advertisement featuring a candidate for federal office within 60 days of the general election (or 30 days of the primary) and targeted at the relevant electorate except through a separate segregated PAC. General Motors could run such an issue advertisement paid for with its treasury funds in a newspaper (or through the mail or internet), though the FECA prevents it from expressly advocating the election or defeat of a candidate in those venues. General Electric, Justice Scalia noted, through its NBC subsidiary, could engage in such issue [update: I meant: candidate] advocacy in a broadcast. (It turns out that television stations feature federal candidates on their news programs, but almost never endorse candidates or run commentaries endorsing candidates for federal office.)
My memory may be faulty, but I don't believe any party has made the equal protection argument in the BCRA case. (The Paul plaintiffs claimed that the Libertarian Party was entitled to an exemption under the Press Clause, but that's not the same thing.) [Update: My memory was faulty. As a few readers pointed out, the NRA raised this issue both in the district court and in the Supreme Court, though in the Supreme Court it was phrased not in terms of Austin being overruled but rather that the facts have changed, i.e., that media corporations can no longer be separated from other corporations.] The court may nonetheless reach the issue, particularly because, as I've noted, other parts of Austin may be up for grabs.
A few years ago, I wrote an article entitled "Campaign Finance Laws and the Rupert Murdoch Problem," 77 Texas Law Review 1627 (1999). In the article, I suggested that if political equality were accepted as a compelling interest (as it is not today for campaign finance regulation), Congress might well consider repealing the media exemption--requiring all express advocacy to be funded with campaign finance vouchers. But the question here is different: does Congress have the authority to carve out an exemption for media corporations to the separate PAC requirement applicable to corporations wishing to air broadcast advertisements shortly before a federal election featuring federal candidates for office?
The election law list had an interesting discussion about this issue. Spencer Overton started the discussion here by suggesting that the question whether the institutional press plays the unique societal role is an empirical one about which the Court should defer to Congress. (See also here) Eugene Volokh took the position that if we are concerned about the potential for corruption and the sale of access, the media exception seems unjustified (See here and here; see also remarks along these lines by Charlie Smithson, Bob Bauer, and Joe Birkenstock.)
Finally, Marty Lederman here offered a number of new insights on way in which the Court could well uphold the media exception. Among other things, Marty draws a convincing parallel to the Court's religious exercise jurisprudence.