The Truth About Campaign Finance Reform

Richard Epstein*

Richard Epstein

Richard Epstein

One regrettable feature of modern politics is that presidential campaigns now run for the better part of two years, which gives ample time for all sorts of crackpot ideas to make their way to center stage. It is a sign of the times that Bernie Sanders has made enormous headway on the Democratic side of the ledger, taking away attention from Hillary Clinton whose misguidedreform agenda has been overshadowed by the federal investigations and inquiries into her private email server when serving as Secretary of State. On the Republican side, a boorish know-nothing, Donald Trump, has surged to the lead, giving the mistaken impression that the conservative voters of this country are concerned with little more than “white identity politics.”

But more curious still is the incipient presidential campaign of Harvard Law Professor Lawrence L. Lessig, who has taken it upon himself to become the hero of the common man, by seeking to amass one million dollars by Labor Day to project himself into the election on the singular pledge that, if elected, he will leave office once his major campaign reform has been put into place, yielding the presidency to some Vice President like Bernie Sanders, Hillary Clinton, or Elizabeth Warren.

The centerpiece of the Lessig program is a radical reform in electoral politics, which is intended to make sure that the nameless rich are no longer allowed to “rig the system” in their favor. The sole item on his quixotic campaign is a motley collection of legislative reforms that he bundles into a single package called the Citizens Equality Act of 2017. His calling card reads as follows:

EQUAL RIGHT TO VOTE

We must have a system that guarantees a meaningfully equal freedom to vote. To achieve that, we must at a minimum enact the Voting Rights Advancement Act of 2015 and the Voter Empowerment Act of 2015. We should as well add automatic registration, and shift election day to a national holiday.

I shall pass by the vices of automatic registration to concentrate on two components of Lessig’s plan that are now gathering dust in Congress: the Voting Rights Advancement Act of 2015, and the Voter Empowerment Act of 2015. Not surprisingly, govtrack.us has the same prognosis for both statutes: zero percent chance of passage.

For Lessig, the merits of his legislation are self-evident. The Voter Advancement Law, for example, calls for the introduction of elaborate preclearance provisions on a wide range of “covered practices” that are said to impair the right to vote. It is clearly an effort to resuscitate in reinvigorated form the preclearance of Section 5 of the 1965 Voting Rights Act, which was struck down inShelby County v. Holder, for the simple reason that the reality of racial exclusion in the South (and for that matter, the North) have changed so markedly in the last 50 years that the turnout rate for black voters is higher than it is for whites. For someone interested in radical reform to clean up electoral politics, it seems odd to support a new and onerous set of preclearance procedures whose primary effect will be to slow down electoral politics and to allow eager Democratic officials to harass local election officials.

To get a flavor of what is afoot, it is sufficient to look at one key provision of the 2015 Advancement Act that is intended to expand the number of situations under which the preclearance procedures of the 1965 Voting Rights Act can be invoked. That bill would first expand the definition of violation to cover not only violations of the Fourteenth and Fifteenth Amendments, but also “violations of this Act, or violations of any Federal law that prohibits discrimination in voting on the basis of race, color, or membership in a language minority group.” To make matters worse, it targets for enactment any state if there were “(i) 15 or more voting rights violations occurred in the State during the previous 25 calendar years; or (ii) 10 or more voting rights violations occurred in the State during the previous 25 calendar years, at least one of which was committed by the State itself.”

This appalling provision in effect guarantees that large numbers of states will necessarily be subject to future regulation of their conduct based on actions completed long before the passage of the legislation. It takes little imagination for any expert in the field to tally those states that are already caught within the web, and then to find, under the Act itself, new violations, which will allow the noose to be kept in place for the indefinite future. There is no allowance for differences in the size of the state, for the severity of the violations, or for trends in state or local behavior. The impact of these provisions on legislative outcomes is obscure at best. Why anyone thinks that the robust enforcement of this misguided legislation will do anything other than inflame electoral politics is a mystery to me.

The situation on the ground is in fact worse than this brief analysis suggests. The first point to note is the inherent dangers in all forms of modern democratic politics. As James Madison wrote long ago in Federalist Number 10, the dangers of special interests (what he called “factions”) are everywhere. In some cases, it is an outraged majority that can take advantage of an embattled minority. Sometimes it is a clever minority that can use its influence to collect power and wealth from the disorganized majority. The Lessig narrative is that the system is rigged against the ordinary person. There is no mention that the organized majority, or more accurately, a huge panoply of activist groups, has taken its pound of flesh from businesses and from people of high income, many of whom have fueled the innovation and advances from which the public at large benefits.

There is no easy way to keep score on whose political intrigue matters most, but there is little doubt that the progressive forces in the Obama administration have made the redress of inequality a central theme of their policymaking. This has translated into slow growth brought on by higher taxation and more extensive regulation of that heterogeneous group, known as the rich, whose members are often in conflict with each other.

In my view, any effort to concentrate exclusively on general electoral issues obscures the kind of fundamental reforms that are really needed to get this country back on track. Here are two key proposals needed to reverse the long-term national decline.

First, we need to cut back on the overall scope of federal powers of regulation and taxation. The current laws, as exemplified in the ObamaCare decision, NFIB v. Sebelius, give the government virtually unlimited powers of regulation and taxation over the economy as a whole. This current understanding of the law is at sharp variance with the original, classical liberal constitutionalstructure, which recognized the serious perils of an inordinate concentration of power. The level of discretion enjoyed by government officials at all levels is a magnet to anyone with a partisan political agenda. The amount of money spent on campaigns at all levels reflects the fact that our current structures make it possible to use legislation to gain advantages from other groups, without having to go through the bother of selling goods and services that other people want to buy.

This simple truth gives rise to the second yawning defect in our current governance structures. The need for influence is not only felt part and parcel of electoral politics. It also depends on the way the various committees inside each house of Congress operate; these committees have to pass on particular bills that come before them. Thereafter, we can count on a huge amount of slippage between the passage of any piece of legislation and its administration. Under current administrative law, the courts apply the so-called Chevron doctrine to give enormous discretion to administrators who decide how to implement the oft-vague guidelines of particular statutory provisions. And once those regulations or other directives are adopted, they often be can be altered at will by the next president and his team of administrators, leading to serious discontinuities in the operation of the law.

These huge flip-flops in legal interpretation carry with them troubling political implications. Power abhors a vacuum, which means that any interest group that has not been able to carry its way in the electoral process will mobilize its resources to target particular rules in particular agencies that matter most to its operation. And contrary to the Lessig’s childish populist story, lobbying and logrolling is a game that liberal activist groups can play every bit as skillfully as their conservative rivals. Furthermore, many corporations and individuals give to both parties to cover their bases.

One vital administrative law reform needed is to break down the ability of agencies to adopt bad rules that are often at war with the statutory authority under which they act. And in this regard, the usual extensions have been done, most notably, by the Obama administration with its eagerness to push the envelope on executive authority on a wide range of issues from immigration reform to environmental, labor, securities, communications law, and much more. It is all too often the case that business interests are forced to lobby, not in an effort to gain some special favor, but to resist some law or regulation which threatens to drive successful businesses, like Uber, out of business.

In dealing with these issues, the populist agenda only aggravates the underlying problem. What it first does is confirm the vast power of government to control all essential matters of government. The greater the political power, the larger the role of money in politics. Well aware of this, the progressive agenda championed by Lessig and others works over time to rig (yes, it is proper to use their word against them) and then introduce a set of electoral reforms whose disparate impact will help them cement their own power.

Thus one of many approaches would put sharp limitations on contributions made to PACs, but do nothing to restrain the ability of people to work in electoral campaigns, which would give a huge advantage to labor unions—the most regressive political force in America—against those people with the ability (on all sides of the political spectrum) to use their dollars to obtain political influence. It is for this reason that the progressive movement is so vehement in its opposition to Citizens United v. Federal Election Commission. That decision gives small government forces the means to oppose its agenda—which is the opposite of what Lessig and his fellow progressive supporters want, but precisely what this country needs to counter the growth of government and all of the problems that come with it. 

*Considered one of the most influential thinkers in legal academia, Richard Epstein is known for his research and writings on a broad range of constitutional, economic, historical, and philosophical subjects.