Change for Good
excerpted from the book
How big corporate money buys
elections, rams through legislation,
and betrays our democracy
by Mark Green
Regan Books (HarperCollins)
Newton Minow, former Federal Communications Commission chairman,
'We've got a real irony here. . . We have
politicians selling access to something we all own-our government.
And then we have broadcasters selling access to something we all
own- our airwaves. It's a terrible system. "
A comprehensive campaign finance reform
program is ideally suited to achieve the conservative goals on
which our economy and society are built-competition, efficiency,
accountability, open markets, and market integrity. Specifically,
four reforms would restore our electoral democracy by elevating
voters over donors: spending limits, public financing, a restructured
enforcement agency, and free broadcast time and mailings.
Buckley Must Be Overturned
Limits on campaign spending are an integral
part of restoring our democracy; Congress understood this fact
when it included expenditure limits in the 1971 and 1974 campaign
finance laws. Furthermore, the experience of the last quarter
century has taught us that without caps on campaign spending to
complement contribution limits, money will always find ways back
into the system. But as long as Buckley v. Valeo remains the law,
the courts are likely to strike down any attempts to place limits
on campaign spending.
As discussed in chapter 3, the Court in
Buckley concluded that expenditures did not raise the problem
of corruption in the same way contributions did. The Court's conclusion
is based on two critical errors: (1) subjecting expenditure limits
to a higher standard than contribution limits, and (2) considering
only the anticorruption rationale while dismissing the other interests.
Why should campaign expenditures be entitled
to much greater constitutional protection than campaign contributions?
Neither expenditures nor contributions actually are speech; both
merely facilitate expressive activities. And the argument that
contributions pose a greater danger of quid pro quo corruption
than expenditures seems ridiculous on its face: Are we really
to believe that a $2000 contribution to a candidate will create
a greater sense of obligation than millions of dollars in independent
expenditures for that candidate?
And what makes preventing quid pro quo
corruption so much more important than any other governmental
interest? Of course, it is unacceptable for public officials to
sell votes, access, or influence to the highest bidder. Why? Not
because of the quid pro quo-ness of it all; we exchange money
for goods and services all the time in our daily lives. Rather,
it is because the sale of our government undermines the most fundamental
principles of our democracy: competitive elections, effective
government, and-most important of all-the guarantee that our public
officials answer to their true constituents, not a handful of
wealthy benefactors. Quid pro quo arrangements are surely egregious
violations of these democratic norms, but they are not the only
Some may argue that any effort to overturn
Buckley is a pipe dream; and that even if the Court reconsiders
Buckley, it will adopt an even harsher position on campaign finance
regulation. However, if and when the Court finally breaks from
Buckley, it will not be the first time the Court has overruled
a long-standing precedent on an important constitutional issue
... while it took a century, Dred Scott was overturned by Brown
v. Board of Education in 1954.
As an alternative to the judicial route, Senator Fritz Hollings
has proposed overturning Buckley through a constitutional amendment.
I, His proposed amendment states that "Congress shall have
power to set reasonable limits on the amount of contributions
that may be accepted by, and the amount of contributions that
may be made by, in support of, or in opposition to, a candidate
for nomination for election to, or for election to, Federal office."
But to amend the Constitution, a proposal
must gain a two-thirds majority in both houses and be ratified
in three quarters of the states. As any of the proponents of the
ill-fated Equal Rights Amendment can attest, this is a very tall
order; there have been only seventeen successful amendments since
the original Bill of Rights. In 2001, Hollings's proposal was
voted down in the Senate, though it picked up 40 votes. Senator
Feingold opposes the Hollings amendment on the grounds that we
ought to make changes to the freedoms enshrined in the Bill of
Rights not by amendment but rather through the Supreme Court.
But if President Bush (or his successor) manages to fill the Supreme
Court with more justices who don't care whether democracy is for
sale and who have never run for office and so cannot understand
the problem-thereby making it virtually impossible to overturn
Buckley through the courts, Senator Hollings's proposal may become
more urgent and feasible.
Enact Public Financing
Because public financing enhances speech,
promotes competition levels the playing field, and reduces reliance
on special-interest money, it is the essential reform of the next
generation-along with overturning Buckley. So the question is,
what form of public financing? The full public financing programs
of Arizona, Maine, and Vermont are very attractive, promising
experiments. But few elections have been held under Clean Money
laws, and the body of evidence supporting them is limited. Because
Clean Money is still in its infancy, it's hard to see Congress
adopting it in the near future, which is precisely the reason
that the movement's founding organizers focused their initial
efforts in ~e states. They understood that you have to walk before
you can run.
The bill that stands the best chance of
both appealing to members of Congress and re-creating the large,
diverse coalition behind McCain-Feingold is one built on a law
that already has bipartisan support: public funding of presidential
candidates. Qualifying presidential candidates who agree to accept
spending limits receive public matching funds in the primary election
and a flat grant in general election. No one can argue that the
system protects incumbents: three of five incumbent presidents
have been defeated running under it. Nor can anyone argue that
it violates conservative principles: as noted, Ronald Reagan accepted
over $90 million in public funding in his three presidential bids.
From lessons learned in presidential,
state, and local campaigns, public financing for congressional
candidates should include the following elements:
A GENEROUS MATCHING RATE.
At the presidential level, the matching fund program provides
a dollar-for-dollar match up to the first $250 contributed. New
York City has shown that by increasing the matching rate to 4
to 1, candidates with grassroots community support can rely on
small contributions and still raise the money needed to run competitive
Although matching-fund programs aren't
intended to eliminate fund-raising, as Clean Money aims to do,
they can provide the bulk of funds available to candidates. There
is no perfect matching rate, but none has proven more effective
than New York City's in accomplishing the chief goals of reform:
elections that are more competitive and candidates who are less
dependent on special interests. For this reason, the congressional
matching rate for public funds should be set at 4 to 1, up to
the first $250 contributed by individuals (or more if a rich opponent
opts out). Contributions from PACs should not be matched, nor
should out-of-state contributions.
If candidates raise all of their money
in small contributions, they should be able to receive public
funds in amounts up to two-thirds of the spending limit. Most
candidates will raise some of their money in amounts exceeding
$250, and thus the average candidate will receive less than two-thirds
of his or her money in public funds. But the 4 to 1 match, resulting
in grants up to two-thirds of the spending cap, protects candidates
with broad-based support in low-income communities from being
significantly outspent by rivals with better financial connections.
REASONABLE QUALlFYING THRESHOLDS.
For candidates to receive public funds, they must raise enough
money from enough local residents t o prove their viability. How
much is enough? The trick in setting thresholds is to set them
high enough to exclude frivolous campaigns, but low enough to
include serious grassroots contenders. In Los Angeles, where City
Council districts are about 40 percent as large as the average
congressional district, council candidates must raise $25,000
from a total of at least 100 different contributors to qualify
for public funds, and only the first $250 of a contribution applies
toward this threshold. A report by the Center for Governmental
Studies found that the thresholds are "appropriately set."
A comprehensive report on campaign finance
reform by Professor Richard Briffault and the New York City Bar
Association recommends the same qualifying threshold for congressional
candidates. For Senate races, the Briffault report recommends
that the House threshold apply to candidates in states with only
one congressional district, and that $10,000 be added for each
district thereafter, up to a maximum threshold of $75,000. In
state-level public financing programs, the qualifying threshold
for gubernatorial candidates ranges from $35,000 in contribution
increments up to $50 (Minnesota), to $300,000 in increments up
to $500 (Kentucky).
In my view, a House candidate should raise
at least $25,000 in donations of $250 or under to meet the threshold,
which means attracting 100 to 200 contributors at least. For Senate
races the Briffault formula is sound, though with a higher cap
of $150,000 for large states. In states like California and New
York, where high spending limits will allow candidates to qualify
for millions of dollars in public funds, a $150,000 threshold-again,
with only the first $250 of each contribution counting toward
it-is not an unreasonable precondition for such a large public
investment. To ensure that a candidate is supported by his or
her own constituents and not merely outside interests, only contributions
from a House candidate's district and a Senate candidate's state
should count toward the threshold. These are fair standards. Frivolous
candidates will not meet them; serious candidates will.
Until Buckley falls and a spending cap is found constitutional,
funding limits can only be encouraged by offering public funds
to candidates who voluntarily accept them. Only spending limits
can end the arms race for campaign cash and reduce the power of
war chests that incumbents build to scare off competition. And
only the combination of spending limits and public funds can level
the political playing field.
Spending limits that are set too high
tend to favor incumbents, because few others can raise the resources
to compete with them. Limits that are set too low, however, also
favor incumbents, since challengers need to spend enough to overcome
the natural advantages that accrue to incumbents through years
of constituent service, free media, and use of the franking privilege.
So the porridge must not be too hot or too cold. When weighing
these two considerations, a third must also be taken into account:
incumbents and the well-connected will not voluntarily join a
public financing program if they feel its spending limits are
significantly below what they could otherwise raise. If limits
are too low, so too will be participation rates, and the program's
purposes will be seriously compromised.
Of these three considerations, two point
toward higher spending limits, which suggests that it is better
to err on the side of caution. The average House winner spent
$842,245 in 2000; the average candidate who challenged an incumbent
spent just $143,685. In 1988, only 22 House campaigns hit the
million-dollar mark; in 2000, the number reached 176. To control
costs without discouraging participation or diminishing a challenger's
ability to compete, House candidates should be held to inflation-adjusted
spending limits of $900,000-$450,000 each for the primary and
general election. A strong argument may be made that a $900,000
limit, which memorializes a level of spending that is about the
current average, does not do enough to suppress campaign spending.
But to undercut opponents who will use inadequate spending limits
as an excuse to oppose reform, and to ensure that challengers
can spend at significant levels, it is in the reform coalition's
best interests to support limits around the current average cost
of a winning campaign. By definition, this amount can't be too
low or too high if it's the average amount it takes to win.
Senate candidates should be able to spend
$1 million, plus fifty cents for each voting-age person in the
state-which would come to about $8 million (for the primary and
general election combined) in New York State, $7 million in Florida,
$5 million in Ohio and Pennsylvania, and $2 million in Arkansas-or
about one-fourth to one-half of what's recently been spent in
these states. But in comparison to House contests, Senate races
have higher profiles and receive significantly more media attention,
making it harder for incumbents to dominate. Consequently, spending
limits lower than current averages will protect challengers from
the war chests that Senate incumbents can build over six years,
and still ensure-because of free media coverage- that challengers
will have ample opportunity to get their message out.
For instance, in Michigan's 2000 Senate
race Debbie Stabenow spent $8 million in her victory over incumbent
Senator Spencer Abraham, who spent $ 14.5 million. Under the spending-limit
formula just outlined, both candidates would have been held to
about $5 million. Similarly, in Pennsylvania, a $5 million limit
would have helped challenger Ron Klink, who was outspent by nearly
$10 million in his losing 2000 campaign against incumbent Senator
Separate limits for the primary and general
election ensure that the winner of a hard-fought primary will
not be placed at a disadvantage by facing a general-election opponent
who suffered no primary challenge. To ensure equity, of course,
candidates without primary election opponents should be allowed
to spend up to the limit in the primary election period, although
no public funds should be given to candidates without serious
opponents, whether in primary or general elections.
A BONUS PROVISION.
Again, so long as Buckley is the constitutional standard, legislation
cannot prevent the super-rich from spending tens of millions of
dollars on their campaigns. We can, however, help their opponents
by eliminating the spending limit. It is unfair to keep a lid
on a non-rich candidate when his or her opponent effectively says
the sky's the limit.
Florida's public financing program attacks
the issue head-on: candidates whose opponents reject spending
limits are entitled to a dollar -for-dollar match up to the amount
spent by their opponent. In 1994, Jeb Bush did not participate
in the state's public financing program and exceeded its $5 million
spending limit by $4 million. As a result, his opponent, Governor
Lawton Chiles, received several million dollars more in public
funding that allowed him to equal Bush's spending. Many observers
cited the law as an important factor in Chiles's reelection. Indeed,
after the 1994 election swept Republicans to power in Florida's
legislature, they refused to renew the program.
It is unfair, however, to expect taxpayers
to underwrite a spending battle with a billionaire. Had Florida's
law been in effect in New York City in 2001, it would have entitled
the Democratic nominee for mayor (yours truly) to an additional
$58 million in public funds-an obscene amount to ask the taxpayers
to spend on one mayoral candidate, particularly in a time of financial
crisis. Currently, in New York City, the bonus for candidates
who face big spenders is a bump in the matching rate from 4 to
1 to 5 to 1, which meant an additional $700,000 under this provision.
But, if a $58 million increase is too gargantuan, given a $74
million campaign, an amount equal to only 1 percent of that total
One reasonable solution in the future
is the approach of Maine's Clean Money program, which offers a
participating candidate his or her opponent's theoretical share
of public funds, times two. So if a rich person opts out and spends
$5 million in Maine or $75 million in New York City, the complying
candidate in a general election could receive a bonus up to a
maximum of $850,000 in Maine and $8.5 million in New York City-amounts
that would make a challenger more competitive.
The passage of McCain-Feingold increased the contribution limit
from $1000 per election to $2000, the first such increase in nearly
thirty years. If Congress enacts a public financing program, these
limits should ideally be returned to their original level for
House races and left to stand for Senate races, reflecting the
different fund-raising demands of each office.
Admittedly, going back to a $1000 maximum
in hard money gifts may be a nearly impossible goal politically.
A more promising avenue may be to bring PAC limits in line with
individual limits, or to limit the total that may be raised from
PAC contributions, as Los Angeles does (although some might question
the constitutionality of such a move). Limits on total PAC giving
would diminish the relative importance of any one PAC contribution,
because each could be theoretically replaced with another, and
reduce the incumbent's "temptation" when weighing legislatively
interested PAC money against his or her own better judgment.
As for self-financing candidates, the
Committee for Economic Development recommends a reasonable limit
on personal contributions of $25,000-or $50,000 per couple. And
to avoid the obvious loophole, personal loans should be regulated
so that loans not repaid by election day are considered contributions,
and subject to penalty if they exceed contribution limits.
Minnesota prohibits PAC fund-raising while
the legislature is in session, and New York governor George Pataki
has proposed a ban on fund-raising within twenty-five miles of
the state capitol when the legislature is in session. If such
a ban is good for state capitals, why not for our nation's capital?
At the very least, it would mean a more productive workweek for
members of Congress, who would not be dashing off to fund-raising
cocktail parties and dinners several nights a week.
In 2001, the Los Angeles City Council passed a bill tightening
the city's previously mentioned fund-raising ban from eighteen
months prior to elections to twelve for City Council candidates,
and from twenty-four months to eighteen months for citywide candidates.
The bill, which contained other provisions, was vetoed by Mayor
Jim Hahn, but the shorter time allowed for fund-raising is likely
to be resurrected in future legislation.
Non-election-year contributions overwhelmingly
favor incumbents, and they usually come from special interests
seeking to exert influence on legislation, not from citizens seeking
to aid a candidate's election campaign. For both reasons, a blackout
is a good idea. In addition, a fund-raising blackout in the years
before elections would ease the perpetual campaign that now characterizes
American politics. "Twenty years ago, you basically ran a
Senate campaign in the last year of your term, if not the last
six to nine months," said Frank Greer, a Democratic political
consultant. "Now, senators who are elected have to begin
planning for their next campaign right away." Greer made
this remark in 1989; since then, as described in chapter 5, things
have only gotten worse. Much worse.
Incumbents are already the huge favorites
in the arms and ads race, so why should they also have a head
start? Putting everyone on the same starting line would ensure
that incumbents don't get halfway to the finish line before challengers
hear the gun go off. And the next time you listen to elected officials
call reform an "incumbent protection act," call their
office and ask if they support a fund-raising I blackout.
Free Broadcast Time and Mailings
The airwaves belong to us, the public.
We provide broadcasters with federal licenses-for free-on the
condition that they agree to serve "the public interest,
convenience, and necessity." They have not lived up to their
end of the bargain.
How have they gotten away with it? (You'll
never guess.) The powerful broadcast industry vehemently opposes
reforms affecting the.. bottom lines. The industry gave $6.8 million
to candidates and parties in the presidential election year of
2000, with half coming in soft money. Their annual largesse has
allowed them to skirt their public duty, and then some: despite
a thirty-year-old law designed to hold down campaign ad rates,
broadcasters routinely gouge candidates ... When the Senate included
a provision in McCain-Feingold to close the loophole that allows
for such price gouging, the industry went on the attack, showering
both parties with hard and soft money. Their efforts paid off:
the House stripped the provision from Shays-Meehan and the loophole
Why is the broadcast industry unwilling
to live up to its public service obligations? In the 2000 elections,
broadcasters pulled down revenue from political commercials that
approached $1 billion. Reducing that revenue would mean cutting
into profit margins that average between 30 and 50 percent. So
it makes perfect business sense for the industry to invest a relatively
minute amount in contributions to candidates and parties, because
the payoff is astronomical. Dan O'Connor, the general sales manager
of WSYT-TV in Syracuse, New York, put it this way: Ad buyers for
candidates "call you up and say, 'Can you clear $40,000 [in
TV ad time] next week?' It's like, 'What? Am I dreaming? Of course
I can clear that!' And they send you a check in the mail overnight.
It's like Santa Claus came to town. It's a beautiful thing."
Paul Taylor, executive director of the
Alliance for Better Campaigns, a nonpartisan group that advocates
for free airtime, sums up the scam this way: "Let's follow
the bouncing ball. Our government gives broadcasters free licenses
to operate on the public airwaves on the condition that they serve
the public interest. During the campaign season, broadcasters
turn around and sell access to these airwaves to candidates at
inflated prices. Meanwhile, many candidates sell access to the
government in order to raise special-interest money to purchase
access to the airwaves. It's a wonderful arrangement for the broadcasters,
who reap windfall profits from political campaigns. It's a good
system for incumbents, who prosper in the big-dollar, high-ante
political culture of paid speech. But it's a lousy deal for the
rest of us."
Walter Cronkite, the iconic American newsman,
is chairman of the Alliance for Better Campaigns. According to
Cronkite, "In the land of free speech, we've permitted a
system of 'paid speech' to take hold during the political campaigns
on the one medium we all own-our broadcast airwaves. It's long
past time to turn that around. Free airtime would help free our
democracy from the grip of the special interests." That's
the way it is, and even Senator Mitch McConnell, the self-described
Darth Vader of campaign finance reform, agrees that the broadcasters
are not giving the public a fair shake. And for the rest of the
world, this is a no-brainer. "America is almost alone among
the Atlantic democracies in declining to provide political parties
free prime time on television during elections," writes historian
Arthur Schlesinger Jr. [If it did so], it could do much both to
bring inordinate campaign costs under control and revitalize the
political parties "
It's time for electronic consumers to
negotiate a better deal with those we give free licenses to. Cronkite's
alliance is pushing an innovative and market-based proposal-first
discussed in a 1982 monograph from the Democracy Project, Independent
Expenditures in Congressional Campaigns: The Electronic Solution-that
would provide free broadcast vouchers to candidates and parties.
Here's how it would work: Qualifying candidates who win their
parties' nominations would receive vouchers for use in their general
election campaigns. Candidates, particularly those from urban
areas who don't find it cost-effective to advertise on television
or radio, could trade their vouchers to their party in exchange
for funds to pay for direct mail or other forms of communication.
Parties, in turn, could use the vouchers themselves or give them
to other candidates. The system creates a market for broadcast
vouchers that, because of pricing incentives, ensures their efficient
A comprehensive campaign finance reform
program should provide candidates with a right of access to the
public airwaves. Until then, the alliance's voucher proposal should
be restricted to those candidates who accept spending limits.
Whether vouchers were used for airtime or exchanged for party
monies for direct mail, candidates would report them as expenditures.
Under such a system, spending limits would retain their integrity.
The value of the vouchers should be set at $250,000 for House
candidates and vary by population for Senate candidates, with
candidates in midsize states receiving up to $2.5 million in vouchers.
As in public financing, candidates should be required to reach
contribution thresholds to qualify for vouchers.
One might argue that vouchers would simply
encourage the proliferation of slickly produced thirty-second
advertisements. Yet the reality, for better or worse, is that
political commercials are part of elections in America, and there's
little chance that will change. The voucher proposal bows to that
reality, but it also offers hope: candidates who accept the vouchers
should be required to feature their own voices in at least 50
percent of all their ads-whether paid for by vouchers, private
contributions, or public funds. There is a growing public distaste
for anonymous negative advertising, and candidates, given free
access to the airwaves, should be held accountable for their ads.
And there are other ways to promote civic
discourse. Cronkite's alliance has put forth a complement to its
voucher proposal, called "Voters' Time," that would
require broadcasters to air a minimum of two hours a week of candidate
discussion in the month preceding every election. At least half
of the programs would have to be aired in prime time or drive
time, and the formats-debates, interviews, town hall meetings-would
be of the broadcasters' choosing. A voters' time requirement is
necessary, because broadcasters are airing less and less campaign
news and candidate discourse.
In the 2000 election campaign, despite
the closest presidential election in a generation, ABC, CBS, and
NBC devoted 28 percent less time to campaign coverage than in
1988. In a nationwide survey conducted two days prior to the 2000
elections, more than half the population could not answer basic
questions about Bush's and Gore's positions on the issues. There
are many factors contributing to that result, but two of them-the
domination of election by big money interests, and the unwillingness
of the broadcast industry to be a part of the solution-can be
Mandating free airtime for candidates
and candidate discussion would appropriately hold broadcasters
to a minimal standard of what it means, under the Federal Communications
Commission Act, to serve "the public interest, convenience,
and necessity." But this will require a committed Congress
standing up to an unusually powerful industry, one that gives
big contributions and confers access to voters via the airwaves.