Supreme Court upholds political party money limits

WASHINGTON (Reuters) - The Supreme Court on Tuesday reaffirmed the limits on contributions that political parties can raise, and rejected a challenge by the Republican Party that the restrictions violated free-speech rights.

The justices sided with the Obama administration and affirmed a ruling that upheld the limits, a cornerstone of the 2002 federal campaign finance law designed to regulate the influence of money in politics.

Republican Party attorneys had sought to end the limits and cited the Supreme Court's ruling in January that corporations can spend freely to support or oppose candidates for president and Congress.

That decision has been denounced by President Barack Obama for turning loose a flood of special-interest money into the U.S. political system before the November congressional elections, when Democratic control of Congress is in jeopardy.

It also has provoked efforts by Democrats in Congress to adopt legislation to blunt the impact of the ruling and has become a major issue at the Senate confirmation hearings for Elena Kagan, who Obama has nominated to the Supreme Court.

The challenge to the limits, brought by the national Republican Party, its chairman, Michael Steele, the California Republican Party and the Republican Party of San Diego County, was filed one week after the general election in November of 2008.

In appealing to the Supreme Court, attorneys for the Republican Party said high court review was warranted because the case has profound implications for the free-speech rights of political parties and their members.

But the justices upheld a provision at the heart of the 2002 campaign finance law. It was named after Senator John McCain, the unsuccessful Republican presidential nominee in 2008, and Democratic Senator Russell Feingold.

"SOFT MONEY"

The court's ruling applied to limits on the amount of "soft money" political parties can raise and spend. Under the law upheld by the court, national political parties may not solicit, receive, direct or spend contributions over $30,400 annually from an individual donor.

Before the law's adoption, the two political parties had raised hundreds of millions in unregulated money.

The Republican Party said it sought to end the limits so it could raise and spend money to help elect candidates to state offices, finance congressional redistricting efforts and fund lobbying efforts.

The Supreme Court initially upheld the limits in 2003.

But with the addition of Chief Justice John Roberts and Justice Samuel Alito, both appointees of then-President George W. Bush, the court's conservative majority in recent years has struck down a number of law's other provisions, such as the ruling in January.

Of the nine Supreme Court members, Justices Antonin Scalia, Clarence Thomas and Anthony Kennedy said they would have heard the appeal by the Republican Party.

Supporters of the law said the Republican and Democratic political parties in the last election cycle received more than $1 billion in regulated contributions covered by the law, an amount they called more than sufficient for the political parties to be heard.

(Editing by David Storey)