Here’s issue #17 of my Policy and Politics Newsletter, written 1/29/12. The campaign fundraising issue is a complex and critically important one. Here’s one final piece – for now – on this topic.

First, a little more information on where all the money comes from:

• Wall Street’s big donors, those who give over $10,000, dominate the individual contributions to campaigns. Their contributions of $178 million in the non-presidential 2010 elections and $328 million in the 2008 presidential election cycle are triple those of the next most generous sector, lawyers. The Wall Street contributions are roughly 10 times what they were 20 years ago. [1]
• 90% of the Super PAC spending of about $30 million in the Republican primaries is coming from “probably fewer than 100 people” according to David Donnelly of the Public Action Campaign Fund. [2]
• Roughly 72% ($3.4 billion) of all campaign contributions in 2007 – 2010 came from the business sector (individuals and organizations), with labor contributing 4% ($172 million), ideological groups 7% ($308 million), and others 17%. [3]
• Campaign giving is of course closely linked with lobbying. The US Chamber of Commerce, the biggest lobbying organization, spent $66 million in 2011. Of the top 20 lobbying groups (each spent at least $13 million), only two are not corporations or business associations, the American Medical Association and the AARP. [4]

A variety of initiatives are working to get campaign contributions and their undue influence under control:

• Partial public financing of campaigns is working in states fromMaine toArizona where small individual contributions are matched by public funds and total spending is capped (although Supreme Court rulings have weakened some key elements of these state systems). We have a partial public financing system for our Presidential elections that was enacted in response to the Watergate scandal (where secret, large contributions were funneled to the Watergate burglary and related activities), however its effectiveness has been greatly diminished if not eliminated by the huge amounts of money in our presidential campaigns.
• Hundreds of communities across the US, including Los Angeles and New York City, have passed resolutions asking Congress for an amendment to overturn Citizens United, the Supreme Court decision allowing unlimited spending by corporations in our elections. A number of state legislatures are considering resolutions as well. [5]  Numerous organizations have come together to organize these efforts. (See www.movetoamend.org and www.commoncause.org for example.)
• In Montana, the state Supreme Court upheld the state’s 1912 law limiting corporate spending in campaigns, despite a lower court ruling that Citizens United invalidated the law. The law was enacted when it was common practice for the copper industry to bribe state politicians. The 2^nd US Circuit Court of Appeals similarly upheld a New York City law putting limits on political contributions. [6]

Huge campaign contributions by corporations, wealthy individuals, and other groups mean that our elections are not a fair fight, that our “we the people” democracy is undermined by the influence of money, and that there is great potential for outright corruption. Limiting individuals’ contributions and eliminating contributions from corporations are not silencing anyone; they are simply ensuring that some voices aren’t so loud that they drown out all others. If, as the Citizens United decision says, money equals speech, then those with more money have louder voices, and those with no money have no voice. This flies in the face of the principles of our democracy and the Constitution that our founders wrote.

Here’s issue #16 of my Policy and Politics Newsletter, written 1/25/12. Having taken a look at the Supreme Court’s Citizens United decision generally, I’ll now describe a specific example of its impact.

First, a mea culpa. I was wrong when I wrote in the last issue: “These PACs currently have no requirement to disclose their contributors … ” The PACs are required to report contributors and expenditures on a monthly or quarterly basis, at their choice. However, because this schedule is not tied to the schedule of elections, voters may not know until after they have voted who paid for the ads they have seen. In addition, the identity of actual donors can be made difficult to find out. For example, a $1 million donor to one of the pro-Romney Super PACs set up a corporation in Delaware, made his contribution through the corporation, and then dissolved the corporation. [1]

As an example of the impact of the Citizens United decision, a $5 million contribution from Las Vegas casino magnate, Sheldon Adelson, to the pro-Gingrich Super PAC, Winning Our Future, may well have singled-handedly saved Gingrich’s campaign. (We only know who made the contribution because it was leaked, and when asked, Adelson confirmed it. Other contributors will not be revealed until the end of the month.) [2]

This contribution allowed the supposedly independent Super PAC to run ads in South Carolina that are very likely to have allowed Gingrich to win its primary and stay in the race for the Republican presidential nomination. The Super PAC ran ads both attacking Romney and promoting Gingrich at a level that matched the spending of the pro-Romney Super PAC. Without these ads, it is highly likely Gingrich would have lost inSouth Carolinaand that his campaign, which is lacking money and organization, would have been over. It appears that the PACs outspent the candidates inSouth Carolina.

News hot off the press: Adelson’s wife has just given the pro-Gingrich Super PAC another $5 million. This will allow Gingrich to be competitive in theFlorida primary on January 31.

As I noted in the last issue, I call the Super PACs “supposedly” independent because they are required to be by law, but the reality is quite different. For example, Becky Burkett founded and heads up the pro-Gingrich Super PAC Winning Our Future. She is former top aide to Gingrich, an experienced fundraiser, and as recently as 2011 was the chief development officer for American Solutions, a PAC Gingrich founded in 2007. [3]  In addition, candidates and their campaigns can communicate with the Super PACs through their public statements and their campaigns’ ads and strategies, as well as through mutual allies.

Overall, Super PACs have reported spending about $28.5 million to-date in the Republican presidential primaries. This is a drop in the bucket compared to the $1 billion they are expected to spend during the whole 2012 election period.

Here’s issue #15 of my Policy and Politics Newsletter, written 1/15/12. Having examined campaign fundraising amounts and sources in the previous two issues, now I’ll look at the Supreme Court’s Citizens United decision.

The previous two issues documented the large amounts of money spent on political campaigns and that a small number of very wealthy individuals give huge amounts of money to candidates and to our political parties. They also noted that the amounts of money are growing fairly rapidly. This trend is going to continue in the 2012 election cycle and is expected to accelerate, in large part because of a US Supreme Court decision known as Citizens United versus the Federal Election Commission (FEC).

In the 5 to 4 Citizens United decision, the Supreme Court held that corporations (and also unions), which are often treated as “persons” under the law, have a First Amendment right to freedom of speech. Furthermore, it ruled that this right to freedom of speech means that these “persons” can spend unlimited amounts of money to support or oppose candidates for elected office. [1] [2]

This decision overturned key, and in some cases longstanding, campaign finance laws, rules, and precedents. It did not overturn the prohibition on direct contributions by corporations to candidates, but allowed unlimited contributions to political action committees (PACs) that are supposedly independent of and not coordinated with the candidate and his or her campaign. I say “supposedly” independent because these PACs are often run by former close associates or campaign staff of the candidate, or in other ways have connections to the candidate or his or her campaign. In addition, a candidate’s strategy is often well known and can be amplified by these PACs.

These PACs currently have no requirement to disclose their contributors, meaning we, the public, won’t know who is behind the messages the PACs put forth and whether the contributors present potential conflicts of interest for the candidate. Even if these PACs operate independently of candidates and their campaigns, it is unrealistic to believe that candidates won’t know and reward the contributors to PACs that support their campaigns. [3]  Clearly, this will result in elected officials who are less accountable to their constituents and more responsive to contributors.

As a result of Citizens United, we have PACs and their sponsors stating that they will raise and spend hundreds of millions of dollars during the 2012 elections. Already, in the Republican primary race, PACs have spent tens of millions of dollars on advertising, most of it negative and some quite nasty and untruthful, supposedly independently of the candidates’ campaigns. [4]  This “free speech,” bought with large amounts of special interest money, is drowning out the voices and interests of the public; it represents a real threat to our democracy.

A large number of groups has formed a coalition to work to overturn the Citizens United decision. An effort to hold protest rallies at every federal courthouse in the country on January 20, the second anniversary of the Citizens United decision, is being spearheaded by Move to Amend (www.movetoamend.org). In Boston, there will be a protest rally at the Moakley Courthouse on Friday, 1/20, from 12:30 – 1:30 and a Summit on Citizens United and the efforts to overturn it on Friday afternoon and evening and all day Saturday (http://wiki.occupyboston.org/wiki/The_Rally_and_Summit_to_Unite_Citizens_for_Democracy).

Here’s issue #14 of my Policy and Politics Newsletter, written 1/8/12. The previous issue examined the total dollar amounts for federal election campaigns overall and on a per office basis. Now, I’ll start to take a look at where all the money comes from.

The money contributed to federal election candidates comes from 5 sources:

• Large individual donations, which are $200 or more and have to be reported with the individual’s name and are supposed to include the individual’s employer and occupation
• Small individual donations of less than $200 where the individual’s name is not reported
• Political Action Committees (PACs)
• Self-funding by candidates
• Other, miscellaneous sources

The percentages for the 2010 election cycle for Congressional seats are as follows: [1]

Congress in 2010	Large Indiv.	Small Indiv.	PACs	Self	Other
Senate	53%	12%	15%	12%	8%
House	47%	9%	38%	3%	3%

The dominance of the large individual contributions is dramatic, and even more so when one examines the overall contributions of these individuals. And even more dramatic if the focus is on the largest of these contributors.

In the 2010 election cycle, 26,783 individuals each contributed a total of more than $10,000 to federal election campaigns. (This group is roughly 1 out of every 10,000 Americans, or 1% of the 1%, i.e., 0.01% of Americans.) Combined, these contributors gave $774 million to politicians, political parties, PACs, and independent expenditure groups. This 0.01% of Americans contributed 24.3% of all contributions from individuals. Overwhelmingly, these individuals are corporate executives, investors, lobbyists, or lawyers. [2]

On average, they contributed $28,913, which is more than the median individual income in the US of $26,364. The top 3,480 donors gave $336 million in total, an average of almost $100,000 each, with:

• The top 17 contributors averaging $1.6 million each for a total of $28 million
• The next 995 averaging $136,000 each for a total of $136 million
• The next 2,468 averaging $70,000 each for a total of $172 million

As a result, these extremely wealthy contributors have unique access to and influence on our elected officials and political parties. Leaders of both parties are very aware that more than 80% of party money comes from these few donors. Although elections may be one person, one vote, the disproportionate influence of these few donors on who runs for office, who gets elected, and what policies are enacted, undermines the core of our supposed democracy.

In future issues, I will look at some likely results of the access and influence of large contributors; the impact of the Supreme Court’s Citizens United decision; the supposedly independent expenditures that are not part of candidates’ official campaigns; fundraising for presidential campaigns; contributions from business, labor, and ideological sources; and other important campaign fundraising topics.

Here’s issue #13 of my Policy and Politics Newsletter, written 1/1/12. Having taken a look at voting, I now turn to campaign fundraising. This is a complicated story and will require multiple issues of the newsletter.

The amount of money spent on election campaigns in the United States is staggering. This is due to many factors, but, particularly for the federal offices that are the focus here, the long duration of campaigns and the heavy use of TV advertising are two key ones. Fundraising is critical because the candidate with the most money usually wins. The sources of campaign funds are important to examine because they have implications for who gets elected and what policies are enacted. The large sums of money involved lead to concern about the influence that contributors have over elected officials and the policies put in place, as well as to concern about opportunities and temptations for outright corruption.

Because campaigns are expensive and because money is a key factor in determining who wins, a central qualification for running for office is the ability to raise money. Deciding whether or not to run is much more dictated by the ability to raise money than by the ideas, positions on issues, or other attributes of a candidate. It also means that many people who would be good public officials don’t even bother to run.

The total campaign spending for federal elections in 2010 was $3.6 billion. In the presidential election year of 2008, it was $5.3 billion and this will increase for the 2012 election. The cost of campaigns has been growing consistently and significantly. The total for the 2010 Congressional elections was more than twice the amount of the 1998 elections. The 2008 presidential election year amount was 70% higher than the amount in 2000, just two presidential elections ago. [1]  In the 2008 presidential race, President Obama raised $745 million and Senator McCain had $368 million.

The national Republican and Democratic Parties raised roughly $750 million each in the 2007 – 2008 presidential election cycle and over $500 million each in the Congressional election cycle of 2009 – 2010.

In the 2010 Congressional races, the average winner of a Senate seat spent $9.8 million and of a House seat spent $1.4 million. In part because incumbents standing for re-election typically have a big advantage in fundraising, 85% of the incumbents for Senate and House races were re-elected. The average cost of winning a Senate or House seat has gown substantially since 1990: [2]

Congress	2010	2000	1990
Senate (ave. per seat)	$9.8 million	$7.3 million	$3.9 million
% of 1990	253%	188%	100%
House (ave. per seat)	$1,440,000	$840,000	$408,000
% of 1990	353%	206%	100%

The next issue, Money in Our Elections, Part 2, will examine where all this money comes from.