As the upcoming elections draw closer, let me make three predictions that I personally guarantee. First, they will set a record as being the most expensive ever, even accounting for inflation. Second, all the usual do-gooders and reformers will complain that this money undermines “democracy” and something must be done. Third, all efforts to curtail lavish spending (e.g., limits on individual contributions, public funding of presidential elections, transparency of donations, etc.) will fail, just as before.
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This hand-wringing about evil money sidesteps the reasons for the increase. Contrary to what reformers insist, soaring spending is not about an epidemic of donor greed to subvert some “public good.” The sharp increase is about expanding government power — big, fat government itself, not nefarious contributors, is the culprit. In a nutshell, heightened generosity reflects Washington’s growing intrusion into every corner of our lives. Big-money donations are largely defensive. Nobody gives millions unless necessary, and if government can issue a few rules that might devastate your business, out comes the checkbook, and the greater this potential impact, the greater the generosity.
It is no accident that the upturn in campaign donations almost exactly parallels the explosion of Washington’s meddling that began in the 1960s and now seems unstoppable. Indeed, savvy office-holders have long known that the most efficient way to boost campaign donations is to propose an odious regulation. By necessity, the targeted industry will respond by hiring more lobbyists, who will then guide campaign donations so as to defeat the proposed rule. And with the Sword of Damocles always there, the contributions become routine. Accusations of shakedowns aside, everything is perfectly legal and absolutely immune to “anti-corruption” measures.
Consider Washington’s commitment to providing health care, a policy area that until the mid-1960s was almost entirely a state government function. Today, of course, health care is one of Washington’s primary missions, and with hundreds of billions to spend and countless regulations to promulgate, law-making resembles feeding at the aquarium’s shark tank. From doctors and hospitals, from medical device manufactures to insurance companies, from malpractice lawyers to nursing home operators, from charities to Big Pharma, dozens of distinct constituencies proliferate with a stake in the final outcome. This is pay-to-play politics on steroids. Even the slightest rule-change regarding, say, doctor’s fees under Medicare can justify millions in campaign contributions.
The poster child here is Walmart, a business that once eschewed political involvement since, as Walmart’s people naïvely believed, who could complain about just selling cheap, humdrum stuff? They soon discovered otherwise. Walmart may not have been interested in Washington, but Washington was very much interested in Walmart. Between 1998 and 2011, their lobbying expenditures went from nearly zero to $11 million. A parallel huge increase occurred in campaign spending. Walmart’s newly discovered political interests include unionization, employee health insurance, duties on Chinese imports, laws dealing with sexual discrimination, and the employment of illegal workers, among other once strictly internal corporate matters. Countless other businesses, including higher education, have received identical wake-up calls, so be proactive and pay in advance. Build an ambitious federal bureaucracy, and the campaign contributions will come.
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