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Money in Politics: Unlimited, Untraceable, Unstoppable

November 10, 2015
Andrew Jackson was one of the first politicians to run an organized campaign that solicited donations in 1828. He managed to nearly double voter turnout, win a landslide victory, and set a precedent that showed the power of money in politics.[1] Money can buy staff and consultants to advise the candidate and do research. Money can pay for travel expenses so that the candidate can travel and spread their message. In the current age of politics, money can be spent on media ad-blitzes that carpet-bomb TV commercials, radio ads, and even banner ads on the side of a Facebook page.[2]

By Matthew Immerso, W’17

In the 2012 Presidential campaign Barack Obama spent over $480 million on media ad buys alone, shattering any notions that money does not have a part to play in politics. [3]

This enhanced marketing, strategy, and campaigning can pay huge dividends for candidates. In the 2014 election, 81% of the time the better-financed Senator won the election and 91% of House elections were won by the candidate who raised more. [4] The biggest fear amongst voters is that because elections are so dependent on the amount of money raised by each candidate, elected officials will be beholden to their biggest donors. Large donations can influence what a candidate says or doesn’t say because they hope to receive the same donation in the next election. Polls conducted in January 2015 show that 84% believe that money has too much influence in politics. [5]

Campaign finance reform in America has a long, chaotic history with many laws and court cases amending, expanding, or outright contradicting previous laws. After Watergate, public confidence in federal officials was shattered, and the Federal Election Campaign Act (FECA) was passed in 1971. This law limited individuals in how much they could donate to candidates and Political Action Committees (PACs). PACs are organizations that can collect money from members and use it to support a candidate or issue. [6] The Bipartisan Campaign Reform Act (BCRA), passed in 2002, attempted to limit the prevalence of PACs by reducing the amount of soft money that was donated by individuals and corporations. For nearly three decades, there were successful limits on donations to political elections. [7]

However this was all shattered by several key cases. The first was the 2007 decision of Federal Election Commission v. Wisconsin Right to Life. It set the precedent that it was unconstitutional for the BCRA to limit the spending of non-profits on issue ads. Under this ruling, it is perfectly legal to spend unlimited money on issues, as long as there are no formal endorsements of candidates. However, the 1976 decision in Bucky v. Valeo stated formal endorsements can only be proven by certain words such as “vote for” “defeat” or “elect”. Without these “magic words” in an ad, a non-profit can run whatever they like. [8]

Total Spending on Congressional Races 

In 2010, the landmark decision in Citizens United v. Federal Election Committee blew open the floodgates for money in politics. The court ruled that individuals, corporations, and unions could donate unlimited money to entities that existed independent of the campaign. The justification for this decision was that because money can support different issues, money can be a form of speech. Limiting this money is limiting speech, and thus violates the first amendment. As long as the donors were made public and the money trail could be followed, there would be no corruption. [9]

PACs, which were still limited by FECA, were rendered obsolete, and the Super PAC was born. There are limits on how much individuals can donate to PACs, but there was no such limit for Super PACs. Secondly, the decision made a clear distinction between non-profits under FEC v. Wisconsin Right to Life and nonprofits that are classified as “social welfare” or “business league organizations. These two categories under the tax code, 501(c)(4)s and 501(c)(6)s, do not have to disclose their donors. The result is the rise of dark money and the modern day Super PAC; an entity that can collect unlimited donations from corporations and individuals, spend that money in any way that doesn’t explicitly endorse candidates using “magic words”, and does not have to disclose where the money came from. [10]

Building further on this deregulation of campaign finance was the 2014 decision in McCutcheon v. FEC. Previously donors were limited in how much they could donate directly to candidates in the aggregate. In addition to limits on donations to each candidate, individuals could not donate more than $48,600 in direct contributions over the course of the election cycle. This court decision erased that limit, and now there is no limit on how much individuals can directly donate as long as they donate to different groups. [11]

Money influences elections. The definition of corruption exists in a gray area and the extent of that corruption is unknown, but there is a wide consensus among top Washington officials, campaign directors, and academics that big money has a corrosive effect on the attitudes and policies of government officials. [12] This is a problem, because 2016 is expected to be the most expensive election cycle in history and could total up to $10 billion. [13] The Presidential election alone is expected to cost more than $5 billion. [14] Already, with more than a year until the election, Jeb Bush has a war chest of more than $114 million with $103 million of that coming in as dark money. On the other side, Hillary Clinton has raised over $63 million, with more than $47 million in direct contributions. [15] As long as the laws exist the way they do, politicians will take advantage of them. And if that reform is not airtight, wealthy individuals, corporation, and unions will still find a way to unfairly influence elections. As Justices Steven and O’Connor once wrote, “money, like water, always finds an outlet.” [16] Republican, Democrat, it does not matter who wins. When the money comes rolling in, all that matters is who wrote the check.

 

  [1] http://edsitement.neh.gov/curriculum-unit/1828-campaign-andrew-jackson-and-growth-party-politics#sect-theunit

  [2] http://abcnews.go.com/blogs/politics/2012/07/breakdown-how-campaigns-spend-their-millions/

  [3] http://www.nationaljournal.com/2016-elections/how-do-presidential-candidates-spend-1-billion-20150608

  [4] http://www.washingtonpost.com/news/the-fix/wp/2014/04/04/think-money-doesnt-matter-in-elections-this-chart-says-youre-wrong/

  [5] http://www.nytimes.com/interactive/2015/06/02/us/politics/money-in-politics-poll.html

  [6] http://www.infoplease.com/us/history/campaign-finance-reform-timeline.html

  [7] http://www.washingtonpost.com/news/the-fix/wp/2014/04/03/a-history-of-campaign-finance-reform-from-george-washington-to-shaun-mccutcheon/

  [8] http://www.infoplease.com/us/history/campaign-finance-reform-timeline.html

  [9] http://www.vox.com/cards/super-pacs-and-dark-money

  [10] http://www.vox.com/cards/super-pacs-and-dark-money

  [11] http://apps.washingtonpost.com/g/page/politics/supreme-court-decision-striking-down-overall-limits-on-federal-campaign-contributions/909/

  [12] http://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf

  [13] http://thehill.com/blogs/ballot-box/presidential-races/230318-the-5-billion-campaign

  [14] http://www.bloombergview.com/articles/2015-04-26/how-record-spending-will-affect-2016-election

  [15] http://www.kjrh.com/news/national/2016-presidential-candidates-ranked-by-fundraising

  [16] http://www.huffingtonpost.co.uk/harry-brown/money-like-water-always-f_b_3687907.html

Graphic

 

Spending drastically increases in 2010 with the court decision Citizens United v. FEC and ushers in an era of Super PACs

(Image created in Excel by me, data from http://www.cfinst.org/pdf/vital/VitalStats_t14.pdf)

The graphic has dimensions of 4:5 so this can be manipulated for pixels of 400 x 500

 

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