January 27, 2010

A "market solution" to the perceived problem that is the Supreme Court's corporate speech case.

Bruce Ackerman and David Wu say Congress should create a tax credit for money contributed to political candidates — $50 per person in "presidential years." (Don't presidential candidates have to collect their contributions before the year that has the election in it? But that's a minor quibble. Let's concentrate on the main idea: a tax credit for campaign contributions.)
If each citizen also had a chance to contribute democracy dollars, their donations would overwhelm the sums that corporations are likely to spend under the recent Supreme Court decision.

Under our initiative, candidates will find new rewards by appealing to mainstream interests. If they effectively express the concerns of ordinary people, citizens could respond by sending millions of democracy dollars in their direction. Despite the new financial power granted to corporations, Americans would gain a renewed sense that they could make a difference in politics.
The Supreme Court opinion did not free corporations to make more contributions to candidates. It recognized a constitutional right to speak for themselves. Ackerman and Wu's solution is designed to increase the flow of money to candidates, which would presumably boost the candidates' power to speak and counter this newly increased speech by corporations.

Ackerman and Wu are right that their solution — unlike attempts to rein in corporate speech — doesn't threaten free speech rights, but it's probably not true — as they claim — that it "allows ordinary Americans to compete effectively with corporations." It creates a huge flow of money to politicians so that the politicians can compete with corporations.

So Ackerman and Wu have a "more speech" solution — the classic preferred solution under First Amendment theory — but the "more speech" is going to come from the candidates. The speakers that will be yammering in our ears night and day will be corporate entities and politicians, not ordinary people, though Ackerman and Wu would like us to assume that the candidates that get the money will be those that "effectively express the concerns of ordinary people." So it's kind of like speech, except that somebody else is speaking for you.

Good idea? They're already doing it in "Oregon and other states." I'd like to hear more about how the state-level experiment has fared. Do the incumbents snap up the money and make it even harder for newcomers to get started?

Ackerman and Wu also put forward a new idea: setting up an electronic system that immediately refunds the amount you contribute onto your credit card. That way you wouldn't need to wait until you file your income tax return to get the money back. Ah! How the cash could flow! Just push buttons on line. Is that too easy? Do you worry about corruption? Does it unduly favor the kind of people who use computers and credit cards... or is that really everybody now?


rhhardin said...

Ordinary citizens a $50 tax credit to contribute to Supreme Court justices based on their opinions.

rhhardin said...

A better and cost-free plan is being able to transfer $50 from one candidate to another.

Joaquin said...

Tax credit this, tax credit that.
As if our tax code wasn't already a freakin nightmare!

Skyler said...
This comment has been removed by the author.
Meade said...

Modern technology provides opportunities for enhanced convenience and access. Donations to campaigns could be made electronically, with the money automatically refunded to each citizen's credit card or bank account. Call these electronic transfers "democracy dollars."

Here's an idea:

Don't tax us to begin with.

Call these electronic non-transfers, oh, I don't know, "private property."

Superdad said...

The solution (assumes a problem - I dispute this assumption) is in the opinion. People can band together around their issues/cause, form a corp and run all kinds of adds too counter the adds of the "evil" corporations.

rdkraus said...

Any solution that involves a gov't tax credit is NOT a "market solution."

This is the kind of thing faux "smart" people say (see above post about getting smart).

Ron said...

I wonder the degree to which corporations will not only contribute a lot themselves, but also pressure their employees to contribute as individuals under veiled threat of losing their jobs. That could get ugly.

EDH said...

Next would be a call to apportion the credit among the different elective offices and races, because otherwise the donations will tend to cluster on "superstar" candidates.

This is already lamented in other spheres as the Winner Take All Market phenomenon.

Jim said...

This is the world's largest government giveaway disguised as a market solution.

After all, we're not restricting the program to people who ACTUALLY PAY TAXES in the first place. So where do these geniuses think that the "tax credits" are going to come from? As if we don't have enough problems financing government as it is?

I suspect they know full well that this is a very poorly disguised massive bankrolling of political campaigns - especially Democratic ones since we all know that dead and non-existent taxpayers need tax credits too.

It's a terrible idea on stupid stilts.

Awful. Awful. Awful.

Peter V. Bella said...

How about this. After each election all left over money in all campaign funds- even those friends of the idiots funds- must be turned over to the government.

george said...

Tax systems should not be used to try to control people's behavior. When you issue credits for doing certain things and increase the tax rates on other activities such as drinking or smoking you are not funding the government you are trying to control the thoughts and actions of the populace.

Better to give everyone a $50 tax cut and let them keep their freedom to spend it where it is most needed. These guys are so addicted to our money they can't even let us keep it unless they are sure we will spend it on what they decide is important.

A pox on the lot of them.

William said...

It gives a megaphone to the will of the majority and a laryngectomy to that of the committed. What's wrong with that? In America, the velocity of the committed has on occasion been able to overcome the intertia of the majority. The abolitionists, despite being a minority, were able to steer the nation towards their goals.....Bankers, like 19th century blacks and 20th century gays are subject to the antipathy of the majority. They need a system of government where their money and energy can be effectively utilized to lobby against the prejudices of the majority....I'm not sure if I'm being tongue in cheek.

Opus One Media said...

Some may be missing the point here. First, there is only so much advertising space to go around. It isn't limitless; contrary to popular belief.

The election rules that go into effect 60 days out are very specific about pricing and what a candidate pays...that is, they have to be uniformly offered the best current rate and everyone who is a candidate must get the same ad space at the same rate as another other candidate or anyone for that matter.

Now, how can this be run amuck? If a few corporations create a shortage of advertising space by making large buys and at prices higher than the normal market, and do so a few months out from the 60 day rule, they can, effectively drive up the ad-space prices and create a shortage of space at the same time. .. there is nothing illegal about it.

PoNyman said...

Opus One Media said:
First, there is only so much advertising space to go around.

First off, if advertising were the only outlet I might see your point. But there are far more outlets then just simple advertising. Second, I think you have hit on the way we can get the newspaper business out of the financial rut they've been in. Let the dollars flow man. Third, I don't see any newspaper letting their ad pages fill up with speech that would turn off their readers. Campaigns only have a season that is so long. After that season then you might find more ardent ads taking up less space. Fourth, advertising isn't the most effective form of speech anyway, so if you think the competition is going to drain away their funds in that tank then you should thank your lucky stars.

BJK said...

How do we get from "taking the money out of politics" to "taking the money out of tax revenue and put it into politics"?

Our government is doing a bad enough job managing its expenses without us skimming $50 off the top of every taxpayer's liability. Moreover, it does not appear that the current system of campaign financing needs subsidizing.

Finally, if we do believe that more speech is the answer, why not take the caps off individual campaign contributions, admit that money = speech in contemporary politics, and give Buckley v. Valeo the over-turning it has been due since the day the Supreme Court made the ruling. (Prosecute corruption where you find it, and if you don't find it....look for someone who will. Just don't tell me that a corporation & a campaign's spending are unlimited, but an individual's ability to contribute to a campaign should remain limited.)

Joe said...

How be we stop the damn tax credits and deductions and simply the taxes and that will do more than anything to remove the corrupting power from corporations and "the rich." (This also has the added advantage to reduce the number of accountants and lawyers and would reduce tax fraud and the size of the IRS. Simplify regulations would do even more.)