Exhibit A came yesterday. The New York Campaign Finance Board preempted a vote by the City Council to loosen the limits on political contributions by unions. The significance of the board’s open retreat will be felt well beyond City Hall — because the New York experience reinforces a national trend against current campaign‐finance laws.
These restrictions have always produced unintended outcomes — mostly bad: They’ve made elections less competitive, parties weaker and campaigns longer and more negative. The recent moves by local and national governments to regulate campaigns have been no exception to this rule.
And now key Democratic Party interest groups are allying not to strengthen, but to explicitly weaken, the very type of campaign‐finance restrictions the party’s trumpeted for so long.
Back to the City Council: In the biggest change to New York’s Campaign Finance Act in four years, the council was set to raise considerably the amount unions can donate to candidates in city elections. (Mayor Bloomberg opposed the change, but the measure would likely have had a veto‐proof majority.) Now, several locals within a larger union may make separate contributions to the same candidate.
Before this change, contributions from local chapters of a union or organizations affiliated with the same union were to be treated as contributions from the same source. Central Labor Council President Brian McLaughlin, whose organization represents almost 400 union locals, termed those limits a “slap to democracy” that unfairly reduced organized labor’s political strength.
The bottom line is that organized labor is no longer willing to bang its head against the campaign‐finance‐reform wall.
Meanwhile, in Washington, most of the Congressional Black Caucus’ 43 members have decided they made a mistake three years ago in voting for the Bipartisan Campaign Reform Act. Rep. Greg Meeks (D‐Queens) represents the new sentiment among African‐American congressmen. “If I had the chance to vote again,” says Meeks, “I wouldn’t vote the way I voted.”
The CBC’s loud complaint: During the 2004 campaign, some “527 groups” (named for the section of the IRS code that covers them) raised unlimited amounts of money for advertising and get‐out‐the‐vote campaigns using money that normally would have flowed to grass‐roots groups that register and mobilize African‐American voters.
In consequence, last fall, many urban African‐American politicians found themselves sitting atop relatively ineffective and impoverished political organizations. These officeholders have no desire to repeat the experience. They want more money to flow to the parties’ campaign organizations and to the candidates’ own campaigns.
That’s why Rep. Albert Wynn (D‐Md.) has co‐authored a bill, called the 527 Fairness Act, which removes the limit on the amount of money an individual may donate to congressional candidates and federal parties in any two‐year election cycle.
Liberal politicians and interest groups are belatedly learning the wisdom of the old adage that you should be careful what you wish for, lest you get it. As labor and African‐American groups loudly decry campaign‐finance reform’s negative impact upon their political operations, we are witnessing the first of the pro‐regulation dominoes to fall.
Many political animals whose instincts are decidedly pro‐regulation are starting to appreciate that, like most regulatory schemes, campaign‐finance reform looks far better in theory than it does in practice.
If the political momentum continues to grow on the deregulation side of the debate, yesterday’s Campaign Finance Board move may prove a sticky nail in the coffin for this exercise in government overreach.