The Truth About Tax-Funded Campaigns

September 23, 2013   •  By Luke Wachob   •  
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There are a number of reasons that arguments for tax financing of political campaigns tend to fail. Sometimes they’re based on demonstrably false claims about the ability of these programs to increase competitiveness and diversity in politics. Sometimes they ignore the high potential for abuse and corruption that these programs create. Sometimes they’re purely self-serving rants made by people who perceive that tax financing will help candidates they like, and disadvantage candidates they dislike.

In a recent segment of MSNBC’s All In With Chris Hayes, we got a perfect storm of all of these common mistakes in the span of barely a minute, as Chris Hayes and guest Bertha Lewis of the Black Institute celebrated one candidate’s campaign for mayor of New York City as an example of the benefits of tax-funded political campaigns.

To introduce a brief discussion on the topic, Hayes said “I want to talk about the politics of inequality, and how they sort of affect the political system. Because here in New York we just ran the experiment. And, this is the thing that you have not heard, dear viewer…is that part of what allowed him to win was the fact that New York has a very robust campaign system. And, in fact, he was able to kind of take on the 1 percent of the message because he was not drowned out by wave of donations against him, because we have a very robust public financing scheme that essentially put everyone on the level [sic] playing field.”

Lewis jumps in to add her two cents (note: a rhetorical adding of “two cents” is not a contribution eligible for New York City’s matching funds): “you can have poor candidates, candidates of color, more women candidates, and dare we say the word more left candidates, because of that public fight.”

Hayes and Lewis portray tax-funded campaigns as a viable means of increasing diversity and competition, at least for “left candidates,” but their statements are contradicted by the evidence from states that actually use tax-funding for campaigns. As the Center’s research has consistently shown, tax-funded campaign programs have been ineffective at increasing diversity in legislatures. Arizona and Maine, the only two states to have tax-funded campaign programs for all state legislative races since 2000, have seen no increase in female legislators and no change in legislator occupations under their respective programs. A ten-year Government Accountability Office (GAO) study of Arizona and Maine’s programs concluded that tax-funded campaigns had no effect on voter choice, campaign spending, or the influence of interest groups. Connecticut, which also has offered tax-funding for legislative races since 2008, saw no change in legislators’ likelihood of voting with organized interests under so-called “clean elections.”

It may be the case that offering grants of tax dollars to candidates induces more people to run for office, but it shouldn’t be surprising or noteworthy that offering free money for something gets more people to do it. The true test of whether tax-funded campaigns are a good idea is their impact on legislatures and legislation. As the evidence shows, these programs don’t increase diversity or competition, and they don’t sever the tie between legislators and organized interests. Lewis’ boasts fall flat on their face.

Hayes’ claim that her candidate’s political success is partially attributable to tax-funded programs is a dubious claim in the first place. Saying her favorite candidate is independent of influence from the “1%” is laughable. As co-panelist Josh Barro pointed out during the segment, her candidate “also raised a lot of money from the real estate industry… so, I think we overstated [the impact of public financing] a little bit…” No doubt that New York celebrities, most of whom are wealthy, will also have a great deal of influence with her favorite candidate. Of course, the media, often owned by big corporations, will have a great deal of influence too.

The whole episode just goes to show that often in the minds of so-called “reformers,” the candidate I like is “clean,” and the candidate I dislike is “dirty.” The Center is always open to analyzing and debating principled, fact-based arguments for and against tax-funded campaigns. The claims made about its impact on the New York City mayoral race, however, is neither principled nor fact-based.

Luke Wachob

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