Sunday, July 25, 2004

How Campaign Finance Reform is Working

For a while, I've held an idea that the Bipartisan Campaign Reform Act of 2002 was actually working to Democratize fundraising nationwide. In the past week, I saw an unbelievable show of fundraising clout displayed by independent bloggers in helping to propel candidate Ginny Schrader (Democrat - Congressional district PA-8) to legitimacy. I was exhilirated to be part of this experiment in direct democracy and realized that my $30 may have helped to change this country. This ability to help fund candidacies has given a real stake and credit to the blogs and is reflected in many other arenas of fundraising.

The first inklings of a (positive) change coming that I saw were within the Bush campaign. In early 2003, word started spreading about Bush's Pioneers and Rangers. These are the supporters who have rallied friends, families and coworkers to donate to Bush's re-election bid. However, these are not just any fundraisers. The Pioneers are responsible for having raised over $100,000 for the campaign; while the Rangers have raised over $200,000. Recently, the RNC announced that there will also be 'Super Rangers', those supporters who had raised over $300,000.

While many will decry the fact that these are ridiculous sums of money flowing into the campaign, I think it's important to realize who these benefactors are. While some fit the profile we might expect of an oil baron, or energy tycoon; many are younger people who have decided to use their connections to help raise money for the campaign. Instead of being judged solely on the amount of money they could donate; these super-donors were in effect bundling donations from numerous people in order to get access to the campaign. While this doesn't eliminate the presence of money in the campaign; it does help to democratize its presence in the campaign by allowing those who are most adept at raising it to have access to a campaign.

Next up came the 527's. These groups, nicknamed for the section of the tax code that they fit under, are allowed to raise and spend unlimited donations as long as they don't coordinate with a campaign and don't advertise within 60 days of the election. The most notable groups here would have to be MoveOn and ACT. These groups (while still heavily funded by the "elite") give average citizens the ability to vote for their own top causes. Essentially, when someone gives money to MoveOn, they are voting for certain parts of the Democratic platform.

Similar to the 527s but legally different are PACs (political action committees). PACs engage in what is known as bundling, they make solicitations on behalf of individual candidates a nd then collect donations from their supporters. By bundling donations, these PACs forward their positions. For instance, The Club for Growth is an extremely Conservative group which advocates for rolling back most (if not all) federal taxes. If 100 of their supporters donated to a candidate, they wouldn't be noticed individually. However, by donating together, these 100 supporters can drastically increase their influence.

The main effect that has been seen from the BCRA of 2002 has been a sharp proliferation in the avenues of donation to donors. This proliferation has essentially created hundreds of 3rd parties that exist as fundraising shells. While it is true that money still rules politics, the changes have caused the power of money to be split many more ways. Over time, the hopes of the reformers may be reached in different ways than expected, with individual fundraising avenues becoming real parties.

UPDATE:Check out yesterday's NY Times Magazine for an article on the diffusion of power away from the Democratic Establishment.


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