Invigorating Democracy: A Case For Small-Donor Matching

Letter to the Editor

Written by Ezer Smith on November 2, 2015

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We are in a period of intense national frustration. From Black Lives Matter activists fighting to dismantle institutionalized racism to Tea Partiers intent on upending the Republican establishment (hello and goodbye, John Boehner and Kevin McCarthy), the grassroots of American society is alive and burning. The causes of these trends are varied and their directional impetus often irreconcilable, but all share a frustration with the ways that the American political system has failed to adequately represent the interests of its people. Now more than ever, we need structural reforms that will bridge this gap and make it easier to solve the real and pressing problems of American life. We need reforms that will incentivize politicians’ good behavior, ensure fair elections, and encourage political participation. One such correction is simple, within reach, and has never been more relevant: campaign finance reform.  

The torrents of money flooding into candidates’ coffers nationwide is not a new phenomenon, nor is it unexpected in upcoming elections. The roughly $518 million already raised during this national election cycle was telegraphed by the Supreme Court’s 2010 decision in Citizens United vs. Federal Elections Commission. Citizens United, as it is commonly known, held that political speech is protected under the First Amendment and that, consequently, corporations and unions may not be prohibited from spending on behalf of a candidate. The ruling did not lift the prohibition on corporations and unions giving directly to candidates’ campaigns. Thus, as many predicted, independent expenditures have skyrocketed since the decision. It is no surprise, then, that the 2016 election cycle is on pace to break records for fundraising in an election year. Some politicians have already begun to respond: Bernie Sanders and Lindsey Graham have called for a constitutional amendment to neutralize the effects of Citizens United. The subject has gotten play on the Late Show and Last Week Tonight; even Pope Francis recently weighed in when responding to a question about elections in his home country of Argentina, saying, “The election campaign should be independent from anyone who may finance it.” For the first time in a long time, it seems, money in politics is a resonant issue.

While many agree that money has too much influence on the outcomes of our elections, there is often disagreement on what to do about it, or doubt that anything we could do would actually help. There are certainly those—five Supreme Court justices among them—who would argue that regulating the political spending of large donors is a dangerous affront to freedom of speech. I respectfully disagree, though I understand the hesitance to curtail a constitutionally-determined right. The best way to approach the problem of campaign finance reform is to provide good incentives for politicians to spend efficiently and focus on winning small donations rather than large ones. Small-donor matching programs accomplish both of these goals.

A small-donor matching program is an opt-in funding scheme in which a candidate accepts restrictions on contributions and expenditures in return for public matching of donations up to a certain amount (usually below $200). Some small-donor matching programs match donations at ratios of 6:1 or higher, turning a $200 donation into a $1,400 donation. Suddenly, every small donation is worth a lot more, and politicians can focus on winning votes, rather than dollars. The goal of a small-donor matching program is not to blindly reduce the amount of money spent in elections; the goal is to increase donor diversity with the understanding that current spending levels are bloated and unnecessary. Unfortunately, it takes a lot of money—usually from a few massive donors—to win an election. With a small-donor matching program, grassroots candidates with strong local support can build momentum on the strength of supercharged small donations, making elections more competitive. This invigorates the polity: people see that they, not special interests, hold the reins of our democracy. As a result, citizens have a stronger incentive to participate in the political process. Most importantly, this focus on small-dollar politics means that politicians will be more responsive to their constituents.

While grand solutions are fun to imagine, national change cannot occur without local change. If we want campaign finance reform and fair elections nationwide, we have to look no farther than our own city. The people of Chicago have already spoken: during the most recent municipal elections,79 percent of voters supported an advisory question calling for a small-donor matching system funded by City Hall. Every precinct of every ward in the city voted “yes” by overwhelming margins. The only question now is what that system would look like in practice.

When examining how a small-donor matching program might function in Chicago, one might look to a similar model in New York City. The city implemented small-donor matching in 1986, two years after a massive corruption scandal rocked the New York Police Department. All three mayoral candidates, and many others running for office thereafter, embraced the program. Today, a strong majority of candidates for all New York City offices make use of the program: in 2013, 76.8 percent of declared candidates for all municipal offices utilized public matching funds. New York’s small-donor matching scheme has changed over the years based on the needs of the city’s political system, responding to input from citizens and politicians alike with the help of an independent Campaign Finance Board. The board operates with the same underlying principles the matching scheme itself aims to promote: responsiveness and transparency.

This principled, flexible program has shown quantifiable results. For New York City Council races in 2005, candidates participating in the matching program received over 50 percent of their total funds from matched small donations (under $250) while receiving less than 20 percent of their total funds from donations greater than $1,000. For candidates who did not participate, the data is completely reversed: these candidates received over 50 percent of their funds from donations over $1,000 and roughly 10 percent of their funds from matched donations under $250. Moreover, that same year, 53 out of a possible 59 elected offices for the city of New York were filled by candidates who used the small-donor matching program. Perhaps most crucially, the program drove up donor participation rates. From 2005 through 2009 (when the matching ratio was raised to 6:1), the number of donors giving $175 or less to a candidate increased by 55 percent even as overall voter turnout fell by nine points, from 33 percent to 26 percent. New York City residents’ rate of donor participation in local elections is more than triple their participation rate in state elections. A difference of this magnitude is best explained by the existence of New York City’s small-donor matching program.

These numbers illustrate the effectiveness of the small-donor matching scheme in terms of increasing voter participation, but they are useless without an understanding of the ways money can influence political outcomes. The reality of our political system—particularly at the local level—is that the candidate who raises the most money often wins. This money does not come from thousands of small donors but often from a few people or organizations who are fortunate enough to be able to give extraordinary sums of money during election cycles. This is not to say that City Council members are corrupt, or that large donors give money with the intent of corrupting politicians. Consider a scenario: a candidate for alderman receives $50,000—one-fifth of his total fundraising haul—from a major special interest. The candidate, as a rule, is aware of the special interest’s policy priorities. When a bill comes to the Council floor that is directly at odds with these priorities, the reality of day-to-day politics tells us that the special interest’s donation inevitably has an effect on the alderman’s vote. When voting “no” risks the loss of a major donor, how could it not? This scenario is, unfortunately, all too common. Obviously, many factors go into an alderman’s decision whether or not to support a bill. But we cannot condone a reality in which money so blatantly steers the ship of state, and we cannot foreclose the possibility of a solution simply because it would be difficult.

There are many fine organizations working toward this positive change in Chicago: Common Cause Illinois (where, full disclosure, I interned this summer), Reclaim Chicago, Illinois PIRG, as well as many others. CCIL is already leading the charge in writing draft legislation and shoring up support from aldermen around the city, but a number of challenges remain. Foremost among them is making sure our aldermen continue to listen us on the issue of campaign finance reform, which includes our own Alderman Leslie Hairston of the 5th Ward. This is why I am organizing on campus this fall in support of the ongoing reform effort. I am confident that a group of smart and motivated students can make a difference in this fight, and I know there are many in the UChicago student community who feel the same way I do.

Small-donor matching in Chicago is a realistic and necessary reform. Activists and advocates across the city have put in countless hours pounding pavement, protesting, canvassing, phone banking, petitioning, and agitating for progress. Unfortunately, the political structure of this city encourages change at a snail’s pace: South Side communities achieved the recent victory regarding the Level 1 Adult Trauma Center twenty-four years after the last center closed. Small-donor matching will lend strength to efforts like this, as it helps foster a more responsive political system. Like all such reforms, this is not a silver bullet. But it will be a powerful boost for local democracy and fair elections in Chicago. It will show the rest of the country that Chicagoans are leaders when it comes to making our politicians work for us. This is a grassroots effort, its power derived from the people and is greater than the sum of its parts. This is a movement open to anyone who cares about a better democracy, a better city, a better nation. Come join us. Come help us practice politics from the ground up.

Office: Common Cause Illinois, Common Cause National

Issues: Money in Politics, Money in Politics

Tags: Empowering Small Donors

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