8
Does money buy elections?
Mitt Romney has spent big in his quest to become president. But how much does campaign spending matter in an election?
To view this content, Javascript must be enabled and Adobe Flash Player must be installed.
Kai Ryssdal: So it's done: the New Hampshire primary. Mitt Romney had it wrapped up pretty early last night. So all the who got how many votes and what it all means in the grand political scheme of things has been done to death by now.
So we're not gonna. We're gonna do the story our way. Campaign finance a la Freakonomics, our once every couple of weeks chat with Stephen Dubner, the co-author of the books and the blog of the same name. It's all about the hidden side of everything. Hey Dubner, welcome back.
Stephen Dubner: Hey Kai, thanks for having me. So we're all widely surprised that Mitt Romney won big last night, aren't we?
Ryssdal: Yes, widely surprised.
Dubner: And it's just as obvious why Romney's been winning, right? At least if we listen to his rivals. Here's Newt Gingrich, who came in a distant fourth place last night.
Ryssdal: All right.
Newt Gingrich: Now we got to go back and, uh, figure out how you run in an environment where you clearly have two guys who are gonna say things that aren't honest and who are going to spend millions of dollars doing so.
Dubner: And here's Rick Santorum, who finished fifth in New Hampshire:
Rick Santorum: I'm a little behind the curve in the sense that Gov. Romney has been spending a lot of money.
Ryssdal: Well, it's not like they're wrong, right Dubner? I mean, Romney does have deep pockets. And just today, his campaign said, 'We've raised almost $24 million in the last three months, in the last quarter.'
Dubner: That's right. And so that makes more than $50 million for 2011. And in previous campaigns that he's run for senator, governor, and president, Romney's spent $54 million of his own money. But you know who else put a lot of money into their campaigns? Let me give you a few lovely names: Steve Forbes, Linda McMahon, Meg Whitman. And you know what? None of them won anything, did they?
Ryssdal: OK. So this is the hidden side of everything part? Is that where we're going here?
Dubner: This is the hidden side of everything. Here's what I want to tell you today Kai: money does not buy elections. At least nowhere near what we've been told. Here's Steve Levitt, my Freakonomics co-author. He once conducted a study of Congressional elections, where he tried to isolate the effect of campaign spending from all the other factors:
Steve Levitt: When a candidate doubled their spending, holding everything else constant, they only got an extra 1 percent of the popular vote. It's the same if you cut your spending in half, you only lose 1 percent of the popular vote. So we're talking about really, really large swings in campaign spending with almost trivial changes in the vote.
Ryssdal: All right. Here's the thing: Steve Levitt, very nice guy, knowledgeable economist. Sadly though, I don't believe him. Because if you look, it's always the guy with the most money who wins.
Dubner: You are right. It is almost always the guy with the most money who wins. That is what we know as correlation without cause. So let me explain. When it's raining out, everybody's got an umbrella. And we know that. But you know what, the umbrellas don't cause the rain. We know that, too. Here's the thing: Winning an election, raising money do go together. But it doesn't seem as though money actually causes the winning either. It's just that the kind of candidate who's attractive to voters also ends up, along the way, attracting a lot of money. And the losing candidate, nobody wants to give money to that guy.
Ryssdal: Right. It makes sense, but what happens when you tell politicians this. This can't be a message that they want to hear, right?
Dubner: Yeah. No politicians going to step forward and say: 'Please don't send me you money. I don't want it. I will not use it.' Look, campaign fundraising has become an arms race, and as is any arms race, the first casualty is logic. Right? But let's look past New Hampshire back to Iowa last week. Here's some good evidence for these politicians. Rick Perry spent $4.3 million on advertising there, which is nearly triple what Romney spent -- and he got 10 percent of the vote. Rick Santorum, on the other hand, spent only $30,000 for ads in Iowa, and he lost to Romney by just eight votes. So much for the money argument.
Ryssdal: All right. So far this is a lot of you talking about politicians and money. Did you actually talk to any politicians about money?
Dubner: Well, do you think they're actually going to come out and say, 'Oh I don't need the money.' Well...
Ryssdal: All right. Fair point.
Dubner: I did find one former politician, at least he says he's former. You remember Rudy Giuliani I gather, yeah?
Ryssdal: I do. Twice the mayor of New York City, and for like five minutes in 2008 the frontrunner.
Dubner: That's right. Well I asked him if money buys elections:
Rudy Giuliani: Campaign spending doesn't mean anything because you can spend it incorrectly. I have lost an election by spending it wrong. I won an election, my first election that I won, I won when I was outspent in a Republican primary. We can see recently in Mike Bloomberg's election. Mike Bloomberg spent $100 million! And he won by 4 percent!
So I asked Giuliani what advice he would give to candidates:
Giuliani: I tell candidates, it's always better to be the candidate with the most money, but you can win without it.
Ryssdal: To finish the sentence, it's better to be the candidate with the most money because that means you're the most popular, right? People like you the best.
Dubner: It's exactly right. It's like saying it's better to be the radio show host with the most money. But really what you want to be is the most popular
Ryssdal: Sometimes that goes together. I don't know.
Dubner: Sometimes it does. Sometimes it does.
Ryssdal: Stephen Dubner, Freakonomics.com is the website. He's back in a couple of weeks. Dubner, we'll see you.
Dubner: Thanks, Kai.
Another major error in this radically-cute, yet flawed analysis is that to discuss the utility of capital in a popularity contest, one would need to analyze candidate's rise in popularity over time vis a vis capital. When and how, direct or indirect the capital flow, we'd all be shocked to learn that to be President doesn't entail becoming a wildly speculated-on commodity. A candidate is pushed upward through repeat investment by ever-larger groups of people at varying stages from education, job placement, promotions, faith alignments, and so forth. I love Marketplace, and enjoyed the segment, but would expect more caveats on the air so that people don't spout this nonsense at the water cooler without sufficient preamble.
Wow, is it me, or does it seem like Dubner and Levitt are just phoning it in? The "analysis" of this issue was barely superficial. The more interesting question laid bare was: what is the threshold of money required for candidates to mount an election bid? Yes, yes, we know that he who hath the most does not necessarily win, thank you Mr. Guiliani. However, he who hath least NEVER wins (see Nader, Ron Paul, Mike Huckabee, Teddy Roosevelt). Seems like there is an intriguing proposition to explore there, because the implication is that there is some upper bound, whereby no additional money leads to additional results (perhaps a "diminishing marginal utility" in economics parlance), and a lower bound, which is the price of admission.
But, that would actually involve real work, thought, thinking, exercising logic, dare I say some analysis...who needs that?
Stephen Dubner made an entertaining presentation in his suggestion that campaign finance does not guarantee a candidate’s election. However, that’s really not the point. Not only does money sway election results, which is undeniable, it also buys ill experienced and unqualified candidates their place on the ballot. Thus leading to the influence campaign money has after the election; beholding those elected officials to manipulate our political system in favor of the donor’s interests, or as we’ve all witnessed, to sit and warm their congressional chairs and simply take no action at all.
Okay, I can see why this particular question (already covered in the Freakonomics book from several years ago) is being raised again: Newt et al. are bellyaching about Mitt's war chest and pointing to it as the reason for Mitt's success in Iowa and New Hampshire. But it seems to me that Steve Dubner's analysis doesn't actually get at the important issue. The important issue isn't whether or not the candidate with the most money necessarily has the greatest chance of prevailing, it's the fact that running any kind of legitimate national campaign requires raising huge sums of money (whether the amount one candidate raises is slightly bigger or smaller than their competitors is beside the point). And raising huge sums of money means going to those who have it - mostly the already extremely wealthy and well-connected. The quid pro quo is clear: if you as a politician get money from them, you make time for their lobbyists, appoint people sympathetic to their causes to your cabinet and other positions of authority, support legislation favorable to them, and so on. And the converse is also true: if you as a politician want to keep your job, you're very careful to steer clear of angering those with the kind of money to fund attack ads against you during your next campaign. The Citizens United ruling makes this an even greater problem. So as much as I appreciate the "freakonomics" approach, in this case I think they've made a perfectly fine analysis of a relatively unimportant question. The bigger issues continue to loom large.
Dubner/Levitt are fascinating and clever guys, but sometimes it seems like they try too hard to come up with novel or counterintuitive results and fly right past obvious facts. In this case, in making their claim that fundraising ability is not a significant factor in winning elections, Dubner/Levitt completely ignore the initial "Invisible Primary" phase of the campaign when election day is still far off and would-be candidates need to convince donors to give them money so they can mount a campaign in the first place. No money, no campaign, no electoral victory -- how's that for a causal model? And unless you think those early donors are representative of the voting public as a whole, what does that say about our democratic process?
Well, if you’re going to split hairs—sure money buys politicians and political access rather than elections, but to say that money doesn’t determine public policy is like expecting people to believe in Santa Claus. Politicians will say the money they receive is only incidental to their positions on a particular issue, and so not to be confused with bribery; the Supreme Court, in its infinite wisdom, has supported this lie by calling money free speech. But when politicians are handpicked by PACs and a nominating process that wages its political campaigns with money, how can anyone imagine that money isn’t determining election outcomes. Both party candidates are bought, and anyone who isn’t will never be heard publically. Any serious threat to the corporate power structure is successfully snubbed and squelched out of existence, which is why, in spite of all the clamoring about socialism, there is no real democratic left. Only tweedledum versus Gays in the military.
Let's see if I got it right:
Surprise! There is no direct, linear correlation between dollars spent on an election and the number of votes cast. Those of you who thought there was some kind of relation between money spent and elections won, what idiots you are. I guess we can all stop worrying about who spends money on elections, it doesn't make any difference.
Really?
So why haven't all the money guys who obsess about fractions of pennies they can make in complicated transactions realized this before and stopped putting money into elections? Even Google, with interview questions for genius applicants, should have figured this out long ago and led the pack of smarties who no longer waste money on politics.
But what really happens? The rich spend money on politics and politicians. They get fantastic dividends on their investment. Our political system becomes more corrupted by the power of money, our politicians loose focus on the needs of their constituents and instead focus on how they can get money to win the next election and how they can please the people they need to give them money.
My real question is this: why would you broadcast an idiotic segment like this? Your Freak sounds like a cheerleader for the 1%, an apologist for those who want to excuse their spending ungodly amounts of money on elections, "gee, it doesn't really matter anyway so stop scrutinizing what we do!"
I'm really disgusted. I realize you yourselves are scrutinized by Republicans who would like to eliminate your programming altogether, but really? Do you need to sink that low?
Thanks for the rest of your usually interesting and thoughtful programming. I'll probably listen again, once I get this nasty taste out of my mouth...
