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Hillary Clinton says she wants to get big money out of elections, and one of the ways she wants to do it is to curb the influence of big donors by mobilizing lots of small ones. This reform idea has become very popular recently, thanks to the concern about super PACs and billionaires that has been growing since Citizens United. But the idea is an old one. The first serious small-donor programs began more than 100 years ago, and they have been working more or less continually ever since.

The post Small donor democracy? Don’t count on it appeared first on OUPblog.

By Edward Zelinsky

I live in Connecticut. The Nutmeg State’s 2010 election campaign is a prime example of the emerging domination of American politics by self-funding multimillionaires. This troubling trend has been exacerbated by what is euphemistically called campaign finance reform. The law of unintended consequences strikes again. There is, I suggest, a better way.

Former Connecticut congressman Rob Simmons had been the front-runner for the GOP nomination for the U.S. Senate until Linda McMahon declared her candidacy. Mrs. McMahon has never held public office. She is, however, along with her husband Vince, a founder of World Wrestling Entertainment (WWE) and a multimillionaire. Having spent so far over $20 million of her own money on her campaign, Mrs. McMahon is now favored to win the primary for the Republican nomination for the U.S. Senate.

A similar story is playing out in the contest for the Democratic nomination for Governor of Connecticut. The polls indicate that the front-runner for the Democratic nomination is Edward (“Ned”) Lamont. Like Mrs. McMahon, Mr. Lamont is a multimillionaire, the great-grandson of the legendary J.P. Morgan partner, Thomas W. Lamont. In 2006, Mr. Lamont spent roughly $14 million of his own money to defeat incumbent Joseph I. Lieberman for the Democratic nomination for the U.S. Senate. Mr. Lamont has to date spent almost $2 million of his fortune on his 2010 gubernatorial campaign.

Current polls also indicate that another multimillionaire self-funding his campaign leads in the race for the Republican nomination for Governor. Thomas C. Foley, the former U.S. ambassador to Ireland, outpaces Lt. Gov. Michael Fedele (who is participating in Connecticut’s program of publicly-subsidized campaign finance) and businessman Nelson (“Oz”) Griebel (who is not).

What is occurring in Connecticut is emblematic of broader, nationwide trends. It may well be that Mrs. McMahon, Mr. Lamont and Ambassador Foley are qualified to hold the offices they seek. There is, however, no doubt that their currently strong positions are principally attributable to the personal funds they have deployed to advance their respective candidacies.

Of course, the candidate who spends the most doesn’t always win. In earlier ages wealthy individuals were politically prominent. George Washington and Ben Franklin were both wealthy men. The U.S. Senate was a millionaires’ club at the end of the 19th century – as it is again today.

Nevertheless, the contemporary political dominance of self-funding millionaires in Connecticut and in other states is disquieting. Moreover, this trend is exacerbated by the very campaign finance “reforms” intended to reduce the impact of money on our political life. This is the law of unintended consequences striking with vengeance.

Consider, for example, former Stamford Mayor Dan Malloy, Mr. Lamont’s chief competitor for Connecticut’s gubernatorial nomination, and Lt. Gov. Fedele, Ambassador Foley’s main rival on the Republican side. Both Mayor Malloy and Lt. Gov. Fedele have accepted financing from Connecticut’s system of campaign finance. However, the p

Edward A. Zelinsky is the Morris and Annie Trachman Professor of Law at the Benjamin N. Cardozo School of Law of Yeshiva University. He is the author of The Origins of the Ownership Society: How The Defined Contribution Paradigm Changed America.  In this article, Zelinsky argues that Senators Obama and McCain have confirmed the malfunction of campaign finance reform, that this is a healthy development for American democracy, and that the current system of campaign finance reform should be replaced by a simplified disclosure regime.

The most important event of the 2008 presidential campaign may already have occurred: The major party nominees have publicly confirmed the malfunction of campaign finance reform. Such reform has imposed increasingly complex and stringent limitations on the contributions of political donors and on the expenditures of political campaigns.

Senator Obama had been an outspoken apostle of campaign finance reform. At the outset of his presidential effort, Senator Obama had proclaimed his commitment to accept public financing and its accompanying expenditure restrictions for his general election campaign. He has now turned 180 degrees. Senator Obama will now eschew public financing and its attendant limits and will instead fund his general election effort with private donations to escape those limits.

Senator McCain’s change of heart is more complex but even more dramatic. Senator McCain was the prime Republican sponsor of the most recent tightening of federal restrictions on campaigns and donors, the eponymous McCain-Feingold Act. While he will accept public financing in the fall, Senator McCain’s supporters are actively and openly exploiting every legal loophole they can find to permit private contributors to assist his candidacy beyond the restrictions imposed by that Act. The irony is palpable. Senator McCain’s supporters are now assiduously seeking to erode the very constraints on donors and campaigns which Senator McCain had championed.

It is easy to criticize Senators Obama and McCain for their inconsistency. I suggest, however, that there is a broader significance to these events. Senators Obama and McCain have confirmed the malfunction of campaign finance reform. We should now kill this complex and unfair regulatory scheme. American democracy will be healthier without the myriad restrictions which limit Americans’ ability to contribute to the candidates of their choice.

The fundamental premises upon which campaign finance reform rests are false: Money in politics is a bad thing which can and ought to be limited legislatively. On the contrary, for many Americans, a financial contribution is today the only meaningful way, besides voting, they can assist the candidates they support. In any event, campaign contributions cannot be controlled fairly and effectively. Another form of Prohibition has failed.

Consider the simpler era in which I grew up. Working on political campaigns along with other volunteers, my friends and I would meet at local party headquarters and fan out to distribute bumper stickers and campaign buttons to our neighbors. It seems quaint because, in retrospect, it was.

Contrast this low budget, Ozzie-and-Harriet world with the consultant-driven, TV-saturated campaigns which constituted primary season 2008. In these campaigns, the citizen-volunteers have largely been subordinated to the full-time, paid, professional operatives who ran these campaigns. In this environment, a financial contribution is, besides voting, the most meaningful form of support many, probably most, Americans can make to the candidate they support.

Moreover, the attempt to limit the influence of money by law, propounded as a means of leveling the political playing field, has instead reinforced the political power of the celebrities in our celebrity-based culture. During the 2008 primary campaign, both Oprah Winfrey and Chuck Norris provided enormously valuable assistance to the Obama and Huckabee campaigns, generating publicity worth hundreds of thousands (if not millions) of dollars for the candidates they supported. None of this celebrity assistance is capped by McCain-Feingold, despite the obvious value of that assistance.

In contrast, if a non-celebrity citizen favoring a competing candidate sought to counteract celebrity-generated publicity by donating equivalent funds to purchase offsetting advertising, that citizen would have violated the law. If, for example, a supporter of Governor Romney sought to counteract Mr. Norris’s efforts via a campaign donation of $2,500 (a tiny fraction of Mr. Norris’s effective but unregulated contribution to Governor Huckabee), that Romney supporter broke the law which limited him to a $2,300 contribution. Campaign finance reform, it turns out, is just for the little people.

It is unsurprising that this system is now in disarray. The current system, with its complex contribution limits, is overly-complicated and unfair. These complex and inequitable rules should be replaced by a simplified regime which permits all campaign contributions without limit but which requires contributions to be immediately and accurately disclosed.

Whether one believes that campaign finance reform like McCain-Feingold was a noble idea which failed or was an unwise approach from the beginning, Senators Obama and McCain have confirmed the malfunction of that approach. We should now move from the currently dysfunctional system to a simplified regime which permits contributions without limit, which requires complete and accurate disclosure of those contributions, and which no longer puts our political life in the hands of Oprah and Chuck.

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