Supreme Court Got It Wrong: Contribution Limits Don’t Hamper Electoral Competition

May 6, 2009
Guest Post

By Ciara Torres-Spelliscy, Counsel at the Brennan Center for Justice at NYU School of Law and co-author of the new report, "Electoral Competition and Low Contribution Limits" along with Kahlil Williams and Dr. Thomas Stratmann. The report will be rolled out at the Brennan Center's upcoming conference at the National Press Club in Washington, DC, "Money in Politics 2009: New Horizons for Reform" on May 8, 2009.

It might not surprise you to hear that the Supreme Court occasionally gets it wrong on the facts. Sometimes, it just takes a while to prove it.

The Roberts Court's first foray into campaign finance law was three years ago, in a case called Randall v. Sorrell. The court's decision overturned Vermont's very low contribution limits, which ranged from $200 to $400. The court assumed that low contributions limits ($500 or less) would prevent challengers from mounting an effective campaign against an incumbent.

But research just released by the Brennan Center for Justice at NYU School of Law and economist Dr. Thomas Stratmann shows that low contribution limits for PACs and individual contributors in state house races actually do the opposite: they improve electoral competitiveness.

The Supreme Court was right to focus on incumbency as a democratic problem. If incumbents have no fear they will be voted out of office, public policy becomes untethered from the needs of constituents and democracy breaks down.

But if sky-high incumbency rates are the problem, it's important to know that low contribution limits help, rather than hurt, challengers. This report examined data from 42 states over 26 years (1980-2006), and showed that the states with the lowest contribution limits actually have more candidates, closer vote totals and closer fundraising between major party challengers and incumbents in general elections.

When compared to those states with limits of $500 or below to states with contribution limits of $2,000 and above, research revealed that challengers in the lower limit states have a 10 percent higher chance of winning an election. That is a huge effect, because incumbency rates for state assembly races approach 95 percent.

The Supreme Court also thought low limits would damage challengers in competitive races, because those cost more than an average race. But again, the data refute the Supreme Court. The study concluded that even in competitive races, challengers do better in states with low limits.

Another aspect of the report examined the effect of both partial and full public financing - in Minnesota and Maine, respectively. Public financing systems give candidates public funds to run an election. In Maine the public dollars are given in lieu of private dollars. In Minnesota, public dollars supplement private funds raised by the candidates. In both states, expenditures by publicly funded candidates are capped. It turns out that public financing also increases the competitiveness of elections. Despite this welcome effect, the systems still inspire loyalty: even though races become more competitive, incumbents continue to choose to participate in public financing.

The court's mistake in Randall has the potential to do real damage to all sorts of campaign finance regulations that ensure the integrity of our democratic processes, including public financing.

Indeed, a meaningful system of limits is often a predicate for a functioning public financing system. Without low limits, candidates don't have sufficient incentives to opt into the public system in the first place.

For these reasons, the Brennan Center supports the simultaneous adoption of lower limits and public financing in states that lack them. With both reforms in place, the influence of big donors is curbed, and elections are more competitive, yet candidates have enough money to communicate with voters. In addition, candidates are likely to opt in - and stay in - a public financing system.

For example, after the Blagojevich scandal, Illinois is engaged in a wide-ranging public debate - including public hearings by a blue ribbon panel appointed by the new governor and many legislative hearings - about the way to run elections in the future to curb the risk of corruption. This new research from the Brennan Center can serve as a touchtone for crafting sound campaign finance policies for the state.