Editor’s Note: The Millennial Voices series is written by and for Millennials to foster nonpartisan discussion. Eric Essagof is a junior at The George Washington University. The opinions expressed in this commentary are solely those of the author.
It has been five years since the monumental Citizens United v. FEC (2010) ruling did away with decades of campaign finance reforms. Since then, we have seen wealthy donors spend inordinate amounts of money on political activities through SuperPACs and other creative ways to hide their large donations.
What we have not seen, however, is an effective response from Washington. Despite a few legislative attempts by Congress, the result has largely been polarized arguments over reform.
This inaction is unacceptable: Campaign finance reform is too large of a challenge to be ignored.
Citizens United allows corporations to spend unlimited amounts of money on political campaigns, as long as they do not coordinate with the candidates they are backing. This ruling included 501(c)(4) nonprofits as corporations, which are considered "social welfare" groups by the Internal Revenue Service (IRS).
The only rule such a group must follow is that it must be “operated exclusively for the promotion of social welfare.” Wealthy donors are now creating new 501(c)(4) groups to donate millions of dollars to political campaigns and advertising without having to disclose their name.
The influence of money in politics has tangible impacts on how the American people feel about their government.
A recent Harvard survey found that 48% of Millennials agree that "politics today are no longer able to meet the challenges our country is facing." With that, Democracy Corps found that Americans no longer believe that Congress works for the middle class; Rather, they believe Congress works for the banks and wealthy individuals who donate to their campaigns.
Dark money groups contribute to this pessimism and must be addressed to restore trust in American democracy. Unless there is an extreme ideological shift among the justices, a Supreme Court ruling to overturn Citizens United is unrealistic.
Instead, Congress must find ways to amplify the voices of the average American.
There are two policy proposals experts and politicians have coalesced around that would achieve this goal: public financing with donor matching, and tax credits to small donors.
Public Financing with Donor Matching
Public financing has been tried in the past when presidential candidates were given taxpayer dollars if they agreed to not take any private donations. President Barack Obama was one of the first presidential candidates to not use this plan in his 2008 campaign. The incredible success he achieved without it essentially doomed the system in its current form: Obama outraised Sen. John McCain (R-AZ), who used public financing, by a huge margin:
To revitalize the public financing system, the federal government can increase the impact of small donors, those who donate $175 or less, by matching their political contributions with taxpayer funds. This program has been successfully implemented in New York City since 1988, resulting in an increase of small donor participation and voter outreach from candidates.
While this plan does not remove wealthy donors from the equation, it does allow smaller donors to have a larger impact. The Committee for Economic Development, Brennan Center for Justice, and The New America Foundation have all endorsed donation matching as the most effective way to increase candidate competition and reduce the influence of the ultra-wealthy in major elections.
Tax Credits for Small Donors
Tax credits are a conservative approach to incentivizing smaller donors to support political campaigns. Individuals who make small donations would receive tax breaks instead of having the federal government match their contribution. Donors could receive a tax credit of up to $200 or claim a tax deduction of up to $600 for donating to a campaign or political party. While this tax break could be an effective financial incentive to involve more citizens in the political process, it would not increase their influence in the same way that matching funds would.
The tax credit approach was proposed by Rep. Tom Petri (R-WI) when he introduced a bill called the Citizens Involvement in Campaigns (CIVIC) Act in the 113th Congress. Despite this being a constitutional alternative, the bill only had one cosponsor, another Republican, and it was dead on arrival in the House of Representatives. However, conservative campaign finance reformers often cite tax credits as one of their preferred solutions.
A Post-Partisan Approach
Both tax credits and a donor matching system have a chance at increasing activity and competition in American elections. However, neither has been strongly tested outside of the local level. A federal path forward would be more clear if some states enacted a donation matching system and others adopted a tax credit system. States are the laboratories of democracy, and we hope that their experiments will give Congress the information it needs to enact effective campaign finance reform for House, Senate, and presidential campaigns.
This country can no longer sit idly by as wealthy donors destroy the concept of “one man, one vote.” Our elected officials have some tough choices to make on our behalf. When they are deciding who gets a tax cut or whether or not to save the environment, they should be representing the views of all Americans — not just the ultra-rich elite.
Eric Essagof is a MAP Policy Intern and a junior at The George Washington University pursuing a BA in Political Science. He is originally from Westport, CT, which is also the home of Paul Newman, Martha Stewart, and Josh Lyman. He has previously worked at LawStreetMedia.com, The Sheridan Group, and a Congressional office.
As a tax-exempt nonprofit organization governed by Section 501(c)(3) of the Internal Revenue Code, Millennial Action Project (MAP) is generally prohibited from attempting to influence legislative bodies in regards to policy and legislation. It is important to note guest authors frequently take firm stances on issues and policy matters that are currently being debated by policymakers; when they do, however, they speak for themselves and not for MAP, its board, council or employees.