The Folly of Campaign Finance Reform, Part IV - The Conclusion

If you have read all the posts so far and still believe CFR laws are either correct or effective, there is additional information I have researched that I did not discuss here. One is that fundraising success, not media time or attention, is the most effective gauge of popular support for candidates and causes. A review of www.opensecrets.org reveals that PACs and so-called special interests actually supply a small minority of the voluntary donations provide the fuel that power political communications to inform and educate the electorate, something that Jefferson said was necessary to the health of a democracy. Obama’s fundraising strength – 100% of which came from voluntary donations – gave him the means to wage an effective campaign against both Clinton and McCain. The media did not take candidates like Howard Dean and Ron Paul seriously until their fundraising totals showed they enjoyed a great deal of popular support.

But CFR laws passed in the guise of “money undermining the public” and “taking the money and interest groups out of politics” have not achieved these goals. In fact, they have exacerbated the situation by the sharp rise in incumbency and millionaires winning office. In the hope of limiting private donations, they have made politicians more reliant on fundraising than ever before as the realities of the marketplace require increased time spent on raising funds. Limits on donations mean more time spent fundraising, and lower donation amounts obviously leads to increased interaction with those who can give the maximum.

Most alarmingly for political communication, regulating donations limits the ways citizens can participate in the political process and also limits the ways politicians can present themselves and their platform to the electorate. Any law that restricts freedom of speech, limits freedom of expression and affects the outcome of election should be a violation of the First Amendment and a detriment to popular sovereignty. Yet these laws continue to be popular with the public, who are clearly unaware of these serious consequences and unable to follow the complexities of CFR. Even among CFR supporters, there is a backlash because they do not believe the laws are working. When a CFR champion like John McCain abandons the Presidential Campaign Fund and begins employing the same techniques he excoriated others for using, it is obvious the current system is broken.

The challenge, then, is whether to keep passing new CFR laws or try something radical like gutting the entire CFR structure. The answer is likely to be neither in the near term, although the current makeup of the Supreme Court may encourage some organization to challenge the laws on First Amendment issues. In 2007, the Court weakened the 60-day ad provision in Wisconsin Right to Life v. FEC, ruling that the BCRA's limitations on political advertising were unconstitutional when applied to issue ads similar to ones the Wisconsin organization wanted to run.

There is one CFR facet I agree with because it assists politicians, the public and the First Amendment – the call for transparency and added disclosure. The public deserves to know where politicians, PACs, 527s and other organizations are getting their money, and how they are spending it. Web sites like www.opensecrets.org present this information in great detail. It helps create a money trail and assists with accountability. Anything that continues to promote good governance should be encouraged.

But by and large, CFR laws are preventing effective political communication. The laws were designed to prevent inequities, but social and economic inequality will always exist in our society regardless of the level of campaign contributions from the private sector. The more money a candidate can get, the more they will be able to communicate with the voters. The more informed voters are, the better informed they will be. It’s conceivable that Obama’s huge base of support simultaneously comes from and is driven by the large amount of private contributions he has raised from the public. And remember, he also rejected the matching funds from the Presidential Campaign because he thought he would need more money to win the campaign. It turned out he was absolutely right.