Tax Credits and Campaign Spending

Law professor John McGinnis has written four posts on Citizens United for the new Federalist Society blog. All four are worth reading. I focus here on the final post and its diffident policy proposal.

McGinnis makes some good points about inequality in campaign spending.

We have a free speech guarantee in our constitution, not an equal speech guarantee. Wealth is in fact a source of more diverse influences than the other sources that would take its place. The wealthy are heterogeneous in their views. Last election more people earning over $250,000 a year voted for Obama than McCain despite the former’s promise to raise their taxes.  Because innovation is always churning markets, the wealthy have constantly shifting interests.

Those who benefit from restrictions on campaign spending are the media and the entertainment field. They have fewer interests and are ideologically similar.

McGinnis remarks that those who are concerned about unequal spending might support a tax credit of several hundred dollars for those making less than $100,000 annually. He believe this credit would increase the information available to voters.

I wonder whether this would lead to more contributions. The presidential system now permits people to direct part of tax revenue to the presidential public fund. This check off system has seen declining participation for more than a generation.

You might argue that tax credits allows people to contribute to candidates they support rather than a general public funding system. But these credits would have to be paid for by some future taxpayers who would be compelled to fund current candidates. (I say “future taxpayers” because the tax credits would be introduced now and thus paid for by debt). Such compulsion seems illiberal. Moreover, many of the future taxpayers who will be forced to pay for the credits will be either minors or unborn. The tax credits now will be taxation without representation later.