Lessig's proposals

Lawrence Lessig proposes having the government take the first $50 of a person’s income tax payment, and return it to each individual taxpayer as a voucher to be used to fund political campaigns. The taxpayer would be able to spend this voucher on any candidate he wants, or to spend it on general campaign expenses of the party he identifies with. Each individual would be able to contribute no more than $100 more to any campaign. Your estimate is that this process could potentially generate as much as 6 billion dollars to be distributed to candidates.

This proposal is ingenious, and may even have the effect he and I want, but I have some reservations about it. The first has to do with the issue brought up by the Citizen’s United decision. Is a corporation an individual, a person? If so, as the Citizen’s United decision seems to imply, would the first $50 of a corporation’s tax payment also be returned to the corporation to be used for campaign contributions? Would a corporation also be limited to $100 in additional contributions? This would be an interesting development. If not, how would corporations be treated? Is a constitutional amendment necessary to make sure that a corporation is not a person? There is a separate movement to this effect (see Jeffrey Clements, Corporations are not People).

The second reservation has to do with paying for it. It would involve reducing revenue to the government of potentially 6 billion dollars. That reduction would have to be compensated for by either reducing spending in other areas, or raising taxes to make up for the reduction. Republicans, as they are now, would be attracted to reducing spending, but the Democrats would resist and would want to raise taxes. The measure would thus become just another point of contention between the Republicans and Democrats in their paralyzing war between taxing and spending. The likelihood of getting anything so game changing through the present congress seems vanishingly small. Corporations and the wealthy would fight it strongly. This is not to say that it might not be a good idea, just that it would take a strong external push to get it past the logjam that our government is.

The third reservation is perhaps more philosophical. It has to do with appealing to the government to fix the problems we have with the government. Governments, of course, set the rules for just about everything, including financing campaigns, but to ask them to in addition create an agency to administer a program to provide that financing is a step beyond what seems to be appropriate for a government. Such an agency could lead to a moral hazard problem such as what we have in dealing with large banks, or with the corporate capture of regulatory agencies. Politically also, it is more difficult to create such an agency than it is to merely change the rules for financing campaigns.

Campaign Finance Reform

A friend of mine last week quite adamantly claimed that campaign finance reform is the one overriding issue that we should all focus on, to the exclusion of other issues. For him the goal has to be to take money out of politics. Without that nothing else can be accomplished.

To this I present a syllogism:

Politics, most generally, is the competition for power in government…or business…or love.

Money is power.

Taking money out of politics is an absurdity; it amounts to telling politicians to compete for power without power (money).

Unfortunately it is not just my friend who advocates trying to take money out of politics. Lawrence Lessig has recently written an entire book (Republic, Lost) developing this position. He builds his case on the basis of the notion of dependence corruption. As he defines it, “an institution can be corrupted … when individuals within that institution become dependent upon an influence that distracts them from the intended purpose of the institution. The distracting dependency corrupts the institution.  Lessig, Lawrence (2011-10-05). Republic, Lost: How Money Corrupts Congress--and a Plan to Stop It (p. 15). Hachette Book Group. Kindle Edition.’ Given this definition, it is not hard to demonstrate that congressmen are corrupt. I have reservations about his use of corruption as the basis for his argument that campaign finance reform is necessary, but his actual proposals are what are important. As it turns out, he is not so much arguing that we should remove money from politics as he is arguing that the money for political campaigns should be derived from individuals as part of their payment of taxes, in a program administered by the government.

The problem I have with his proposal is that he treats political parties as no more than labels individuals use to check off where they want their money to go. The candidates become central, thus continuing the push to eliminate parties from any role in the political process. To me this is a complete misunderstanding of the political process.