WHY LIMITED SUCCESS FOR CAMPAIGN SPENDING

ABSTRACT: So why were all the outside money and all the advertising it bought less effective than was anticipated in the recent election? First, the great bulk of the outside money was spent on advertising, largely negative advertising. Voters were overwhelmed and simply tuned them out. The advertising lost effectiveness and experienced diminishing returns. Second, the huge amounts of money and advertising drew lots of attention. So fact checkers were very active and the mainstream media became active in covering the money, the advertising, and the fact checking. This gave voters information that may have led them to question or resist the messages of the ads.

Third, the big money and advertising appears to have been less effective than good old fashioned grassroots organizing. Finally, Democratic candidates and messages appear to have resonated better with voters than Republican candidates and messages. Despite the outside money’s lack of success in electing desired candidates, I doubt that it will go away. My next post will examine likely future effects and what can be done to better monitor and control potential negative impacts.

 FULL POST: So why were all the outside money and all the advertising it bought less effective than was anticipated – and than hoped for by those paying for it – in electing specific candidates in the recent election? I think there are four major reasons.

First, the great bulk of the outside money was spent on advertising, largely negative advertising. And it bought lots of ads. But voters know that ads are marketing and hype, and that their goal is often to deceive and obfuscate (especially negative ads) rather than to inform. [1] Also, voters were overwhelmed by the din and repetition of all the ads and simply tuned them out. [2] Advertising markets where the Presidential race or other races were competitive were literally saturated; all the available air time was purchased for political ads. In short, because there was so much advertising, it lost its effectiveness and experienced diminishing returns. [3]

Second, the huge amounts of money and advertising drew lots of attention. So fact checkers were very active in analyzing the accuracy of the ads. And the mainstream media became active in covering the money, the advertising, and the fact checking. This included reporting on who had funded the ads or that the actual funders were veiled in secrecy. This coverage of the ads, their accuracy and their funding, gave voters information that may have led them to question or resist the messages of the ads. Although negative advertising has historically depressed voter turnout, that did not happen in this election. Perhaps there was an actual voter backlash against the negative advertising.

Third, the big money and advertising appears to have been less effective than good old fashioned grassroots organizing – voter outreach, identification, and get out the vote efforts. The ground game appears to have been more effective at producing votes than the airwaves. [4] In addition, efforts to make it harder to vote or to suppress voting appear to have generated a backlash in some places that resulted in high voter turnout that blunted the impact of negative advertising.

Finally, Democratic candidates and messages appear to have resonated better with voters than Republican candidates and messages. The extreme positions and statements of some Republicans, particularly Tea Party types, generally did not sit well with voters, both within their states or districts and beyond. And the advertising blitz could not overcome these differences between the parties.

Despite the outside money’s lack of success in electing desired candidates, it did have significant impacts. (See 11/14/12 post.) I doubt that it will go away, and there are good reasons to be concerned about big money in political campaigns. My next post will examine likely future effects and what can be done to better monitor and control potential negative impacts.


[1]       Carroll, J., 10/29/12, “America’s kidnapped politics,” The Boston Globe

[2]       New York Times Editorial, 11/10/12, “A landslide loss for big money,” The New York Times

[3]       New York Times Editorial, 10/7/12, “The cacophony of money,” The New York Times

[4]      New York Times Editorial, 11/10/12, see above

THE IMPACT OF ALL THE CAMPAIGN SPENDING

ABSTRACT: Roughly $6 billion was spent on the 2012 elections for federal offices. Although complete data isn’t yet available, an unprecedented $1.3 billion plus of this amount was “outside” money. Roughly a quarter of this outside money was “dark” money – money where the actual source of the money cannot be identified. About 80% of the outside money was spent opposing a candidate, typically through negative advertising. And over 70% of the outside money was spent trying to elect Republicans. The big outside money donors are large corporations and very wealthy individuals who have very specific, special interests in government actions that provide them substantial benefits.

Although the deluge of outside money achieved only limited election results, it had other significant, if somewhat more subtle, impacts. First, the great majority of the outside spending was on negative advertising, which changed the tone of the campaigns and demeaned the whole electoral process – candidates, voting, and the role of government. Second, the unlimited contribution amounts increase the influence these contributors have with elected officials; it creates a sense of obligation. Third, candidates had to spend even more of their time than before raising money. Finally, certain issues were not even discussed during the campaign for fear of alienating large donors.

FULL POST: Roughly $6 billion was spent on the 2012 elections for federal offices according to the best estimates; a truly staggering sum. Although complete data isn’t yet available, an unprecedented $1.3 billion plus of this amount was “outside” money, namely spending by entities other than the candidates’ campaigns themselves. And roughly a quarter of this outside money was “dark” money – money where the actual source of the money cannot be identified. [1]

About 80% of the outside money was spent opposing a candidate, typically through negative advertising. And over 70% of the outside money was spent trying to elect Republicans. This Republican advantage in outside money was offset in part by Obama’s and other Democratic candidates’ ability to out raise Republicans in direct contributions to their campaigns (i.e., in “inside” money). [2]

Beyond the general concern about the influence of large amounts of campaign money on candidates and elected officials, these unprecedented levels of outside money raise particular concerns. The outside money comes almost exclusively from large donors (i.e., $100,000, $1,000,000, and multi-million dollar contributions). The outside money donors are large corporations and very wealthy individuals who have very specific, special interests in government actions that provide them substantial benefits.

The good news is that all this outside money didn’t buy successful election results to the extent I and many others thought it would. Clearly, outside money significantly affected the Republican Presidential primary.[3] It also had a notable impact on some Congressional primary races. And presumably the large sums that flowed into competitive Congressional races, particularly in the last few days before the election, did affect the outcome of some of those races. [4] [5]

Although the deluge of outside money achieved only limited election results, it had other significant, if somewhat more subtle, impacts.

First, the great majority of the outside spending was on negative advertising, which changed the tone of the campaigns, particularly in competitive races. This negativity demeaned the whole electoral process – the candidates, voting, and the role of government. The ads were often misleading and sometimes clearly false. This occurred because candidates cannot be held accountable for the ads, given that the outside money is independent and outside of the candidates’ control (at least in theory). [6] The negative advertising forces candidates to spend time and money defending themselves rather than discussing issues. Note that in the Massachusetts Senate race there was very little of the negative advertising that was common elsewhere because the candidates had an enforceable agreement to ban outside spending on advertising.

Second, the unlimited contribution amounts, newly unleashed by the Supreme Court’s Citizens United decision, increase the influence these contributors have with elected officials when they are in office. The big contributions by large corporations (which have far deeper pockets than any of the other players) and very wealthy individuals, create a sense of obligation. [7] For example, Sheldon Adelson and his wife have given over $36 million to Super PACs and unknown tens of millions to non-profit groups that don’t have to report donors. He has a clear policy agenda and makes it known that he views giving to these groups, who then support specific candidates, the same as giving to the candidates directly. [8]

Third, candidates had to spend even more of their time than before raising money. This diverts their time and attention from interacting with voters and discussing issues. [9] The huge amounts of money in general, turn campaigns into an arms race. The unlimited outside spending exacerbates this, requiring candidates to build up huge war chests to be able to counter last minute outside expenditures. [10]

Finally, certain issues and issue options were not even discussed during the campaign for fear of alienating large donors. For example, the issues of global warming and meaningful regulation of the financial industry effectively disappeared from the presidential and many other campaigns. It’s hard to believe that the deep pockets and big campaign spending of companies and executives in the oil, gas, and coal corporations and of those from Wall Street didn’t contribute to the lack of discussion of these issues.

So why were all the spending and all the advertising less effective than was anticipated – and than hoped for by those paying for it – in electing specific candidates? That will be the topic of my next post.


[1]       Schere, M., Elliott, J., & Barker, K., 11/2/12, “Dark money rises,” ProPublica

[2]       Sunlight Foundation, retrieved 11/13/12, “Outside spenders’ return on investment,” http://reporting.sunlightfoundation.com/2012/return_on_investment

[3]       Boston Globe Editorial, 11/8/12, “Billionaires: Now, mind your own business(es),” The Boston Globe

[4]       Calvan, B.C., 11/5/12, “Spending on congressional races soars,” The Boston Globe

[5]       McGinty, J.C., 10/29/12, “Donors make last-minute investments in House races,” The New York Times

[6]       Eggen, D., & Farnam, T.W., 11/8/12, “Spending by independent groups had little election impact, analysis finds,” The Washington Post

[7]       New York Times Editorial, 11/10/12, “A landslide loss for big money,” The New York Times

[8]       Boston Globe Editorial, 9/29/12, “As super PACs link arms, mega-donors’ clout increases,” The Boston Globe

[9]       Eggen, D., & Farnam, T.W., 11/8/12, “Independent groups’ big money had little impact on vote results,” The Boston Globe

[10]    Eggen, D., & Farnam, T.W., 11/8/12, “Spending by independent groups had little election impact, analysis finds,” The Washington Post

THE DEBT, THE ECONOMY, AND THE POLITICAL PARTIES

ABSTRACT: Since 1945, Democratic presidents have on average reduced the federal government’s debt as a percentage of GDP by about 3% while Republican presidents have on average increased it by about 3%. PresidentObama has increased the debt percentage more than any president in this period. However, this is largely due to his inheriting a large deficit and the worst recession since the Great Depression. Other than this, the six largest increases in the debt percentage have occurred in recent Republican presidents’ terms.

Multiple measures of economic performance are better under Democratic presidents than Republican ones. Since 1949, overall economic growth measured by median annual increase in GDP has been 4.2% under Democratic presidents and 2.6% under Republican presidents. Stock market performance since 1913 as measured by the median increase in Standard and Poor’s index of 500 stocks has increased 12.1% under Democratic presidents and 5.1% under Republican presidents. The annual increase in corporate earnings since 1936 has been 10.5% under Democrats and 8.9% under Republicans.

This data certainly shows that Republicans aren’t more fiscally responsible than Democrats; if anything it strongly suggests the opposite. The data also show that Republicans aren’t the party of economic prosperity more so than Democrats.

FULL POST: The historical record of the federal debt and the performance of the economy under Republican and Democratic presidents is interesting to examine.

First, the federal government’s total debt (the total of all the previous annual deficits and surpluses) as a percentage of the overall economy (i.e., the Gross Domestic Product or GDP) is probably the most meaningful statistic about the debt. Since 1945, Democratic presidents have on average reduced the debt’s percentage of GDP by about 3% while Republican presidents have on average increased it by about 3%.

President Obama has increased the debt percentage more than any president in this period. However, this is largely, if not totally, due to his inheriting a large deficit and the worst recession since the Great Depression. Other than this, the six largest increases in the debt percentage have occurred in recent Republican presidents’ terms: George W. Bush’s two terms (with 2005 – 2009 being the worst other than Obama), George H.W. Bush’s term, Ronald Reagan’s two terms, and Gerald Ford’s partial term. The only two terms under Democratic presidents where the debt percentage increased were Harry Truman’s and Bill Clinton’s first terms. Both of them reduced the debt percentage in their second terms significantly more than the increase in their first terms, so overall they both reduced the debt percentage. [1]

Multiple measures of economic performance are better under Democratic presidents than Republican ones. Since 1949, overall economic growth measured by median annual increase in GDP has been 4.2% under Democratic presidents and 2.6% under Republican presidents.

Stock market performance since 1913 as measured by the median increase in Standard and Poor’s index of 500 stocks has increased 12.1% under Democratic presidents and 5.1% under Republican presidents. The annual increase in corporate earnings since 1936 has been 10.5% under Democrats and 8.9% under Republicans. [2]

While a president’s actions have only indirect influences on these measures and a president inherits policies and the state of the economy from his predecessors, this data certainly shows that Republicans aren’t more fiscally responsible than Democrats; if anything it strongly suggests the opposite. The data also show that Republicans aren’t the party of economic prosperity more so than Democrats.


[1]       The Economist, 11/1/12, “The change in America’s debt by presidential term,” www.economist.com/blogs/graphicdetail/2012/11/daily-chart

[2]      Healy, B., 11/2/12, “Taking stock of past races,” The Boston Globe