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WASHINGTON — The United States Supreme Court is now considering Senator Ted Cruz’s challenge to a federal campaign finance law that limits how political donations can be used to reimburse candidates for the money they lend themselves.
During oral arguments on Wednesday, it is a 2002 law that caps the amount of political donations made after an election at $250,000 that winning candidates can use to later repay personal funds they loaned to their own campaign.
Proponents of the law argue that taking large sums of money to repay loans after a candidate has been elected could pose a risk of politicians engaging in corrupt practices on behalf of parties who retroactively and indirectly hedged the debt. But the Republican senator from Texas and his allies argue that such regulations create a threat to free speech.
“It weighs down and mostly weighs down the campaign narrative, the candidate narrative,” said Charles Cooper, Ted Cruz’s Senate campaign attorney who argued in court on Wednesday.
Conservatives have long argued that campaign finance regulations are an attack on a candidate’s freedom of speech, as funds raised can be used to spread their message on television, digital advertising and direct mail.
The current limit, he argued, would put a candidate in the position of “going through the math of deciding whether or not I’m going to loan more than $250,000 to my campaign because my ability to get it back is going to be compromised. by law and regulation. »
It’s common practice in politics for candidates to lend money to their campaigns in the heat of the moment for votes and then repay themselves with donations made after the election or in future cycles.
The interrogation of the judges of the Supreme Court on Wednesday did not make it possible to clarify the evolution of the case.
Deputy United States Solicitor General Malcolm Stewart argued on behalf of the federal government and asked that the case be “dismissed for lack of standing”. He accused Cruz of intentionally creating a situation to complain about.
A day before Election Day 2018, when Cruz narrowly defeated Democrat Beto O’Rourke, the incumbent Republican loaned his re-election campaign $260,000 — presumably to file a lawsuit to overturn the rule and raise funds. funds to recover the $10,000 that exceeds the $250,000 cap.
“They went out of their way to engage in transactions they otherwise would not have undertaken, only to subject the senator to financial loss and thereby lay the groundwork for a lawsuit,” Stewart said Wednesday.
Donors face limitations when donating to a federal candidate each election cycle. Part of the government’s argument against Cruz’s argument is that for a candidate to accept contributions from one cycle to pay off personal debt from a previous cycle violates the spirit of avoiding gifts.
“There are severe restrictions on gifts to public servants in all three branches of government, so there is an established understanding that the government has a substantial and legitimate interest in preventing the effects that could arise if federal public servants were to receive money that would enrich himself personally,” Stewart said.
Stewart argued that the window of uncertainty between the loan taken out in one cycle and then partly repaid by a donor in a future cycle is the point where corruption could emerge.
“A contributor who removes that uncertainty, who pays the money that the debt will be repaid, passes on a financial benefit to the candidate, just as if a donation had been made,” he said.
Judges on the court’s conservative wing rejected that argument.
“Cruz says it doesn’t enrich him personally because he’s no better off than he was before,” judge Amy Coney Barrett said. “He’s paying a loan and not lining his pockets.”
But Judge Elena Kagen was obviously skeptical of Cruz’s case. She suggested that Congress intentionally set $250,000 as the breaking point for an office holder’s personal financial pressure.
“The candidate with $3,000 in debt is much less likely to start thinking about how they can sell their votes than the candidate with $500,000 in debt,” she said. “So the candidate is in a very different situation, the more the debt goes up.”
Self-funding and personal campaign loans are common practice, especially among Texans in Congress. It is not uncommon for candidates to carry campaign debt for years. Wealthy candidates often lend money to their campaigns and never get paid back.
But Cruz, a lawyer, has spent years laying the groundwork for this case.
In 2012, Cruz was a longtime Senate contender for the GOP nomination against wealthy David Dewhurst, who was then the state’s lieutenant governor. As Cruz gained ground, he poured a $1 million loan into his campaign and eventually won the nomination and general election.
But he was never able to recover hundreds of thousands of dollars of that sum, following the 2002 law he is now challenging. The Congress adopted it to avoid the appearance of quid pro quos between candidates and future donors. The theory behind the limit is that money raised after an election no longer helps a candidate win office. Instead, the money goes to the official’s bank account.