Copyright 2016. FairElectionsMaryland. All Rights Reserved.
What’s the problem small donor fair elections are trying to fix?
In state elections, candidates (in the median states) received about 15% of their money from small donors who gave $250 or less. The bulk of the money for state candidates, as for federal, has come from individual donors who give $1,000 or more, or from PACs (Malbin, et al., 2012). In both federal and state elections, the donors who provide the bulk of the money thus come disproportionately from a thin slice of the wealthiest households.
Maryland is no exception. In the last statewide election in 2010, special interests spent millions to influence races. Real estate and developer interests, for instance, doled out $3 million. Self-financed candidates gave themselves nearly $3 million. Lawyers and lobbyists contributed almost $3 million as well. Check out an overview of spending here.
The ongoing Free State experiment in democracy should evolve to lift up the voices of the many over the few. Public financing can break the stranglehold that special interests, wealthy contributors and lobbyists exert on politicians, and create consistency with the concept of representative democracy.
What exactly is public campaign financing?
“Public campaign financing” is the term used to describe programs that provide public
money or other support to qualified candidates to run campaigns for public office.
Public campaign financing enables candidates to wage competitive campaigns even
though they lack personal wealth or access to wealthy campaign contributors.
These small donor incentive programs reduce candidate reliance on special interest money and, consequently,
may soften the public’s perception that government officials trade political favors for
State public financing programs may be divided into three broad categories: those which
provide funds directly to individual candidates, those that provide funds to political
parties, and those which provide tax incentive to citizens who make political contributions.
Many states operate programs that combine more than one of these categories.
Fair Elections Maryland is most interested in enacting and strengthening small donor incentive programs
that match small dollar donations.
Doesn't Maryland already have small donor incentive programs for elections?
Yes and no. The public funding program in Maryland extends only to candidates running for governor or lieutenant governor. Public funding is not yet available for other statewide candidates, such as Comptroller or Attorney General, or state legislative candidates. Localities (such as county councils) were only recently granted the authority to enact their own public finance programs.
In 2014, several gubernatorial candidates, Democrat and Republican, indicated their intention to use small donors for their campaigns. These candidates included Heather Mizeur (D), Larry Hogan (R), David Craig (R), and Ron George (R).
Fair Elections Maryland will continue to work to strengthen our current public finance law and extent public finance to statewide, state legislative, and local campaigns.
What jurisdictions across the country currently have small donor fair election programs?
According to the National Conference of State Legislatures (NCSL), 25 states have programs that provide public funds for use in election campaigns. A total of 14 states, including Maryland, offer public funds to political candidates. Ten states provide grants to qualified political parties. Seven states offer tax incentives to encourage citizens to make political contributions. New York City established public funding in 1988, a program which has been wildly successful at promoting the participation of minorities in the city's government.
Small donor fair elections continue to expand. In 2013, the City of Los Angeles introduced a new multiple-matching fund system for its 2013 elections, and West Virginia made permanent the state’s public financing program for seats on the state’s highest court.
Check out a complete overview of public funding in the states here.
Didn't the U.S. Supreme Court rule small donor incentive programs unconstitutional?
No. The United States Supreme Court has, however, repeatedly stated that large campaign contributions to candidates pose a threat of corruption or, at the very least, may create an appearance of corruption.
Small donor fair elections are undoubtedly constitutional and conforms to the First Amendment. In the U.S. Supreme Court’s landmark Buckley v. Valeo decision, which is still the cornerstone of modern campaign finance law, the Court upheld the constitutionality of small donor incentives, saying that such programs are “a means of eliminating the improper influence of large private contributions.” Small donor incentive programs are generally constitutional and can be enacted without fear of a serious First Amendment challenge.
Are small donor fair elections a partisan issue?
Small donor incentive programs have fans on both sides of the aisle, from John McCain to Nancy Pelosi.
The Maine Clean Election system, as it is known there, has been in place since 2000. In Maine’s 125th Legislature, seated in 2010, 73% of Republicans, 87% of Democrats, and 100% of independents used Clean Elections. In Arizona in 2010, 73% of Republicans and 88% of Democratic
candidates were publicly funded. In many races, Clean Elections candidates beat those who ran traditionally financed campaigns.
In Maryland, both Democrats and Republicans have been enthusiastic about these incentive programs. In 2014, Democratic Gubernatorial Candidate Heather Mizeur announced her intention to use small donor incentive programs, as did Republican Gubernatorial Candidates David Craig, Ron George and Larry Hogan.
What is happening on the Federal level with small donor fair election programs?
Congress put into place voluntary small donor fair election programs for presidential elections in 1976, in response to the Watergate scandals that surrounded the Nixon re-election campaign. His campaign committee was found to have illegally received hundreds of thousands of dollars from some of the country's largest corporations. The Presidential Election Campaign Fund consists of money that is voluntarily contributed by millions of taxpayers who check-off this option on their tax forms. Under this system, four incumbents have sought reelection - three challengers have won.
While the presidential small donor fair election system has functioned as intended, changes in campaigns for presidential candidacies have caused many aspects of the system to become outdated. Major candidates no longer believe they can run a competitive campaign due to the funding cap and other constraints of the system. In 2012, Mitt Romney and Obama both opted out of the system—forgoing $91.2 million in public funds. Each campaign went on to raise more than $1 billion.
No such system has ever existed for congressional campaigns. On February 5th, Congressman John Sarbanes (D-MD), along with House Democratic Leader Nancy Pelosi and over 100 House members as original co-sponsors, introduced the Government By the People Act (H.R. 20) – a bill to lift up the voices of everyday people in the political process through empowering and encouraging small dollar donors. The legislation is modeled, in part, on the matching system already in place in NYC.
Donations of up to $150 to congressional candidates would be matched at a rate of 6 to 1 — meaning a $50 check would turn into a $350 check. If candidates agreed to take only small donations, the match would increase to 9 to 1. Candidates who are able to raise more than $50,000 in small donations in the final 60 days of the election would be eligible for even more resources.
Why should candidates be forced to have small donor fair election campaigns?
Candidates arenever forced to publicly finance their campaigns. In fact, it is unconstitutional to require a candidate to participate in public finance. Public financing programs are entirely voluntary. Fair Elections MD believes that in jurisdictions that implement small donor public financing, public pressure will encourage candidates to opt in to the system, since it affords a candidate the greatest measure of credibility. Most importantly, elected officials would rather spend time focusing on their constituents and tackling the issues, rather than engaging in fundraising. Small donor fair election programs give them that option.
What is the history of small donor fair election programs?
The idea of small donor incentive programs dates back to the early twentieth century, when Progressive Era reformers sought to curb the undue political influence wielded by multi-millionaires created during the nineteenth century’s industrial revolution. It was Theodore Roosevelt who said, in 1907, "The need for collecting large campaign funds would vanish if Congress provided an appropriation for the proper and legitimate expenses of each of the great national parties.” This was one of the first public calls for small donor fair election campaigns in our country.
Efforts to enact small donor incentive programs were unsuccessful, however, until the early 1970s. The federal Revenue Act of 1971 established the Presidential Election Campaign Fund to provide these programs to presidential election candidates. In 1974, Maryland, Minnesota and New Jersey became the first states to offer public financing to candidates. Seattle, Washington became the first local government to enact a small donor incentive program in 1978.
Full small donor incentive programs became available for all statewide candidates in Maine (1998), Arizona (1998) and Connecticut (2005), for candidates in some legislative races in New Jersey (2004), for certain offices in New Mexico (2003), and for judicial candidates in North Carolina (2002). In addition, Albuquerque (by voter initiative) and Portland (by legislative enactment) became the first two cities to pass full public financing laws in 2005.
Matching funds programs have taken off in local jurisdictions including New York City (1988), Los Angeles (1990), San Francisco (2000) and Tucson (1985). Like their full public financing counterparts, jurisdictions with matching funds have seen a reduction in real and apparent corruption, more candidates running for office, greater competition between candidates, and increased voter involvement in elections.
Today, the challenges of building a perfect democracy are ongoing. That is why Fair Elections Maryland continues to work for small donor fair election programs across Maryland.
Do voters support small donor fair election programs?
Small donor fair election programs are popular when they are in place. For instance, Maine voters consistently show support for fair elections. In the most recent polling from Spring 2013, 84% of Mainers polled say that it is important that their fair elections program continue, and 83% of Mainers hold the view that gubernatorial candidates should use or should have the option to use public funding to finance their campaigns.
Maryland-specific polling commissioned in 2009 by Common Cause Maryland and Progressive Maryland found that 82% of voters feel that when it comes to the way we finance election campaigns, changes should be made. 55% of voters support major changes, including 71% of independents. And 70% of voters favor Maryland passing a campaign finance reform law that provides a limited amount of public financing to qualified candidates who agree to take no or little private money and to limit their campaign spending.
What's the point of public finance if Citizens United makes it possible for special interests to flood elections with money through independent expenditures?
While small donor fair election programs goes a long way toward curing many campaign finance and electoral ills, it is not a panacea for all problems. Independent expenditures and other forms of “non-candidate spending”, as well as wealthy candidates who self-finance their campaigns, can in some cases undermine these incentive programs. To be sure, when a publicly financed candidate faces a wealthy or otherwise strongly financially-backed opponent, that advantage can have an effect on the race. But elections are ultimately decided by votes, not dollars.
As New York City mayoral candidate Mark Green, who faced and lost to self-financed, former NYC Mayor Michael Bloomberg in 2001, said: “It is irrational to argue against a system that enables a diverse group of people to run competitive campaigns because a wealthy candidate can occasionally outspend a participating candidate. The program benefits are not undermined by the rare occurrence of a Bloomberg candidate.”
The National Institute on Money in State Politics has conducted research showing that public financing systems greatly reduce the disparity between candidates’ fundraising amounts. For example, in the Connecticut House, the average proportion of competitive races between 1996 and 2006 jumped from 27.9 percent “competitive” to 70.4 percent “competitive” in 2008.
Fair elections programs still have a valuable role to play. The system can break the direct connection between candidates and funders; it can keep candidate spending on an even footing; it can help political outsiders enter the race. It can even, through matching funds, allow candidates to respond to a moderate amount of outside spending.
While no political reform is without shortcomings, small donor fair election programs—in combination with other reforms—are the best mechanism to solve campaign finance and electoral problems.
Can publicly financed candidates win?
Absolutely! Take Connecticut in 2012: a whopping 77 percent of successful candidates were publicly financed! Or take Arizona in 2010: 86% of Senate candidates and 74% of House candidates were publicly financed. Races won by fair elections candidates beat those won by running traditionally financed campaigns. New York City’s program has been a smashing success. In 2009, 93% of primary election candidates used public financing. Furthermore, 66% of general election candidates participated. These NYC rates have been consistent for a decade.
How do small donor fair election programs improve elections?
According to a report by the Center for Governmental Studies, small donor fair election programs make elections better in three ways: creating more contested races, creating more competitive races, and enabling ordinary citizens to run for office.
Contested races help ensure that public officials are responsive to all of their constituents. Even in the case of a well-liked incumbent who is unlikely to be defeated, having an opponent helps ensure that opposing views are aired and brought into the public discourse, even if those views are not ultimately adopted. Contested elections are good for democratic values. Small donor fair election programs have been shown to increase the percentage of contested races; a 2010 study found that both Maine and Arizona enjoyed a general decline in races with unopposed incumbents since public financing was implemented. Enabling ordinary citizens to run for office allows for more diversity in government, and helps ensure that the needs of typically underrepresented communities are met.
How do small donor fair elections improve democracy?
Small donor incentive programs engage voters more deeply. Simply put, more people donate to campaigns, and more people vote.
One study by the Campaign Finance Institute found that in Minnesota, 57% of funds were received from donors who gave $250 or less in 2010; in Wisconsin, 36% of funds were in this amount. Small donations in other Midwestern states that do not have public financing for legislative races—Illinois, Indiana, Michigan, and Ohio—fell between 3% and 12%.
In Arizona, voter turnout increased by 8 percent, from 64 percent to 72 percent, between the 1996 presidential election (pre-Clean Elections) and the 2000 presidential election (the first under the program). That number went up another five percentage points to 77 percent in the 2004 presidential election.
Public financing that provides a match for small contributions creates incentives for average people to get more involved and reinforces the belief that their participation matters. Besides defeating corruption and its appearance, small donor incentive programs encourage voter-centered campaigns. This is good for democracy!
How do small donor fair elections impact incumbents?
Incumbents will often take advantage of public financing themselves. Small donor incentive programs frees politicians from the grip of big money, allowing them to raise money exclusively from — and thus be exclusively dependent on — their own constituents.
Incumbents who participate will undoubtedly focus more energy on constituents. According to a report by the Center for American Politics and Citizenship, which polled thousands of legislators across the country, in general, the average state legislative candidate in a state without small donor incentive programs spend 28 percent of their time fundraising. The average state legislative candidate in a small donor fair election state spends just 11 percent of their time fundraising.
Some incumbents will choose not to participate in fair elections. But publicly financed campaigns will make challengers to incumbents more competitive. In Maine, House incumbents enjoyed a greater than 30% financial advantage in the two elections preceding fair elections. In 2006, after fair elections, incumbents outspent challengers by an average of only 2%; in 2008, challengers actually outspent incumbents.
Nicole Gordon, the former director of the New York City Campaign Finance Board, makes the important point that these small donor incentive programs are not aimed at displacing incumbents. Instead, the system seeks “simply the regular presence of opposition and the threat that someone might have the wherewithal to make a meaningful run for office…forcing elected officials to focus on what the voters want.”
Is it true that "fringe" candidates tend to get elected with small donor incentive programs?
No. Evidence suggests that small donors who contribute more frequently in fair elections programs are more representative economically and demographically than those whose large contributions now dominate political finance. Evidence also shows that that small donors do not tend to polarize politics. By contrast, there is substantial anecdotal evidence that the biggest donors have been the principal culprit among donors in fueling partisan brinksmanship.
Last fall, The Washington Post explained that the Club for Growth, a group that receives very large donations from wealthy supporters, “has become extremely successful at encouraging uncompromising voices on Capitol Hill, such as Sen. Ted Cruz.” A 2013 report by the Sunlight Foundation concluded that the most “conservative Republican members of Congress depend more on 1% of the 1% donors than moderate Republicans do, suggesting a polarizing effect of big money, at least on the political right.”
Read more on this topic here.
Do small donor incentive programs increase the number of people who donate to campaigns?
Yes. Studies find that these programs do increase the number of small donors as well as their proportional importance to candidates.
In jurisdictions with partial small donor incentive programs, more voters are likely to make contributions—and not necessarily in such big amounts—because the government will match their contributions with public money, thereby making the contribution worth more to a participating candidate than the same contribution would mean to a nonparticipating candidate.
Small donor matching funds help bring participants into the political process who are traditionally less likely to be active, and strengthens the connection between public officials and their constituents.
What are the demographics of those who give donations through small donor fair election programs?
With small donor incentive programs, people from a broader array of backgrounds are able to participate in the political system. There is evidence that under these programs, donations become less concentrated in wealthy white neighborhoods. For example, Public Campaign, a non-profit, non-partisan election reform organization, found that Arizona citizens who donated to publicly financed candidates were more likely to be Latino and low-income than donors who did not. Arizona experienced a more than threefold increase in gubernatorial contributions after the implementation of public financing, with the majority of contributors earning $50,000 or less per year.
Do small donor fair elections help minorities?
Yes. In fact, small donor incentive programs help a wide variety of underrepresented communities to be competitive in elections.
A Brennan Center report issued in 2010 documented a series of “firsts” resulting from New York City’s small-donor matching funds system: the City’s first African-American mayor, David Dinkins, participated in the program, as did the City Council’s first Dominican-American, first Asian-American, and first Asian-American woman members. Dan Cantor, former chair of the Working Families Party, points out that the “multiple match system has tremendously lowered the barrier to candidates who come from a background of service to communities and unions.” And small donor incentive programs created a shift in the demographics of the New York City Council so that the body is now composed of a majority of people of color.