Reforming Politics; M. DeBow

The Conventional Wisdom Misses the Real Problem The reformers apparently think that, without the "corrupting" influence of cam paign contributions and other lobbying ef forts, Congress would make "better" deci sions. This position is, in turn, based on an assumption that there is a correct answer to any given public policy question, and that this answer would be rather easily identified and implemented by a Congress freed of Michael DeBow is a professor of law at the Cumberland Law School ofSamford University, in Birmingham, Alabama. the corrupting influences of money and, thereby, acting "responsibly." This is a delusion. In virtually every instance, there is no "correct" answer to a public policy ques tion waiting to be discovered by well meaning officeholders. Exceptions to this rule may well exist in times of war and other national emergencies, but in peacetime there are no clear" answers" to most of the questions that government is increasingly called upon to answer.

To see that this is so, consider the related issues of government spending and taxing. While 90 percent or more of Americans might ' 'agree" that the deficit should be lowered-or at least not increased-they will not agree on how such a state of affairs is to be reached. Should the rate of increase in Social Security benefits be reduced? Should appropriations to Aid to Families with Dependent Children, or National Pub lic Radio, or farm price supports be cut and if so, by how much? To state the problem is to answer it; there is no "an swer. " The political process will, of course, generate some sort of answer, but there is absolutely no reason to believe that any answer adopted by Congress is "the" an swer. In seeking to change campaign finance and lobbying methods, reformers are focus ing on a symptom of the problem-spending 628 to influence government decisionmaking rather than on the real problem-the vast size and scope of American government.

For roughly the last 60 years, the size and scope of the national government have steadily increased, along with tax rates and the reach of government regulation into many areas of our lives. As a result, the idea that there are, or should be, any limits on the powers of the government has largely passed from the contemporary scene. This is particularly true with respect to the fed eral government and to the regulation of economic activity. Not only do we not have a national government of enumerated pow ers as envisioned by the Founders, we have a national government of such unlimited scope that it would be very difficultto agree on an enumeration of powers that it does not have. Do you doubt it? Reflect on the fact that in the recent debate over health care, no serious attention was paid to the question whether the federal government has the authority to regulate this area of our lives.

Instead, arguments focused on whether such regulation would lead to beneficial results. In short, Americans have, consciously or unconsciously, rejected the concept of lim ited government. In its place, we now have Leviathan. 1 The growth of Leviathan trig gered a parallel growth in the efforts of private interests to extract favorable treat ment from the government. Given the size of government and the virtually unlimited scope of its powers, private interests businesses, unions, ideological groups, re tirees, and so on and on-face tremendous incentives to become active in the political sphere in order to pursue governmentally conferred benefits and to oppose like efforts put forth by others. From society's view point, all this activity is a waste of re sources. Moreover, the problem of private interest capture of government power is only one problem aggravated by the growth of gov ernment power. The other major problem is that massive government power is subject to massive mistakes and miscalculations even 629 in the absence of private-interest manipula tion or, indeed, in the absence of any cor ruption at all.2 Platonic Guardians can make mistakes, too, and given all that we ask them to do today, we'd be better offwith a smaller government than with our current govern ment even if it were staffed with public spirited experts.

In short, any attempt to reform politics that does not include a serious effort at downsizing government is doomed to impo tence. CampaignFinance Reform Is Not Likely to Produce Positive Results If you accept my argument thus far, you may still think campaign finance and lobby ing reform could do no harm-even if it is likely to have little or no positive effect, given the size and scope of government. Shouldn't we at least try to reform politics, even if we recognize that the real source of our problems is the virtually unlimited scope of government power? Maybe not. There are several good rea sons to reject the view that increased regu lation of campaign spending and fundrais ing, and interest-group lobbying would improve the political process. First, attempting to limit the effectiveness of political interest groups by regulating campaign finance and lobbying would raise severe First Amendment questions. 3 Bluntly put, the First Amendment was de signed to protect the kinds of activities that the good-government crowd seeks to cur tail. Given the current state of First Amend ment case law, any serious attempt to reg ulate in these areas may very well be struck down by the courts.

Professor Lillian BeVier of the University of Virginia Law School has argued that First Amendment protection of this kind of ,'speech' , is in fact in the broad public interest. "Special interest" groups, and political action committees that they form, are a means of overcoming the collective action 630 THE FREEMAN • OCTOBER 1995 problems that [the rational ignorance of most voters] engenders. Because they serve this function, special interest groups may arguably be regarded as be nign if not indispensable players in the democratic process. With respect at least to their own particular interests, such groups have the significant potential ef fectively to monitor legislative behavior and thus to reduce legislative shirking. They convey information to otherwise uninformed and powerless group mem bers about legislative activity and in turn funnel information from the group back to the legislature. Under. this view, special interest groups deserve the protection of the First Amendment's freedom of asso ciation because of the indispensable role they play in monitoring elected officials.4 Put another way, there is simply too much at stake for politics to be conducted without efforts by "outsiders" (that is, the gov erned) to influence the process, and it is a good thing that the First Amendment case law recognizes this fact.

Second, interest groups "have a number of close substitutes to direct contributions lobbying, voter mobilization efforts, 'soft money' donations, and so on.,,5 Any at tempt to regulate independent efforts to advance a particular candidate or espouse a particular viewpoint on a contested issue would be even more vulnerable to First Amendment attack than limits on direct campaign contributions. Thus, interest groups would likely be able to live with and work around, at least to some extent, any new restrictions that did survive First Amendment scrutiny. Third, it stands to reason that from time to time interest groups will inadvertently rep resent the interests of most of the general public even as they represent their own private interests. For example, the interest groups that fought the Clinton Administra tion's healthcare proposals represented the interests of the general public at the same time they represented their own private interests. When President Clinton pro claimed that it was his healthcare reform against the special interests, most Ameri cans should have cheered for the special interests-which prevailed, in the end. With a government as powerful and intrusive as ours, we should not be too quick to blunt the effectiveness of interest groups who will oppose further accretions of government power. Since almost any given interest group may, on a particular issue, oppose the expansion of government, this point covers a lot of territory.

Fourth, if current efforts at campaign finance and lobbying reform succeed and have a real effect on the ability of interest groups to influence politicians via legal cam paign contributions and so on, this would likely increase the amount of under-the table bribes and payoffs to politicians. Sim ply put, "meaningful" reform would shift a portion of the market for influence under ground. 6 This is simply a result of the fact that government's authority is so great that there will be competition, legal and illegal, for influence over it. Finally, the conventional wisdom about campaign spending/fundraising may very well be wrong. For example, the line of causation in campaign contributions is often cloudy. Does Interest Group X contribute to Congressman Y because he agrees with them, or does Y agree with them only (largely?) to gain their contributions? More over, recent research presents a strong chal lenge to the conventional wisdom on cam paign finance reform. This research brings into doubt the reformers' claims that (1) the incumbents' financial edge over challengers is critically important, and (2) PAC contri butions have a substantial effect on the political system. 7 As Harvard economist Steven Levitt put it, "the substantial amount of energy devoted to the topic by the public, the media, and politicians might be more productively channeled towards other issues.,,8 While this research will be sub jected to further testing and debate, it cur rently stands as an important reason to hold off on any major attempt to rewrite cam paign finance law, at least pending the out come of further research.

In summary, any effort to reform the WHY IS IT NATURE VERSUS PEOPLE? 631 practice of seeking political influence with out first reducing the size and power of government is not likely to have a significant positive effect, and may well infringe the First Amendment and other widely held values. D 1. Gary Lawson, "The Rise and Rise of the Administrative State," Harvard Law Review, April 1994, pp. 1231-1254. Lawson describes the "post-New Deal administrative state" as the result of a "bloodless constitutional revolution." 2. For discussions of the types of failure that plague government activity, see Charles Wolf, Jr., Markets or Gov ernments: Choosing between Imperfect Alternatives (Cam bridge, Mass.: MIT Press, 1993), and Michael E. DeBow, "Markets, Government Intervention, and the Role of Infor mation: An 'Austrian School' Perspective, Withan Application to Merger Regulation," George Mason University Law Re view, Fall 1991, pp. 31-98.