Voting with Dollars: A New Paradigm for Campaign Finance

Voting with Dollars: A New Paradigm for Campaign Finance

by Bruce Ackerman, Ian Ayres

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In this provocative book, two leading law professors challenge the existing campaign reform agenda and present a new initiative that avoids the mistakes of the past.

Bruce Ackerman and Ian Ayres build on the example of the secret ballot and propose a system of “secret donation booths” for campaign contributions. They unveil a plan in which the government provides each voter with a special credit card account containing fifty “Patriot dollars” for presidential elections. To use this money, citizens go to their local ATM machine and anonymously send their Patriot dollars to their favorite candidates or political organizations. Americans are free to make additional contributions, but they must also give these gifts anonymously. Because candidates cannot identify who provided the funds, it will be much harder for big contributors to buy political influence. And the need for politicians to compete for the Patriot dollars will give much more power to the people.

Ackerman and Ayres work out the operating details of their plan, anticipate problems, design safeguards, suggest overseers, and show how their proposals satisfy the most stringent constitutional requirements. They conclude with a model statute that could serve as the basis of a serious congressional effort to restore Americans’ faith in democratic politics.

Product Details

ISBN-13: 9780300127010
Publisher: Yale University Press
Publication date: 10/01/2008
Sold by: Barnes & Noble
Format: NOOK Book
File size: 18 MB
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Read an Excerpt

Voting with Dollars

A New Paradigm for Campaign Finance
By Bruce Ackerman

Yale University Press

Copyright © 2004 Bruce Ackerman
All right reserved.

ISBN: 030010149X

Chapter One

Reforming Reform

Campaign finance lives in a time warp, untouched by the regulatory revolution of the past generation. Reformers suppose that they can adapt well-established models to fix the problem of big money in politics. But they are wrong. Real progress requires us to rethink the very foundations of the enterprise.

The old paradigm has three elements. The first confronts big money as if it raised a problem similar to the one posed by polluters dumping garbage into a waterway. The Environmental Protection Agency not only restricts the garbage each polluter can dump but places an overall limit on the amount of junk in the river. Why not do the same when big money pollutes democratic politics?

To be sure, the Supreme Court has resisted this analogy in the name of the First Amendment-repeatedly striking down efforts to restrict overall campaign spending. But judicial intervention manages only to precipitate predictable boos from the left, and cheers from the right, with no serious efforts at reappraisal from either side.

The debate is no less pre-scripted when we turn to a second basic remedy. Why not reduce or eliminate the flood of private money by providing for publicly subsidized campaigns? Reformers invariably understand the injection of "clean money" as a centralized process-replete with heavy-handed requirements that favor incumbents, entrench existing parties, and alienate citizens from funding decisions. Their basic proposal would serve just as well for farmers or arms exporters. Apparently, only minor modifications are required before politicians can join the feast at the federal trough.

For conservatives, the prospect of a political feeding frenzy heightens anxieties provoked by rigid command and control over private fund-raising. But even their opposition wanes as they turn to the third reform plank. The reigning paradigm demands full publicity for all contributions. The public has a right to know who is paying whom when. With every deal open and aboveboard, let the voters decide whether a big gift or giver taints the candidate's integrity. This full-information plank has gained increasing prominence over the past decade. Even strict conservatives concede that secret transfers of cash look suspicious. If the public keeps demanding reform, the best way to channel protest is by insisting on full information. Still more recently, leading liberals have been coming to the same conclusion as they despair when confronting the intractable difficulties of implementing other parts of the traditional paradigm.

We challenge the organizing premise of this now-familiar debate. All three pathways to reform draw from a century-long argument about the regulation of the economy. Whenever a policy wonk confronts the widget market, it is second nature to ask whether widgets generate harms to third parties that require command and control regulation, whether widget producers need subsidizing to achieve optimal levels of production, and whether widget consumers require better information to make informed choices.

These standard responses systematically mislead when we turn to our present subject. Command and control, bureaucratic subsidies, and full information are part of the problem, not part of the solution. We reject a paradigm drawn from the regulation of widgets and build on a more democratic tradition centered on the franchise. When dealing with the ballot, Americans do not champion the virtues of full information. We make it a crime for anybody to penetrate the sanctity of the voting booth. Nor do we suppose that votes, like widgets, may be sold to the highest bidder. Each citizen expects his ballot to have equal weight in the final decision.

Why not think of campaign finance in similar ways? It isn't enough to count every vote equally on election day. The American citizen should also be given a more equal say in funding decisions. Just as he receives a ballot on election day, he should also receive a special credit card to finance his favorite candidate as she makes her case to the electorate. Call it a Patriot card, and suppose that Congress seeded every voter's account with fifty "patriot dollars." If the 100 million Americans who came to the polls in 2000 had also "voted" with their patriot cards during the campaign, their combined contributions would have amounted to $5 billion-overwhelming the $3 billion provided by private donors. Under this scenario, would George W. Bush and Al Gore-two heirs of political dynasties-have emerged as the leading candidates? If so, would they have made different issues central to their campaigns?

Our patriotic initiative avoids many of the difficulties associated with traditional "clean money" proposals. The old paradigm creates a special bureaucracy charged with the delicate task of doling out funds to qualifying candidates and parties. But the Patriot program does not keep ordinary Americans on the sidelines while bureaucrats give politicians handouts. Our new paradigm makes campaign finance into a new occasion for citizen sovereignty-encouraging Americans to vote with their dollars as well as their ballots, giving renewed vitality to their democratic commitments.

We have only begun to tap the potential of voting with dollars. Our paradigm also points in a new direction for the regulation of private contributions. Liberals and conservatives have increasingly converged on the "full information" plank of the traditional reform agenda-to the point where it is fast becoming a Motherhood issue. Who could possibly complain about requiring candidates to reveal who is bankrolling their campaigns, and how much they are giving?

We do. Full publicity makes sense only under one assumption-that the candidates themselves know the identity of their contributors. Because candidates will naturally be grateful to big givers, shouldn't they be obliged to share this knowledge with the public? Otherwise, ordinary voters can't subject political rhetoric to a basic reality test-matching each politician's words against the list of contributors who will come around after election day to assert, however discreetly, their claims to official favor.

But this argument begs a big question-why should candidates know how much money their contributors have provided? When we are dealing with widgets, this kind of knowledge is a self-evidently good thing-if the widget producer doesn't know who is paying for his goods, and how much money is on the table, he won't be able to figure out whether to accept deals or reject them.

This point doesn't apply here. A victorious politician is guilty of corruption if he delivers the goods to his campaign contributors in too obvious a fashion. The analogy with the ballot box provides a sounder guide for policy. The secret ballot came to America only during the late nineteenth century. Voters previously cast their ballots in full view of the contesting parties, who carefully monitored each decision. Within this framework, corrupt vote-buying was commonplace. Party hacks could readily determine whether they got what they were paying for. No voter could receive his election day turkey without casting his ballot before the watchful eyes of the turkey's provider.

It was the secret ballot, not some sudden burst of civic virtue, that transformed the situation. Once a voter could promise to vote one way, and actually vote another, it was no longer easy for him to sell his vote. Even if he sincerely intended to perform his side of the bargain, vote-buyers could no longer verify the credibility of his commitment. Suddenly, the promise of a voter to sell his franchise for money became worthless-and as a consequence, vote-buying declined dramatically.

We use the same logic in dealing with private contributions. On analogy with the secret ballot, we propose the "secret donation booth." Contributors will be barred from giving money directly to candidates. They must instead pass their checks through a blind trust. Candidates will get access to all money deposited in their account with the blind trust. But we will take steps to assure that they won't be able to identify who provided the funds. To be sure, lots of people will come up to the candidate and say they have given vast sums of money. And yet none of them will be able to prove it. As a consequence, lots of people who didn't give gifts will also claim to have provided millions of dollars.

The resulting situation will be structurally similar to the one created by the secret ballot. Protected by the privacy of the voting booth, you are free to go up to George W. Bush and tell him that you voted for him enthusiastically in 2000 even though you actually voted for Al Gore. Knowing this, neither the president nor you will be prone to take such protestations seriously. The same "cheap talk" regime will disrupt the special-interest dealing we now take for granted. Just as the secret ballot makes it more difficult for candidates to buy votes, a secret donation booth makes it harder for candidates to sell access or influence. The voting booth disrupts vote-buying because candidates are uncertain how a citizen actually voted; anonymous donations disrupt influence peddling because candidates are uncertain whether givers actually gave what they say they gave. Just as vote-buying plummeted with the secret ballot, campaign contributions would sink with the secret donation booth.

But not to zero. There are lots of reasons for contributing to campaigns, and the new regime undercuts only one of them-the desire to obtain a quid pro quo from a victorious candidate. It would no longer make much business sense for a group of trial lawyers or oil barons to contribute big bucks to a candidate to encourage special-interest legislation. But the secret donation booth will not deter gifts from citizens who simply wish to express their ideological commitment to a candidate's causes without any expectation of special access or influence. These ideological gifts may well be very substantial, depending on the candidate's charisma and the attractiveness of her positions. Nevertheless, the overall volume of private donations will generally be much lower.

Especially when Patriot is taken into account. Each voter already has 50 Patriot dollars at his disposal to support candidates and political organizations during the campaign. Only those who find this sum inadequate to express their convictions will dip into their private funds. Cumulating our two initiatives, it seems safe to predict that our new paradigm will generate a big change in the prevailing public-private mix of financing. During the last campaign more than $3 billion flowed into the campaign coffers of all aspirants for federal office, but we would be surprised if half this sum were generated under the new regime; in contrast, $5 billion or so would be coming into the campaign through the patriotic system. On conservative assumptions, public funds would dominate by a ratio of 2 to 1, and probably much more. At the same time, the total resources available for political speech would be much greater under the reformed system-in contrast to the $3-plus billion under the ancien régime, politicians would have more than $6 billion with which to engage the voters. The new paradigm, in short, promises an effective increase in both political equality and political expression. It achieves this result without compromising any of the basic liberties of citizens-even the freedom to give private contributions. As long as givers channel money through blind trusts, they should be free to give substantial amounts to the causes they favor.

This conclusion leads us to distance ourselves from the final, and most important, remedy in the traditional reform repertoire. Above all else, the great progressive goal has been to limit the amount of private money flowing into campaigns. Ever-more-rigorous restrictions are pursued on two levels: First, reduce the amount any particular giver can donate; second, reduce the total amount any candidate can spend. The reform legislation sponsored by Senators John McCain and Russell Feingold is the best known recent example, but we have been through cycles of restriction before, and the results have consistently disappointed expectations.

The dismal cycle looks like this. Phase one: Legislators impose limitations in response to popular disgust at the role of big money in politics; phase two: Big givers devise legal loopholes enabling them to continue giving large sums; phase three: Reformers mobilize another wave of popular disgust, and we return to phase one.

The seemingly remorseless character of this cycle has greatly impressed liberal academics of late-leading them to question the efficacy of the traditional emphasis on command and control. According to this increasingly fashionable view, controlling the flow of campaign funds is like the effort to dam the Mississippi. You may stop the river from overflowing its banks at one point, but this triumph will lead to unexpected inundations elsewhere. Like water seeking its own level, private money will inexorably flow around reformist barriers to overwhelm the political process. Rather than damming the flow, sober reformers should simply inform the public about its true extent. Speaking broadly, the new "hydraulicists" urge the reform movement to reject its previous fixation on command and control and to make full information their first priority.

We have already explained why the hydraulicist emphasis on full information is mistaken. We also think that these academics' despairing diagnosis of command and control is exaggerated. Direct control can sometimes be effective, and we shall be making strategic use of this tool. Nevertheless, there is a Sisyphean aspect to the struggle for ever-more-stringent and comprehensive controls. Restrictive command and control should no longer be the first priority of reform. It should function as a technique of last resort, filling in gaps left by structural measures like the secret donation booth. Requiring a blind trust doesn't place substantive limits on private fundraising, but it does purge the practice of some of its worst features. We should consider additional restrictions only after assessing the dangers that remain even after special-interest deals are disrupted by the secret donation process mandated by the new paradigm. As long as a patriotic finance initiative assures the dominance of citizen funding in the overall mix, we believe that only very selective controls-targeted only at the very biggest givers-will seem sensible.



Excerpted from Voting with Dollars by Bruce Ackerman Copyright © 2004 by Bruce Ackerman. Excerpted by permission.
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