Where campaign finance needs to go now

Zephyr Teachout in Reuters, June 28, 2011

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By Zephyr Teachout

In the mid-1990s, Arizona voters faced a pretty normal problem: their government was corrupt. Legislators were thinking about wealthy donors, not their constituents. Some of those donors were giving money legally (through campaign contributions), and some illegally (through bribes—think AZScam). But whether illegal or legal, the problem was the same: the elected officials had their minds on the sources of cash, instead of the problems of the state. It wasn’t good for democracy, since candidates without a lot of wealthy friends just weren’t going to run for office.

Arizona voters decided to push for public financing of elections. But they worried that candidates might not use the public financing because the amounts provided—for example, around $15,000 for legislature races—could come up short. Would it be enough if a self-financed candidate spent all his money, or the Chamber of Commerce unleashed a flood of attack ads? Candidates might get cold feet; instead of opting into public funding, they’d choose to raise money the old fashioned way, calling rich people who knew lots of other rich people, and telling them whatever they needed to hear.

So Arizona had two choices. It could pass a law to give the hypothetical nervous candidate a high default lump sum of public funding for her campaign, insurance against a big money dump. Or it could pass a law that gave the nervous candidate extra funding if the feared event happened: if the rich candidate or the Chamber of Commerce spent over a certain set amount she’d get an equal amount to be able to fight back. Arizona chose the second option—why use state money when it wasn’t needed? After a threshold, a publicly funded candidate was automatically given an additional $1 for every $1 spent by the self-financed candidate or attacking outside groups. The law didn’t prohibit anyone from spending money. And it was automatic, so it didn’t discriminate on the basis of any ideology.

This is the law the Supreme Court knocked down Monday in McComish v. Bennett as a violation of the First Amendment. In brief, Justice Roberts doesn’t want wealthy politicians to worry too much. Worrying, after all, is burdensome, and doctrine tells us we don’t want to burden speech. Free speech is threatened if a candidate hesitates before spending an additional $10,000 because his opponent would get access to a triggered $10,000. (An extended exchange in oral argument revolved around whether self-funded candidates might have to “think twice” about spending an extra $10,000. Justice Roberts countered that thinking twice sounded like a sufficient burden to him.) In the opinion, he reiterated that the choice was a burden, while asserting that “we do not need empirical evidence to determine that the law at issue is burdensome.” Justice Kagan, in a passionate dissent, called out the various contortions of logic in the majority opinion, as well as its fundamental unreality: “If an ordinary citizen, without the hindrance of a law degree, thought this result an upending of First Amendment values, he would be correct.”

But back to our voters in Arizona–what can be done after this opinion striking down their law? The tragedy is that the Supreme Court took away a very cleverly designed system, one which—when explained—was supported by over 75% of Arizonans. But the Court did not gut every option. In fact, one of the surprises of this opinion is that the Supreme Court left the bulk of Arizona’s public financing scheme alone. And funds can still be matched to things the candidate does—just not to things that other candidates do.

There’s a big difference between now and the late ‘90s: the explosion of low-dollar online fundraising. In 1998, John McCain was still two years away from shocking the world with his 40,000 donors, and Barack Obama a decade away from raising half a billion online from mostly small donors. Arizona now has a third option: give matching funds based on a candidate’s ability to raise low-dollar contributions. For every $50 raised, give a candidate $250. That not only gives our hypothetical nervous candidate some ballast, it gives her a motivation to go talk to anyone and everyone.

Low-dollar matching funds tie a candidate’s imagination and mental energy to the task of representation. When she wakes up every morning, a candidate will always think, “how can I raise $10,000 today?” But with low dollar matching funds, she’ll be getting to that $10,000 by trying to maximize the number of people who give her $50. The local developer is worth $1000, but with 5-to-1 matching funds, ten $50 contributions is worth $2500. So she’ll be working the laundromats and working on messages that reach thousands, instead of working with laundered lobbyists’ money and messages that reach a small elite cohort.

That might worry the Chamber of Commerce. But that’s a burden I can live with.