Hawaii just found a way around Citizens United.
Other states are following.
The Core News
On May 14, Hawaii Governor Josh Green signed a historic, bipartisan bill (passing 24-0 in the State Senate and 50-1 in the House) that effectively bans corporate spending in state elections. Set to take effect on July 1, 2026, it represents the first successful state-level legislative effort to bypass the Supreme Court’s 2010 Citizens United ruling.
The Legal Loophole: “Corporate Power Reset”
Citizens United established that the government cannot restrict a corporation’s First Amendment right to free speech via political spending. However, a legal framework developed by Tom Moore (Center for American Progress) shifted the focus from a corporation’s rights to a corporation’s powers.
State-Created Entities: Building on an 1819 Supreme Court precedent by Chief Justice John Marshall, the framework notes that corporations are artificial entities created by state law. They only possess the powers explicitly granted to them by the state.
The Distinction: Rather than trying to restrict a corporation’s speech, Hawaii simply changed its incorporation laws to decline to grant corporations the legal power to spend money on elections in the first place.
Impact and Enforcement
Targeting Dark Money: The law does not ban Super PACs, but it blocks their primary source of anonymous corporate funding. Super PACs in Hawaii can now only operate using fully disclosed donations from actual human beings.
National Security: Lead author State Senator Carl Rhodes highlighted that anonymous corporate “dark money” (which grew from under $5 million nationwide in 2006 to over $1 billion in the 2024 presidential cycle) poses a national security risk by allowing foreign adversaries like Russia, Iran, or China to potentially fund American elections undetected.
Severe Penalties: Corporations that violate the new law face severe consequences, including the loss of tax privileges, losing the right to sell products to the state government, or being entirely banned from doing business in Hawaii.
The Road Ahead
While the Hawaii Attorney General warned that the law will face immediate legal challenges, legal scholars note the underlying state authority is deeply rooted in 200 years of American law, making the outcome highly unpredictable for a conservative Supreme Court.
Hawaii’s model is rapidly spreading:
Montana activists have cleared legal hurdles to put a similar initiative directly on the ballot for voters this November.
14 other states (including California, New York, Georgia, Minnesota, and Vermont) have already introduced legislation based on this framework, with Connecticut planning to follow in 2027.
ELSEWHERE
Hawaii vs. Citizens United
The Atlantic
State lawmakers want to change the terms of personhood for corporations.