Thursday, June 26, 2008

When Do Campaign Finance Laws Become A Way to Protect Incumbents?

Guest Blogger

Rick Pildes

Whenever the Court divides 5-4 in high-profile cases along lines conventionally considered ideological, as in today’s campaign-finance decision that holds unconstitutional the “Millionaire’s Amendment” provision of the McCain-Feingold law, the temptation is to process the decision in those same ideological terms: the decision must be a victory for politically “conservative” views of campaign-finance regulation and a defeat for “liberal” ones. But today’s decision is more interesting and complex than that. I want to suggest why campaign-finance reformers ought to be more accepting of today’s decision than most are likely to be.

A fundamental risk with all laws that regulate politics is that they will be devices for incumbents and their allies to protect themselves against genuine competition. And a key aspect to this case is only hinted at in the Court's opinion but nonetheless undoubtedly shapes the decision: the enormous risk that this provision - and others like it Congress might adopt - is a way for incumbents to manipulate election laws so as to make it even harder for challengers to take them on. Even those who generally support campaign-finance regulation must recognize the risk that the power to regulate in this area, as with voter ID laws, gerrymandering, or any other law that regulates the election process, will become a power to entrench current powers in place. This particular provision reeks of that possibility (as I noted in my 2004 Harvard Law Review Supreme Court Foreword, in which I criticized this provision while endorsing the Court's decision upholding the McCain-Feingold law in general). Every incumbent's nightmare is to wake up and discover that an extremely wealthy challenger has decided to take him or her on. So when Congress says we must make it easier to compete and raise large amounts of money against wealthy self-financed candidates, there is surely reason to be, at the least, suspicious. This provision also makes Congress' purported concerns about corruption and the appearance of corruption seem self-serving. Apparently, those concerns disappear for Congress when a wealthy candidate runs, since now the opponent is free to raise money in amounts that otherwise are considered corrupting.

The specter of incumbent self-entrenchment is central to today’s decision, in my view. That shadow emerges most clearly when the majority expresses concerns about laws that impose different rules for candidates competing in the same race (Slip op, at 11). But it is also hard within conventional constitutional doctrine to find a way for the law to reach the risk that election rules are self-entrenchment mechanisms. The reason is that laws like this pose a risk to a structural value the Constitution secures, but not to any kind of conventional individual right. The structural value is that elections be open, competitive, and not rigged through groundrules incumbents have adopted that insulate themselves from robust challenges. That the Court has acted to protect that structural value cannot be doubted: the best example is the famous one-vote, one-person cases, which held unconstitutional self-entrenching malapportionment schemes of the 1960s in the famous line of cases that begin with Baker v. Carr. But the Court has always been on shaky ground in enforcing the structural value of open democratic competition in elections, because nothing in the Constitution directly and expressly gives the Court the power to protect the process of democratic elections per se – to ensure that anti-competitive rules are not enacted – as opposed to protecting the specific, enumerated, individual rights the Constitution guarantees.

These issues are the axes around which the debate between majority and dissent revolves. And it is a legitimate debate, given the structure of constitutional doctrine. Applying conventional tools of analysis, the dissent argues there is nothing unconstitutional in the Millionaire’s Amendment because that provision violates no individual right. In a conventional sense, that is true: it is hard to see how a candidate’s individual right is violated when he or she remains free to spend as much money as they want. But notice that the dissent, unlike the majority, stops at the individual-rights side of the analysis and essentially ignores the larger, more structural concern of whether this provision is a way for incumbents to entrench themselves (a value all incumbents agree on, which is why legislating to do so is one area where bipartisan agreement flourishes). Indeed, the dissent simply declares this provision a "good-faith attempt by Congress to regulate." In my view, that is much too naïve. At the very least, before proclaiming the virtue of such a provision, the dissent should have explored the possibility that this is not true and actually demonstrated that the law is not an incumbent-entrenchment device. To accept Congress at face value when it regulates in such a politically self-interested arena, with a provision like this one involved, is far too credulous.

What we see in the case, as in many others in this area, is the Court groping for a way to police against the genuine risk that legislators will regulate in self-interested ways when it comes to politics. The Constitution does not directly provide an easy means for courts to address that concern, but nonetheless, the Court has found ways since the 1960s to try to guard against that risk. In my own view, the Court should be more aggressive than it has been in recognizing this risk and addressing it. But since reformers of the political process are concerned about corruption of that process, they should certainly be concerned about the kind of corruption that involves legislative self-entrenchment. The more often the Court finds ways to get at that problem, the better. And that, in my view, is why today’s decision should be seen in a richer light than those who simply look at the headlines are likely to see it.


I'm unsure of why this has anything to do with incumbent entrenchment. Is there any reason to think that challengers are more likely to be self-financed than incumbents? A simpler explanation is the conservative wing of the court disfavors campaign finance reform generally and is attempting to chip away at the regulation.

"But it is also hard within conventional constitutional doctrine to find a way for the law to reach the risk that election rules are self-entrenchment mechanisms."

You wouldn't have to reach the question of self-entrenchment, (The mostly unacknowledged problem with all campaign regulations.) if we just took seriously that "no law", and the lack of any enumerated power for Congress to regulate campaigns, as opposed to actual voting procedures.

The origin of the Millionaire's amendment, on the floor rather than as part of the original McCain-Feingold bill, indicates its incumbent-protection purpose. Incumbents rarely need to self-finance, and challengers have greater difficulty raising money than do incumbents.

As the Davis Court noted, the increased limits for candidates faced with a self-financed challenger argue against the notion that the $2,300 limit on contributions generally or the overall limit on all federal contributions are needed (at those levels) to prevent corruption or the appearance of corruption.

The Millionaire's Amendment was always one of the weakest links in McCain-Feingold, and its demise should not be a surprise.

Professor Hasen's blog expresses the concern that supporters of campaign regulations should have - the implications for public financing regimes that attempt to "adjust" for independent expenditures.

Brett, the thing is, I don't really see how Buckley is wrong on campaign contributions. "No law" clearly means no regulation on advertising or similar expenditures (which are clearly speech), but contributions? When you contribute to the McCain or Obama campaign, there's no guarantee your money is going to be spent on speech at all. It may go to speech, it may go to get out the vote, it may go to powering the lights at campaign headquarters or gas for the plane, it may go to pay off the candidate's mistresses, etc. You just don't know and have no control over the issue.

So an expenditure constitutes money that is used for speech, which the expender directly controls the content of. A contribution constitutes money that may or may not be used for speech, which the contributor does not control the content of. Doesn't that make a big difference from a First Amednment standpoint?

Jeffrey said: I'm unsure of why this has anything to do with incumbent entrenchment. Is there any reason to think that challengers are more likely to be self-financed than incumbents?

Actually, this is very easy to see. Nearly three years ago I looked at the issue of campaign finances by those candidates who are likely to self-fund. Here is what the FEC data I found reported:

Incumbents by far reap among the $613.8 million dollars raised by House candidates in 2004, incumbents received $445.9 million or 72% of the money and that was not for 435 candidates, but 405 incumbents, an average of $1.1 million per incumbent.

Challengers to incumbents garner far less funds, just $91.7 million or just shy of 15% of funds. For the 650 challenger candidates running for the House 2004, that equates to an average of $141,000 per candidates or a little more than 10% of the average incumbent war chest.

Open seat candidates gathered the remaining 13% of funds, totaling $76.2 million. But spread over just 94 candidates, the average open seat House candidate raised $810,000--a competitive sum.

As a result of the vast inequties of funding distrubution, open seat and challengers tend to rely on their own sources of funding, in the form of candidate contributions and loans from the candidates themselves. For all House candidates in 2004, candidate contributions and loans totaled $25.7 million or just over 4% of all sources of funding. But in 2004, incumbents turned to themselves for just $1.38 million of the $25.7 million. Meaning that candidate contributions to incumbent races equated to just 0.3% of funds raised by incumbents.

Simply put, incumbents almost never turn to their own money (and many have lots of money) to fund their campaign.

If Congress was really interested in "leveling the playing field" which was their oft-repeated objective during the debates on BCRA, then they should treat political wealth, that is the massive warchests the incumbents generate while in office, the same as personal wealth and allow challengers to raise funds under increased contribution limits until parity is achieved. But since, post-Davis, asymmetrical limits are unconstitutional, the better bet would be to restrict fundraising by incumbents until such time as a challenger declares or some arbitrary date, such as Jan. 1 of election year or six months from the primary date or something similar.

Of course, such a proposal is not particularly likely to get passed in Congress.

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