Outside Money in Politics

One complaint about political campaigns is that they are increasingly funded by “outside money” that comes from outside the jurisdictions in which the elections are held.

In a recent special election in Florida to fill a seat in the US House of Representatives, $9 million in outside money was spent to influence that election.  The headline in this article says that outside money bought that election.  The article suggests that people outside the district, because of their spending on political ads, are determining who will represent the voters in that district.  It is, the article says, “The death of the local campaign.”

Is that outside money inappropriate?  Should there be limits on outside money in politics?

Here is another viewpoint.  This article says that same congressional race had national implications.  The Democratic candidate, Alex Sink, is a well-known figure in Florida politics, having been elected to the office of Florida’s Chief Financial Officer in 2006 and having been the Democratic candidate for Governor in 2010.  The Republican candidate, who won, is a former lobbyist with little name recognition.

The article says, “Republicans say that if their first-time candidate defeats a seasoned veteran, it will demonstrate just how toxic the health-care law will be for Democrats this fall.”  And goes on to say, “The race is particularly important for Pelosi’s Democrats, who have battled the perception that they have no chance of winning the close to 20 seats they need to claim the majority in November.”

If the race has national implications, why shouldn’t people outside the district have a say in its outcome?  They don’t get to vote, but shouldn’t they be able to engage in political speech to try to influence those who do vote?

Every race for the US Senate and House of Representatives has national implications, because both parties want to elect more members to tilt the balance of power their way.  Voters in congressional races are not just electing their representatives, they are electing people who will tilt the national balance of power, and it seems completely appropriate that because of the national implications for those local races, people throughout the nation should participate in those campaigns.

Indeed, the only reason outside money comes in is because the elections have effects that go beyond their local districts.  People outside the district are affected by the outcome of the election, so there is good reason for them to try to influence the outcome.

Randall G. Holcombe is Research Fellow at the Independent Institute and DeVoe Moore Professor of Economics at Florida State University. His Independent books include Housing America: Building Out of a Crisis (edited with Benjamin Powell); and Writing Off Ideas: Taxation, Foundations, and Philanthropy in America .
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