It’s the Spending, Stupid! Understanding Campaign Finance in the Big‐​Government Era

July 18, 2001 • Briefing Paper No. 64

Proponents of new restrictions on campaign finance often argue that the United States spends too much money on campaigns and elections. That proposition is difficult to sustain since the nation spends so little of its wealth on campaigns. Advocates of new regulations also decry increases in overall spending on elections. Such spending has increased in nominal terms over time and especially in recent decades. However, the increases should be seen in perspective. General inflation accounts for a significant part of the rise in campaign spending; Americans now spend more on everything than they did in the past.

The increase in election spending should also be seen in the light of five other “mores”: more elections are held, more wealth is available for politics, more voters take part, more advertising must be bought, and more campaign finance regulations must be honored.

The most important factor driving campaign finance upward is “more government.” Taxes and regulations on society have increased the ambit of government at all levels. Increasing government activity leads to more efforts to influence political decisions including spending on campaigns, a relationship confirmed by scholarly studies.

Efforts to restrict or ban campaign spending will be futile. The only sure way to lower campaign spending would be to restrict government to its constitutional powers.

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