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Money plays a major role in modern politics. The 2020 election cycle saw politicians spend roughly $14 billion dollars, a new record for a presidential election year. As the 2024 presidential election draws nearer, it seems likely that this election cycle will break records once again.
Up and down the ballot, money flows into political campaigns, sometimes from questionable sources. As large donors fuel lengthy campaigns, politicians end up feeling indebted to the people and organizations that helped them get elected to office. This is why the problem of big money in politics is such a concerning one: because wealthy and corporate donors end up having disproportionate influence over our elected leaders.
In this guide, we’ll unpack the essentials of campaign finance and uncover the need for campaign finance reform.
The Basics of Campaign Finance
Understanding the influence of money in elections starts with understanding why politicians need to raise money in the first place. The simple truth is that American elections are expensive. The greater the responsibility of the office a candidate is seeking, the more money that candidate will likely need to raise. Campaign funds get spent in a variety of ways, such as campaign advertising, staff salaries, the cost of travel and renting office space, and more. Costs can add up quickly, especially over the course of a long election season.
Very few politicians could fund their own campaigns, even if they wanted to do so. They solve that problem by collecting campaign contributions from their supporters. Some of those contributions come in the form of direct donations, but others are harder to trace. Political action committees, or PACs, collect money from a variety of sources and put it toward politicians’ campaigns. That intermediate step makes it hard to maintain political funding transparency. When money is channeled through Super PACs, 501(c)(4) organizations, and LLCs, transparency is diminished even further, creating the problem of dark money.
This system ensures that donors have plenty of leverage over politicians. Political leaders depend on campaign contributions to stay in office, so they are forced to appease the people and groups that provide those donations. Political financing regulations and limitations on political contributions can undermine that influence, but the influence of money on politics still remains a major area in need of reform.
The Need for Campaign Finance Reform
Large political donations undermine democracy because they give wealthy donors more influence than the average donor or voter. In addition to undermining electoral integrity, this discourages average people from taking part in politics. This creates a cycle, making the government even less representative and giving even more influence to wealthy donors.
The benefits that politicians give to their donors vary. They can look like policy influence, special exemptions, tax breaks, government contracts, and more. Organizations also benefit greatly from having a line of direct access to the politicians whose legislative decisions impact their industries.
For example, California recently increased the minimum wage for fast food workers. However, the new minimum wage does not apply to businesses that have a bakery and sell bread as an independent menu item. Critics say that this benefits one of the governor's donors, who owns a number of those businesses.
In Indiana, a recent bill allows the city of Indianapolis to levy a fee on properties to support public safety initiatives. It also includes an exemption, which ensures that a major Republican donor can avoid paying the new fee. These controversies show that campaign donors can often turn a profit by using their donations to get special treatment.
Most Americans agree that this sort of favoritism is a major issue. A recent study by the Pew Research Center found that reducing the influence of money in politics was ranked as the third-highest priority among Americans — coming just after the issues of strengthening the economy and defending against terrorism.
This study comes after a previous study published in 2023, which found that:
72% of Americans say there should be limits on the amount that individuals and organizations can spend on political campaigns.
84% of Americans agree that special interest groups and lobbyists have too much influence on politics.
85% of Americans agree that the high cost of political campaigns makes it hard for good people to run for office.
Support for campaign finance reform also extends across party lines, demonstrating the widespread support for decreasing the role of money in politics.
Inside the Movement for Campaign Finance Reform
There are a number of ways to address the influence of money in elections, ranging from anti-corruption legislation to election finance monitoring. Most clean elections advocacy groups support a variety of anti-corruption measures and electoral spending regulations. Almost all of them support greater transparency in campaign financing and political influence regulations to keep lobbyists from secretly writing laws. The differences come from differing priorities and familiarity with different issues.
Here are two of the most commonly proposed reforms:
New Funding Systems
Some activists are pushing for public election financing. This system would allow the government to fund electoral campaigns, either directly or by matching donations. This gives politicians a source of funding that does not come with strings attached, so they can act independently of large donors.
Democracy vouchers, a system used for local elections in Seattle, offer another option. In this system, all local citizens receive vouchers for campaign funding, and they can donate those to whichever candidates they like. Instead of restricting political donations like traditional political donation controls, this system ensures that everyone can donate to their preferred candidates. Fair elections advocacy groups often support this general approach because it opens the democratic process to more people.
Increasing Transparency and Disclosure
The other way to increase public trust in elections is to force politicians to be open about their allegiances. Increased transparency in campaign financing makes it easier for voters to catch politicians when they offer unfair benefits to their backers. Voters can force politicians to back down from corruption, so this method offers another line of defense. Clean elections advocacy groups tend to support lobbying disclosure laws that force lobbying groups to report their activities.
Activists can also help with this approach without passing any formal democracy reform initiatives. Many transactions are a matter of public record. They are only secret because it is hard to sort through the huge volume of data that is out there. Dedicated workers can examine bills and financial records, and then publicize the results. This grassroots electoral expenditure oversight can be more powerful than many government ethics reforms. After all, politicians can always undermine election integrity measures, but they cannot stop people from watching their political campaigns and calling for fairer campaign practices.
The First Step Toward Electoral Integrity
Democracy relies on widespread, equitable participation in the election process. When the financial necessities of supporting political campaigns tie leaders to donors, that participation becomes impossible. The system forces politicians to court donors, instead of listening to their constituents. Reforming campaign contributions is a major step toward fixing that problem. Good political financing regulations reduce the influence of wealthy donors, thereby returning power to the people.
Anti-corruption legislation and lobbying disclosure laws are vital tools for democracy reformers who want a fairer system. The right regulations on political influence can even restore public trust in elections and encourage more people to take part in the democratic process. That increase would reinforce political accountability by forcing politicians to listen to a more active and engaged electorate.
Government ethics reform starts with pressure from the voting public. While politicians currently have a strong incentive to please their campaign donors, they also have an incentive to adjust their positions in order to please voters. When it comes to campaign finance, real change can happen as soon as voters force politicians to act with honesty and transparency.
Still, it can be a challenge to start that change. The current financial system makes it hard for independent candidates to challenge the established system. It also favors established candidates because donors prefer to back politicians who are most likely to win office. Meanwhile, some voters feel obligated to compromise on campaign finance issues so they can elect an established politician that they support on other issues. Change is still happening, but this inertia slows it down.
The good news is that there are a variety of ways to get involved in the movement for campaign finance reform. One of the best ways is to run for office as an independent, anti-corruption candidate. Interested in running for office, or in encouraging someone you trust to run for office in your community? Book a free consultation about launching your campaign today, and find out how you can get access to free tools and support for your campaign.
You can also volunteer to support people-powered, anti-corruption candidates running for office across the United States.
Photo by Giorgio Trovato on Unsplash
