Tag Archives: small-dollar donors

A Remedy? Or A Different Disease?

There has to be a better way to finance election campaigns.

The relief I felt after the just-concluded midterm election reflected two realities: the predicted Red wave failed to materialize, and I got my email inbox back. (Mostly.) I know I was not the only person being inundated with dire warnings, announcements of a three or four time fundraising “match,” and breathlessly reported one percent polling spreads–usually featuring bright colors and huge headlines.

And all–all!–asking for money.

I don’t know who those insistent, repetitive emails were supposed to persuade. They sure didn’t make me want to send them any money. (In some cases, they made me regret the small amounts I had contributed.)

When Howard Dean first demonstrated that the internet could be employed to encourage small donations, I was thrilled. When Obama raised zillions of dollars in small increments, I  thought the days of depending on political fat cats was over. Since no candidate could be “bought” for these small contributions, I counted this as a win for democracy.

It turns out to be more complicated than that.

Small dollar fundraising did indeed reduce political reliance on the “usual suspects”–the big money donors. But. (You knew there was a “but,” didn’t you?) This approach to fundraising has produced different–but equally troubling– negative consequences, and those negatives go far beyond the annoying assaults on our inboxes.

In a recent New York Times discussion between a liberal and a conservative campaign strategist, both opined that reliance on small-dollar donations is doing more harm than good.

The conservative strategist, Tim Miller, explained the problem: when McCain-Feingold banned unlimited, unregulated contributions from corporations, unions, and individuals, the fundraising focus turned to internet campaigns aimed at small donors.  That created some very perverse incentives.

I think that there were some nice sentiments about wanting to get corruption out of the system, limit the amount of money that bigger donors can give to candidates. But in doing so, campaigns weren’t going to decide to start spending less money. So they had to come up with other means in which to raise money. And it created a couple of scourges.

One, it just made fundraising the central activity for most politicians. And a lot of their time is spent around fundraising. I think that there are some pernicious side effects to that.

But it also created some negative incentives. I think one of them that I get into in the article is that what we saw very quickly, beginning with Joe Wilson, when he shouted, you lie, at Barack Obama during a joint address to Congress and then realized that he could raise a ton of money. Within 12 days, he raised more money sending out appeals to all the conservative lists he could buy than he’d raised in his entire campaign before that. Very quickly, then, there were a lot of imitators who realized that all of a sudden, they could raise big gloms of cash by being obnoxious and shouting things about the people they hate.

And I think that as a result of the decreased power, maybe the well-intentioned decreased power of bigger givers, politicians were then incentivized to do everything they could to get small-dollar money.

And usually — not entirely — that has tended to be saying things that are inflammatory, doing things that are going to get people to retweet you and post you on Facebook, spreading conspiracies, spreading mistruths. And so it has created just a different type of grift and a different type of corruption rather than the old company X gives you 20 grand in the hopes that you kill amendment Y.

When we decry contemporary political polarization, we need to recognize the part played by internet fundraising. As Miller pointed out, lunatics like Marjorie Taylor Greene have become massively successful fundraisers by saying insane things, followed by “an email about how the left wants to cancel her.”

The liberal strategist, Micah Sifry, agreed.

I think the problem is that we have a unhealed wound in this country that dates back to the Civil War and that we have had recurring cycles where opportunistic politicians decide to feed on the prejudices and on the warped beliefs of people who think that this was supposed to always be a white Christian country, and then use that to power their political careers.

The internet now enables some people like Marjorie Taylor Greene to self-finance, as it were, because she doesn’t have to worry if every Fortune 500 company in the country decides to stop donating money to her. So I think that there’s a deeper problem, which is, why do we have 30 percent of the population that wants this insanity and will fund politicians who give it to them?

Good question….


And I Had High Hopes….

When Barack Obama raised zillions of dollars from millions of small-dollar donors, I was ecstatic. It seemed to me that his success in online fundraising–fulfilling the promise of earlier efforts by Howard Dean and John McCain–would counter the outsized influence of big money donors.

After all, no public official was going to feel indebted to someone who’d sent in $20 dollars-or even $200. Campaigns would be funded by small-dollar gifts sent by regular, mostly non-ideological voters who’d decided they liked Candidate A.

How naive I was….

A guest essay in the New York Times took a look at the current, ugly status of online fundraising. Not that it will come as a shock to anyone who sent $3 or $5 dollars to a candidate only to have their inbox subsequently buried in hysterical, overwrought and frequently inaccurate appeals for money–contributions that would be matched or doubled and would allow Candidate Y to meet the onslaught of scurrilous attacks from Opponent Z.

The overwhelmingly positive narrative about the power of small-dollar online fund-raising began to congeal: Grass-roots fund-raising is pure and good. Big-dollar donations from corporate cronies are suspect. This is what democracy looks like!!!

It hasn’t exactly worked out that way. It turns out that Americans don’t just vote for certifiable nutcases and nice but clearly unelectable candidates–they also send them money.

As it turned out, grass-roots fund-raising is also what ending democracy looks like. As with any other mass movement, people-powered campaigns followed the standard Hofferian trajectory: beginning as a cause, turning into a business and becoming a racket. Our online fund-raising system is not only enriching scam artists, clogging our inboxes and inflaming the electorate; it is also empowering our politics’ most nefarious actors.

It is how Donald Trump and his cast of clueless coupsters raised nine figures to “stop the steal” that they had fabricated to try to stay in power. It is one way our most extreme candidates dominate the conversation and gain power in our political system. It has redirected money from politicians who work to find compromises that might just help people, diverting it instead to those who either have no chance to win or, worse yet, can win and want to undermine that work for their own ends. And it’s hard to imagine how we can stop it.

The author pointed to an example “of the hellscape to come.”  Remember when South Carolina congressman Joe Wilson shouted “You lie!” at President Barack Obama during an  address to a joint session of Congress?  After the Democratic-controlled Congress censured him, Mr. Wilson’s campaign team used that incivility to fundraise. The campaign “uploaded fund-raising pleas to YouTube” and bought ad space on The Drudge Report.

In just 12 days he collected more money than he’d spent during his entire previous campaign.

The lesson wasn’t lost on those who raise money for campaigns.They could raise money and gain influence without bothering to build relationships and coalitions in Washington and back home. They could bypass all that by “being jerks on the internet and calling out their voters’ enemy du jour in the most ostentatious manner they could summon.” (Josh Hawley raised $3 million after he was pictured giving a salute to the rioters about to storm the Capitol.)

It’s created a perverse incentive structure, empowering the congressional shock jocks at the expense of actual legislators. Meanwhile, a series of court decisions supercharged political fund-raising generally. The new no-limits era allowed big donors to maximize huge contributions to political committees and blasted billions in dark money through the system, continually raising the stakes of each fund-raising deadline.

The elevation of the small-dollar donor has created other nightmarish unintended consequences, however. Democratic candidates with no hope of winning are raising ungodly sums from online liberals drawn to their flashy videos and clever slams. This is particularly the case when said candidates are running against notably loathed Republicans. In 2020, this meant Jaime Harrison, the current Democratic National Committee chairman, raised a record-breaking $131 million in his campaign against Senator Lindsey Graham, despite the fact that Mr. Harrison lost by double digits and never really had a prayer….hundreds of millions of dollars are being pumped into hopeless hype candidates.

As the essay notes, it has become a race to the bottom, inflaming a party’s base voters.

Can we ever know the full effect that years of emails, texts, Facebook ads and viral Twitter ads with doom-driven fund-raising appeals have had on the average voter’s conception of the country and politics? How those stimuli may have contributed to the radicalization of their recipients, especially those who aren’t in on the joke (a nihilistic campaign politics trope in which the strategists make arguments they know are phony)?

So much for my early optimism….