Giving the two parties even more money will not solve polarization

Last December, as part of the must-pass "CRomnibus" bill, Congress changed the law so that political parties could raise considerably more money. Under the new rules, a single donor can now give $1.5 million to the parties during a two-year election cycle.

Good government groups were predictably upset. But another group of observers had a different view: In their view, political parties may not be perfect, but the alternative to strong political parties is extremism and chaos. They argued that you can't get money out of politics. But you can channel it. And if you want moderation, political parties are the best channel.

Two of the leading advocates of this view, Raymond J. La Raja and Brian F. Schaffner of the University of Massachusetts Amherst, now have a new book, Campaign Finance and Political Polarization: When Purists Prevail, which makes the strongest and most extended case yet for allowing political parties to control more money. "Our argument" they write, "is that financially strong party organizations should reduce party polarization." They're also skeptical about small donors, which they dismiss as polarizing.

My colleague Mark Schmitt has written the definitive overview of the reform skeptic movement, a larger group of mostly academics (which include La Raja and Schaffner) who, as Schmitt explains, offer a "challenge to many of the assumptions and unexamined verities of those who aspire to reform the American political process."

What follows here is a more targeted discussion of two specific debates this new book raises: about the value of empowering political parties, as well as its skepticism of empowering small donors. Although the small-donor critique is a side point of the book, it's an important critique to address, given the full-fledged push by many campaign reformers into small-donor experiments.

Here's the quick summary of my take: Stronger parties will not move to the center because there are both few meaningful opportunities to move to the center and little meaningful center to move toward. The median voter theory on which they stake so much simply does not operate under our current political rules. The claim that small donors are polarizing reflects a failure to understand how a small-donor matching system would change the incentives of running for office and of giving.

And while I disagree with the conclusions La Raja and Schaffner reach, I happily recommend their book. It's clearly written, full of data, and provocative. And I do agree with their implicit criticism that reformers often fail to investigate their assumptions and as a result develop overly simplistic and counterproductive models of the world, often in a too simple corruption framework.

The case for strengthening parties with more money

La Raja and Schaffner argue that two factions are battling for the soul of our two political parties: the "purists" and the "pragmatists."

The purists are ideologically motivated. They are in politics because they believe in principles and ideas. They prefer extremism to compromise, and would rather lose elections than be forced to concede any of their principles.

The pragmatists, by contrast, are in it for the power. Above all, they want to win elections. In La Raja and Schaffner's telling, the pragmatists are the heroes: "Because party insiders are chiefly interested in winning elections," they write (emphasis mine), "their priority is to invest in candidates who will be most competitive in general elections — candidates whose views are closest to the median voter."

La Raja and Schaffner argue that our current political polarization is a consequence of the purist outsiders prevailing over pragmatist insiders. And — here's the crux of their book — campaign finance laws are to blame: Reformers mistakenly thought they could get money out of politics by placing limits and other regulations on the flows of campaign money to and from parties.

But money has continued to flow. It just flowed elsewhere — to purist outsider factions and candidates who play by their own rules. According to When Purists Prevail, the rise of extremist outsiders is the unintended consequence of various limits reforms have placed on flows inside and outside the party.

If this explanation is correct, it suggests we should reempower the pragmatists by allowing party insiders to control larger pots of money, which they can then use to discipline outsiders, run more moderate candidates, and push back against the centripetal forces that are pulling our political system apart.

To this end, La Raja and Schaffner recommend removing limits on contributions to parties (or at least significantly raising them), and removing restrictions on the ability of parties to fund candidates.

La Raja and Schaffner extensively analyze state-level data going back to 1990, drawing on variation among state-level campaign finance regimes. They show that parties are more likely than outside groups or individual donors to support moderate candidates, and moderates disproportionately benefit from party funding. This makes sense, since to the extent that moderates do run, they are most likely to run in contested and therefore expensive seats, where party money could help most.

La Raja and Schaffner then try to make the case that legislatures that allow unlimited party fundraising and contributions are less polarized, and then try to argue that this would generalize to the US Congress.

I've already quibbled with them about their data analysis, and remain unconvinced that campaign finance laws explain observed variation in state-level polarization. I won't rehash that debate here. But, bigger picture: Given the many large-scale forces that have contributed to polarization (among the most prominent: geographical sorting, nationalization of politics, and increased party voting discipline, among many others), it would take a lot for campaign finance laws to offer much explanatory purchase.

The case against empowering parties with more money

For parties to act as moderating, centripetal forces, three things ought to be true:

1. There are enough competitive districts for more party money to make a difference.
2. There are incentives for the parties to move to the middle (i.e., the median voter theory actually works).
3. Party leaders view running moderates as their preferred electoral strategy, and would therefore see this as the best use of additional resources.

But before explaining the problems with assumptions, let's first put up a few basic facts about campaign spending.

In the 2014 election, the Democratic Congressional Campaign Committee spent $69 million, and the Democratic Congressional Senatorial Committee spent $60 million. The National Republican Congressional Committee spent $65 million, and the Republican Senatorial Committee spent $46 million. These are big numbers, certainly enough to support all candidates in the limited number of contested elections. Even the "outside" Super PACs are basically just party committees by another name. American Crossroads/Crossroads GPS spent $48 million on the 2014 election. But this is not an outside group. It's run by Karl Rove and other party insiders, as are most of the other leading super PACs and 501c "outside groups."

As Thomas Mann and Anthony Corrado point out in a recent Brookings paper "Party Polarization and Campaign Finance," the role of parties as dominant vehicles of campaign finance have grown considerably over the past few decades, just as polarization increased. In an earlier era in which candidate funding was dominant, there was considerably less polarization. As Mann and Corrado write (and I quote at length, because it such an important point):

It would be a mistake to characterize parties as weakened players in national elections. While it is certainly the case that the changing regulatory fabric and tactical choices of organized groups has led to an environment in which formal party committees are not the sole or even dominant financial participant outside of the candidates involved in a race, they have never been as effective in the financing of election campaigns as they are today.

To contend that parties have been marginalized or that their role in contemporary elections is diminishing as a result of the rise of Super PACs and other non-party organizations is to view "the party" simply as the formal party committees, rather than as a networked amalgamation of diverse organizations with common electoral goals and shared ideological predispositions. Congressional party leaders are all champion fundraisers on behalf of their parties.

The four congressional party committees play a unique and consequential role in targeting key races, steering a massive redistribution of funds from their mostly safe incumbents to these more competitive races, raising substantial sums from small and large donors to boost their candidates in those races, and developing party strategies as part of the leadership team.

So parties are doing just fine.

Yet despite controlling all this money, party organizations are not using it to get involved in primaries, not even to support moderates. Robert Boatright, Michael Malbin, and Brendan Glavin have analyzed the data. Parties are spending all of their money on general elections, with only a few tiny exceptions. If parties were forces of moderation, you'd expect to see them supporting moderate candidates in primaries, to move the party to the middle. Yet they aren't.

To understand why parties have not used their money to push moderates, and why they're not likely to do so even if they have more money, let's now turn to the three faulty assumptions and what's wrong with them.

There aren't enough competitive races to make a difference

La Raja and Schaffner's most consistent argument for giving more money to parties is that parties would use the money to support more moderate candidates in competitive elections.

But there's a problem: There aren't that many competitive elections.

Graphic by Lee Drutman, data source: FairVote

In the last two US House elections, just one in 20 seats were really close (with a margin of victory of less than 5 percent between the two major parties), and just about one in six had a margin of victory of 15 percent or less. Again, parties already invest considerable sums in these races.

The Senate's not much better. Of 34 seats up for election in 2014, only five are Cook Political Report toss-ups, and only four are in the "lean" category (as of the October 5 ratings). The majority (19) are solid and not competitive at all.

La Raja and Schaffner argue that if parties had more money, they might try to contest more races. This seems unlikely. Most of these seats are just not contestable, and no amount of money is going to make them so. Democrats and Republicans have more and more become regional parties. Their voters live in separate places. Democrats predominantly live in urban areas; Republicans mostly dominate rural and suburban areas. As a result, a large number of single-member House districts are going to be dominated by one party or the other — no matter how the lines get drawn.

This is also true in state elections. Consider the recent state legislative election in Virginia, in which 122 out of 122 incumbents (100 percent) were reelected. Only a handful of seats were anywhere near close. Virginia is far from unique. There are just very few competitive races. Barely half of state legislative seats are even contested, and the numbers continue to fall.

Absent many competitive races, there's very little pressure for party insiders to run enough moderates to meaningfully move the parties to the center.

The "median voter theorem" doesn't work in today's politics

But even if we had more competitive districts, evidence suggests this would not produce more moderate candidates. New research by political scientists Anthony Fowler and Andrew B. Hall suggests that partisans who win in close congressional elections vote just as extremely as partisans who win by landslides. Fowler and Hall conclude, "Elected officials do not adapt their roll-call voting to their districts' preferences over time, and ... voters do not systematically respond by replacing incumbents." Political scientists Stephen Ansolabehere, James M. Snyder, and Charles Stewart reached similar conclusions going from 1996 back to 1874: Competitive districts exert only a minor and occasional moderating pull on candidates. Political scientists Thomas Brunell and Bernard Grofman have also reached the same conclusion. Political scientists Jacob Hacker and Paul Pierson have described the median voter theory as a failure in a recent paper criticizing the "Downsian" paradigm (Anthony Downs popularized the median voter theory).

Median voter expectations are especially unlikely today because over the past several elections, the number of potential swing median voters has continued to decline to pretty much zero. As political scientist Corwin D. Smidt argues in a new paper documenting disappearing "floating" (swing) voter over the past few decades:

Candidates have little need to appeal to the moderate or pragmatic concerns of the few remaining floating voters. For those states where one party has an advantage, greater stability enhances the dominant party's certainty of winning and reduces its need to appeal to moderates or floating voters. But even if stalwart supporters are evenly matched, and floating voters are potentially decisive, the predictability of support among likely nonvoters may make a mobilization strategy more appealing. Candidate efforts to persuade and win over a small group of floating voters are costly and provide uncertain payoffs.

In choosing candidates, parties might face a trade-off. On the one hand, they want to run moderate candidates who could win over potential swing voters. On the other hand, they want to make sure that their most reliable voters get engaged in volunteering and voting. And picking a candidate who is too moderate risks alienating their most loyal supporters. But with so few voters up for grabs, that trade-off has vanished. There's little to be gained by running moderates and plenty to lose in terms of turnout.

Analysts sometimes still do get confused because many voters self-identify as moderate. However, as Vox's Ezra Klein has explained, summarizing research by political scientist David Broockman, "When you dig into their policy positions, the people who show up as moderates in polls are actually pretty damn extreme." Similarly, research by political scientists Edward G. Carmines, Michael J. Ensley, and Michael W. Wagner also finds there is no moderate center. Most "moderate" voters tend to be low-information voters, who vote at significantly lower rates than partisans and have political beliefs that don't fit the two parties. Moreover, as low-information voters, they are the most likely to be misled by advertising. Party leaders know they can influence low-information moderates more by running ads than by selecting true moderates. And this is exactly what they do.

More party money would just make politics nastier

Mitch McConnell, the Republican Senate majority leader, seems like a pretty good example of the kind of pragmatic insider that La Raja and Schaffner want to empower.

But look at how McConnell has operated in the Senate. Rather than working with Democrats and trying to move his party to the middle to win over moderate voters, he did everything in his power to gunk up the Senate and make Obama and the Democrats look bad. He did so because he thought destroying the Democratic brand was the most effective way to win elections.

In our current era, in which neither of the two parties is dominant, politics has become more zero-sum and nastier, as political scientist Frances Lee has convincingly argued. With control of the Senate within reach, McConnell clearly saw more gains in obstructing Democrats than in moving to the center. This is how the pragmatists now operate. They spend most of their efforts and resources trying to make the other party look terrible. Give the parties more money to spend, and they'll just spend it making the case against the other party through even more negative advertising. Politics will just get nastier.

The debate over small donors

The second front in the political reform debate is over small donors.

For a long time, political reform groups sought full public funding of elections, a.k.a. "clean elections." Now the favored reform (which I support) is to enact systems that support small donors. These systems are often referred to as "citizen-funded."

The leading exemplar here is New York City's system, which provides $6 in public funding for every $1 in small donations. In the US House, Rep. John Sarbanes (D-MD) has 160 co-sponsors for the Government by the People Act, which would establish a national version of a 6-to-1 public match for small-donor contributions, plus a small-donor tax credit. We also now have an experiment in Seattle that just approved a system in which residents each get four $25 vouchers to support their favored candidates.

The cold water that reform skeptics like to throw on the small-donor approach is that small donors are ideologically polarized. Therefore, they argue, any reform that empowers small donors will ensure polarized candidates. As Schaffner tweeted during the recent Democratic debate:

Just so we all remember that small donors have preferences that are just as immoderate as large donors #DemDebate pic.twitter.com/enchW5FYql

— Brian Schaffner (@b_schaffner) November 15, 2015

In the story that La Raja and Schaffner tell, the best hope of moving politics to the middle is to empower party pragmatists, who can collect money from ideological donors and then transfer it to moderates.

But when interpreting these distributions of ideology, it's important to keep two facts in mind.

First, almost all individual donors are partisans, which means they are going to give to one party or the other.

Second, donors can only give to candidates who are running. Since most candidates are noncentrist, most individual donors are going to appear noncentrist. If small donors appear polarized, it's because they are mostly responding to candidates who have already passed the large donor and corporate PAC gatekeeping filter that operates in most elections.

And, yes, as Michael Barber has shown in a recent paper, more moderate candidates tend to get more money from PACs, while more extreme candidates get more money from individuals. This is because most PACs are corporate PACs, and businesses generally prefer moderate candidates, since they tend to be the most pro-business. They also overwhelmingly support incumbents, since they are access-oriented above all.

If we wanted to create a political system that maximized pro-business centrism and incumbency, we could move to a campaign finance system that gave PACs a larger role. But this would be a disastrously nonrepresentative system of government, in which business interests would have excessive influence. It's hardly a solution.

One thing we do know from the New York City public matching system is that it brought in more diverse donors. As Michael Malbin, Peter Brusoe, and Brendan Galvin explain in an analysis of the New York City small-donor program:

There can be little doubt that bringing more small donors into the system in New York City equates to a greater diversity in neighborhood experience in the donor pool. Increasing the number of small donors has been more than a means to dilute the power of the major givers. It has also led candidates to reach out to and engage a more representative set of constituents as they raise their campaign funds.

A small-donor matching system could bring in different kinds of candidates, particularly if such a system privileged in-district, constituent donations. Such a system could connect candidates more closely with their constituents, as opposed to the partisan national fundraising operations. This could stimulate more of the regional issue diversity that used to exist in Congress and provided an alternative dimension on which to compromise. It may even reduce polarization. Likely, it would bring some new ideas into Congress. In a new and impressively exhaustive summary of the research on citizen-funded elections, Malbin notes that there is solid evidence for the claim that citizen-funded elections draw more and more diverse candidates into running for office.

But even if small donors are just as polarized as large donors, we would be no worse under a system that privileges small donors. And given quite legitimate concerns about large donors seeking and gaining access, as well as the benefits of small-donor systems engaging a more diverse and representative pool of voters, there's a strong small-d democratic case for moving to a small-donor system.

And while, yes, moving to a small-donor system would be an experiment, we've already done the experiment where large individual donors and corporate PACs account for the vast majority of funding, effectively playing the role of political gatekeepers. We've also already experimented with a system in which the parties control vast sums of money. And that system looks very polarized. Doubling down on it doesn't seem like a great idea.

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