The 2016 election is shaping up to. Campaign Finance Laws: Their Solution Is the Problem Nathan Harvey

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1 Campaign Finance Laws: Their Solution Is the Problem Nathan Harvey The 2016 election is shaping up to be the most expensive in American history. Of course, this is unsurprising given the exponential increase in campaign spending we have seen in the last few election cycles. Most of this money has been concentrated on political advertising. In 2008, The New York Times reported that spending on political advertising reached at least $2.5 billion. By 2012, that number had doubled to around $5 billion, according to campaign finance reports. There is little doubt that this trend is set to continue in the upcoming cycle. Many news outlets have predicted that spending on campaign advertising will easily top $5 billion, with 9

2 others anticipating that number to reach upward of $7 billion. Florida is no exception to this growing inclination in American politics to spend more and more money on campaigns. As a battleground state in presidential elections, Florida, with 29 electoral votes and 11 major media markets, is often a major player for political advertising and a target for election spending generally. According to the Center for American Politics, total political contributions to Florida s national and state candidates in 2004 were $125 million. In 2008, contributions amounted to nearly $156 million. That number jumped to $226 million by With total contributions already exceeding $157 million for the 2016 election cycle, it is very likely that this year will see a bigger influx of money into Florida than ever before. The explosion of campaign spending in recent years has been met with resistance from many Americans. There seems to be an instinctive reflex in the American psyche against the marriage of money and politics. After all, the more money there is in the political system, the more likely corruption ensues, right? Not necessarily. It is quite natural that Americans feel uneasy about all of this money being injected into the political process. After all, they have good reason to be We collectively spent less money on advertisements discussing candidates and issues in the media than a single company spent on product advertisements in one calendar year. concerned about corruption in government. The government has grown within the past century into an enormous, bloated behemoth with fewer checks on its power than ever before. With the government s ability to distribute benefits or punishment, and its power to choose economic winners and losers, it is no surprise that groups seek to influence it by spending large sums of money on political campaigns. But even amid the bad taste that money and politics leaves in people s mouths, there is no evidence that spending more on elections hurts democracy. This begs the question: is more campaign spending really such a bad thing? Before delving into specifics, it will be beneficial to first put some numbers into perspective and examine the larger picture. Consider that spending on political advertising in the United States in 2008 amounted to approximately $2.5 billion. By comparison, the nation s largest advertiser, Proctor & Gamble, spent nearly $5 billion that same year. Thus, we collectively spent less money on advertisements discussing candidates and issues in the media than a single company spent on product advertisements in one calendar year. Another way to put these numbers into context is to think of how much money we spend on elections compared to the amount we spend on 10 The Journal, Fall 2016

3 government generally. The 2012 federal budget was $3.7 trillion, while about $5 billion was spent on elections that year. Hypothetically, if elections were entirely funded by the government, we would only spend about percent of the budget electing the individuals that run our country. These comparisons show just how little we actually spend on our democratic process in the scheme of things. Even considering the relatively small amount of money spent on our democratic process, the influence of money in elections has long been a central concern in American politics. To combat this assumed problem, the federal government and the states have adopted campaign finance laws, each with their own set of rules. Many of these campaign finance laws seek to limit the amount of money that can be contributed to or spent on electioneering communications. The Bipartisan Campaign Reform Act of 2002, otherwise known as McCain-Feingold, is the most recent and comprehensive campaign finance law adopted by the federal government. The Sens. John McCain, R-Ariz., and Russ Feingold, D-Wisc., confer on lobbying reform in Courtesy of NBC News. law was intended to curb the proliferation of soft money in elections by restricting political advertisements funded by outside groups from running 30 days before a primary and 60 days before a general election. However, since McCain-Feingold became law, campaign spending has exploded. The law has also raised significant and serious First Amendment questions. For this reason, many of the provisions of the law have been challenged in federal court on multiple occasions. The final blow came in 2010 when the Supreme Court struck down spending restrictions for corporations and unions in the controversial Citizens United case, all but crippling McCain-Feingold. On top of the legal complications surrounding the federal government s effort to limit campaign spending, history and social science show that campaign finance laws have done little to solve the perceived ills of our democratic system. In many ways, campaign finance laws have actually exacerbated many of the challenges their supporters attempt to address. Although these laws were originally intended by the American public to cleanse our political system from corruption, they have failed. From a public policy perspective, there is a maxim that we should judge laws based on their results, not by their intentions; but, when it comes to the campaign finance laws that our policymakers have crafted, we have seen neither good results nor good intentions. At most, they have done nothing to curb the negative influence of money. At the same time, these laws have 11

4 made our political system less competitive and have prevented voters from becoming more educated about issues and candidates. For one, campaign finance laws facilitate a system in favor of incumbent politicians. Historically, campaign spending has been shown to have a relatively small impact on election outcomes. Other factors, such as party identification, voter turnout, and political environment play much larger roles in deciding elections than campaign spending. However, spending does come into play when a challenger is facing an incumbent. Since incumbents typically suffer diminishing returns on the amount of money they spend in elections, challengers often benefit from increased spending much more than incumbents do. This is due in large part to incumbents having higher name recognition and established voting records, whereas challengers are often not as well known to voters and additional spending allows them to better introduce themselves to voters. So it is no surprise that incumbent politicians would be in favor of limiting campaign contributions or spending. Doing so handicaps their electoral opponents from mounting a potentially successful campaign against them and protects their incumbency advantage. This makes for far less competitive elections and helps explain why Congress has a nearly 90 percent retention rate each election cycle while the institution s approval rating hovers closer to 10 percent. Not only do campaign finance laws rig the system in favor of incumbents, but they also prevent the dissemination of political knowledge to the public. Research shows that higher campaign spending produces more knowledge about electoral issues and candidates. A study by the Cato 12 The Journal, Fall 2016

5 Institute found that as spending increased, particularly by challengers, more people were able to accurately place a candidate on a 7-point ideology scale. The study also suggested that voters were better able to match candidates with their respective policy positions. Further, the evidence submits that spending boosts voter awareness, recall, ability to perform campaign-related knowledge tasks, and respondent accuracy. Thus, more spending makes for a more informed electorate, which in turn, makes a better democracy for all. While it is undeniable that campaign spending has surged within the last few election cycles, we must realize that limiting campaign contributions and capping election spending hurts the democratic purpose more than it helps. As we have seen, campaign finance laws serve to protect incumbents and prevent competitive elections. These laws also hinder the distribution of much needed political knowledge that allows citizens to make informed votes. This is not to say that campaign spending should go unchecked, but the campaign finance laws as we know Not only do campaign finance laws rig the system in favor of incumbents, but they also prevent the dissemination of political knowledge to the public. them today can be categorized as the following their solution IS the problem. As the 2016 election continues and concludes, we are sure to see more spending on campaigns and political advertisements than ever before. No matter the outcome of the election, the growing trend to spend increasing amounts of money on political campaigns is unlikely to change. Even so, this is not necessarily a bad thing. Not only do candidates, particularly those challenging incumbents, benefit from being able to better communicate their message, but voters benefit too from more information about candidates and issues. Money is simply a tool used to fuel our democratic process. If we truly aspire to have a less corrupt and more transparent electoral system, we must dispel the notion that spending more money on elections is inherently bad. After all, as Americans we know that even democracy comes with a price tag. Nathan Harvey is a law clerk at Institute for Justice. 13

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