The Effect of Campaign Finnacne on Democracy

Daniel Sykes Student ID 250719824
Every election cycle, huge sums of money are spent in the promotion for campaigns to elect or re-elect candidates for public office. These contributions play a vital role in the success of election campaigns. Sources of campaign donations range from big businesses and trade unions to PACs (political action committees) such as the NRA. These groups donate to candidates in the assumption and hopes that the candidate will pursue a discourse and perhaps implement legislation that benefits the donating group. When we refer to “campaign finance”, we are of course referring to funds that are used to promote and advertise, hire advisers, pay for travel expenses, administration fees and other costs associated with running a campaign. The Presidential Election of 2008 generated one billion US dollars in campaign contributions and finance1, with this figure on the rise, many have spoken out against the propensity of election victories to be seemingly “bought” by the party who generated the most funds2. In this essay I will be discussing whether or not big money in campaign finance is a threat to democracy.

It is important to consider the history of campaign finance reform and how it evolved over time, for this gives us a better perspective when reviewing our modern situation to see if democracy has lost its way. Before the 19th century, the majority of legislation concerning campaign finance was minor and its most salient concern was preventing mandatory donations to political campaigns. 31907 saw the introduction of the Tillman Act under Teddy Roosevelt's administration, this act essentially banned donations from national and state banks as well as large corporations to political campaigns. Further regulation came with the 1972 Federal Election Campaign Act, this capped donations from individuals as well as enforcing transparency along with various other regulations4. Following allegations of systemic corruption in the US government after the Watergate scandal, further restrictions were enacted as well as the establishment of the Federal election Commission, a regulatory body with the purpose of monitoring campaign finance.
As successful as these policies were in terms of regulatory oversight and accountability of candidates, expenditure in campaign finance continued to increase. large portion of this increase is caused by the increasing influence of corporations, big business and unions who bypass restrictions of hard money (donating straight to the candidate) and donate large sums of money to PACs5. Political action committees are essentially organizations devoted to spending money on a particular cause or candidate. Due to their seemingly unrestrained power and potential for unlimited funding (especially in the case of Super PACS)6, they have become the politician's weapon of choice for election success. Campaign finance legislation is primarily concerned with combating the perceived corruption these PAC's foster, but campaign finance reform can go both ways, with legislation such as Citizen’s United removing barriers for public contributions to PAC's, allowing their toxic influence grow exponentially. The debate over campaign finance has become so polarizing that both sides, those who seek fewer restrictions and those who seek more, both accuse the other of undemocratic practices. Restrictions of donations being an attack on free speech7, whilst corporate influence in elections being an attack on the idea of a government by the people for the people.8

The year 2002 saw the introduction of the Bipartisan Campaign Reform Act which essentially banned various forms of money donations from organizations and lobby groups and as well as limiting campaign advertisements by interest groups within a thirty day period of a primary election. A Lobbying group named Citizens United intended to air a short film critical of Hilary Clinton, but the airing of the film was prohibited on the grounds that it was in violation of section 203 of the BCRA which placed restrictions on political broadcasts by organizations thirty days prior to a primary election.9 The group took the case to the supreme court and it culminated in what is now known as the Citizen’s United v. Federal Election Commission ruling. The judges ruled that Citizen's United's First Amendment rights were being violated as their right to free expression was limited as the result of the campaign finance restrictions. Whilst this ruling was passed in the aura of democracy and the first amendment, it ironically has a contrasting effect. The broader ramifications of this ruling essentially established a precedent that money is an article of free speech and its “expression” must be defended by the constitution. This is a very dangerous precedent because it undermines the democratic power of people in favor of the contents of their wallets and the financial power.

The ruling changed many elements and practices relating to campaign finance and in my opinion, damaged democracy in many more areas. For example, due to the reliance on PAC money, legislatures are encouraged to act in accordance with the wishes of their campaign contributors for once they are elected, they will be held accountable by their donors and often must act for the interests of the PAC if they have any hopes of receiving future funds10, consequently the interests of these corporations and donating groups is often against the best wishes of their constituents. The Citizens United ruling also struck a heavy blow to political accountability in campaign ads, due to the involvement of PACs in broadcasting campaign messages, candidates no longer have to officially be associated with ads relating to their campaigns as PAC's are able to do all the work for them, this often leads to many misleading and untruthful attack ads as due to their private ownership, the output of PACs can often be difficult to control.

This financial influence in elections does not only lead to a reduced importance for the candidate/voter relationship, but it also damages the conduct of corporations themselves. As a corporation, the sole duty is to produce profits and beat your competitors in every channel possible. Puttingd a price tag on election successes and essentially bribing their way to achieve desired legislation opens the door for corporations to enact laws that work against the public good. Rather than launching expensive campaigns in the hopes of promoting the low risks of genetically modified produce, if corporations have enough pawns in congress, they could very easily push for legislation that nullifies the need to identify the involvement of genetic modification on the food's information label. Or on a more aggressive note, corporations could push for increased taxes on their competitors in other industries and oil companies could push for American expansion in the middle east. Allowing markets to influence the outcome of our elections is incredibly risky because corporations cannot be trusted to act for the good of the public as they are caught in a never ending struggle to keep up their profit margins. It must be noted that this narrative of mass corporate corruption is entirely speculative, meaning its not certain that corporations will act in this way. So while we can only speculate about the intentions of these corporate donors and their lack of concern from the general population, we cannot possibly perform a full psychological analysis of every wall street donor and hence we cannot say with confidence that a desire to subvert democracy was intentional.

The ruling changed many elements relating to campaign finance and in my opinion, damaged democracy in many areas. For example, due to the reliance on PAC money, legislatures are subtly pressured to act in accordance with the wishes of their campaign contributors and in some cases this is against the best wishes of their constituents, for example, the congressmen voting for the keystone pipeline which will destroy numerous homes in order to benefit oil companies. The Citizens United ruling also struck a heavy blow to polical accountability in campaign ads, due to the involvement of PACs, candidates no longer have to officially be associated with ads relating to their campaigns as PAC's are able to do all the work for them, this often leads to many misleading and untruthful attack ads.
PAC's and large campaign finance sums have also given an unfair advantage to Incumbents, who typically receive higher contributions than those who challenge their seat from Political action committees. One salient example of this is in 1993, where the House of Representatives held a majority of members from the Democratic Party, the amount of Democratic PAC donations compared to Republican PAC money was calculated as being a ratio of nine to four. Following the Republican victory in conquering the house in 1995 this ratio flipped, and is calculated as being 7 to 10. The following year, the typical amount contributed to an election campaign for an incumbent in Congress was $721,000. In contrast, a candidate hoping to take the seat averaged around $122,000. Campaign finance is a vital factor in why members of the house benefit from such a high re-election rate. This is bad for democracy in that it creates something of an establishment in politics and makes it harder for underdogs to be victorious when they can rarely hope to receive enough funding to adequately campaign against the incumbent.

Another undemocratic issue with Political Action Committees relates to how to the often anonymous nature of their contributors. Campaigns could be entirely financed by characters of ill or corrupt repute and the potential corruption is hidden away from the public spotlight (for example, an anti-tax PAC being predominantly funded by anonymous wall street titans). However, the 2012 Disclose has shown us that it is possible to enrich our system with more transparency. The act mandated that donations above $10,000 must be reviewed by the Federal Election Commission with a report filed. The act represents a huge step forward for democracy as now the American people can have a better sense of who is funding the ads they see broadcast to them on a daily basis during the election cycle. It is also a strong blow against corruption, as the American people are now able to review a candidates voting records and observe whether there is a correlation between the source of their funding and the direction of their policies, giving a better idea as to whether congress is working for the individual voter and sticking to their principles or whether they are simply being whipped by corporations.

A primary concern for critics of big money in campaigns is that wealthy donors greatly overshadow grass roots donors, whilst the primary principle of democracy is people power, with no vote having more sway than anothers, having large sums of money greatly increases your influence on politics as you can not only cast a vote yourself, but you can influence others to cast the same vote. One interesting idea to combat this seemingly undemocratic issue is the idea of not only just one vote per voter, but also a government granted allowance they can use for political campaign funding. Known officially as the Ackerman-Ayers plan, this idea would see voters being gifted $50 that they can use on federal elections. Fifty percent for presidential runs campaigns, thirty percent for Senate elections, and twenty percent for elections for congress. The voter would be able to donate at a time they see fit, even during the primaries. This idea is effective due to its potential to empower minority groups who cannot afford funding out of their own pocket, It also encourages candidates to better appreciate this voting block, for fifty dollars per voter can combine to be a substantial amount of money.

However one must also take issue with the idea that “money” is exclusively the primary threat to democracy in US elections. The belief that excessive campaign finance is the primary medium for systemic corruption in elections is too myopic. Politicians and donors alike possess an enormous range of means to reach their desired campaign outcome, for example, how much unpaid work each candidate benefits from, their promotions by the media, Hollywood or celebrities, whether they have an iconic and recognizable family name, whether they are good looking and physically able. The potential for monopolies and corruption is endless. Money will always remain merely one medium in a stream of countless others. For example, an underdog and unknown candidate who is campaigning against a member of the Kennedy or Bush establishment is consequently going to be at an immediate disadvantage due to a multitude of factors regardless of money and campaign contributions. If we are to be salient in bringing down the perceived corruption in campaign finance, then it would seem fitting to remove all means by which one candidate can have an immediate advantage over the other. This would arguably result in a never ending tautology in which we are endless striving for the unachievable – a level playing field for democracy.

Whilst there is nothing inherently wrong with voters donating to a political campaign, it must be acknowledged that campaign donors typically have very little in common with the vast majority of American voters. These campaign donors have been frequently proven to be, for the most part, overwhelmingly white, disproportionately wealthy and generally in the upper echelons of various aspects of society. In 1996, the Joyce Foundation organized a survey of campaign donors, primarily those who donated sums equal or greater than two hundred dollars. One of the most shocking findings was that a staggering eighty-one percent of contributors that paid such an amount earned a yearly income of over one hundred thousand dollars, for reference the national average for an American household at the time was around forty-one thousand a year. Additionally, only 5 percent of this group were non white and only 20 percent were female.
These figures are important because they represent a severe lack of disparity in the political donation process. Democracy is a word derived from the Greek, essentially meaning people power, the issue at hand is that such a disproportionately large quantity of campaign donations are received from a certain demographic of people. Surpassing even the donors who earned on average one hundred thousand a year are the enormously wealthy donators who contributed sums equal to or exceeding ten thousand dollars. A study by the Sunlight Foundation. During the congressional elections of 2010, these donors contributed almost twenty five percent of all donations to candidates, political parties and political action committees. Of this group, almost fifty five percent were industry leaders from rich corporations. The Joyce study also concluded that these wealthy donors typically leaned more conservative, meaning a reduction of the welfare state, reduced tax rates, less government regulation on the free market and various other views associated with modern conservative philosophy.

To conclude, whilst the injection of large sums of money into campaign elections may create numerous gateways for questionable corporate influence, it is an inherent symptom of America's political culture. The flow of money in campaign finance will gradually increase as long as America maintains a vibrant capitalist economy, as stated earlier, the prevelance of money in elections is not inherently undemocraftic, but the key underlying problem is that this money is primarily in the hands of a elite group of wealthy donors and corporations, whose power is disproportionatly large and whose interrests often contrast with those of the average American citizen.