Since the Supreme Court Ruling on corporate limits last month, a lot of people have been discussing the role of lobbyists, special interests, and those that try to buy undue influence. I’m ecstatic that this is gaining attention, because it doesn’t matter if you are liberal or conservative, I have yet to meet anyone that isn’t against this growing source of corruption in America.
Obama seems to think the ruling was wrong, and attacked the Supreme Court in his State of the Union address. Lawrence Lessig wrote a nice article about our general lack of trust in congress, spurred by lobbyists and corruption. He recommends the Fair Elections Now Act, which is good, but won’t prevent the corruption we have today.
Lessig follows the obvious answer – which is more spending caps and more legislation. And while these are good ideas, they won’t work, because they don’t address real problem:
The government distributes too much money.
Why has the amount of money spent on lobbyists more than doubled in the last 10 years? Because our government is expanding. When we give money to the Federal Government to spend, special interests line up to assist with the distribution of those dollars. If we just don’t let the Feds get the money in the first place, the lobbyists will disappear. But as long as the money is there, the lobbyists will remain.
On the surface, it seems like contribution caps should be enough. But the reality is that there are just too many loopholes. Although the limits are allegedly $5,000 per candidate per year, it doesn’t take much browsing through OpenSecrets.org to discover that individuals, PACs and corporations are all able to openly donate much more (example1, example2, example3). Unfortunately, legislation to close these doors is difficult at best, and impossible due to freedom of speech at worst. There are so many back-door mechanisms to donate money (e.g. “hey, I’ll buy you a ticket to come talk here in San Francisco”, or “I can run a TV show about you”, or “I can write an article for you in my paper about how bad your opponent is”), that it just isn’t realistic to expect we can possibly close them all.
Special interest groups have figured this out. They’re not just buying a few candidates, they’re now buying all of them. Consider AT&T, for example, who donated $4.5M to candidates last year. If you believed that the $5,000 per candidate contribution limit applied, that would mean they would donate to ~900 candidates. In actuality, they donated to ~430. And since there are only ~500 Congressmen, that means they donated to most of them! And AT&T is not alone. The National Association of Realtors, and practically every union are doing exactly the same thing: buying “access” to more than half of Congress.
Once we realize that centralizing our spending through the Federal Government is the problem, two simple solutions emerge:
- We need to give the government less money to spend.
- When we do give money to the government, we should federate it through states and local agencies as much as possible. Don’t leave decision making power in Washington, where a small number of politicians can be influenced.
This realization also highlights why Obama’s entire strategy leads to more corruption, not less. Obama spent over $700B last year in “stimulus”. Did he really believe that he could distribute such a massive amount of spending without calling out the lobbyists in droves? Does it really surprise him that when he announced that he wanted a federal takeover of federal student loans that Sallie Mae would kick up it’s lobbying to the tune of $8M?
The unfairness and corruption is caused by the lobbyists and campaign contributions, that is true. But they are not the root cause, and they are impossible to stop without violating our own liberties (hence the Supreme Court ruling). When all money flows through a small funnel in Washington, corruption increases. Take the money back, federate our spending across the states and local governments, reduce spending and reduce taxation, and the corruption will decrease.
