Introduction
The issue of campaign finance is one that has been debated among academics for many years, and has gained greater public attention in recent years due to the enormous, and constantly increasing money spent on political campaigns. It has been estimated that $7 billion were spent at the 2012 American election, the most expensive in U.S. history, which comprised of 3,514 candidates running for 475 seats. Much of that money was spent communicating to the public on the merits of candidates and their views on public issues (Weintraub and Tausanovitch 2013). Numerous books, journals and articles have been written on the topic of Campaign finance, with opinion split between those who claim that campaign finance is a problem, thus reform is necessary, and those who see reform as unnecessary and an infringement upon First Amendment rights. In studying the literature on the topic, it was noticeable that there were different approaches or techniques used by the authors to make their argument and to come to particular conclusions. Some favoured a more conceptual and ideological approach, outlining their philosophy and how campaign finance reform fits or doesn’t fit with it (Barrone 1986; Levine 1997; Sullivan 1998; Boaz 2009; Taylor Jr. 2009; Rubin 2010; Smith 2012). With this approach, it was permissible to use older literature due to its timeless nature. Whereas, others favoured a more empirical approach that included numerical data, tables and graphs in order to make their point (McSweeney 2005; Stratmann 2006; Gulati 2012; Johnstone 2013; Pastine and Pastine 2013). With this approach, only recent literature could be used because numerical data quickly becomes outdated and therefore irrelevant. It was also noticeable that there tended to be three schools of thought on the subject: those in favour of campaign finance reform; those against campaign finance reform; and those that preferred to portray both sides of the argument in an unbiased and balanced way. Books and articles from all sides of the argument are reviewed to gain a broad knowledge of the different schools of thought on the subject of campaign finance reform.
The Problem of Campaign Finance
Campaign Finance refers to the funding of electoral campaigns at federal, state and local levels. This involves public and/or private money being donated to a candidate that is used to pay for the financial expenditures that a political campaign entails. Typically, this covers costs of travel, hotels, catering, grassroots fundraising, management and research, communication and advertisements i.e. billboards, lawn signs and leaflets. The biggest expense of campaigning in modern times is television advertising (Gulati 2012), which includes positive advertising and, more controversially, negative advertising. Attack ads, push polls and smear campaigns are all contentious techniques used most frequently in U.S. campaigns, due to the lack of restrictions on campaign finance.
Political Action Committees (PACs) and Super PACs are the organisations that raise the money to influence elections and legislation. Super PACs can raise unlimited sums of money from corporations, unions, associations and individuals and then spend unlimited amounts of money on things like TV advertisements (Gulati 2012). In the 2012 election, Super PACs spent an estimated $1.3 billion, the vast majority of which came from a small set of “ultra-wealthy mega-donors” (Pursley 2014). A criticism of Super PACs is that because they are capable of funding entire campaigns on their own, they circumvent parties and eliminate the need to cultivate small donors (Pursley 2014). Super PACs have been described as “ethics-deprived organisations” that “lack redeeming social value” but instead “spread fear, distort issues, squelch opportunity for meaningful debate, and are spoiling politics with irresponsible and dishonest political advertisements.” (Gulati 2012). A common argument against campaign finance is that when an individual, PAC or Super PAC makes a contribution to a candidate they are likely to expect something in return, a quid pro quo. A system that involves quid pro quo campaign contributions is more than likely to worsen the chance of politics to become a process of accommodating particular groups with particular selfish interests, instead of an effort to reach the best decisions for society as a whole (Strauss 1994).
The most frequently expressed concern about Campaign Finance within the literature is the risk of corruption that an unregulated system would be unable to prevent (Strauss 1994; Grant 2004; Gulati 2012; Johnstone 2013; Pursley 2014). It is very possible in the current system that politicians have the potential to be bribed by certain special interest groups, thus creating the problem of politicians serving the needs of the campaign donor rather the public, and because politicians are more likely to serve the needs of his/her donor rather than the needs of the public or the constituency, it causes a “swamping” of that constituency’s influence in general, thus undermining federalism (Pursley 2014). A common argument is that unlimited and unregulated campaign finance creates substantial implications for democracy (Yang 2000; Taylor Jr 2009; Pastine and Pastine 2013; Pursley 2014). Democratic participation is threatened and one reason articulated is because of the growing perception that wealthy interests either control or at the very least have too much influence over government, causing the public to lose confidence in the political process, with acknowledgement to numerous questionable fundraising methods and vast amounts of money being collected and spent on the campaign process (Yang 2000; Pursely 2014). The fact is that it is virtually impossible to get into office without raising and spending large amounts of money, and this need or obligation weakens the connection between politicians’ policy preferences and their actual actions, thus undermining and distorting the fundamental premise of a representative democracy (Taylor Jr 2009; Pastine and Pastine 2013).
The solutions to Campaign Finance
Attempts to curtail the problems associated with Campaign Finance date back as early as 1867, yet most efforts were largely ineffective and hardly ever enforced. It was not until the 1970s that the US Government made serious attempts to address the problem. The Federal Election Campaign Act (FECA) was successfully passed in 1971, which required wide disclosure of campaign contributions and expenditures. The act was amended in 1974, following the public reaction to the Watergate Scandal, introducing limits on contributions to and spending by congressional candidates, a taxpayer-financed system of funding presidential elections along with contribution and spending limits for presidential campaigns, and a new federal agency, the Federal Election Commission (FEC), to enforce the law. However, a challenge to the constitutionality of the new rules as violations of freedom of speech, led to the Supreme Court striking down parts of the legislation while upholding other provisions in Buckley v. Valeo (1976) (Grant 2004). The most recent major reform to campaign finance is the Bipartisan Campaign Reform Act (BCRA) of 2002, also known as the McCain-Feingold law. This legislation prohibited unlimited and unregulated contributions, known as “soft money”; and defined political issue ads paid for by corporations or unions as “electioneering communications”, banning the broadcast of such ads within 30 days of a primary or within 60 days of a general election (Campaign-Finance Reform: History and Timeline | Infoplease.com).
It is a commonly held view on both sides of the argument that the reforms that have been made have not been successful and the system is still broken. It is within the proposed solutions to the problem that the debate begins, with some saying that the reforms don’t go far enough and more restrictions and regulations are needed; and others saying that the regulations are the problem as they are counter-productive causing unintended consequences. Probably the least controversial solution proposed is disclosure of where campaign contributions come from. It is the most adopted form of campaign finance regulation in democracies around the world (Briffault 2010), perhaps because the lack of transparency over where money has come from, causes the public to hold trepidations. It is argued that disclosure requirements provide a valid means of deterring corruption and strengthening democracy, providing voters with valuable accountability regarding where campaign participants money has come from and how it is spent; thus, enabling the public to make more informed decisions on who ought to be, or ought not to be, elected (Yang 2000; Briffault 2010). A further argument is that disclosure plays an important role in educating the public about how the electoral system works, how government decision making occurs, and the relationship of campaign finance and government action (Briffault 2010). Disclosure is generally accepted from the public, and academics from both sides of the debate. Campaign finance disclosure frequently displays very high levels of public support in opinion polls. Among academics, both campaign finance reformers and campaign finance sceptics have endorsed support for disclosure. This can be put down to the universally held belief that government transparency is essential for public accountability (Briffault 2010).
Another commonly proposed solution to the problem of campaign finance is that there ought to be limits on campaign contributions (Hill 2006; Stratmann 2006; Hunker 2013). The argument is that limiting the amount of money an individual, group or corporation can give to a candidate is an effective way of reducing the influence of money in politics, thus strengthening representative democracy. There are currently just six states in the U.S that place no limitations of campaign donations – Alabama, Missouri, Nebraska, Oregon, Utah and Virginia; and another six states that have very minimal contribution limits – Indiana, Iowa, Mississippi, North Dakota, Pennsylvania, and Texas. Supporters of contribution limits also tend to support limiting the amount a candidate can spend in their campaign, and the arguments for both contribution limits and expenditure limits are very similar. Stratmann in his paper Contribution Limits and the Effectiveness of Campaign Spending empirically analyses the data and comes to the conclusion that campaign expenditures by incumbents and challengers are more productive when candidates run in states with campaign contribution limits, as opposed to in states without limits. He argues that campaign advertising is more productive when spending ability is curtailed by contribution limits (Stratmann 2006). However, this study was done in 2006, and so could possibly be outdated now.
A final proposed reform to campaign finance is public financing of campaigns. Small-scale public financing of campaigns already exists in numerous states, but many academics would like to see the program extended. Perhaps one of the most radical and controversial kinds of reforms proposed is the idea of “Clean Elections” which uses public funds to finance a candidate’s entire campaign (Gartner 2013). The argument is that public financing helps to level the playing field by giving all candidates sufficient resources to pay for campaign expenditures, with evidence for this in New York City and Los Angeles which uses public financing for mayor, city council and other races (Hill 2006). Supporters of Public financing claim that public financing helps to minimise money’s role in politics and opens up American democracy to new voices and ideas by “opening up the system”, allowing lesser-funded candidates to challenge better-funded candidates, whilst providing a broader and livelier debate (Hill 2006). Public financing helps challengers to overcome potential financial barriers to entering campaigns, providing a more competitive election (Gartner 2013). Critics of this reform say that tax-payer financing of elections is merely “welfare for politicians,” and concerns are raised over the expense of public financed elections, especially at a time of continuing budget deficits (Smith 1999; Boaz 2009).
Arguments against Campaign Finance Reform
On the other side of the debate is those who are against campaign finance reform. The main argument against reform that is regularly expressed throughout the literature is that any restrictions and regulations on campaign finance is a violation of the First amendment of the constitution – a violation a freedom of speech (Sullivan 1998; Smith 2001; Samples 2006; Boaz 2009; Rubin 2010; Smith 2012). In the landmark case of Buckley v. Valeo (1976), the Supreme Court ruled that: “A restriction on the amount of money a person or group can spend on political communication during a campaign necessarily reduces the quantity of expression by restricting the number of issues discussed, the depth of their exploration, and the size of the audience reached. This is because virtually every means of communicating ideas in today’s mass society requires the expenditure of money.” This ruling caused certain amounts of ridicule within the pro campaign finance reform community, who perceived the ruling as meaning “money equals speech.” However, those against campaign finance reform are quick to note that the court did not say “money equals speech,” the ruling said that political speech requires spending money, and so restricting money translates to restricting speech (Boaz 2009; Smith 2012). Opponents of campaign finance reform point out that it is obvious and little more than common sense that limiting money means limiting speech. Consider a law saying that “the retail price of a political book may not exceed twenty dollars.” It is true that such a law is just about the money, and not about the book, nevertheless the law limits the amount and effectiveness of political speech as it affects the incentives to write and publish such books (Sullivan 1998). Money is related to speech because money buys the means of communicating with voters and freedom of speech means government places no restrictions on what can be said in response to fundamental political questions (Samples 2006).
Adversaries of Campaign Finance Reform not only argue that campaign finance restrictions are an attack of freedom of speech, but also that there are a number of unintended consequences associated with the reforms. One of these unintended consequences is that campaign finance restrictions causes, or at least plays a part in, the lack of competition that incumbents have in elections (Boaz 2009). In fact, incumbent members of Congress nearly always win re-election when they run; since 1998 they have been re-elected more than 98 percent of the time (Samples 2006). This figure could now be outdated though. It is undoubtedly true that incumbents have a significant advantage over challengers in campaign spending and one reason for this is because restrictions on campaign finance actually chokes out political competition. From the very beginning of races, incumbents enjoy a number of inherent advantages over challengers including money for staff and high name and issue recognition among voters. In order for challengers to overcome these advantages and build a recognition for themselves among voters, they are obliged to spend huge amounts of money, but they are limited by campaign spending limits. For this reason, spending limits harm challengers more than incumbents, thus, by undermining the competitiveness of elections, campaign finance laws undermine democracy (Sullivan 1998; Samples 2006; Smith 2012). An additional unintended consequence of campaign finance restrictions raised in the literature is that limiting campaign spending causes a reduction in public knowledge, attention and involvement in elections. John J. Coleman of the University of Wisconsin did a study which concluded that campaign spending increases public knowledge of candidates across the population, therefore if we are to believe that voters should be informed and participate in the democratic process, we ought to be encouraging campaign spending, not restricting it (Boaz 2009).
One of the most significant philosophical differences between academics on either side of the debate is associated with trust in government. For people who advocate campaign finance reform, government is a trustworthy institution whose power can be used to bring about what is best for society; hence why reforms and laws are made in an attempt to eliminate evils from the system, such as corruption, and promote democratic and egalitarian ideals. Alternatively, academics who are opposed to such laws and reforms, view the government as the founders did, as an inherently untrustworthy institution, especially when it comes to regulating political speech, which is the reason why the First Amendment exists (Smith 2012). Campaign finance reform opponents have a grievance with the ubiquitousness of government, which promotes corruption due to the vast powers it has over virtually every aspect of life (Boaz 2009). It is the incumbent legislators and elected officials that writes the rules and regulations, and then employs the referees (Congress created and oversees the Federal Election Commission), therefore it is no coincidence that campaign finance laws have a tendency to advance the interests of incumbents and public officials (Samples 2006).
Conclusion
In closing, there are thousands of pieces of academic literature on the topic of Campaign Finance Reform, all with various different viewpoints and arguments for and against reform. Typical arguments for reform are that campaign finance causes corruption because it is a form of legalised bribery, consequently democracy and equality is threatened and/or affected. Three kinds of solutions are often proposed to remedy the problem, including: disclosure over where funds have come from and how it is spent; limits on campaign contributions and spending; and public financing of campaigns. Typical arguments on the opposite side are that restrictions on money are a desecration of freedom of speech, as money is required to get the message out there into the public sphere, and also that campaign finance laws favour incumbents and limit competition.
As with various other issues and aspects of the U.S. political system, the topic of campaign finance reform is complex as it comes into contest with the Constitution, which attempts to limit the size and scope of government, and uphold the inalienable rights of the individual. This highlights a philosophical difference between conservatives and libertarians – who are sceptical of government; and liberals and progressives – who believe in government.
Although the subject of campaign finance reform is well debated amongst academics, it is not debated widely within the general public, so change is unlikely. This hinders both advocates and sceptics of reform, because, what is clear from the literature is that neither side is happy with the current system.
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