Myths of Money in Politics

As we get closer to November’s presidential election, there has been increased interest in campaign finance law. What was once the bane of most political science majors’ existence is now suddenly a popular topic in both the media and even pop culture. Campaign finance law has earned a byline in a seeming majority of major news outlets’ election stories, and was the subject of an episode of Aaron Sorkin’s The Newsroom weeks ago.

For most folks, their knowledge of an otherwise obscure topic centers on the 2010 Supreme Court case Citizens United v. Federal Election Committee. As the popular narrative goes, Citizens United was a controversial ruling engineered by Republican-appointed justices to give their political allies a leg up in elections. It supposedly led to a flood of outsider money into elections, thereby corrupting politicians and helping Republicans win a historic majority in the 2010 midterm Congressional elections. President Obama went so far as to criticize the Court’s decision in his first State of the Union address:

 “With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests–including foreign corporations–to spend without limit in our elections.”

First, let’s acknowledge the president’s misreading of the case. Citizens United did not allow corporations to spend without limits; corporations (and individuals) may only donate a set amount of money to an individual candidate or political party, per the 2002 McCain Feingold campaign finance law. Nor, despite the claims of even respected news outlets such as Politico, did the case foster the creation of “super PACs”. A subsequent court ruling did this ( v. FEC). Citizens United really just allowed for independent organizations (be they corporations, nonprofits, media outlets, etc.) to make unlimited independent (i.e. not tied to a candidate or party) expenditures. Such protections even cover CNN and The New York Times from potential prosecution for political speech. (Shapiro)

 The broader arguments against money in politics flow from some logical assumptions. We don’t want our politicians to simply be instruments of big corporations, and allowing anyone to spend as much money as possible on elections may do this.

But the problem isn’t really that there’s too much money in politics. It’s that politicians control too much money.

Americans spend more money on chewing gum than we do all federal elections. For the amount of areas under government control, I’d argue that we’re not spending enough. (Using OMB data, the nonpartisan estimates 2010 government spending as nearly 25% of our total GDP.) As rational actors, with so much of our time and money subject to government control and or confiscation, we really should be more interested in politics. As the Cato Institute’s Trevor Burrus notes:

 Our political parties no longer fight over simple regulations of interstate commerce and tariffs, we fight, on a national level, over the nature of American health care and how we will educate our children. How could these fights not be schismatic, vicious, and underhanded?

 With this much at stake, the money will come into politics somehow. Past attempts to legislate money out of politics have failed. Consider the very notion of a “super PAC”. PACs (political action committees) were started by labor unions as a way around the 1947 Taft-Hartley Act, which forbade unions and corporations from spending money on elections. So instead of giving money directly to candidates and political parties (who are easier for regulators to identify and scrutinize), the money dispersed between more sources that were tougher to regulate. Oops.

 But even if it were possible to effectively regulate political spending, would we want to? If you’re one of the majority of Americans who disapproves of Congress’ performance, the answer should be “no”.

The whole concept of campaign finance reform has largely been advanced by insiders and current officeholders. Money spent on campaigns generally helps to provide information about candidates, be it good or bad. More spending means more information, and more information means more accountability. This is not good for Congressmen who would prefer to coast to 30+ year reigns full of influence peddling and largesse.

Finally, money isn’t everything in elections. Scores of candidates have been badly outspent and gone on to win major elections; Ted Cruz’s GOP Senate primary victory over lieutenant governor David Dewhurst (who outspend Cruz by a 3 to 1 margin) is an example from only one week ago. Corporations, in general, don’t give a ton of money to candidates…doing otherwise would alienate large chunks of their client bases.

Campaign finance limits are relevant in very narrow, specific cases. Shapiro (cited above) has some great insights as to when and where this should happen; he essentially argues for disclosure requirements for particularly large donations. Such limits are reasonable and should be the starting point for any discussion of the regulation of political speech. Banning spending from persons or organizations who disagree with you? Probably not a wise goal of election law.


“Aaron Sorkin’s The Newsroom: One-Sided Politics Will Not Save Us from Politics”, Trevor Burrus

“3 Reasons Not to Sweat the Citizens United Ruling”, Reason TV

“Why Citizens United Has Nothing to Do with What Ails American Politics”, Ilya Shapiro


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