Small Donor Democracy?
| by Jay R. Mandle In a truly democratic political system, private money would play no role in determining the outcome of elections. All qualified candidates for office would be provided with public funds. Such a campaign finance system is fundamentally different from the present one. No one needs to be reminded that the private system of campaign financing in this country favors candidates with access to wealth. Those who are able to accumulate large campaign war chests possess significant advantages over their opponents. Despite the consistency with which candidates who raise large sums win elections, there has been an important shift in the composition of campaign funding since 2016. Between that year and 2020, small donors – those who contributed under $200 – have increased in relative importance. The 1.3 million large donors in 2006 far exceeded the 50,000 small donors who gave that year. By 2020 however, there was an important reversal as the number of small donors reached nearly 12 million compared to 8.2 million large donors. Small donors had become a relatively more important source of campaign funds. In addition over this period, small donors’ contributions represented an increasing percentage of total campaign money. Though large donors continued to dominate the flow of funds to campaigns between 2016 and 2020, small donations increased as a percentage of the total amount of money contributed to candidates. Growth in the importance of small donors has been welcomed by reformers who see it as producing a more democratized funding system. They are especially optimistic about the increase in small donations in places like New York City, Washington DC, and other jurisdictions where small contributions are matched with public money. As Law Professor Richard H. Pildes writes, “Small-donor based public funding has now… [become] the sun around which Democrats believe that campaign-finance reform should revolve.” As such, it was included in the Freedom to Vote Act that was passed by the House of Representatives but not the Senate in 2022. The Act’s funding system for House candidates would have encouraged small donations by matching every small dollar contribution to a candidate with six additional dollars of public money. But Pildes himself possesses strong reservations concerning the benefits of small donations. He believes that their increase has contributed to what he calls “one of the most troubling aspects of American democracy today: the intense polarization of the political parties.” The basis of his concern is that, while it has been widely understood that large donors are more ideologically extreme than the population as a whole, limited data now suggest that the same is also true for small donors. Pildes worries that the growth of small donors “might also contribute to making American democracy more polarized and more dysfunctional.” In drawing that conclusion however, Pildes treats the ideology of the Left and Right as equivalents in driving polarization. That is wrong. Many right-wing donors – large and small – have demonstrated that they stand with Donald Trump in their opposition to democracy. But among liberal campaign contributors, that opposition has no voice. Polarization in the United States has been created by a minority standing in opposition to representative government. Small donors are not the problem; rather it is right-wing donors, of all sizes, who are the source of our polarized politics. A more important critique of matching systems is that though they are designed to increase small donor financial contributions, they actually achieve little in that regard. In New York City’s matching system, for example, only 3.3 percent of the voting age population made small contributions in 2020. The situation was similar in Washington DC’s public financing system. Data for the city’s top five zip codes show that only between 2.1 percent and 4.0 percent of the population made grants that were matched. It is true that these percentages in publicly funded matching systems are higher than the 1.8 percent of the national population that made small contributions in 2020. However, the increasing number of small donors has not been large enough to substantially democratize the financing of American politics. To make elecoral outcomes more representative – and to democratize the political system more broadly – elections should properly be thought of as a public good. Like roads, public health measures and the water supply, elections affect everyone in a society, even though no individual obligation exists to provide for their financing. In the absence of treating elections as public goods by making full public campaign financing available, those wealthy and motivated enough to make large contributions will continue to exercise a disproportionate influence on political outcomes. Because there is only one way to fund politics that does not skew outcomes to benefit a minority, campaigns that are funded fully with public money should be restored as the goal of reformers seeking a deeper system of political representation. __________________________ ABOUT THE AUTHOR Jay Mandle is the Emerita W. Bradford Wiley Professor of Economics, Emeritus,at Colgate University. His many books include Change Elections to Change America: Democracy Matters Students In Action, and Creating Political Equality: Elections As a Public Good,. Mandle’s regular monthly editorials, Money On My Mind, appear on the Democracy Matters website, and explore the role of private money in politics and other critical social issues. The views expressed in Money On My Mind are those of the author, (not necessarily those of Democracy Matters, and are meant to stimulate discussion. |