Corruption

Do Contribution Limits Reduce Corruption?

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Reducing official corruption is the main justification for limits on campaign contributions. A new analysis by the Center for Competitive Politics (CCP) casts doubt on that rationale, finding that strict contribution limits are not associated with lower levels of corruption. Looking at convictions of public officials on corruption charges during the decade from 1997 through 2006 (the most recent year for which data are available from the U.S. Justice Department's Public Integrity Section), CCP Research Director Laura Renz calculated a conviction rate per 100,000 residents for each state. She divided the states into three categories based on their campaign finance rules: those with high limits (above $5,000) or no limits on contributions to candidates, those with limits between $1,001 and $5,000, and those with limits of $1,000 or less. Renz found no obvious relationship between conviction rates and contribution limits:

Overall, the distribution of corruption among all 50 states is random, at least when compared to contribution limits. All three states with the lowest corruption rates have no or very high limits on contributions to candidates for state legislature, while 2 of the 3 states with the highest corruption rates also have no or very high limits.

Of states with low limits on contributions, 5 make the "Top 10" for high corruption rates while 4 make the "Bottom 10" with very low corruption rates. Half of the states with moderate contribution limits are in the "Medium Corruption" group.

According to Renz, "This analysis demonstrates that there is no credible reason to believe that contribution limits on what citizens can give to candidates for public office [have] any effect on restraining corruption by elected officials or otherwise cleaning up any 'culture of corruption' that may exist." That conclusion seems too strong to me. It's fair to say that the analysis provides little support for the theory that contribution limits reduce corruption, but it's a pretty simple analysis that does not take into account the timing of the contribution limits or the possibility that some states imposed them in response to cases of corruption.

If that's true, the coexistence of strict limits and a high corruption rate would not necessarily show the limits are ineffective; you'd want to see what happened to corruption after the limits were imposed. If the tightening of restrictions tends to be followed by a decline in corruption across different states, that would be prima facie evidence that the limits work (though it would not be conclusive, since other factors associated with the adoption of new limits, such as publicity and increased scrutiny, might be driving the declines in corruption). And if no such pattern appears, that would count as evidence against the effectiveness of contribution limits (though again, not conclusive, since new restrictions might be accompanied by intensified law enforcement efforts, leading to more convictions).

More fundamentally, I'm not sure convictions on public corruption charges are the right measure by which to judge the effectiveness of contribution limits. Corruption might involve dispensing favors to campaign contributors without an explicit quid pro quo, in which case it probably would not lead to criminal charges, let alone a conviction. Then again, as Renz notes, attempts to curtail this sort of corruption by restricting contributions might increase corruption convictions, making bribes more tempting by making it harder to raise money legally.

This sort of analysis is a bit risky, since CCP does not want to concede that limiting political speech by limiting campaign contributions would be constitutional if only it worked as advertised. At the same time, it's perfectly legitimate to demand evidence that the official rationale for carving out this exception to the First Amendment holds water in the real world.

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  1. Seeing as that any government imposition such as contribution limits should bear a pretty heavy burden of proof, I think this study (whatever its limits) provides a very strong prima facie case that the state cannot meet that burden.

  2. Well, without even really thinking about it much, shrinking legal contributions would seem to provide an incentive for two types of behavior: (1) illegal contributions and (2) and scrambling more furiously over the now more limited pool of legal contributions.

    I guess one response to this would be public financing of campaigns, but that has a bunch of problems with it too, such as how incumbents and the major parties are kept from dominating such a system. Then there is the whole deal of why I should be forced to sponsor the speech of Republicans and Democrats.

  3. I read this in George Will’s “One Man’s America”* the other day.

    [Eugene] McCarthy’s insurgency, the most luminous memory of many aging liberals, would today be impossible — criminal, actually — thanks to the recent “reform” most cherished by liberals, the McCain-Feingold campaign regulations. McCarthy’s audacious challenge to an incumbent president was utterly dependent on large early contributions from five rich liberals. Stewart Mott’s $210,000 would be more than $1.2 million in today’s dollars. McCain-Feingold codifies two absurdities: large contributions are inherently evil, and political money can be limited without limiting political speech. McCain-Feingold criminalizes the sort of seed money that enabled McCarthy to be heard. Under McCain-Feingold’s current limit of $2,100 per contributor, McCarthy’s top five contributors combined could have given just $10,500, which in 1968 dollars would have been just $1,834.30. But, then, McCain-Feingold was written by incumbents to protect what they cherish: themselves.

    I’m amazed that alleged thinking people support this contribution limit nonsense.

    * A good read that I recommend.

  4. Good, balanced analysis, Jacob.

    In principle, I have no objection to limiting campaign contributions. We all know that writing a check to a candidate is not just a pure act of free speech. The problem is that they find ways around every rule, so you have to start regulating ads, and pretty soon you’re regulating things that are a lot closer to the “speech” end of the spectrum than the “bribe” end of the spectrum.

  5. Dang! Screwed up the /blockquotes again (forgot the / and preview). I assume y’all are smart enough to figger it out.

  6. thoreau,

    Not to quible, but are there any “pure acts” of free speech? And would we really want to rely on such a standard if there are?

  7. “Do Contribution Limits Reduce Corruption?”

    I’m going to say….

    no.

  8. Fair point, Seward. I guess the problem here is that campaign contributions are made “impure” not by mixture with, say, commerce or whatever, but rather by mixture with an element that is very close to bribery. That makes campaign contributions a seemingly reasonable target for regulation. Of course, when you look at how it works out in practice, that’s not quite so reasonable.

  9. thoreau,

    Well, I’m guessing you know the standard libertarian response; shrink government so there is less to “bribe” folks over.

    Something that struck home to me recently was how often government actions require some opposing action as a result of the unintended consequences of the former. Not original or anything, just something I’d never really grasped before.

  10. isnt the idea behind the contribution limitations essentially incumbent-protection?

  11. Of course, the fundamental disconnect here is that the vast majority of opportunities for corruption occur outside of financing campaigns.

    Employing politician’s family members, helping them buy or renovate their houses, contributing to foundations that they control, etc. etc. etc. ad freakin’ infinitum – all of this will exist even if we make it illegal for any person ever to contribute a single penny, in any currency, to a politican’s campaign.

    Campaign finance reform as a mechanism for controlling corruption is a farce and a sham.

  12. “Do Contribution Limits Reduce Corruption?”

    I couldn’t tell you the answer to that one. But I would figure that it would increase post political career employment opportunities for Congressmen and their families/friends.

  13. …CCP does not want to concede that limiting political speech by limiting campaign contributions would be constitutional if only it worked as advertised.

    Isn’t this a synecdoche for most all liberty arguments? The philosophical libertarians argue that the infringements are unethical, and the pragmatic libertarians argue that the infringements are pragmatically useless or destructive.

    You, Sullum, as a philosophical libertarian, are compelled to operate as a pragmatist to engage with those who see liberty as nothing more than an option in the game of social engineering.

  14. I should be able to give money, goods, or services to whoever I want and I should be able to receive money, goods, or services from whoever wants to give it to me (unless it was stolen or something). The thing that makes politicians different is their authority to regulate and spend tax money. That is the real cause of corruption, not money.

  15. The problem is that SCOTUS has also ruled that the fact that a law fails to actually serve the ostensible purpose that creates its constitutional justification does not mean that the law is unconstitutional. Lawmakers can just claim the law serves the purpose.

  16. Interestingly I thought McCain’s case was more that these limits are needed to combat the perception of corruption.

  17. As with many other unconstitutional laws, I worry that arguing about the law’s efficacy shifts the debate away from the real issue. Setting that aside for the moment, I would like to see what would happen if they looked at corruption rates per 100,000 politicians, vs. 100,000 population. The small-population states seem to be overrepresented in the high-corruption column. After all, who would have ever pegged North Dakota as the most corrupt state in the union?

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