A Role for Parties
Daniel H. Lowenstein
A "collision between public and private interests" has produced "a system
gone awry," according to David Donnelly, Janice Fine, and Ellen Miller.
Apparently, the authors are not fans of James Madison. In Federalist No.
10, Madison argued persuasively that the clash of public and private interests
is inevitable in a republic. No measures short of the destruction of liberty
could prevent the collision.
It is to be expected that private interests will deploy whatever resources
are at hand to influence public policy. Of course, corporations, unions,
and other interests will use campaign contributions--and other measures far
more potent than campaign contributions-- to further their interests. And
of course articulate individuals such as Donnelly, Fine, and Miller
will resort to hyperbole when seeking support for their proposed policies.
Those who believe politics should resemble a learned debating society may
look askance at such activities. Madisonians will recognize them as symptoms
not of democratic failure but of democracy itself.
Despite its exaggerations and its shaky foundation, Donnelly, Fine, and Miller's
essay contains much that is of value. Although the consequences for public
policy are not nearly as great as they suggest, they correctly assert that
the present system of campaign finance gives rise to widespread conflict of
interest.1 Most importantly, they concisely demonstrate
some of the major flaws in the proposed reforms that have dominated recent
debates on campaign finance.
Donnelly, Fine, and Miller support what they call the "Clean Money Option,"
a version of which has been enacted by Maine voters. Under this system, candidates
will be encouraged to agree to spending limits, in return for their campaign
funds being almost entirely provided by the state.
If you glance at a map you will quickly notice that Maine is very far away
from California, where I reside. I cannot say how the Clean Money Option will
work in Maine, but I sincerely hope it will have beneficial effects.
There are many differences between Maine and California besides geographical
location. Among the most important are that they have more lobsters and we
have more people. Whatever the effects of the Clean Money Option may be in
Maine, I am afraid they would be quite harmful in the unlikely event it were
applied on a larger scale, such as in congressional elections or in big states
I have this fear primarily because of what I believe are the answers to three
questions that Donnelly, Fine, and Miller never even consider:
1. How much will the Clean Money Option cost?
2. Will the amounts made available to candidates be sufficient for vigorous,
3. Who will decide, and on what basis, how much will be spent in campaigns?
These questions are interrelated. The answer to the third, presumably, is
either the state legislature or the electorate in initiative campaigns such
as the one in Maine. Either way, there will be a strong bias toward low amounts,
for several reasons: the political and budgetary need to keep public costs
down (see Question 1); the widespread perception, exploited by writers like
Donnelly, Fine, and Miller, that "too much" is spent on campaigns; and the
benefit to incumbents of keeping campaign expenditures below a competitive
level. Since no reason appears why the setting of campaign spending limits
should be exempt from the forces of self-interest and demagoguery that attend
most political decision-making, it is predictable that the answer to Question
2 is a distinct "no."
I asked a couple of California campaign consultants (one Democrat and one
Republican) what they would regard as an appropriate amount to spend for a
talented but not well-known candidate challenging an incumbent in a competitive,
high-turnout, California congressional district. The lower of the two figures
I received was $800,000. If that amount were given to two candidates in each
House district, the cost would be nearly $700 million. Add about two-thirds
as much for the Senate elections that take place in a given election year,
and the total--with nothing included for primaries or independent or third-party
candidates--would be well over a billion dollars for a two-year cycle. Congress
is very unlikely to spend so much.
The Clean Money Option would be disastrous for electoral competition, which
according to Donnelly, Fine, and Miller should be enhanced by campaign finance
regulation. One of the most consistent findings in political science research
in the last two decades is that challengers typically need to spend large
amounts to have a chance to defeat incumbents. The Clean Money Option encourages
incumbent legislators to guarantee their own electoral security by limiting
their challengers' campaigns.
Even if incumbents' self interest did not prevent funding of campaigns at
fully competitive levels, ordinary principles of fiscal prudence would do
so. To pay two candidates in every district the amount that challengers
could usefully spend in the most competitive districts would be extremely
wasteful. For this reason, many public financing proposals work by matching
private contributions with public funds. But for a number of reasons, some
of which are well-stated by Donnelly, Fine, and Miller, matching is also an
inefficient means of allocating public funding.
What is needed is an allocation of public funds based on reliable political
judgment of where the money can be used to enhance electoral competition.
Obviously, no government agency can be trusted to make such judgments, so
reformers have assumed they must employ mechanical allocation devices, all
of which are seriously flawed.
But sensible allocation of funds is possible, by the simple expedient of
entrusting the allocation to the political parties. Such a system would provide
vastly more bang for the public buck than any of the typical public funding
schemes proposed by reformers, including the Clean Money Option. Because of
the more efficient allocation, the system would increase the level of electoral
competition while minimizing the reliance on private contributions that causes
conflicts of interest.
Space does not permit setting forth the details of such a plan, but I have
done so in the article cited in a footnote above, and will be glad to send
copies on request. One point should be added here. Neither the Clean Money
Option nor any of the reform ideas that Donnelly, Fine, and Miller criticize
addresses the fundamental cause of the campaign finance problem. That fundamental
cause is the need for voters to receive information on large numbers of candidates.
Voters increasingly believe they should vote for the "best candidate" rather
than for the party. Whatever else may be said about this idea, it vastly increases
the information needs of the voter. But most voters are turned off to politics
and do not seek out such information. Candidates have no choice but to spend
ever-greater sums to force information into unreceptive minds.
The campaign finance problem is in large part the result of a candidate-oriented
rather than a party-oriented electoral system. Public financing channeled
through party leaders, in addition to its great advantages of efficiency,
would be a small step in the direction of a cheaper, more accountable electoral
system, which is to say a more party-oriented system.
1 As I have previously argued, it is usually more accurate
to think of campaign finance in terms of conflict of interest than in terms
of corruption or, worse, the appearance of corruption. See my article, "On
Campaign Finance Reform: The Root of All Evil Is Deeply Rooted," Hofstra
Law Review 18 (1989): 301-67. The same article contains a detailed proposal
for campaign finance regulation along the lines suggested briefly at the end
of the present commentary.
2Ironically, the system is well suited to the largest-scale
election of all, the presidential election. The reason is that presidential
elections do not depend on campaign spending by challengers in order to be