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What does campaign finance do?
Here is Ed Lopez's survey article, here is the survey from Thomas Stratmann. Overall the academics who work on this issue tend to see the practical ramifications of campaign finance restrictions as very often constituting less than meets the eye. It's also well understood that most campaign finance reform benefits incumbents, who already have name recognition.
The pointer is from Ed Lopez, who notes:
Consider two ratios.
1. In 2000 the federal government spent about 1.8 trillion (~18% of GDP), and total campaign expenditures on all federal elective offices was about $1.85 billion (about $1b on congressional races, $0.35b on presidential, and $0.5b in soft money). So federal public sector advertising was 1/1000th of federal public spending. Ratio 1 = 0.001.
2. In 2000 the private sector share of GDP was about $7.5 trillion (after federal, state and local spending net of intergovernmental transfers), and total private sector advertising, according to Advertising Age, was $240 billion (Statistical Abstract Table 1251). So private advertising was 3.2% of private spending. Ratio 2 = .032.
By this comparison, private sector advertising is more than thirty times greater than the amount we spend on federal elections trying to make sure we get the right person for the job. Given how much we expect from our federal government, isn't it surprising that campaign spending isn’t twice, or even ten times, more than it is right now?
Ed thinks that campaigns need more money flowing through them, not less; I don't have a personal view on this issue. Reihan Salam offers interesting comment on recent controversies surrounding Barack Obama.
Posted by Tyler Cowen on June 21, 2008 at 10:59 AM in Political Science | Permalink
Comments
The point isn't whether too much or too little money is spent on campaigns, it is the fact that large campaign contributors (wealthy individuals and "bundlers") have a disproportionate influence on who can be a viable candidate, on who wins, and therefore on what policies are adopted and decisions made by office-holders.
We need to create a voluntary system of mostly publicly-funded campaigns (primary and general election) that is sufficiently attractive that no candidate will choose to opt out (i.e., there will be no fundraising and spending advantage to opting out). It will be the best financial investment taxpayers have ever made, resulting in great savings for taxpayers and consumers as the payback for big-money campaign contributions (subsidies, special tax breaks, import quotas/tariffs, earmarks, etc.) is eliminated. And it will bring our democracy much closer to de facto "one person, one vote".
Posted by: Brooks at Jun 21, 2008 11:39:08 AM
Political candidates do get quite a lot more contributions in kind as far as publicity, marketing and advertising go than your average breakfast cereal, though. I haven't the foggiest idea what that would be worth, though I'd imagine marketing professionals would have some notion of the value.
Also, I'm suddenly struck by the comparison of tupperware parties and townhall meetings.
Posted by: PaulJC at Jun 21, 2008 11:40:53 AM
Brooks is surely right that the issue is that it's undemocratic to finance campaigns in this way. There might well be some link between the contributions you get and the support you have but the opportunity the wealthy have to distort debate and the moral worth of candidates who are ready to be bought make the system itself a farce.
In Finland the major candidates for the presidency (and even some minor ones) have to go through no fewer than nine televised debates and there are no silly rules either. That's democracy.
Posted by: Finnsense at Jun 21, 2008 12:04:59 PM
With regard to these supposedly comparable ratios: What about advertising by federal contractors (i.e., at least that portion as is directed toward government decisionmakers) and advertising by government agencies (i.e., their entire PR budgets)?
Posted by: Jason Briggeman at Jun 21, 2008 12:51:41 PM
Brook's numbers are silly. While he's correct to commonsize the figures he's using against the corresponding federal / public expenditures, he's comparing one product from the public sector against the entire range of products in the private sector. Should we be spending a share 32 times as large on advertising for soda, toothbrushes, cars and the rest as we spend on the presidential election? You look at it that way and, golly gosh, maybe we're overspending on the election.
However, I imagine I put much less stress on the impact of who actually wins individual elections than Brook's does.
Posted by: Team John L at Jun 21, 2008 1:12:41 PM
Team John,
Whose numbers?
Posted by: Brooks at Jun 21, 2008 1:20:40 PM
Indeed, I was referring to those quoted from lopez. I guess I slipped Freudian-style in typing that up. My apologies.
Posted by: Team John L at Jun 21, 2008 1:22:41 PM
The campaign finance laws abrigde the right to free political speech. If the law prevents me from spending as much as I like promoting someone for public office, then it has abridged my rights. If it forcibly takes money from me to support the candidacy of those I oppose, then it has also violated my right to free political speech. This is black and white, and no amount of wordsmithing can gloss this over.
Once you have ceded the right of the government to determine how much, for whom, how, and when political speech may be employed by the individual, then you have already consigned yourself to tyranny.
Posted by: Yancey Ward at Jun 21, 2008 1:26:36 PM
Yancey,
What do you think of my idea, a VOLUNTARY system of public financing of campaigns?
Posted by: Brooks at Jun 21, 2008 1:29:33 PM
Yancey,
Another question: Are you opposed to ANY campaign finance laws? In other words, if Exxon-Mobil wants to give $1 billion to a presidential candidate's campaign (or to a sitting president for his re-election campaign), would you want that to be legal?
Posted by: Brooks at Jun 21, 2008 1:32:31 PM
Brooks is wrong. James Madison solved this problem long ago when he wrote Federalist No 10: donations and lobby efforts will all cancel out in the end so long as no restrictions are placed on factions. So the problem isn't too much spending by donors; the problem is that it's too little. Campaign finance laws only make the problem worse by creating a wasteful evolutionary arms race btw the reformers and the donors
Posted by: enrique at Jun 21, 2008 1:46:00 PM
Brooks,
Any candidate is free to reject donations from me, but he has no standing to prevent me from spending or speaking on his behalf or against his candidacy. In other words, your voluntary system can in no way restrict my right to speak, or purchase advertising for or against any candidate.
As a matter of first principle, I support no campaign finance laws. If the shareholders of Exxon want to give away their money to a candidate, then they are free to do so. As a compromise position, I might be persuaded to limit campaign donations to those given at the individual level, but any restrictions on size will just be another violation of the individual's rights to free political expression.
Posted by: Yancey Ward at Jun 21, 2008 2:13:18 PM
Brooks,
I went back and read your first comment again. Your system is not voluntary. You proposed use taxes to fund the campaign spending pool. Your system might be voluntary for the candidates who draw from it, but not for those who are forced to contribute to it.
Posted by: Yancey Ward at Jun 21, 2008 2:17:12 PM
Yancey Ward: The campaign finance laws abrigde the right to free political speech. If the law prevents me from spending as much as I like promoting someone for public office, then it has abridged my rights.
Laws against bribery also abridge these rights. A bribe is paying for political speech in the sense that a briber wishes to pay a public official to spread their political message both with their vote as well as via political speeches to the public, the legislature, etc. This is exactly why money is not speech, or else bribes should be legal.
Furthermore, I would argue that campaign contributions leads to much bigger and more intrusive government via rent-seeking. Tariffs, subsidies, preferential tax treatment, etc. Corporations don't want an absence of regulation; they want regulation that hurts their competitors.
Campaign finance is not a black and white issue with clear obvious solutions (although matching funds for small donors strikes me as rather attractive). Instead, the ideals of liberty need to be balanced with the ideals of representative democracy. With most libertarians ignoring the topic altogether, we are bound to end up with a campaign finance system that ignores incentives and thus honors neither liberty nor democracy.
Posted by: perfectlyGoodInk at Jun 21, 2008 2:18:58 PM
PerfectlyGoodInk,
Fine, then pass a constitutional amendment that states that the government may restrict the speech of those more capable of exercising it.
I have no problems with laws against bribery of public officials, but those laws should apply to money given and taken for personal enrichment. If the donations come for the purpose of campaign spending, then the first principles of free speech override those against bribery.
In any case, the extension of campaign spending and speech on behalf of a candidate for public office cannot be reasonably ascertained to be bribery of those public officials. Practically all supporters of campaign finance laws take the position that speech on behalf of a candidate may also be restricted. What is your position?
Posted by: Yancey Ward at Jun 21, 2008 2:30:42 PM
Campaign contributions help politicians gain or hold onto political power, and I can't think of too many things that are more personally enriching than power. Like money, it can get you quite a few perks.
So I see no substantive difference between a campaign contribution and a bribe. The difference is largely semantic, describing the paths that the money flows take, while the end result is the same.
So while I am more open to restrictions upon political speech than most libertarians, I generally would prefer a solution that did not rely upon restrictions, as money tends to find a way around them (just like bribe money has). But the goal should not be to eliminate money from the system, but to make our political system more representative.
Posted by: perfectlyGoodInk at Jun 21, 2008 2:48:38 PM
Yancey,
Correct that my proposed system is not voluntary from the taxpayers' perspective; I meant voluntary from the candidate's perspective. And no, it wouldn't stop you or anyone else from buying ads or other forms of political speech apart from the candidates' spending and speech.
(1) So I ask you again, would you object to any such a system of public financing, even if the candidates could opt out if they wished?
(2) If you would object any such system because you object to taxpayers being forced to finance it, is your objection practical (not a good use of taxpayer funds) or philisophical? In either case, please explain.
(3) And if you would object to any such system if taxpayer financed, would you object if it were voluntarily funded through private contributions?
Posted by: Brooks at Jun 21, 2008 3:07:16 PM
There is only one indicator of campaign finance reform, whether incumbents are re-elected more or less often. Any "public" financing system that would pass will result in more often, if it can possibly get more often than it is already is.
Posted by: Andrew at Jun 21, 2008 4:08:14 PM
Brooks,
Yes, if it were financed via taxes, I would be opposed. Otherwise, people are free to voluntarily fund any system they desire.
Posted by: Yancey Ward at Jun 21, 2008 7:06:11 PM
Yancey,
Please answer my question #2. It would be nice to have your rationale, not just your position.
Posted by: Brooks at Jun 21, 2008 7:12:06 PM
PerfectlyGoodInk,
More reprensentative by whose measure? By your argument, any campaign donation can be seen as a bribe and be appropriately banned as such.
Do you then support restrictions on non-candidates to spend whatever amount they wish on advertising and speech supporting or attacking the candidacies of seekers of political office? If so, then how do you determine what is appropriate and what is not?
Posted by: Yancey Ward at Jun 21, 2008 7:16:41 PM
Yancey,
And since I'm heading out for the evening, IN ADDITION to answering #2, please also answer this:
If the direct effect of such a taxpayer-funded system would be to save taxpayers 10 times the cost of the campaign funding (by eliminating special favors the politicians dole out to their big campaign contributors using the taxpayers' money), would you still oppose creating such a system?
Posted by: Brooks at Jun 21, 2008 7:18:57 PM
Brooks,
My objection is philosophical. I do want my money and time spent supporting candidates to which I might be opposed, nor would I want to force others to support candidates that they are opposed to.
There are practical objections, too. How do you determine who gets the money and who does not? If you are going prevent some candidates from drawing from the pool, then you must set an arbitrary line where some get it and some don't, and the only way this can be done is to require a certain level of prior public support, but then how do you build up this support if you can't spend on political speech yourself?
Posted by: Yancey Ward at Jun 21, 2008 7:24:10 PM
Brooks,
I would oppose it even if it saved a 1000 times as much. You don't correct one wrong by utilization of another.
Posted by: Yancey Ward at Jun 21, 2008 7:26:03 PM
It makes perfect sense that there's much less nominal spending on elections than private advertising. Each voter has about, say, a dozen elected representatives who matter, and they only select them once every two to four years on average. In that same timeframe, they encounter tens of thousands of spending decisions. Their choices on election day are also more limited, with for the most part two or even only one choice per office. Given that for each choice, there's really only so much advertising that can be done for each choice before it gets annoying, it is unsurprising that there's so little spending on elections.
Another factor is that there is a huge amount of implicit spending on elections in the form of political organizing by unions, churches, etc. which isn't included in the spending total. The private sector for the most part doesn't engage in this; aside from maybe car enthusiast clubs and whatnot.
Also to consider is that for the people who benefit most in monetary terms from election results, it is entirely possible that it is a more worthwhile to do post-election lobbying or subsidies for ex-political people (for instance, support of think-tanks to house out-of-power Republicans who support your industry). In other words, not trying to influence election results, but making sure that regardless of the results the people elected agree with them after a couple years.
Posted by: bbass at Jun 21, 2008 7:30:41 PM
