Tag: campaign finance

Time to End the Campaign Finance ‘Reform’ Ruse

Today POLITICO Arena asks:

Looking at the repeated failures of campaign finance reforms, is it time to end the restrictions?

My response:

Funny, we didn’t hear the primal scream about campaign finance from liberal Democrats during the 2008 campaigns, when money was pouring into their coffers from everywhere. Do we need any better evidence of the hypocrisy surrounding their screams this year? If so, turn to the lead editorial in this morning’s Wall Street Journal. It’ll tell you all you need to know about the campaign finance “reform” ruse that has been going on for years.

As I’ve written often at the Arena, the true aim of this game is incumbent protection, and it has been from the beginning. But thanks to the First Amendment, incumbents can’t shut down all private campaign financing, or regulate it in many of the ways that have been tried over the years. So after each new “reform,” private money – which is speech – finds new ways to try to influence election outcomes. The reformers real beef, then, is with the First Amendment. They won’t say it. But there it is. It’s time to end this nonsense.

The New York Times Undermines its Narrative

The New York Times has an odd story today on campaign finance on its front page. The story argues that organizations which do not have to identify their donors are sponsoring ads that criticize candidates for office. Complaints about secrecy notwithstanding, the third paragraph of the story discloses one of the major contributors to a group and reveals his putative interests in becoming involved. It also goes into great detail about the donor, his political associates, and even meetings his associates attended and what decisions were made therein. Later parts of the story recount the already disclosed names of supporters of Karl Rove’s efforts in this cycle. True, the story does not reveal everything the reporters believe should be disclosed about donors. But the groups and their donors are hardly secret given what is revealed in the story itself.

The story also cannot get its story straight. The Times’ reporters evidently wanted to fit what they have found into a standard, “special interest” template: the organization in question - the American Future Fund - as a front for energy interests. The story also says the group has sponsored ads on general themes like too much spending,  Obamacare, and another stimulus. But the reporters are determined to see “suggestions of an energy-related agenda,” their own reporting notwithstanding. This forcing of facts into a template comes along with a recognition that the politics of energy and ethanol have become more complicated making it difficult to say what interests are actually being advanced in the American Future Fund effort.

So the story discloses, while decrying secrecy, and both asserts and denies the domination of special interests. In the end, the story holds fast to a simple, conventional theme which is then undermined by its reporting. We should admire, I guess, that the Times’ reporters were willing to undermine their own narrative. But why not just embrace complexity? They are writing the first, not the final, draft of history.

The story also reports that donors desire anonymity because they wish to avoid taking sides in political disputes in public. The story does not say why they desire to avoid taking sides. Perhaps a quick call to the Koch family or George Soros might have provided an answer to that question.

Obama’s Attack on the Chamber of Commerce: Perfectly Consistent

Today POLITICO Arena asks:

Will President Obama’s campaign finance attacks on the U.S. Chamber of Commerce and others resonate with voters over the next three weeks?

My response:

With so many senior advisors leaving the White House so early in the term, you have to wonder who’s left to advise the president except, well – the president. And judging from his attacks on corporate campaign spending generally and the U.S. Chamber of Commerce in particular, you’re inclined to believe that that’s the case. After all, the attacks are perfectly consistent with the president’s larger agenda.

As others here at the Arena have noted, not since the New Deal have we seen so sustained an anti-business political agenda as has come from this president. Under such an assault, is it any wonder that businesses have created so few jobs, or that they’re fighting back? Yet for that, the president is criticizing them – with campaign finance claims that not even the New York Times finds credible.

This campaign finance angle has an especially unseemly air about it, however – see the Wall Street Journal’s editorial this morning about Democrats unleashing the IRS and Justice on donors to their political opponents. The effort to restrict the speech that campaign finance represents – promoted by the political establishment, especially Democrats – has always been at bottom about incumbency protection, not “good government.” We didn’t hear complaints when Obama abandoned the public financing system in 2008, for example, as “unconscionable” amounts of private money poured into his campaign. Obama may be barking now that the shoe’s on the other foot, but his bark rings as hollow as his agenda, which is why it’s not resonating with the voters, and is not likely to in the three weeks ahead.

Clean Elections Act Dirties the First Amendment

In 1998, after years of scandals ranging from governors being indicted to legislators taking bribes, Arizona passed the Citizens Clean Elections Act. This law was intended to “clean up” state politics by creating a system for publicly funding campaigns.

Participation in the public funding is not mandatory, however, and those who do not participate are subject to rules that match their “excess” private funds with disbursals to their opponent from the public fund. In short, if a privately funded candidate spends more than his publicly funded opponent, then the publicly funded candidate receives public “matching funds.”

Whatever the motivations behind the law, the effects have been to significantly chill political speech. Indeed, ample evidence introduced at trial in a lawsuit challenging the law showed that privately funded candidates changed their spending — and thus their speaking — as a result of the matching funds provisions. In elections, where there is no effective speech without spending money, the matching funds provision of the Clean Elections Act diminishes the quality and quantity of political speech.

In 2008, the U.S. Supreme Court in Davis v. FEC struck down a similar provision in the federal McCain-Feingold law in which individually wealthy candidates were penalized for spending their own money by triggering increased contribution limits for their opponents. Even this modest opportunity for opponents to raise more money was found to be an unconstitutional burden on political speech.

Cato has thus filed a brief supporting a request that the Supreme Court review the lower court’s decision upholding Arizona’s Clean Elections Act.  We highlight Davis (in which Cato also filed a brief) and numerous other cases that point to a clear conclusion: if the mere possibility of your opponent getting more money is unconstitutional, then the guarantee that your opponent will get more money (Arizona’s act automatically disburses matching funds) is even more so. Allowing the government to abridge political speech in this fashion not only diminishes the quality of our political debate, but it ignores the fundamental principle upon which the First Amendment is premised: that the government cannot be trusted to regulate political speech for the public benefit. 

The Supreme Court will decide later this fall whether to review this case, McComish v. Bennett.

DISCLOSE Again and Maybe for the Last Time

The DISCLOSE Act, slightly modified, is headed for a cloture vote on Tuesday afternoon. The alterations to the bill have changed few minds outside of Congress. It remains to be seen whether the modification in the bill — the sponsor removed a passage allowing labor unions to transfer funds among its affiliates — will be enough to attract enough support to achieve cloture.

My policy analysis of DISCLOSE applies to the altered bill.

The Center for Competitive Politics provides an analysis of the altered bill here.

The American Civil Liberties Union is sending around a letter of opposition that states “we believe this legislation would fail to improve the integrity of our campaigns in any substantial way while significantly harming the speech and associational rights of Americans.”

The ACLU has four objections to the altered bill:

  • The DISCLOSE Act fails to preserve the anonymity of small donors, thereby especially chilling the expression rights of those who support controversial causes.
  • The DISCLOSE Act would chill not only express advocacy on political candidates, but also issue advocacy.
  • The DISCLOSE Act imposes impractical requirements on those who wish to communicate using broadcast messages.
  • The DISCLOSE Act imposes unjust restrictions on contractors, TARP participants and corporations with minimal foreign participation.

Big Money Speaks

Several groups came together to raise $15 million that they are now spending to promote the Fair Elections Now Act, the current public financing bill before Congress. I think this is a good thing. That is, I think it’s a good thing they can raise and spend several million dollars making their case on a public matter. It is an especially good thing compared to an alternative world in which Congress prohibited these groups from raising and spending millions of dollars for political advocacy.

Still, we might keep in mind a recent report by the United States Government Accountability Office that examined public financing in Maine and Arizona:

While there was some evidence of statistically significant changes in one of the five goals of Maine’s and Arizona’s public financing programs, we could not directly attribute these changes to the programs, nor did we find significant changes in the remaining four goals after program implementation. Specifically, there were statistically significant decreases in one measure of electoral competition—the winner’s margin of victory—in legislative races in both states. However, GAO could not directly attribute these decreases to the programs due to other factors, such as the popularity of candidates, which affect electoral outcomes. We found no change in two other measures of competition, and there were no observed changes in voter choice—the average number of legislative candidates per district race. In Maine, decreases in average candidate spending in House races were statistically significant, but a state official said this was likely due to reductions in the amounts given to participating candidates in 2008, while average spending in Maine Senate races did not change. In Arizona, average spending has increased in the five elections under the program. There is no indication the programs decreased perceived interest group influence, although some candidates and interest group officials GAO interviewed said campaign tactics changed, such as the timing of campaign spending.

In other words, nothing changed except that taxpayers paid for campaigns.