For La Raja:

What is the problem La Raja sees with the current system of campaign financing?

La Raja’s main criticism of campaign finance reform is that it impedes the centralization of political parties. According to La Raja, campaign finance reform restricts the amount of funding political parties can provide to candidates. Since all funding for campaigns cannot emanate from political parties alone, alternative outside election-funding streams manifest, and political parties become decentralized. As a result, campaign resources are not filtered through organized political parties but distributed among numerous partisan players like political action committees (PACs), legislative campaign committees (LCCs), or independent-expenditure-only organizations (Super PACs).

In a decentralized election-funding environment, campaigns become independent, candidate-centered affairs. Rather than cohesive political parties that fund multiple candidates nationwide with transparency regarding regulative oversight, campaign finance reform causes candidate campaigns to be individualized enterprises that receive financial support and resources via convoluted channels from numerous non-party players with diverse incentives.

There are also distinct differences between how committees or intra-organization actors within political parties respond to elections. For example, campaign finance reform laws and reformers, in general, perceive national campaign committees like the Democratic National Committee (DNC) to be equivalent to LCCs like the Democratic Congressional Campaign Committee (DCCC). This is wrong, says La Raja.

Certainly, LCCs act like political consulting firms with a singular objective of having immediate power in Congress. Thus, LCCs concentrate their electoral resources on a handful of incumbents facing challenging re-elections. But national campaign committees have longer-term goals to grow their respective political party organizations nationwide by cooperating with state and local party organizations to pursue objectives like policymaking and recruiting new talent.

What solutions does the author propose?

Centralized political parties, La Raja argues, would mean cleaner elections where candidates’ financing is concerned. However, Progressive Era reforms over the past century that have striven to decrease partisanship in elections have also created a decentralized system where financial oversight is increasingly difficult. Nonetheless, there are hopeful signs for a renaissance of centralized political parties displayed by contemporary national campaign committees through their cooperation with state and local party organizations. For these national campaign committees, presidential elections serve as the unifying affairs that enable them to mobilize partisan voters en masse.

How is the Democratic Party decentralized?

The Republican Party’s membership is more monolithic than the Democratic Party’s membership. In general terms, Republicans tend to come from the business sectors and the middle class. Thus, the Republican Party has an easily identifiable constituency that contains a large proportion of wealthy donors. The Republican National Committee (RNC) raises funding in a centralized manner from a national donor base, and therefore it benefits most from having fewer restrictions on cash donations from individuals. Unlike the RNC, its Democratic counterpart, the DNC, is not a centralized fundraiser.

The difference between centralized Republican and decentralized Democratic fundraising strategies is a reflection of the two parties’ resources. In contrast to the Republican Party, the Democratic Party does not have a nationwide source of donors. One reason for its decentralization regarding fundraising is the historical connection between the Democratic Party and labor unions. The latter provides an important election resource, which is its membership’s ability to mobilize Democratic voters before elections, but this is a noncash contribution.

A second reason is the heterogeneous composition of the Democratic Party membership. Compared to the more demographically monolithic Republican Party membership, Democrats encompass people with a wide range of demographic characteristics. Thus, identifying a potential Democratic donor, let alone appealing to him or her for money, is a more challenging endeavor with higher organizational costs than the Republican Party confronts when fundraising.

There is yet an additional difference between the two parties concerning fundraising. The RNC consistently raises more money than the DNC. The two causes for the Democratic Party’s decentralization retard its fundraising capacity and make establishing a nationwide donor network challenging and resource-intensive to do.

Still another impediment to DNC money raising and a nationwide donor base, however, is the localized nature of Democratic politics. Given the candidate-centered nature of politics caused in part by campaign finance reform, Democratic voters, in particular, identify less with a unified party policy platform or governing ideology and instead support local candidates espousing particularistic ideals. In the mind of many Democratic donors, therefore, if they are going to contribute money to support a political candidate, they will give it directly to the candidate rather than his or her party, represented in this case by the DNC.

What did Democrats have to gain from passage of the BCRA?

La Raja explains that campaign finance reform is a partisan strategy where one party seeks to enhance its electoral resources compared to those of the other party. As discussed above, Republican fundraising strategies consist of cash donations from a nationwide constituency of business class and middle-class voters including many wealthy individual contributors. Contrarily, Democratic fundraising is a decentralized amalgam of local interests represented by candidate-centered campaigns and partisan organizations with a single or handful of ideological policy-oriented goals.

The BCRA campaign finance reform in 2002 constrained party fundraising and spending toward candidate campaigns. The legislation’s effects included redirecting centralized party-building fundraising initiatives toward independent committees, causing the funneling of money funds

through state and local organizations instead of a national committee, as well as incentivizing candidates to take greater individual responsibility for the fundraising of their campaigns.

Viewed through a partisan lens, the BCRA of 2002 reduced the capacity of national committees to raise money and fund candidates directly, which the RNC was best at, while also emboldening localized and candidate-centered fundraising efforts, which complements the decentralized fundraising strategy of the Democratic Party, or more specifically, its candidates.

For Hansen et al.:

Much has been said about how recent changes in campaign finance laws could affect election outcomes. What do Hansen et al. find on the effects of Citizens United on the 2012 presidential election?

Citizens United (CU) had no significant impact on the corporate funding of elections, but the Supreme Court ruling did have a positive impact on the abilities of extremely wealthy individuals to make independent expenditures in elections.

The main consequence of CU was that it allowed for the creation of independent expenditure-only organizations called Super PACs. PACs have existed for a long time, and they are still the principal means of corporate funding of elections. A corporation can either create a PAC or give money to an existing PAC. There are limits on how much money a PAC can receive. PACs also give money directly to candidates, but there are limits on these donations, as well. Typically, a corporation gives to a PAC knowing the contribution will go to a particular candidate, usually an incumbent with whom the corporation is establishing a relationship with the hope of influencing favorable legislation. Corporate PAC donations are reported publicly by the Federal Election Commission (FEC). As a result, corporations that deal directly with customers, such as retailers, are more cautious about public perceptions resulting from their PAC donations. Other corporations with less direct contact with consumers may still worry about how their shareholders perceive political contributions.

One way around disclosing donations is giving to a tax-exempt 501(c) organization that engages in express advocacy for particular issues, which in turn gives implied endorsement to particular candidates who hold the same legislative goals. Regarding Super PACs, however, the rules regarding the disclosure of donors to the FEC is the same as with PACs. Therefore, even though a corporation can make unlimited contributions to a Super PAC for purposes of independent expenditures, meaning there is no cooperation with the actual candidate concerning how to spend the money, although it usually goes to negative advertisements, the same public relations concerns exist.

Do you agree or disagree with this finding?

Even though corporations as entities are not lining up to pour millions of dollars into Super PACs to support political candidates, many extremely wealthy individuals who own or run corporations are doing just that. In one extraordinary example, in the 2012 election cycle, a single person donated more than $90 million to Super PACs. If a person has that level of wealth accumulated during a

lifetime spent working in the corporate business environment, will his or her individual donations somehow reflect newfound personal incentives unrelated to the corporate interests to which he or she is otherwise devoted? It is doubtful.