How to be Nonplussed by Citizens United and Exorbitant Campaign Spending

I’m thrilled to commit some of my own mischief to this faction.  My research on interest group involvement in American politics is directly relevant to the topics discussed here and when I speak to students and groups about these topics, I generally find a great deal of misunderstanding and false memes in the area of group influence in American elections and legislative politics. The purpose of my first post here is to recognize the recent trends in campaign finance and the increase in participation in this game by outside groups, and to question how, or whether, it matters.

In blogs, as in all things in life, it’s better to tell stories with pictures, so I’ll start by putting some campaign finance data into perspective with the following graphs.

First, if we look only at money donated to candidates, and their various supporting fundraising committees, over time, we can see that recent campaigns have become much more expensive than in the past (data compiled by author from Center for Responsive Politics and adjusted for inflation, reported as millions of 2008 dollars).

 

 

In addition, what gets the ire of many people is the increase in outside expenditures in recent years.  Since the 2010 Supreme Court decision known as Citizens United vs. FEC, and the follow-up Federal Appeals Court ruling in Speechnow v. FEC, the landscape that regulates campaign spending by people, groups, unions, and corporations not coordinated with a campaign has completely opened up.  Prior to these court decisions, corporations and unions could only contribute to electioneering through PACs, which have limited impact (despite their demonization), especially in the post McCain-Feingold (BCRA) era.  Now, corporations, unions, and anyone else claiming to be a “group” (read: Madisonian “faction”) has the protection of First Amendment free speech rights and can campaign in an unlimited way, for or against candidates, parties, or whatnot.  The caveat is that their efforts cannot be coordinated with candidates’ campaigns, or else they’ll be considered a campaign donation which has strict limitations. (But see the Colbert-Stewart farce on this topic which seriously questions the reality of being uncoordinated.)  See the next graph for perspective on the increase in expenditures by outside groups.

 

The pace of increased expenditures by outside groups is impressive.  It’s possible that outside groups will spend as much on electioneering in 2012 as candidates will (but maybe not—as we’ve seen, candidates can spend a lot).

If you add in all the money spent in congressional elections and so forth, Americans are spending quite a lot of money on campaigning.  For many, it’s not the actual amount that is alarming, but the rate of increase from election to election.  If we look at total spending on the last three presidential elections (below) we can see that the rate of increase is impressive.  However, some perspective might be helpful here.  Even if we spend about $6 billion on total election expenditures this year, it will equal the amount Americans spend on Halloween, Christmas decorations, fast food, and laundry detergent.

 

So perhaps whether these things are a lot of money is in the eye of the beholder.  Certainly as a percentage of the federal budget, or of GDP, $6 billion is a drop in the bucket (literally < 1%).

But even if $6 billion is a lot of money, the question still remains, does it matter?  There has been much lamenting about the price of campaigns and the over-reach of outside groups.  However, if the objective of elections is to determine a winner, and the concern is that the high price tag or the increased participation by non-candidate, non-party spenders may unduly influence the process, the alarms may be falsely rung.  Political science has repeatedly shown that elections, especially presidential elections, are not typically decided on campaigns.  Campaigning may help voters focus their attention (see this), be persuasive in some cases (see this), and help deliver successful message (see this). Frequently, macro-economic trends are the best predictors of presidential elections.  History tells us that all that money spent by outsiders may not affect the outcome of the election—because campaigns (generally) don’t matter (see political science research here, here, and here, for example).

Even if the high-level of spending doesn’t affect the election outcome, there may be other reasons to be concerned about election spending, or the imbalance in the sources of election financiers.  This shall be the topic of another post. 

To sum up, the pace of spending on elections has increased in recent years and the total sum of spending on campaigning, to some, is alarmingly high.  Recent legal shifts have opened the door for outside groups to engage in unlimited “uncoordinated” spending on campaigns, but all this money may only contribute to election outcomes under specific circumstances. Typically, the rate of change in third quarter GDP or unemployment are likely to be much better predictors of the election outcome than any amount spent by any group on campaigning.