fling93 loves fishies

Show Me the Money!

This morning, I was listening to Forum with Michael Krasny on KQED discussing the issue of campaign finance reform. This was brought up by the controversy surrounding Secretary of State Kevin Shelley, which I’m not too familiar with (although I was glad to see him endorse a voter-verifiable paper trail). But as you might have guessed, campaign finance reform is one of my biggest issues.

Unfortunately, I don’t have time to cover the entire issue in my usual level of detail right now, so this is not as well-researched as many of my other posts, and I’m not going to be able to address some of the key points, like the free speech implications and the blind trust idea. But I wanted to cover some of the bases and announce a couple of events this week that you can attend if you’re in California, so bear with me.

Lobbying hinders libertarianism

Campaign finance is a pet issue of mine partly because of obvious results of lobbying that have resulted in outcomes that were not in the best interests of the American people, like sprawl, copyright law, tariffs, tax deductions, and subsidies. But more importantly, I see it as one of the two main obstacles to libertarianism (the other one being the plurality electoral system which discourages and marginalizes third parties). Yet most libertarians dismiss attempts at campaign finance reform. A common sound-byte I hear is that, “you can’t take money out of politics, so take politics out of money instead,” implying that people and corporations wouldn’t bother lobbying the government if it didn’t intervene so much in the economy.

The problem is that the main reason the government intervenes so much in the first place is exactly because people and corporations had lobbied for it to do so. Why did they? Because in many cases, it’s more cost-effective to lobby the government to tilt the rules in your favor than to invest that money and try to win the game fairly (especially if your competitors are lobbying the government themselves). And not surprisingly, vested interests have a vested interest in lobbying remaining effective. And note that tilting the rules typically requires more goverment intervention, so this is actually a huge reason that government keeps getting bigger and bigger. One that libertarians would be foolish to ignore.

McCain-Feingold and 527s

It also seems to me that there’s been a lot of whining about all the money going into 527s, which are currently dominated by liberal groups like MoveOn, although there are also some conservative groups like the Swift Boat Veterans for Truth. While the soft money flowing to these groups is a loophole that John McCain would certainly like to see closed (especially when they illegally use it to affect federal elections), there has been grumbling about how the BCRA (commonly known as McCain-Feingold) got us into this mess, implying that it hasn’t helped at all. On the contrary!

First of all, the way it used to be (as I understand it), there were no disclosure rules on soft money donations to the political parties. So you had absolutely no idea who was donating how much to whom. 527s, on the other hand, must report all their contributors to the IRS. Indeed, you can find all the contribution information on a site I’m quite fond of, the Center for Responsive Politics (opensecrets.org). For example, here are the top contributors for MoveOn.org, the top one being George Soros.

Indeed, that’s exactly how the New York Times Magazine was able to do this fascinating story on the vast amounts of money now flowing to Democrat-friendly 527s (via Dan Drezner). Because of the disclosure rules, they were able to track down exactly who was giving all this money and where it was going. You couldn’t do that with the soft-money going to the political parties before McCain-Feingold.

Secondly, as the New York Times Magazine story details, all this 527 money is not under the control of the Democratic Party. This is changing the power dynamic in interesting ways. It used to be that donors gave money to the party, but then had no say in how it was used. The party had full control of it. Now, donors can pick a specific 527 tailored to their tastes, and it’s the party that has no say in how that money gets spent. This decentralizes a lot of power that had been concentrated in the two big parties, which I think is a tremendous improvement that gives libertarian ideals a better chance to succeed.

Thirdly, the amount of money involved is actually significantly less than before McCain-Feingold. Per opensecrets.org:

Contributions to political nonprofits active in federal elections have not kept pace with soft money donations to national party committees in previous election cycles, the nonpartisan Center for Responsive Politics reported today.

So-called 527 groups, named for the section of the tax code that governs them, raised fewer funds through the first 15 months of the current election cycle than the national political parties raised in soft money over the same amount of time during each of the past two election cycles, the Center’s figures show.

From January of last year through March of this year, 527 groups active in federal elections raised $146.4 million, compared to the $212.4 million in soft money the national political parties raised over the same period during the 2002 election cycle. The parties raised $159.3 million in soft money during the first 15 months of the 2000 cycle.

The disparity would be even greater if contributions to 527s in 2002 and 2000 were coupled with party soft money raised during those cycles.

So, while McCain-Feingold hasn’t fixed the problem, I think it was a big step in the right direction. One of the guests on Forum remarked that we haven’t gotten rid of murder, so does that mean that laws against murder are a failure? No, you have to measure progress, and hopefully I’ve helped illustrate that progress a bit.

Of course, there’s still a long way to go. It’s not clear what the final solution will be, or if there will ever be a final solution. It could be that the struggle will go on indefinitely (much like, say, the War on Terror). But I hope that it is clear that this is a struggle worth fighting.

California Clean Money Campaign

One of the Forum guests mentioned that California’s campaign finance laws were horrendously bad — much worse than the federal campaign finance laws — and cited the California Clean Money Campaign (caclean.org). It seems to me that this is a group promoting Clean Money, Clean Elections (CMCE) in California. This proposal, already in use for elections in Arizona and Maine (and soon in Massachusetts and Vermont), is an interesting form of voluntary public financing that appears to address most of the concerns raised against publicly financed campaigns

Basically, if a candidate raises a minimum number of $5 contributions (to screen out the lunatic fringe), they qualify for public financing of their campaign, but they are not allowed to use private funding, just the “clean money.” Candidates don’t have to use public financing if they don’t want to; they can choose to run as a “non-participating” candidate and raise money privately, just like candidates do now. If a non-participating candidate outspends a publicly financed candidate, this unlocks a limited amount of extra money that the publicly financed candidate can use to match up better.

I’m not an expert on the issues around this system, but if you are interested in learning more or discussing it, California Clean Money Campaign has a couple of upcoming events. For those of you down in the San Jose area like me, there’s a South Bay Area meeting this Thursday, August 19, from 7PM-9PM in in Cupertino. Specifically, the Union Church of Cupertino, 20900 Stevens Creek Boulevard, in the Montgomery Music Room. There’s also a meeting in San Francisco this Saturday, the 21st, from 11AM-2PM at 260 Townsend St, and one in L.A. on September 11th (a date I think you can remember). I myself am planning to go to the South Bay one on Thursday. My schedule this week is a bit hectic, so no guarantees on that, but I hope to see some of you there.

Not that you’d know how to recognize me, since I won’t be wearing my all-powerful balloon fish hat.