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Monday, October 20, 2008

$ 150 million worth of speech

The Obama Campaign announced Sunday that it raised $ 150 million in September, an obscene, record-breaking figure that more than doubles the previous record (which was Obama's haul in August). This certainly justifies Obama's decision to opt-out of public financing. What is especially interesting to me is that 3.1 million people have contributed to his campaign, including more than 630,000 new contributors in September. And the average donation was around $ 86. Of course, by definition "average" means there were donations of more than that, including several large fund-raising events, including one hosted by Barbra Streisand that netted $ 11 million.

But I would like to hear how these numbers--donors, new donors, average donation amount--compare with past primary and general elections. And what do these numbers tell us about the debate over campaign-finance rules and public funding? The theory of Buckley v. Valeo (which never has been entirely repudiated) is that making campaign contributions is a First-Amendment protected way of expressing support for a candidate, albeit a right subject to fairly close regulation and limitations in amount (a principle with which I generally agree). The theory of campaign-finance regulation has been that politicians will simply cozy-up to a small number of big-money donors who use large contributions to gain access and influence, resulting in various forms of corruption (indeed, that was the warning from the McCain Campaign in response to the Obama announcement).

But if a campaign can fund itself, at least in part, on smaller contributions from a substantial number of voters looking to do their part and have their say, do we come close (or at least closer) to a First-Amendment regime of "The People" speaking through their pocketbooks to support a candidate, without the same risk of corruption or influence-peddling? I think McCain's criticism misses the mark because the corruption rationale works when a campaign receives $ 2 million from one contributor; it looks very different, and has a different effect, when the campaign receives $ 2 million from 20,000 contributors. The corruption criticism looks out of place when it becomes not a problem with the amounts of money people are able to contribute (which remain restricted), but of the number of people who are able to contribute, particularly in small amounts.

Can what Obama has achieved tell us anything about how candidate fundraising can work, especially with the power of the internet? Is Obama a unique candidate and no (or few) other candidate can generate this kind of excitement and support?

Updated: Tuesday morning

Publius at Obsidian Wings links Obama's expansive fundraising to Madison's theory of republicanism. Recall that Madison argued that the way to limit the power of factions in a republic is to increase the size of the republic and thus the number of factions, preventing any one from seizing control. Similarly, dramatically expanding the size of the donor base, the Obama model (and Publius recognizes, as does one of our commenters, that Howard Dean started us down this road in 2004) prevents any one donor from gaining influence.

Posted by Howard Wasserman on October 20, 2008 at 09:35 AM in Current Affairs, First Amendment | Permalink


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Obama isn't the only example. There was Howard Dean, and on a smaller scale Ron Paul raised around 30-40 million on similarly sized donations.

Posted by: anon | Oct 20, 2008 8:39:26 PM

"This certainly justifies Obama's decision to opt-out of public financing."

That line caught my eye, too. It reminds me of Winston Churchill's alleged conversation ...

Churchill: Madam, would you sleep with me for five million pounds?

Woman: My goodness, Mr. Churchill… Well, I suppose ... we would have to discuss terms, of course ...

Churchill: Would you sleep with me for five pounds?

Woman: Mr. Churchill, what kind of woman do you think I am?!

Churchill: Madam, we’ve already established that. Now we are haggling about the price.

Posted by: Adam | Oct 20, 2008 3:48:21 PM

How well does the system work when a candidate takes in multiple small contributions from the same donors that add up to more than the statutory limit? Since Sen. Obama refuses to release any information on his "small" (under $200) donors, it's impossible for the public or the media to verify his claim that they are indeed, small donors.

That said, IMHO the campaign finance laws are a travesty and if they were all repealed tomorrow, we'd all be better off. Let Obama raise as much money as he wants, from foreign donors, too (so far he's only raised about $63 million from foreign donors, if press reports are to be believed). One could argue that all donations and their source, of any size, ought to be made public; aside from that, I cannot see any public benefit to creating a huge regulatory obstacle to running for office.

Posted by: DBL | Oct 20, 2008 2:23:37 PM

Democrats, the party of the rich.

Posted by: anon | Oct 20, 2008 12:43:25 PM

"This certainly justifies Obama's decision to opt-out of public financing."

Not if promise-breaking is (at least prima facie) unjustified!

Posted by: Chris | Oct 20, 2008 11:09:13 AM

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