The Only Way to Fix Campaign-Finance Regulation Is to Destroy It

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Spending laws have become become complex, senseless, and indecipherable. One counter-intuitive way to fix it: Repeal contribution caps.

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Insanity is doing something over and over, but expecting a different result. That pretty well describes campaign finance reform in America. The worse the system gets, the more we regulate it. The more we regulate it, the worse it gets.

It all started in 1974, when Congress capped campaign contributions and spending. The public rationale for the caps was that smaller donations and less spending would reduce the corrupting influence of money. A less apparent agenda, of course, was also less noble: Help reelect incumbents. Incumbents are usually better funded and better known than their challengers, so making it harder for all candidates to raise and spend money often puts newcomers at a disadvantage.

The Supreme Court, in the 1976 Buckley decision, knocked down mandatory campaign spending caps, saying they violated the First Amendment on free-speech grounds, but kept caps on campaign contributions. This essentially left us with what we have today: a government-regulated system in which individual contributions to federal candidates are limited, but spending by candidates and outside groups is unlimited.

Has government regulation of campaign finance achieved its goal of reducing the importance of money in politics? A simple statistic can answer the question. Since 1974, total congressional campaign spending has gone from $77 million an election cycle to $1.8 billion (in 2010). You decide whether that sounds like success.

Over the last four decades, the campaign finance system has become a Rube Goldberg-esque contraption of complex, senseless, and indecipherable regulations. To fix it, new "reforms" (a.k.a. regulations) are routinely proposed, and some are even passed -- such as the McCain-Feingold Bill in 2002. But the gush of money into politics continues unabated.

It's time to recognize reality and do something we should have done years ago: Repeal campaign contribution caps.

This suggestion will no doubt horrify some people. But when they think about it, cooler heads will prevail.

When businessman W. Clement Stone contributed nearly $10 million to Richard Nixon's presidential campaigns in 1968 and 1972, appalled editorial writers and good-government types demanded Congress make it illegal for any person to contribute such a large amount of money. And so Congress did -- spawning a massive array of rules and bureaucratic red tape to make sure contribution caps are obeyed, not to mention a slew of ways to legally get around them (in deference to free speech principles).

Since then, contribution caps have given birth to a lot of the things today's editorial writers and good-government types detest, including super PACs and, of course, the new whipping boy of campaign finance -- the misunderstood Citizens United Supreme Court ruling. (Citizens United did not create unlimited "independent expenditures," as many pundits think. They have been around for years.)

Contribution caps were intended to keep wealthy individuals -- like Clement Stone -- from dropping millions into campaign treasuries. They have not succeeded. The millions casino mogul Sheldon Adelson and Hollywood mogul Jeffrey Katzenberg have pumped into this year's elections through super PACs proves the point. And they are only the most obvious examples.

The existing $2,500 cap on individual donations pushes money into independent entities such as super PACs, 527s, and 501(c)4s -- legal avenues for individuals and organizations to pipeline unlimited money into presidential and congressional elections. If we did away with the cap, we'd also do away with the need for these entities (after all, they only exist to legally circumvent the cap).

The current system, with its limits on donations to candidates and complete lack of limits on donations to super PACs, diminishes candidates and breaks the chain of responsibility between voters and elected officials.

Under the current system, candidates have no responsibility for what super PACs do or say. They can deny -- in fact, legally, they must deny -- any involvement with them, even though these entities are, in essence, speaking for them through ads that are virtually indistinguishable from their own campaigns' ads (only the hard-to-read disclaimer at the end tells them apart).

If we eliminated contribution caps, political actors like Adelson and Katzenberg would give their money directly to Mitt Romney and Barack Obama, not the super PACs, and the candidates would each be publicly on the hook for accepting and spending this largesse.

The super rich are already spending without limitation, so let's recognize that reality and make the candidates responsible for taking and spending the money. We get to vote for and against candidates. Their names are on the ballot. We don't get to vote for or against super PACs -- groups with ambiguous names like "Restore Our Future" and "Priorities USA Action."

In addition to eliminating contribution caps, we should make two other changes to our campaign laws: First, require full disclosure of all political donations and expenditures and, second, reinstitute the $50 campaign-contribution income-tax credit that existed between 1972 and 1986. Now, with online giving, this tax credit would encourage more small donations and broaden the base of political fundraising without multiplying rules and bureaucratic red tape.

These changes would make our campaign system, if not perfect -- nothing will make an electoral system in any democracy perfect -- at least more honest and simple to understand. These are worthy, and achievable, goals.

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Ron Faucheux is president of Clarus Research Group, a nonpartisan polling firm based in Washington, D.C. More

Faucheux has written or edited seven books on politics and is an advocacy strategist, pollster, university lecturer, and a former two-term state legislator and state-cabinet official. He is on the faculty at the Graduate School of Political Management at George Washington University and the Public Policy Institute at Georgetown University. He received his undergraduate degree from Georgetown University, a law degree from LSU, and a Ph.D. in political science from the University of New Orleans, where he concentrated on voter behavior research. He edited and published Campaigns & Elections magazine for more than a decade. His popular daily newsletter, Lunchtime Politics, summarizes polling from around the nation.

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