[EL] 2nd try/Relationship between Contribution limits and third party expenditures

[Trevor Potter]

The amount of "outside money" in 527s, c4s etc in the elections immediately following McCain Feingold did not increase  to equal the soft money that had previously been given to parties. That may in part prove the reformers argument that some (much?) of this money was given under the duress of solicitations by federal officeholders, and that corporations were happy to be able to say no ( as business groups like the Committee for Economic Development argued).

Further, the successful fundraising of hard money ( limited individual contributions) by party committees post McCain-Feingold Meant that the National committees raised more money in aggregate after the Act than before, so the "displaced funds" concept may have not existed in those circumstances. 

Trevor Potter

Sent from my iPad

On Dec 14, 2012, at 7:42 AM, "David A. Schultz" <dschultz at gw.hamline.edu> wrote:

> David:
> 
> Assuming the water balloon analogy is correct that squeezing in one place shifts the money elsewhere, your argument is probably accurate.  But there may be an asymmetry here.  Lowering contribution limits may lead to increased independent expenditures but I am not sure that increasing contribution limits decreases independent expenditures.  Increasing contribution limits may simply increase options and opportunities to spend more money or for third parties to expend.
> 
> Additionally, Laura Brod (former MN legislator and friend) argues that money to candidates is more accountable than third party spending.  Maybe.  However, does it not come with a tradeoff in terms of more potential special interest money going to candidates?   Other thoughts to follow or do others wish to chime in?
> 
> 
> David Schultz, Professor
> Editor, Journal of Public Affairs Education (JPAE)
> Hamline University
> School of Business
> 570 Asbury Street
> Suite 308
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> 
> >>> David Mason 12/14/12 8:16 AM >>>
> I suspect you are not going to find studies of the sort you are asking about because I doubt there many examples sufficiently isolated to these facts to study and because looking at reported Independent Expenditures is too narrow a lens.
>  
> What we do know for certain is that the inverse is true: when McCain Feingold limited contributions to parties (by banning soft money), all sorts of independent 527, c4, and Super PAC entities that had not previously existed arose.  A lot of this happened before Citizens United: that changed some rules but not the dynamic.
>  
> While most of these groups' expenditures were not Independent Expenditures, they were surely political: lots of voter ID, GOTV, and, before 2012, non-express advocacy advertising.
>  
> This demonstrates what everyone ought to understand: when you limit options by legal fiat, buyers will choose the next best available substitute.
>  
> I suppose you could look to economic literature on price controls to see all sorts of examples.
>  
> Dave Mason
> 
> On Fri, Dec 14, 2012 at 8:57 AM, David A. Schultz <dschultz at gw.hamline.edu> wrote:
> Since I received no responses on my previous query, let me try it again.
> 
> I am curious to whether there are any studies examining the relationship between contribution limits and third party independent expenditures.  Specifically, is there evidence that in cases where contribution limits to candidates are higher there is less third party spending?  Framed another way, I see some arguing that if we increase contribution limits to candidates it will channel spending away from independent expenditures and toward candidates instead.  Thus the case for raising contribution limits to candidates is seen as a means of reducing third party spending or at least redirecting it candidates.
> 
> Is anyone willing to comment on this or direct me to any studies that support these claims?
> 
> Here is my original post.
> 
> Thank you.
> 
> Let me pose a question in terms of a hypothesis.
> 
> Raising contribution limits to candidates for office lessens the impact that third party (independent spending) has on campaigns.
> 
> Conversely,
> 
> By raising contribution limits to candidates it decreases the amount of spending by third parties.
> 
> Does anyone have evidence or research that tests these or a similarly related hypothesis.
> 
> Thank you.
> 
> David Schultz, Professor
> Editor, Journal of Public Affairs Education (JPAE)
> Hamline University
> School of Business
> 570 Asbury Street
> Suite 308
> St. Paul, Minnesota 55104
> 651.523.2858 (voice)
> 651.523.3098 (fax)
> http://davidschultz.efoliomn.com/
> http://works.bepress.com/david_schultz/
> http://schultzstake.blogspot.com/
> Twitter: @ProfDSchultz
> Named one of the inaugural 2012 FacultyRow SuperProfessors
> 
> 
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