Campaign Finance I

I'm not sold on the concept of publicly financing campaigns.  It should not be easy for any crackpot to get hold off taxpayers' money to launch a loony, joy ride of a political campaign.

Still, articles like this from the excellent Ruth Marcus make me willing to re-consider:

Washington operates on the tacit understanding that campaign contributions grease the way for access and influence. Both sides in this transaction, lawmaker and donor, perceive, or at least present, themselves as the victim: elected officials as captives of a system that demands incessant fundraising; donors as the target of a none-too-subtle shakedown scheme.

As the legislative director for Teledyne Controls, a California defense contractor, told OCE investigators, "It does go through your mind whether you are buying influence." Yah think? 

Having spent 10 years on the Hill, I wouldn't say money buys results (except in a few highly publicized cases where people went to jail), but it can get you a hearing, without which you have little or no chance of getting what you're looking for.  Even the late Paul Simon (D-IL) acknowledged that his time was limited, and when handed his list of phone calls gave preference to big donors.

Most so-called campaign finance reforms have, in my view, made the system even worse.  Limit how much individuals can give?  OK - you simply empower "bundlers" who can bring many individuals together.  Even worse, because only small amounts can come from any one source, it takes MUCH more time for Members to fund raise.  Every lunch hour and free evening becomes a fund raising session whereby a Members Chief of Staff will her take over to the Republican or Democratic Committee to start placing phone calls to lobbyists and constituents.

This is time not working on the nation's problems or even time socializing and getting to know one another personally.  Don't underestimate the importance of this latter activity - its one of the reasons Washington has become so nasty.

The Citizens United Case

Perhaps no Supreme Court case since Bush v. Gore has engendered such dyspeptic rage at Citizen United v. FEC, a 5-4 ruling that held laws prohibiting independent expenditures by corporations advocating on behalf of a candidate's election to be unconstitutional.

It may seem unusual that corporations have "free speech" rights that extend to elections.  It seems that it is this proposition is behind much of the outrage.  If you have a problem with that, however, you should have gotten angry a long time ago when the court first stated that proposition.  That such a right extends to corporate spending on behalf of a ballot proposal was announced many years ago in the First National Bank of Boston v. Bellotti case.  Extending the reasoning of Bellotti to advocacy for a candidate doesn't seem like such a leap if you accept the court's reasoning in these prior cases.  This did mean reversing its decision in Michigan Chamber v. Austin, a case that, itself, was not terribly consistent with the Court's previous rulings in this area.

For our purposes, the question however is what has been the affect on our government?  So far, we've seen no evidence that corporations have any interest in availing themselves of this newly declared liberty.  Right now the big winners appear to be the portion of the Washington bar specializing in campaign finance laws.

Congress is getting ready to take up legislation that will provide transparency to efforts by corporations to finance independent campaigns for or against one candidate (Note: corporations and labors may still not actually donate $ to the campaign itself - the activity must be truly independent).  Interestingly, it's liberal groups, however, that are voicing concerns about having to disclose their donors.

We'll keep watching corporate activity here to see what the impact of the ruling is.  As an in-house corporate lawyer, my own guess is not a whole lot as companies are (a) loath to spend money on politics unless it directly affects its short term bottom line, and (b) very risk adverse when it comes to the resultant publicity.