The Moral High Ground On Federal Financing

Barack Obama is likely to opt out of the federal public financing system for the general election and instead embrace a variant of Joe Trippi's general election funding idea: tap your massive donor base and cap contributions. Once the decision is formally handed down, the McCain campaign is likely to protest massively. Obama, they will say, simply broke his word for the sake of political convenience. But the reality is that John McCain, by spending money right now on the general election -- polling Obama exclusively, running ads in swing states, opening offices in states, sending staff to states -- is spending money raised for the primary period. Had McCain opted to take public financing for the primaries, he would have blown past the caps months ago. Did Obama break a promise? Yes. Does McCain have grounding to criticize him for it? It's not so clear.

Rick Hasen makes the following points:

$85 million is shabby. The Times writes that this amount is "not so shabby," which explains why Senator McCain is opting in. I think that's wrong. I think Senator McCain is opting in because he figured (1) he is likely not to be able to raise as much as Sen. Obama if they both opt out, and by opting in he can try to embarrass Sen. Obama into opting in; and (2) opting in is not a big deal for Sen. McCain, because he is likely to raise a ton of money with the RNC, which is subject to more generous contribution limits. So he's not planning on running his campaign on just $85 million. To speak of the decision to opt in today as a decision to decline private financing fails to recognize the reality of the situation.

3. The Obama "web boom" is a big deal The Times focuses on the fact that half the primary money overall has come from donations "above $1,000." Of course, thanks to McCain-Feingold, these donations are capped at $2,300. Let's look what has happened with small donations so far this year. Overall, in 2004, donations of $200 or less (what I've termed "micro-donors") made up 28% of the total of donations raised by all candidates in the primary system.

This primary season so far, these micro-donors have made up 35% of the total donations. (On the Democratic side, it has been 40%, on the Republican side, 27%). Sen. Obama alone, however, has raised nearly half of his donations (47%) from small donors giving under $200, and about one-third in donations from $1,000 to the $2300 maximum. This is a big deal. I think it is a misnomer to call it "partial public financing but I think it is fair to say that this "web boom" of small donations gives egalitarians something to cheer. If there is going to be a revitalization of public financing in the future, it likely will build on this kind of micro-donor enthusiasm through generous matching funds which would give candidates who have greater private support some greater public support. (That's much like the voucher plan I've long championed.)

What do you think?