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Analysis

How Citizens United Changed Politics and Shaped the Tax Bill

The real impact of an unregulated campaign finance is on policy, and the proof is in this year’s tax bill.

December 14, 2017

As Congress is poised to push through a histor­ic­ally unpop­u­lar tax bill, it’s worth revis­it­ing a piece by our colleague Daniel Weiner, noting the forth­right­ness with which members of Congress have made clear that donors have been driv­ing this process. A cynical public has long believed that “candid­ates who win public office promote policies that directly help the people and groups who donated money to their campaigns,” but rarely have we seen both office­hold­ers and donors them­selves state this so openly. It’s worth asking: Has some­thing changed? We think so. But first, let’s look at some of those state­ments.

On the office­holder side, to take but one example, Rep. Chris Collins (R-NY) told the Hill news­pa­per, “My donors are basic­ally saying, ‘Get it done or don’t ever call me again.’” And Steven Law, pres­id­ent of the Senate Lead­er­ship Fund and former chief of staff to Major­ity Leader Sen. Mitch McCon­nell noted “[Donors] would be morti­fied if we didn’t live up to what we’ve commit­ted to on tax reform.”

Perhaps even more strik­ing is the brazen­ness with which donors them­selves are admit­ting they have threatened members of Congress. Conser­vat­ive donor Doug Deason of Texas expli­citly said the “Dallas piggy bank” was closed until tax and health bills were passed. “Get Obama­care repealed and replaced, get tax reform passed…You control the Senate. You control the House. You have the pres­id­ency. There’s no reason you can’t get this done. Get it done and we’ll open it back up,” Deason told Repub­lican lead­ers.

Deason refused to host fundraisers for Rep. Mark Mead­ows (R-NC) and Rep. Jim Jordan (R-OH). “I said, ‘No I’m not going to because we’re clos­ing the check­book until you get some things done.’”

One outside spend­ing group showed members of Congress poten­tial ads they might run in their districts depend­ing on how tax reform proceeds on Capitol Hill. One uniden­ti­fied House Repub­lican told Huff­Post: “Like a teacher show­ing the kids a paddle on the first day of class, the blatant implic­a­tion was that those who misbe­haved would be spanked.”

So what’s going on? We have a theory, and it relates to that most famous of Supreme Court campaign finance cases, Citizens United, decided in 2010. When people talk about Citizens United – which allowed unlim­ited “inde­pend­ent” spend­ing in elec­tions and indir­ectly led to now infam­ous super PACs they often talk about how it has opened the floodgates to massive amounts of money in our polit­ics. This is a miscon­cep­tion. In fact, while the amount of money spent in federal elec­tions since Citizens United has increased, the increase has not been partic­u­larly dramatic.

What has been dramatic is the change in who funds elec­tions. Increas­ingly our elec­tions are financed by just a hand­ful of donors who make multi­mil­lion dollar contri­bu­tions to support candid­ates for federal office. In 2010, the top 100 indi­vidual donors contrib­uted just of $73 million to federal candid­ates, parties, and other commit­tees, includ­ing super PACs. In 2012, that number increased to $380 million, and by 2016, it reached over $900 million.

All of this means that a few donors matter much more than they used to, and those donors can make threats that genu­inely terrify members of Congress. Whereas before Citizens United donors of $100,000 or more could make up as little as 5 percent of all indi­vidual contri­bu­tions in federal elec­tions, after Citizens United they could repres­ent as much as one in four dollars. That’s power!

The very real threat for members of Congress is that if they don’t get tax reform done, they may face heav­ily financed chal­lengers in primary races. Vice Pres­id­ent Mike Pence’s chief of staff made clear he under­stood the power of such threats when he told donors they should recon­sider their contri­bu­tions in the event the tax bill fails. “[I]f I were you, I would not only stop donat­ing, I would form a coali­tion of all the other major donors, and just say two things. We’re defin­itely not giving to you, No. 1. And No. 2, if you don’t have this done by Dec. 31, we’re going out, we’re recruit­ing oppon­ents, we’re maxing out to their campaigns, and we’re fund­ing super PACs to defeat all of you.”

In recent years, as the Supreme Court has dismantled the nation’s campaign finance laws, it’s become fash­ion­able in some quar­ters to argue that money in polit­ics does­n’t matter because it does­n’t drive elect­oral outcomes – that is, the actual outcomes of elec­tions hasn’t really been changed by the huge influx of post-Citizens United big spend­ers. Last year’s elec­tion, which saw Sanders and Trump soar, despite rais­ing far less money than their oppon­ents, led to even more hand­wringing – with some arguing that “campaign money in 2016 has become mean­ing­less.”

We’ve stated before that we find these analyses uncon­vin­cing. Candid­ates for federal office need a minimum amount of money to run compet­it­ive campaigns, even if they don’t need the most money of all candid­ates to win. And when members of Congress get used to rais­ing money from just a few people, they give those people enorm­ous power. The real impact of an unreg­u­lated campaign finance is on policy, and the proof is in this year’s tax bill.

(Photo: Think­stock)