40/52 – Money in Politics
Your first REAL job after college is always memorable. For most of us, in high school jobs, we were doing things that helped us understand what we did NOT want to do after college. Except for two essential skills that I learned in the produce room at Stop and Shop that served me well later in life. First, I can still wrap just about anything in plastic shrink wrap so tight that you can't even see it. Secondly, I can still (almost) cut a watermelon in half such that no seeds show. And, of course, then wrap it in shrink wrap.
My first real job after college was at an association called the Public Affairs Council. Technically, I worked for the Foundation for Public Affairs (I used to joke about the name, using a similar riff to that which I also used relative to the Punic Wars, but I’ll leave that there). I learned a lot of lessons in leadership there from people like Dick Armstrong, Ray Hoewing, Terri Perella, and Steve Walker. I encountered my first computer implementation, an MAI Basic 4 machine with four ten-megabyte platters encased in a giant cube. After a few years, I had my initial lessons in managing a small staff and realized I should have paid more attention to what Dick, Ray, Terri, and Steve were doing.
I also learned more than most about the role of money in politics. PAC was initially created as the Effective Citizens Organization and dedicated to a Dwight Eisenhower quote: “Politics ought to be the part-time profession of every citizen who would protect the rights and privileges of free people and who would preserve what is good and fruitful in our national heritage." The operational focus of the Council was programs centered around helping corporations navigate the post-Watergate reforms surrounding political involvement – and especially political contributions -- in a responsible way.
Remember that I started at PAC six years after Watergate and the passage of the Federal Election Campaign Act (FECA) Amendments of 1974. The reforms were not perfect, but they were designed to at least create some bumper lanes around campaign spending and to allow citizens to know who was donating to whom and how much. Specifically, the Federal Election Campaign Act (FECA) Amendments of 1974, and later amendments in 1976 and 1979…
Created the Federal Election Commission (FEC)
Established contribution limits
Set campaign spending limits (later struck down by the Supreme Court)
Required detailed disclosure of contributions
Created a presidential public financing system
It seems almost Pollyanna-ish relative to the current campaign finance mess, but in 1980, the primary contribution limits were as follows.
Individual contributions: $1,000 per candidate per election, with an aggregate limit of $25,000 per year.
Political Action Committee (PAC) contributions: $5,000 per candidate per election
Party committee contributions: Similar to PAC limits.
Corporate and association contributions were not allowed, although they could set up PACs to solicit voluntary contributions from employees and members. Individual contributions to PACs: $5,000 per year.
Each primary, runoff, and general election counted as a separate election for contribution purposes
The system in place largely met the sniff test of knowing who gave what to whom, with limits on the ability of a few individuals to unduly influence the process.
Total campaign spending on federal elections in 1980 was approximately $768 million, broken down roughly as $300 million on Presidential campaigns and $468 million on Congressional races.
By comparison, with weeks left until Election Day, OpenSecrets predicts that 2024's federal election cycle will be the costliest ever, with a total cost of at least $15.9 billion in spending. This will surpass the 2020 cycle's record-smashing total of $15.1 billion.
The top 10 individual donors have contributed $599 million – 7% of all money raised – thus far for the 2024 cycle. Extending the list to the top 100 donors shows that they account for 16% of all fundraising, and extending it further to the top 1% of all donors accounts for a full 50% of all money raised. In contrast, all donors giving under $200 account for just 16% of all money raised (https://www.opensecrets.org/news/2024/10/total-2024-election-spending-projected-to-exceed-previous-record/).
Is anyone better informed now than they were then? Is anyone better off now – other than campaign consultants and TV network advertising revenues?
What happened? How the hell did we wind up here?
The Supreme Court is what happened.
Critical Supreme Court decisions gutted the campaign finance reforms implemented after Watergate. Buckley v. Valeo (1976) struck down spending limits. McCutcheon v. FEC (2014) eliminated aggregate contribution limits. Citizens United v. FEC (2010) most notoriously allowed unlimited corporate/union independent spending, and SpeechNow.org v. FEC enabled Super PACs.
Following the 2010 Supreme Court decision in Citizens United v. FEC and the subsequent D.C. Circuit Court decision in SpeechNow.org v. FEC, Super PACs could raise and spend unlimited sums from individuals, corporations, unions, and other groups. The net effect of these cases has been a dramatic increase in outside spending in federal elections, the growth of independent expenditure campaigns, more negative advertising (since candidates can't control outside group messages), and reduced importance of traditional campaign contribution limits. The cases have opened the floodgates for wealthy individuals and corporations to spend directly on campaigns.
Technically known as independent expenditure-only committees, super PACs may raise unlimited sums of money from corporations, unions, associations, and individuals, then spend unlimited sums to overtly advocate for or against political candidates. Unlike traditional PACs, super PACs are prohibited from donating money directly to political candidates, and their spending must not be coordinated with that of the candidates they benefit…As of October 27, 2024, 2,455 groups organized as super PACs have reported total receipts of $4,290,623,359 and total independent expenditures of $2,346,345,621 in the 2023-2024 cycle. (https://www.opensecrets.org/political-action-committees-pacs/super-pacs/2024).
Just FYI, here are the most significant individual contributors to SuperPACs in this cycle (OpenSecrets.org):
In 2024, outside groups have spent more than the candidates in 53 races (OpenSecrets.org). Living in battleground North Carolina in an endless tsunami of political advertising, I can’t help but wonder if the content of political ads might be viewed a little differently if we knew – in real time – who was paying for the ads. And that many of the fancy-sounding names are just funnels for the spending of a single person. President Obama had it exactly right in comments following his 2010 State of the Union Address:
They can buy millions of dollars worth of TV ads –- and worst of all, they don’t even have to reveal who’s actually paying for the ads. Instead, a group can hide behind a name like "Citizens for a Better Future," even if a more accurate name would be "Companies for Weaker Oversight." These shadow groups are already forming and building war chests of tens of millions of dollars to influence the fall elections.
Now, imagine the power this will give special interests over politicians. Corporate lobbyists will be able to tell members of Congress that if they don't vote the right way, they will face an onslaught of negative ads in their next campaign. And all too often, no one will actually know who’s really behind those ads.
As for the provision requiring that “spending must not be coordinated with that of the candidates they benefit," if anyone believes this is working, I have a bridge in Brooklyn that I would like to sell you. I'm sure, technically, all the paperwork is in compliance, but it doesn’t take a rocket scientist (let’s exclude Musk and Bezos from the inquiry) to know that the current system of campaign finance engineered by the Supreme Court is not working. It has made us less democratic and exacerbated the fissures in society that were already exposed by social media.
The explosion of money from a tiny number of wealthy individuals, the influx of corporate money, and gerrymandered non-competitive Congressional districts (over 90% of incumbents are reelected) have polarized and paralyzed our political system.
We were far better off back in my Public Affairs Council days.
