How wealthy campaign donors may reduce political polarization and weaken the tea party

April 24

David Barrows, of Washington, DC, waves a flag with corporate logos and fake money during a rally against money in politics outside the Supreme Court on Oct. 8, 2013. (Photo by Chip Somodevilla/Getty Images)

This is the second of two guest posts by Stanford political scientist Adam Bonica and lawyer Jenny Shen about the recent McCutcheon v. FEC decision. Their first post is here.

In our previous post, we addressed why and how much the McCutcheon decision matters. Now we analyze who stands to benefit the most.

As Lee Drutman and others have noted, top donors have favored Republicans in the past and thus the ruling should be seen as good news for the GOP. However, some Republican factions will benefit more than others. Based on our analysis, those most likely to benefit will be more moderate, “establishment” candidates, especially pro-business Republicans. The tea party, even though it was a vocal advocate of striking down aggregate limits and claimed Shaun McCutcheon as a supporter, stands to be the biggest loser.

The types of candidates that the top 0.01 percent of donors have supported in the past suggests which candidates stand to benefit the most after the McCutcheon decision. The figure below shows how the top 0.01 percent of donors and small donors — defined as those giving less than $500 in total during the election cycle plus the totals raised in non-itemized amounts — have distributed their contributions to congressional candidates from 2009 through the first quarter of 2014.

The amounts raised from small donors and the top 0.01% of donors by candidates grouped with respect to partisanship and ideology. The totals include itemized contributions to congressional candidates. All other contributions (including those to super PACs and 527s) are excluded.
The amounts raised from small donors and the top 0.01 percent of donors by candidates grouped with respect to partisanship and ideology. The totals include itemized contributions to congressional candidates. All other contributions (including those to super PACs and 527s) are excluded.

Grouping Republican candidates by ideology reveals that the decision is good news for some but very bad news for others. The most conservative Republicans have raised only a small fraction from top donors compared to their less conservative counterparts. The top donors similarly favor more moderate Democrats to those who are more extreme, but the differences are less stark.

This pattern is also apparent when you look at some individual candidates. Orrin G. Hatch and Ben Nelson, both relative moderates, each raised more than 10 times from the top 0.01 percent than they raised from small donors. By contrast, small-donor fundraising successes like Ron Paul, Alan Grayson, and Michele Bachmann — darlings of the extreme wings of their parties — raised over 10 times as much from small donors as they did from the top 0.01 percent of donors.

(It is important to note that the analysis, in line with the ruling in McCutcheon, excludes contributions made to super PACs or 527s. Independent expenditures, which account for a large percentage of contribution dollars from the top 0.01 percent, are more polarizing in nature.)

The above only holds insofar as McCutcheon does not fundamentally change how elite donors give to candidates. It’s been suggested that the McCutcheon decision might create a new breed of mega-donors, eager to throw money at any and every candidate willing to take it. This “drunken sailor” hypothesis seems dubious. More plausible is that the parties may succeed in their efforts to convince some of their loyal supporters to adopt party-centered funding strategies.

While it remains to be seen how successful a party-centered strategy might be, it is difficult to see how the tea party could come out ahead. There are two reasons for this. First, calls for party unity don’t apply to primary contests. Second, divisions within the Republican Party run deep. Nowhere is this more apparent than the growing schism between big business and the tea party. During the 2010 elections, executives and board members of Fortune 500 companies spent six times more opposing tea party challengers during the primaries than what they later spent to support tea party candidates during the general elections.

Nate Persily and Ray LaRaja both see a silver lining in McCutcheon’s potential to curb polarization. As the reasoning goes, parties have incentives to promote electable candidates who tend not to be as ideologically extreme. However, the data suggest that parties may not be necessary in order for McCutcheon to reduce polarization.

The bottom line is that the era of big donors is here to stay. This era may help counteract polarization, but that will come at the cost of greater political inequality.

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