Five conservative justices on the Supreme Court appear poised once again to strike down a law favored by the campaign finance reform community. Late last month, the Court heard oral arguments in the case McComish v. Bennett, which involves the matching funds provision of Arizona’s public financing program, a measure intended to protect participating candidates from the threat of being outspent by privately funded opponents. The provision is in many ways similar to the federal Millionaire’s Amendment, which operated to increase contribution limits for publicly funded candidates facing an opponent who is self-financed, until it was struck down by the Court in 2008. And this case comes on the heels of the most notorious campaign finance case decided by the Supreme Court in recent memory, Citizens United v. FEC, in which the conservative majority struck down laws limiting corporate spending in elections, permitting them to spend unlimited amounts of money in support of candidates.
Campaign finance reform has been getting a substantial black eye at the hand of the Court lately, and the McComish case will most likely cause this trend to continue. The effect of these cases on public opinion hasn’t yet been definitively measured, but these cases have forced states such as Connecticut to rethink their approach to public financing. And if the Arizona law is struck down in McComish, a number of states around the country will be forced to take legislative action to replace or abandon similar provisions in their public financing schemes. With each change, political leaders are forced to resubmit their argument to the electorate for why public financing of campaigns is a worthy cause in an environment of increasingly high-profile criticism compounding severe budgetary concerns.
The particular variety of public financing at issue in McComish provides a grant of government funds to a candidate in exchange for a ban on private contributions to that candidate, effectively creating a spending limit as the candidate is not permitted any other source of campaign funds. For over thirty years, virtually all of our presidential campaigns have been funded this way. But President Obama opted out of the public financing system in the 2008 election, and is likely to opt out once again in 2012, because the amount of the grant has not kept pace with the cost of campaigning. The Arizona matching funds provision is one response to this problem: Rather than providing a larger grant, the government provides additional 1-to-1 matches for every dollar spent by an opponent over the amount of the initial grant. Like the Millionaire’s Amendment, this approach attempts to deal with the competitive limitations of public financing only in the event that an opponent takes advantage of this limitation. It is the reactive nature of these provisions which has led to all of the trouble public financing has had with the Constitution.
The prospect of being outspent by an opponent is a real threat to the attractiveness of a public financing program. And if participation is viewed as a disadvantage, that could mean the end public financing since it is a voluntary program (the Supreme Court has long held that spending limits are only constitutional if voluntary). But attempts at addressing this shortcoming on a candidate-by-candidate basis, rather than rethinking the system itself, have proven counterproductive. In the case of both the Millionaire’s Amendment and Arizona’s matching funds, the result has been unstable public financing regimes which ultimately cause embarrassment in the highest court in the land. It is becoming clear that selectively using government grants to compensate for the spending disadvantage inherent in such a public financing program will not pass constitutional muster. The answer lies in rethinking public financing systems entirely to bake competitiveness right in.
Mechanisms for financing campaigns which rely on public grants alone suffer from an additional infirmity: They do not promote participation in the political process among the citizenry. It is convenient, then, that there is (at least) one common solution to both problems. Permitting candidates to receive a mixture of both public and private funding prevents corruption and gives non-traditional candidates the boost they need in public grants — either in the form of a lump sum payment or as matching funds for small-dollar private contributions — while also avoiding the potential competitive disadvantage. Public matching funds for small-dollar contributions to a publicly funded candidate (as opposed to matching the spending of a privately funded opponent) gives all publicly funded candidates the means to be competitive, and leaves it to the candidate to decide whether to increasing her spending in the event of a well-funded challenger. The sponsors of the Fair Elections Now Act, which would provide for public financing of congressional campaigns, have embraced just such a solution, as have many states and municipalities around the country. And the Supreme Court has already given the constitutional stamp of approval to just such a matching funds provision in the presidential public financing program, so there is little likelihood that this approach is vulnerable to a court challenge.
Public funds used to match private small-dollar contributions increases the impact of private funding by ordinary citizens without any risk of corruption. This encourages more participation by those citizens and solves the competitiveness problem. More profoundly, this hybrid approach does not foreclose one of the most meaningful avenues citizens may employ to express their opinions on matters of public concern, such as collective bargaining rights in Wisconsin, defending the legitimacy of our first African-American president, and marriage equality. Incorporating private campaign contributions into a system of public financing — or rather, not walling publicly funded candidates off entirely from non-corrupting forms of private financing is the best way to ensure that campaign finance reform will no longer be kicked around by the Supreme Court. Fortunately, it will also make public financing a more perfect system, incorporating the best of both worlds.