Facing the most severe budget crisis in state history, New York governor David Paterson has wagered his political future on a dubious idea: that voters will think its wise to funnel millions of taxpayer dollars into the campaigns of scandal-ridden politicians. In Wednesdays State of the State address, Paterson announced an extremely broad political reform package. The laundry list includes a new, all-powerful ethics oversight commission; expanded reporting of outside income for lawmakers; a constitutional amendment enacting term limits; reducing the maximum individual campaign contribution by 97 percent, with even greater reductions on campaign contributions by lobbyists; a ban on contributions by any corporation or limited liability partnership; a prohibition on bundling campaign contributions (that is, delivering multiple individual contributions from one source, such as a company or advocacy group, to the campaign at one time, to emphasize the source and reason for the support); new regulations for the state comptrollers office; and an increase in civil fines for campaign-finance violations of up to 250 percent, plus the criminalization of some violations.
Above all, Patersons package would institute taxpayer funding of political campaignsincreasing bureaucratic control over what should be a fundamentally nongovernmental activity. Private political activity is protected by the First Amendment and should be encouraged, not regulated. Yet self-styled reform groups, including Common Cause and NYPIRG, are gushing over Patersons proposal, seeing it as a way to prevent future corruption and citing former state senate majority leader Joseph Brunos bribery, former governor Eliot Spitzers prostitutes, and former comptroller Alan Hevesis misuse of state employees for personal services.
Brunos case shows how misguided this outlook is. Bruno was recently convicted of fraud for concealing payments for outside work that hed received from business interests seeking legislative favors. His ethical violations, that is, consisted of good old-fashioned bribery. The public surely deserves to know if state pols are on the payrolls of people seeking government contracts or benefits; a reasonable requirement to disclose that information makes sense, and in fact thats where the state legislature was headed. But Paterson risks sabotaging that reasonable measure with his instantly controversial manifesto of political-speech rules, which would regulate not the politicians themselves but the ability of ordinary New Yorkers to participate in the political system. (Spitzers cavorting with prostitutes, of course, is unconnected to any such legal reform, and Hevesis conduct was also a violation of existing law, explaining why he is no longer state comptroller.)
One cant help but note that the governors proposals have political implications that just happen to benefit him. Limiting the amounts that citizens can contribute to campaigns tends to insulate incumbents from political criticism, which is often expressed when like-minded citizens associate with each other in business groups, unions, and advocacy organizations to lobby and contribute to their preferred parties and candidates. For Paterson, whose fund-raising has been anemic, having the state take over funding of campaigns could also have obvious political benefits in future runs for governor.
Without seeing the details, it is hard to tell if Patersons taxpayer-financing proposal is unconstitutional or merely bad policy. His fact sheet describes a 4:1 public matching system with enhancements to encourage participation. In a 2008 decision, Davis v. Federal Election Commission, the U.S. Supreme Court struck down a federal law based on the leveling the playing field rationale. Since then, federal judges in Connecticut and Arizona have held that enhancements, aimed at equalizing candidates financial resources, violate the First Amendment.
But even if Patersons proposal passes the constitutional bar, taxpayer-financing systems in other states have a lousy history. Last month, the Phoenix New Times, Arizonas leading alternative liberal newspaper, declared the states taxpayer-financing system one of the worst ideas of the decade. Far from getting rid of corruption, the system provides new ways to abuse the taxpayer; for example, Arizona candidates have colluded to obtain taxpayer funding for third-party candidates to undermine their major-party challengers. In Connecticut last year, State Senator Joseph Crisco was fined for, in the words of the New Haven Register, breaking almost every conceivable part of the public campaign finance law in a failed attempt to get $85,000 in public money.
Does public financing make politicians less dependent on private interest groups? Apparently not. Preliminary research conducted by the Center for Competitive Politics (CCP) in Connecticut following the states adoption of taxpayer financing in 2008 shows that lawmakers voted with interest groups in virtually the same patterns as before. In fact, since the advent of so-called clean elections, some powerful interest groups, such as the Connecticut Business and Industry Association, have enjoyed greater legislative support for their agendas. Studies by the CCP also found that New Jerseys taxpayer-financing system didnt make candidates any less reliant on organized interest groups, which they now needed to help raise qualifying funds for the taxpayer funding, as well as to engage in get-out-the-vote efforts. (New Jersey has since abandoned the public-financing scheme.)
Similarly, in Arizona, research by the Goldwater Institute found that former governor Janet Napolitano and other candidates relied on interest groups and unions to provide the qualifying contributions for taxpayer subsidies. Other CCP research has shown that taxpayer-financing programs also fail in their goals of producing more lawmakers with diverse backgrounds and increasing the number of female lawmakers. The only measurable success, if one can call it that, is the percentage of candidates, mostly incumbents, who agree to take free taxpayer money. These programs do not reform our system of representative democracy; they hand over the keys of the treasury to candidates.
Not every idea in Patersons grab bag is wrongheaded. But considering that his own advisors cant seem to comply with current lobbying regulationsadvisor and lobbying-firm head Bill Lynch was recently fined $10,000 for not complying with filing requirementsthe governors proposal to add multiple layers of regulation to the states campaign-finance, lobbying, and ethics regulations deserves the strictest scrutiny.