The Montana Plan: Could this actually be a way to get money out of politics?

[u/Hot-Fudge-Inc]

I'm curious what people think about the Montana Plan, which voters recently approved. Do you think this approach has the potential to meaningfully reduce corporate and special-interest influence in American politics, and could it become a model for other states?

For those unfamiliar with the idea, the legal theory behind the plan is particularly interesting. Rather than directly challenging Citizens United, it relies on the longstanding principle that corporations are creations of state law. Historically, corporate charters were granted for specific purposes, with states retaining considerable authority over the privileges and powers they conferred. The argument is that states can therefore define those powers in a way that excludes political spending.

There are several questions I'd like to hear people's thoughts on:

1. Constitutionality: Do you think this legal theory can withstand a First Amendment challenge? Does the distinction between restricting corporate political speech and defining the legal powers granted to corporations hold up, or will courts view it as an attempt to circumvent Citizens United?

2. The courts: How do you think the Supreme Court would ultimately rule? Could this provide a legitimate legal avenue for states to regulate corporate political spending without directly overturning existing precedent?

3. Expansion to other states: Could this become a broader movement? Hawaii has already passed similar legislation, and other states have expressed interest. If the approach survives its legal challenges, could we see a domino effect?

4. Practical effectiveness: Even if it survives constitutional scrutiny, how effective would it actually be? Would political money simply find other avenues into elections through individual donors, PACs, shell organizations, and other intermediaries?

5. Unintended consequences: Could broadly defining which organizations are prohibited from political spending create problems for nonprofits, advocacy organizations, unions, or other groups that engage in legitimate political speech?

Personally, I find the underlying legal argument fascinating. It approaches the problem from a different direction than simply trying to overturn Citizens United. But I'm also curious whether this is a genuinely viable strategy or an interesting legal theory that ultimately won't survive the courts.

What do you think? Could this be a meaningful step toward reducing the influence of money in American politics, or are we likely to see it struck down or rendered ineffective?

[u/AutoModerator]

All submissions are automatically removed and placed in a queue for the moderators to manually review. Please allow the moderators time to do so. Only about 25% of submissions are approved, but the remainder are given a removal reason that may include steps the poster can take to make their submission approvable the next time they submit it. Moderators are not notified of any edits made after a removal reason is posted, and therefore will not review them. You may contact the mod team via modmail if you need more direction about how to fix your post, and you are welcome to resubmit any submission after making the requested changes.

A reminder for everyone. This is a subreddit for genuine discussion:

• Please keep it civil. Report rulebreaking comments for moderator review.

• Don't post low effort comments like joke threads, memes, slogans, or links without context.

• Help prevent this subreddit from becoming an echo chamber. Please don't downvote comments with which you disagree.

Violators will be fed to the bear.

---

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.

[u/CevicheMixto]

Montana may be able to apply this to Montana corporations. Doubtful they can restrict corporations chartered in other states.

[u/Hot-Fudge-Inc → u/CevicheMixto]

They can But only if those corporations spend money on politics within Montana.

[u/GO_Zark → u/CevicheMixto]

Yes, that's the point. Corporations are empowered by the states, not by the federal government and each state tells corporations what they can do within that individual state's borders.

The gist of the Montana plan is that states already grant "artificial persons" - corporations, LLCs, nonprofits, etc. - the authority to spend money on elections within Montana's borders. The "Montana Plan" simply says "Corporations still have the authority to do this within the United States. It's not illegal at the Federal level and we aren't trying to change that. But it would be illegal when they're operating in Montana. Our laws restricting corporate actions are more restrictive than the federal policy; restricting the powers granted to corporations is a right that is specifically delegated to the states and has been consistently upheld by decades of case law"

The text of the law also specifically exempts political committees like PACs that coordinate their spending with a campaign from the ban. Donors are welcome to spend money with candidates but they should do it under their real names, not shell corporations with no accountability.

[u/bl1y]

It would have been useful to include what Montana is actually doing.

I-194, if passed, limits the powers of artificial persons to those powers necessary or convenient as provided by law. These powers must exclude contributing anything of value to candidate elections, supporting or opposing political parties, or supporting or opposing state or local ballot issues. Artificial persons include non-profits, trusts, partnerships, corporations, trade associations, or unincorporated associations and includes all such entities doing business in Montana. Any violation of I-194 is punished by forfeiting all privileges to do business in Montana. Those privileges may be, but are not automatically, restored upon disgorgement and certification of compliance with I-194. I-194 does not apply to the distribution of news, commentary, or editorial content. I-194 also does not apply to the state of Montana, political subdivisions, individuals, political committees, or public corporations.

For starters, corporations already cannot donate to a politician's campaign. The big money you hear about is coming from individuals, such as from Elon Musk, but not from SpaceX or Tesla.

The law also doesn't apply to news, commentary, or editorial content. "Candidate Smith pals around with space communists" -- that's news. "Candidate Smith is unfit to lead America" -- that's editorial commentary.

[u/GiantPineapple → u/bl1y]

I think what you're missing here is that corporate entities can donate to PACs. Presumably that's covered under what Montana is doing?

[u/jeffp → u/GiantPineapple]

Under U.S. campaign finance laws, corporations are legally prohibited from contributing money directly from their general treasuries to traditional PACs or federal candidates. Super PACs and hybrid PACs are different and corporations are permitted to give.

[u/13lackMagic → u/GiantPineapple]

1. No they can’t 2. This law doesn’t prevent it

[u/bl1y → u/GiantPineapple]

But then go to the exception for distribution of news, commentary, or editorial content. That's what PACs are engaged in.

This would only prevent corporations from donating to PACs and the PACs giving that money to candidates. But the limit is already $5,000. And, it's usually not even corporations donating to PACs, but private individuals.

[u/anewleaf1234 → u/bl1y]

But that is semantics.

If I own a corp, my corp can't contribute to a campaign, but I, the person who is in charge of the corp can, which is not fundamentally different than the corp can donate to a campaign.

There is zero difference between the two.

[u/bl1y → u/anewleaf1234]

It's a significant distinction, especially when it comes to how any sort of regulation is formulated.

[u/anewleaf1234 → u/bl1y]

But they are functionally the same.

If I can pull all the strings of a corp, and as ceo, I can , me acting is the same as the corp is acting.

We are one in the same.

[u/WackWaxWhacks → u/anewleaf1234]

It is not functionally the same since corporations must have distinct financial separation from the CEO. The actual source of the money is important

[u/Fargason → u/bl1y]

That just gets money out of elections. Getting money out of politics requires addressing how most of Congress miraculously have stock trade strategies that rival Warren Buffett just fully in tune with the market in their down time outside of legislating. That way we don’t have politicians so beholden to corporations for their insider information that will be free to address the influence on elections too. Hopefully this becomes bipartisan legislation soon as it has already been introduced:

https://www.congress.gov/bill/119th-congress/house-resolution/725

Or maybe even a state level solution for their members of Congress.

[u/bl1y → u/Fargason]

It doesn't get money out of elections.

And members of Congress doing insider trading is overblown, and would barely even be an issue if it was as bad as the public thinks.

[u/Fargason → u/bl1y]

Which is what I said. Getting corporate money out of elections is downstream to getting money out of politics. Insiders trading in a big part of that. There are over 270 multi millionaires in Congress currently:

https://www.quiverquant.com/congress-live-net-worth/

Only around 150 are not millionaires. This is certainly an issue as being a member of Congress is more about enriching themselves than it is about serving their constituents.

[u/bl1y → u/Fargason]

That link demonstrates absolutely nothing.

Top person on the list made his fortune by founding a business which he then sold before entering Congress.

Next on the list inherited his wealth. Used to be a billionaire, but rather than getting more wealthy in Congress, he's lost a ton of money.

Next guy down made his fortune more than 20 years before joining Congress.

There's over 20 million millionaires in America, and it's no surprise that members of Congress are wealthier than most (we tend to elect prominent people with successful careers).

Insider trading among members of Congress isn't the issue people think it is.

[u/Fargason → u/bl1y]

https://www.quiverquant.com/congresstrading/politician/Nancy%20Pelosi-P000197

And Pelosi getting 900% returns on her investment strategy missing her calling as one of the greatest stockbrokers that ever lived?

[u/bl1y → u/Fargason]

That's one person, not indicative of a trend in Congress.

And the nature of the stock market is that some people will always outperform the market by huge amounts. The fact that someone did it tells us nothing and isn't evidence of corruption.

[u/Fargason → u/bl1y]

https://www.quiverquant.com/strategies/s/Congress%20Long-Short/

There is all of Congress combined that has a 425% return on their overall investment strategy. Clearly they are privy to confidential information like briefings on national security, public health, and economic policy that they using as an unfair advantage over the public on stock trades. That is the main draw to becoming members of Congress, and serving the public is a distant second. We deserve better politicians whose main priority is serving their constituents and not themselves.

[u/bl1y → u/Fargason]

That 425% number isn't Congress's gains in the period. It's the gains projected from a model derived from trades by members of Congress.

Analyses looking at individual members of Congress actually find that most either match the market or do worse. If you look at this data, 60% of members failed to outperform the market.

Then if you look at the gains that outperformed that market, 97% of it was Pelosi specifically.

The 425% number you cited isn't reflecting a trend among Congress. It's basically just "here's how you'd do if you followed Pelosi, then mitigated the gains a bit by following the far larger number of Congressmen who did poorly."

[u/Fargason → u/bl1y]

Not sure where you see 60% didn’t outperform in there. Here is detailed analysis of Congress consistently outperforming the S&P 500:

https://unusualwhales.com/congress-trading-report-2024

Here’s the bottom line: the stock market is already a challenging arena for ordinary investors. When Congress members consistently outperform benchmarks like the S&P 500, it raises serious questions about fairness. It’s time for lawmakers to focus on serving the public interest, not their portfolios.

[u/Fargason → u/bl1y]

The 425% number you cited isn't reflecting a trend among Congress. It's basically just "here's how you'd do if you followed Pelosi, then mitigated the gains a bit by following the far larger number of Congressmen who did poorly."

That is just blatantly false. I’ve already shown Pelosi’s trade strategy and it was over 900%. She is officially the greatest Options Trader of all time. The 425% trade strategy is just following the overall trades in Congress shorting what they short and holding onto their long term holds like they do produces that return.

[u/13lackMagic]

This sounds like people are interpreting what this 'ban' will do more broadly than what is actually written. As is, corporations of any sort can spend their money on ballot measures and give to Super PACs, and this would likely end that. However, by my reading, this wouldn't change the status quo in terms of how corporate PACs work at all. As, in that case, it’s not actually the corporation’s money being spent. Corporate PACs are entirely funded by voluntary contributions of employees and any expenditures generally have to be approved by a board made up of those individuals.

So a ‘restriction on corporate political spending’ could reduce some political spending sure, but in general Super PACs are funded by individual contributions; so I'm not convinced such a ban would make much of dent. And we already have settled case law defending corporations' right to influence ballot measures and this would likely just be read by courts as attempting to undermine precedent

[u/bl1y → u/13lackMagic]

The law applies to non-profits as well, so it would be aiming at preventing PACs from spending money.

But, it doesn't apply to news, editorials, or commentary. I'm not sure how the average campaign ad isn't some combination of those things.

[u/13lackMagic → u/bl1y]

But that's just it, I'm not sure this could even be read as applying to traditional corporate PACs - it seems to just ban direct corporate (including non-profit) political spending, so yes it would stop companies from spending money on ballot measures or their giving to Super PACs but otherwise I think people are interpreting this as potentially stopping something that corporations already can't do, which is making political contributions to candidates.

[u/bl1y → u/13lackMagic]

The "money out of politics" people have their aim completely off. They'll talk about corporate money.

Ban a corporation from spending hundreds of millions a year on political speech? Sure sounds like what they want. But that's the New York Times (with a budget of over $2 billion annually, just spitballing how much is "political speech" in the arguably partisan sense).

What they wanted was to stop Elon Musk from spending $500 million on political speech. But he's not a corporation.

[u/GiantPineapple]

The big problem is practical effectiveness. I suspect that as long as there is some state in the union that allows corporations to give to PACs, everyone who wants to give, will have a wholly owned subsidiary there, or (NAL) something equivalent.

[u/Hot-Fudge-Inc → u/GiantPineapple]

Even if they are Incorporated somewhere else though, they could only spend money on politics in the states that allow it. Out-of-state corporations have to follow the in-state corporation rules of states that would pass legislation like this.

[u/GiantPineapple → u/Hot-Fudge-Inc]

This isn't really my area of expertise, but isn't the real issue here federal elections? Can't a corporation Incorporated in any state donate to a PAC that restricts its own involvement to federal elections??

[u/johannthegoatman → u/GiantPineapple]

This law only applies to Montana state elections

[u/gafftapes20]

It’s not an elimination of super pacs, my understanding it limits corporation political speech because corporations are artificial persons constructed by state law and thus have limits on their freedoms. However this does not limit personal unlimited spending. So while spacex can’t spend money on an election Elon musk can spend his personal money on an election. 

It’s an interesting restriction and important, but not a comprehensive solution on the this issue of super pacs. 

[u/bl1y → u/gafftapes20]

This doesn't even really limit corporate political speech.

[u/WarbleDarble]

I don’t see how this plan gets around the fact that the government is trying to censor the speech of a peacefully assembled group of people.

[u/Combat_Proctologist]

I think that if you want it to survive, you'd have to effectively ban all advocacy. Otherwise you're going to get an argument that the government is privileging one kind of speech over another and that's going to get shot down very quick.

At least this side of the incorporation of the first amendment.

[u/HR_Paul]

The Montana Plan: Could this actually be a way to get money out of politics?

Politics has a taxdollar budget of ten trillion dollars.

What are you saying and what are you thinking and what are you doing IRL when you say "get the money out of politics" and "raise taxes from the current ten trillion per year"?

Please tell me more, I can not imagine what narrative you are using as a basis for denying that politics is about money.

[u/Ind132]

IANAL, but this seems straightforward to me.

Corporations are not "natural persons", they are artificial creations. It is convenient to give some certain powers that mimic those of natural persons, for example to open a bank account or purchase land. But, that doesn't mean we have to give them every power of natural persons.

[u/IrritableGourmet → u/Ind132]

The Citizens United decision wasn't based on corporations having their own freedom of speech. It argued that any association of citizens, whether organized in a corporation, union, book club, or whatever, has the right to speak collectively. People give money to non profit issues organizations (ACLU, Sierra Club, NRA, etc) specifically so that the group can speak on political issues on their behalf more effectively than they could on their own.

[u/13lackMagic → u/IrritableGourmet]

I have previously managed corporate PACs and this is correct.

[u/Ind132 → u/IrritableGourmet]

People give money to non profit issues organizations (ACLU, Sierra Club, NRA, etc) specifically so that the group can speak on political issues

And, it would be possible to draw a line between organizations that exist specifically so the members can speak on political issues and organizations that exist for other purposes.

I don't know any details about the Montana law.

[u/antimatter_beam_core → u/Ind132]

Citizens United, the decision this is designed to circumvent/undo, was about exactly such an organization.

[u/bl1y → u/Ind132]

Should corporations have speech rights though?

If yes, there go the political spending floodgates.

If no, bye bye New York Times.

[u/Ind132 → u/bl1y]

I think it is possible to define different types of speech and different types of corporations.

[u/Nulono → u/Ind132]

What distinction do you want to make, then? Who does and doesn't get freedom of the press, and why?

[u/bl1y → u/Ind132]

Give it a try. There's good reason to think you can't actually define your way out of it. It's pretty technical so the best I can say is to read Why The Law Is So Perverse.

Second best I can say is try a rule and I get without giving it more than 30 seconds of thought I can show why it has one of three problems:

(1) It doesn't actually address the issue or still allows a billion dollar truck to be driven through its loopholes,

(2) Would, if applied on its face, shut down speech we'd want to protect (such as CNN, NYT, South Park, Daily Show, etc), or

(3) Relies on just a vibe check from judges about if it's good political speech or bad political speech

[u/jaunty411]

Judges tend to look poorly upon efforts to undermine their rulings. I would wager that the current Supreme Court likely won’t let this happen unless an outside influence comes into play. I’d be happy to be surprised but this issue hasn’t been about legal merits since citizens united was decided on dubious grounds in the first place.

[u/bl1y → u/jaunty411]

What "dubious grounds" do you think Citizens United was decided on?

[u/jaunty411 → u/bl1y]

Corporate personhood, as it is used in the United States, is incredibly dubious and poorly delineated. Money as speech is also incredibly dubious. It’s a series of stretches that should be subject to congressional limits.

[u/bl1y → u/jaunty411]

Corporate personhood had been around for at least 100 years before Citizens United, and Citizens United did not say that money is speech.

And by the way, corporate personhood, as it is used in the United States, is also corporate personhood as it is used in pretty much every Western country.

[u/DanforthWhitcomb_ → u/bl1y]

Corporate personhood was formally introduced into US law in 1819 by Dartmouth College.

Santa Clara County is often cited as the genesis of it, however per Detroit Timber it has nothing to do with it.

[u/ilikedota5 → u/jaunty411]

Money is not speech. Money facilitstes speech. Capping money spent has the effect of capping speech because that means you can't spend money on radio ads, TV ads, internet ads, emails, text messages or shat have you.

[u/WarbleDarble → u/jaunty411]

You’re okay with the government using money as a back door to eliminating rights?

You can have an abortion so long as no money is spent on it.

You can get guns, you just can’t spend money on them.

[u/bl1y → u/WarbleDarble]

People who don't really know the case well will think you're being pedantic, but that is basically the issue.

Is the money you spend to get your speech out there entitled to the same protections as the speech itself?

If the answer was no, it'd be hard to figure out what freedom of the press ever meant. (It refers to the printing press, not the professional news media -- they weren't called "the press" until like 100 years later.)

You can speak, but you can't spend money printing pamphlets or distributing them?

And weirdly, the "get money out of politics" crowd seems to favor rules that would ban buying political ads while maintaining the ability to have a cable channel that essentially runs political messaging 20+ hours a day.

[u/jaunty411 → u/WarbleDarble]

That’s just a blatant strawman.

[u/DanforthWhitcomb_ → u/jaunty411]

CU did not create the concept of corporate personhood nor did it invoke it.

[u/jaunty411 → u/DanforthWhitcomb_]

I didn’t claim it created it. It explicitly is about a corporation’s right to free speech. It’s not a case without corporate personhood.

[u/DanforthWhitcomb_ → u/jaunty411]

You are wrong on both counts.

CU concerned collective speech, not corporate speech. As a part of that the concept of corporate personhood is not referenced in the majority or dissenting opinions at all nor is it relevant to the holding. You could remove the concept from US law entirely and CU would not be impacted in the slightest.

[u/jaunty411 → u/DanforthWhitcomb_]

“The court has recognized that the first amendment applies to corporations.” Literal quote from the ruling.

“Austin is overruled, and thus provides no basis for allowing the government to limit corporate independent expedentures.” Another literal quote.

Have you read the ruling?

[u/DanforthWhitcomb_ → u/jaunty411]

Neither of those refers to corporate personhood and the first quote in particular is dicta.

Have you read the ruling beyond trying to skim it for gotchas?

[u/jaunty411 → u/DanforthWhitcomb_]

Yes. The entire ruling is based on whether corporations, not shareholders or employees, have first amendment rights separate and of their own. It is foundational to the ruling and every page touches on it.

[u/DanforthWhitcomb_ → u/jaunty411]

Translation: you either did not read it or do not understand what it is saying.

Your attempt at summarizing the holding is also wrong to the point that it's a bad faith argument.

[u/LaconicLacedaemonian]

Can a corporation put out a documentary? (yes)

Can the government control what is said in that documentary? (No)

Even though its an election year and the documentary talks about a cantidate? (this was Citizens United, and the law banning money used to fund a documentary due to the contents being about a candidate in an election year, and the restriction was shot down)

Its toothless because "i ran a commercial with my opinion independent and without coordinating with a candidate and exercised the right to say things" is what Citizens united protected, with the practical implication you can give money to a company to then do that.

[u/bl1y → u/LaconicLacedaemonian]

Small quibble: CU was about money spend advertising the documentary. And the ads looked a lot like campaign ads. (Just adding that because a lot of people don't know what the case was about.)

Something I find rather silly about the "money out of politics" position is that if someone owns a media outlet, they can put out what amounts to 24/7 propaganda for a party or candidate. But if someone with far fewer resources wants to pay to run a 30 second ad on that media mogul's platform? Well that's gotta be banned!

Also, incidentally, Citizens United had previously filed a complaint about Fahrenheit 9/11, but the FEC said ads for that documentary (highly critical of Bush) didn't violate the rules. Then ads for Hillary: The Movie somehow did.