The Fallacy of Campaign Finance Reform

Federal election law reforms, like most policy reforms, add layers of regulation to the legislative onion. Law and established tradition becomes ever more corrupted by legislation, where legislators and regulators endeavor to plug the leaks and repair the breaks in earlier legislation. Welcome to the world of campaign finance reform where an expanding spaghetti of intricate rules govern who can do what, when and how during the federal election process.

John Samples, in his 2006 book The Fallacy of Campaign Finance Reform (University of Chicago Press), presents the case against current and further federal campaign finance regulations. Samples begins:

Politics often concerns compromise, but the First Amendment to the U.S. Constitution is uncompromising. It states that “Congress shall make no law . . . abridging the freedom of speech.” The founders thought freedom of speech should be free of the usual tradeoffs that mark the birth of most laws… (p. 17)

The federal government’s powers were to be limited to those delegated to it by the states and the people in the Constitution, and restricting speech was not among those powers delegated. Though legislators might fear that million spent running campaign speeches across radio and television could influence elections, the Constitution doesn’t grant Congress power to abridge that speech.

America’s founders didn’t think free speech to be risk free. Dangerous ideas are often promoted by eloquent and forceful speakers, and campaigns promoting foreign wars, domestic interventions, repression of minorities, eugenics, and many other evils have cascaded across the U.S. since the founding era. Government repression of the speech promoting these ideas might have saved America much sorrow and bloodshed. But the founders saw more danger in corrupt government than in corrupt society. A government empowered to restrict speech deemed dangerous would as likely restrict speech critical of politicians currently in power.

Classical liberals understood that many things could go wrong in societies of free people and voluntary associations. They had no illusion that people and organizations were always good or free of corruption and bad intentions.

Speech, press, religion, and association were off-limits from legislation. Governments were not granted the power to limit these freedoms, which the founders believed were natural rights existing before government. The common view was that those with state power were likely to overstep their authority (as all past governments had). Free people in voluntary society safe behind the freedoms of speech, press, religion and association, were the bulwarks to resist and push back against unjust government.

The Onion weighs in on campaign finance reform.

Interventionist Dynamics and the Policy Reform Onion
Government policies are onion-like. New government programs begin with high-hopes or at least high rhetoric about reform said to make the world a better place. Medical care reform began with policies said to improve the quality of medical schools (but had the effect of closing one-quarter of all medical schools including all the medical schools for African-American doctors).

Education reform at the federal level began with funding for science education to help the U.S. compete with Soviet science and Sputnik. Over decades, each federal intervention has “layered-up” with additional legislation. In education, medical care, transportation, drug laws, drug regulations, securities law, banking, immigration, retirement savings, workplace safety, labor laws, wage regulations gun restrictions, telecommunications and environmental regulations, the federal government has enacted ever-deepening layers of regulations.

Whatever the goals of the original legislation in each area, later legislation is usually called for to reform the unintended consequences of the original legislation. It turns out to be very difficult for governments to reach into an operating society to shift things around and reorganize the way things are done.

Economists call this long-term process interventionist dynamics, and economic
theory explains why new interventions in the economy have consequences so divergent from the stated intentions of legislation.

Though discussions of interventionist dynamics usually focus on economic interventions, the same process applies to interventions in political processes such as federal election law.

The Introduction to The Fallacy of Campaign Finance Reform is available online and begins with a discussion of the McCain-Feingold Act. Through the book students are taken on a tour, layer by layer, of campaign finance reform visions and failures.