Down the Rabbit Hole of Money in Politics
Campaign cash and the election industry
Two previous articles have been republished by Future of Jewish: a piece by Contributor Ryan Favro on the history behind economic anti-Semitism, and one by me on the ways in which “genocide” is being used to discuss the war in the Middle East.
If you’re the kind of person Hunter S. Thompson dubbed a “political junkie”, you’ll be familiar with the phrase “money in politics” — or, the fact that political campaigns in the United States are financed by private donations. You’ve probably heard about “dark money”, super PACs, and the statistic — it fluctuates year by year — that 90-some percent of the time, the candidate who raises more money wins. The arguments against money in politics have always been clear: it subverts the democratic principle of “one person, one vote” by allowing the wealthy to have an outsized voice, and has a corrupting influence by making politicians beholden to large donors or special interests. Indeed, a recent Pew survey found that 72 percent of Americans think there should be limits on election spending, and 85 percent think the cost of political campaigns makes it “hard for good people to run for office.”
But ever since Donald Trump bucked the trend in 2016, winning both the primaries and general election against more well-funded opponents, money in politics, as an issue, has been shunted to the back burner of progressive politics. Reformers, shaken by the Trump upset, seem to have lost some of their confidence in the issue’s foundational claims. I, too, was once quite animated about money in politics, but have found myself discussing it less and less over the years. This isn’t because I have changed my opinion, but rather due to the subconscious feeling that a significant amount of the wind has been taken out of this issue’s sails. The question is, does money in politics meaningfully influence elections and governance, or is it an overrated non-issue that activists have exaggerated? When we shift away from the realm of perception, the data shows that money in politics plays an enormous role in the American political system, in ways big, small, and sometimes unexpected.
Money in politics is nothing new. Moneyed interests using their wallets to grease the wheels and influence favorable outcomes is a practice as old as democracy. During the 20th century, however, genuine efforts were made to check the influence of money in elections with laws such as the Tillman Act of 1907, the Federal Corrupt Practices Act of 1910, the Hatch Act of 1939, and the Federal Election Campaign Act of 1971. That all changed in 1976 with the landmark Supreme Court decision Buckley v. Valeo, which ruled that spending money to influence elections is a form of protected speech, and in the process, rendered significant portions of previous campaign finance laws either unconstitutional or toothless.
Thus began the modern era of runaway money in politics, a dynamic that was only supercharged with a later landmark ruling. In the 2010 case, Citizens United v. Federal Election Commission, the Supreme Court decided that corporations and unions have the same First Amendment speech rights as individuals — and remember, Buckley ruled that money is speech. Put another way, as Mitt Romney once said to a campaign trail heckler in 2011, “Corporations are people, my friend.” Citizens United gave rise to super PACs — political action committees that can accept donations of unlimited size from corporations, unions, and politically active nonprofits to spend advocating on behalf of particular candidates or issues. And since politically active nonprofits don’t have to disclose their contributors, donors can remain anonymous by funneling their funds into super PACs through such nonprofits, resulting in what’s known as “dark money.”
According to the Federal Election Commission (FEC), the House of Representatives collectively raised over $194 million for the 1982 elections. Inflation adjusted, that’s about $639 million in today’s dollars, as per the US Bureau of Labor Statistics. In 2022, by contrast, they raised just shy of $2 billion. In 1982, the Senate raised nearly $129 million, or $424 million today. In 2020, they raised over $2.1 billion. In 1984, presidential candidates raised close to $232 million, or $766 million in today’s bucks. In 2020, they raised over $4 billion. That’s not counting the more than $12 billion that have been raised by super PACs since 2010. The rate of campaign fundraising has not just lapped the inflation rate many times over, it has long since outpaced the inflation rate of healthcare.
The first question is, does money actually win? Trump famously won the 2016 Republican presidential primaries despite being significantly outraised by several competitors — in particular, Jeb Bush, who impotently spent $130 million on his low-energy campaign. Trump went on to defeat Hillary Clinton in the general, losing the fundraising contest once again. In the 2020 Democratic primaries, Joe Biden overcame being outraised by Bernie Sanders and a pair of self-funded billionaires, Michael Bloomberg and Tom Steyer. Beto O’Rourke broke fundraising records in his 2018 Senate bid against Ted Cruz only to lose, and Amy McGrath opened a hare-like $30 million lead over Mitch McConnell in 2020, only for the tortoise to win the race. To the casual consumer of headlines, it’s easy to get the impression that this whole “money in politics” thing is overblown. But the data tells another story.
Not even the almighty dollar could rescue Jeb(!)
In nearly every presidential election going back to 1976, the candidate who raised the most money won, both in primary and general elections.1 Over the last 25 years, the Congressional candidate with the most money has won between 85 and 95 percent of the time, and the Senatorial candidate with the strongest fundraising has won between 71 and 88 percent of the time. We may not always be able to say with absolute confidence that the candidate who raises more money usually wins because of the money, as opposed to the winning candidate raising more money because they’re winning (this is known as “reverse causation”). But looking at the big picture, fundraising remains predictive of electoral victory by a healthy margin.
The next question is, if money wins, how does it affect governance? This one is far more difficult to answer definitively. Even if every single politician were in no way beholden to the donors and special interests who helped elect them, the very fact of influencing the outcome of most elections constitutes, by itself, a profound influence on governance. Of course, we all know that quid pro quo lies at the very bedrock of all politics, but tabulating the dollars raised into units of political influence is difficult to quantify in any objective way. What we can do is observe some associated trends.
A number of striking patterns have emerged parallel to the staggering influx of money that now flows into the election industry. Since the mid-1970s, real median household incomes have not kept pace with economic growth. Since 1979, the gap between economic productivity and typical employee compensation has drastically widened, as has income inequality. Congress has become more polarized, voters have become more polarized, and confidence in US institutions has plummeted.
Given the countless moving and interconnected parts that comprise any economy or society, much less one as immense as the United States’, conclusively demonstrating that money in politics caused these other patterns is exceedingly difficult, if not impossible. We may not have located the fire, but boy is there a lot of correlational smoke, much of which arises right after Buckley v. Valeo and accelerates right after Citizens United. Still, we should take these with a grain of salt.
I would also be remiss not to discuss the role monetary considerations play in the behavior of the press. The American media, as Fareed Zakaria once said, is not a charity. Unless you’re getting all of your news from C-SPAN, the coverage you’re consuming was selected based on how much revenue it could generate for the parent company. In some cases, such as in 2016, this dynamic works at cross purposes with “money in politics” by giving a candidate like Donald Trump, whose antics viewers could not peel their eyes away from, a jaw-dropping $4.6 billion in free media coverage. Oftentimes, networks simply broadcast entire Trump rallies in real time without commentary. Yes, Clinton outraised Trump, but the press essentially functioned as a pro-Trump super PAC.
Another feature of the media is that they generally regard political fundraising as a metric of “electability” and “seriousness.” In this respect, the press works symbiotically with political donors by rewarding the top-raisers with additional coverage and clout. Neither of these media behaviors are strictly speaking part of “money in politics”, and yet they are unquestionable examples of money in politics. This is not to necessarily suggest we should broaden the meaning of money in politics to encompass the press, but it’s certainly worth thinking about.
The final question is, what can be done? Since the Supreme Court has ruled that money in politics is a protected constitutional right, the only way to truly abolish it is with a constitutional amendment. Given the state of polarization, and the fact that the US has not amended the Constitution in over 30 years, and not substantively in over 50, that prospect seems vanishingly remote. As I lamented last year, “We are, unfortunately, no longer the kind of thriving political society that can make big changes.” There are some smaller reforms worth pursuing, such as expanding public financing and closing regulatory loopholes. Ultimately, however, there are no good answers right now — at least, none that seem achievable in the foreseeable future. But it’s time we at least got on the same page about the facts. Whether money in politics is the master problem behind every other issue is very much a matter of interpretation. But the available data and a little common sense make it clear that it is a problem.
See also: “When More Democracy Is Less: The Paradox Of Primaries”
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Outside of the exceptions discussed above, there were only three other times fundraising wasn’t decisive during this span. One was in 1992, where George H. W. Bush edged out Bill Clinton in cash but lost a crazy three-way race with Ross Perot in which Clinton won with only 43 percent of the vote. The other two occurred in the 2008 primaries, where John McCain and Barack Obama both won despite being outraised.