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Burying the Incumbent Protection Racket

Wednesday, June 16, 2010

Although only 14 percent of the public approves of Congress, in an ordinary year 95 percent of all incumbents are re-elected. How is this possible?

The Supreme Court’s decision in Citizens United v. Federal Election Commission has rekindled a healthy debate about campaign finance and its role in the U.S. political system. In freeing corporations and unions from advertising restrictions, the Court unleashed a storm in the political class, with President Obama—who singlehandedly destroyed the public funding of presidential campaigns—using a portion of his 2010 State of the Union message to upbraid the Court members for allowing new and unpredictable money into the system. As important as this case is, however, it is still a sideshow. Our current campaign finance system, which requires candidates to raise virtually all their own campaign funds, continues to create an odd paradox in American politics: although only 14 percent of the public in some polls approves of Congress, in an ordinary year 95 percent of all incumbents in the Senate and the House are re-elected.

But this should be no mystery. Incumbent representatives and senators begin every re-election campaign with a huge advantage in name recognition. This flows from their full-time Washington and local office constituent service staffs; the privilege of sending information to voters, free of charge, about the work they’ve done for the district or state; and of course all the media coverage that incumbents get while in office.

Prohibiting parties from financing the campaigns of their own candidates is one of the last remaining incumbent protection devices.

Incumbents, of course, know this, and over the years they have adopted “reforms” that have made it more difficult for challengers to raise or spend campaign funds. Fortunately, the Supreme Court has recognized these obstacles for what they are, and has struck down spending caps, limits on independent expenditures by outside individuals and groups, and restrictions on candidates’ contributions to their own campaigns. In its last term, the Court struck down the so-called millionaire amendment in the McCain-Feingold law, which had lifted many of the contribution limits on any candidate (almost always incumbents rather than challengers) whose opponent contributed more than $350,000 to his own campaign.

One key incumbent protection device that the Supreme Court has left standing is the restriction on political parties’ ability to help finance the campaigns of their own candidates. Current law limits party contribution to $5,000 per House candidate and $39,500 per Senate candidates (yes, those are thousands) and allows parties to coordinate spending with their candidates under different formulas for the Senate and House. The coordination limits are subject to a cost of living adjustment (COLA), which is applied to the base allowance. In 2008 the COLA was 4.25. Accordingly, party-coordinated spending with a Senate campaign in 2008 was the greater of $20,000 times the COLA ($85,000) or $0.02 times the voting age population of the state multiplied by the COLA. For example, in a state with a voting-age population of 5 million, the allowance for party-coordinated spending would be $100,000. Coordinated spending with a House campaign in 2008 was limited to $42,100.

Only one reform has a chance to make elections more competitive, and that is to remove all the various limits on how much money and other assistance political parties can provide to their own candidates.

These restrictions mean that in 2008 Senate campaigns permissible direct party spending on their candidates, plus coordinated spending (in which, for example, parties produce or pay for advertisements that the candidate has approved), added up to only a little more than $6 million—about 1.5 percent of the total $389 million spent on all Senate races. Likewise, in House races, direct and coordinated party spending amounted to only about $8.1 million—1 percent of the total $808 million spent. Independent expenditures by the parties—ads, for example, that the candidates have not approved in advance—accounted for another 30 percent of spending on Senate races in 2008 and 13.6 percent on House races.

This comes as a surprise to many people—even to some fairly sophisticated about politics—because the media always refers to millions of dollars being spent by the parties and the House and Senate campaign committees. What’s going on? The answer is that, with the exception of the limited spending described above, party spending must be independent and not coordinated with the party’s own candidates. Congress has insisted, of course, that the Federal Election Commission (FEC) police this line strictly, and the parties and their finance committees are well aware that coordinating spending with their candidates beyond the limited amounts is a felony.

The Supreme Court’s ruling in Citizens United has now focused attention on independent spending. The decision allows corporations and unions to express their views on issues and candidates in exactly this way, just as the tax-favored organizations known as 527s have been able to do for years. In this sense, they have greater opportunities to affect elections than the political parties themselves, because the parties are limited in the size of contributions they can receive.

If the Democrats are serious about freeing the political parties to assist their candidates in a meaningful way, the new bill should permit the parties to contribute directly to their candidates’ campaigns.

Does this make any sense? Why should political parties, which nominate the candidates, be second-class citizens when compared to all kinds of independent groups that have now been empowered—as they should be—to participate in the political controversies of a vigorous democracy? The answer is that prohibiting parties from financing the campaigns of their own candidates is one of the last remaining incumbent protection devices. Challengers normally begin campaigns with little funding and staff, and if they’re lucky enough to raise the funds for a competitive campaign it’s often too late in the game to be effective. Party funding would start challengers off with sufficient funds to hire staff and place ads, but this is prohibited by current campaign finance laws.

A new bill sponsored by congressional Democrats, known as the Disclose Act, would allow parties to coordinate spending with their candidates, but only if the party and not the candidate controls the spending. This is a welcome step forward, but not a workable one. It will be impossible to determine, after coordination has occurred, whether it was the candidate or the party that actually controlled the party’s spending. The FEC will no doubt be called upon to make detailed regulations and adjudicate these issues after challenges about this question by opposing candidates. If Democrats are serious about freeing the political parties to assist their candidates in a meaningful way, the bill should permit the parties to contribute directly to their candidates’ campaigns. That will fully recognize the distinction between political parties and all the independent groups that want—justifiably—to have a say in U.S. elections.

Allowing more participation in the debate can only help to inform voters and make election contests more vigorous. But independent spending cannot make elections more competitive. That requires leveling the playing field between incumbents and challengers. Only one reform has a chance to do this, and that is to remove all the various limits on how much money and other assistance political parties can provide to their own candidates. A reform like this would not even need to change current contribution limits. By simply allowing parties to support their own candidates, challengers would get the financing they need, and we would all have the competitive elections a democracy requires.

Peter J. Wallison, a former White House counsel for President Reagan who is now a senior fellow at the American Enterprise Institute, and Joel M. Gora, a professor at Brooklyn Law School, and an adviser to the ACLU on campaign finance, are the authors of “Better Parties, Better Government: A Realistic Program for Campaign Finance Reform.”

FURTHER READING: Wallison last wrote about "The Troubling Resolution Revolution" for bank and government bailouts. He has also discussed "Republicans and Obama's New Deal" and "Moving Toward Government Control." Michael Barone explains "Why Do Parties Last Longer in Britain?" and Edward Blum questions "Are We a Nation of One Person, One Vote?"

Image by Rob Green/Bergman Group.

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