Thursday Political Equality Blogging

My post on the prospect of billionaires like Sheldon Adelson deciding to really dig deep and spend on politics prompted a certain amount of silly partisan responses (yes, there are liberal billionaires, too, but a world in which politics is a contest between competing teams of billionaires is a depressing idea) but also some interesting discussion. In particular, Chicounsel's post:

My question to Matt is "So what?" Are you saying that it should be illegal for him to spend his own money in what amounts to the exercise of his First Amendment rights of free speech, to peacably assemble and petition the government?

Actually, no. One of the many things I don't like about John McCain is that I think his vision of how to fix the campaign finance system is off-base. My answer would be more like Matt Weiner's suggestion:

One possible answer is that we should prevent such extreme concentrations of wealth. John Rawls thought extreme concentrations of wealth were bad precisely because that much money led to disproportionate political power (and meant that people without the money were shut out of political power in important ways).

I think one should draw a distinction between the top-level and bottom-level issues here. It seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur. On the flipside, things like Larry Bartels' finding that legislators are only affected by the views of the richest two-thirds of their constituents are where proposals for public financing of campaigns or especially ideas like "patriot dollars" could come into play.

Photo by Flickr user Yomanumus used under a Creative Commons license

Comments

It seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur.

To the barricades, Comrades!!

Posted by Ethel-to-Tilly | January 24, 2008 12:26 PM

It seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur.

Good luck with that. Even Sweden has billionaires.

Posted by Mixner | January 24, 2008 12:26 PM

So, Bill Gates continues to innovate, make shrewd business decisions and acquisitions and generally do a bang-up job of building Microsoft into a world brand. However, after some sort of arbitrary/sensibly decided limit of personal wealth he turns all his hard earned money over to............who? The government? Shareholders? Of course we'd expect him to continue his hard work despite hitting the earning limit and at that moment doing everything essentially for free. Yeah, that'll work. I can hear motivated, smart, ambitious entrepreneurs all over the nation clamoring to have this bill pass.

Posted by steve duncan | January 24, 2008 12:27 PM

And we don't all have to be as rich as billionaires for the system to become more honest. Lately I hear a lot about "high information" voters and "low information" voters, and it occurs to me that that if poverty were eliminated that would increase the share of the former.

Maybe the rhetorical focus should be less on how rich people have the loudest megaphone and more on how poor people have essentially no megaphone.

Posted by Consumatopia | January 24, 2008 12:29 PM

However, after some sort of arbitrary/sensibly decided limit of personal wealth he turns all his hard earned money over to............who?

I agree. Changing from a system in which marginal income tax rates scale up progressively to one in which we simply seize all wealth beyond $X would be a completely moronic idea.

Posted by Consumatopia | January 24, 2008 12:32 PM

How about limiting the first amendment to "natural" people, so that corporations, and organizations, cannot give any money but only natural people can. No bundling. Candidates must report within 24 hours all donations. All adds must disclose who paid for them. The average American, I think, would react negatively to some blowhard billionaire who has nothing substantive to say. Or, "hello, me again, sorry for interrupting the Super Bowl, but I think there is an important issue that you to thing about . . ." We need less "this message is paid for by The Sisters of the Poor Who Love America and Wish Apple Pie for Everyone (which is a front organization for whomever)" and more "I'm Joe Billionaire and this is what I think." Then define campaign donations as "not political speech." Keep the limits for individual contributions. But if some guy wants to spend like a drunken sailor on his/her campaign, who are we to say no.

Posted by cal | January 24, 2008 12:35 PM

> So, Bill Gates continues to innovate, make shrewd
> business decisions and acquisitions and generally
> do a bang-up job of building Microsoft into a
> world brand. However, after some sort of
> arbitrary/sensibly decided limit of personal
> wealth he turns all his hard earned money over
> to............who? The government? Shareholders?
> Of course we'd expect him to continue his hard
> work despite hitting the earning limit and at that
> moment doing everything essentially for free.
> Yeah, that'll work

Presumably Mr. Duncan is aware that the real Bill Gates agrees with Matt's point to a large extent, and has been saying so for 10 years.

And for some reason people seemed to work really, really hard in the 1950s and 1960s when the top-to-bottom earning ratio was around 20:1 (say 40,000 for a mid-level engineer; 400,000 for a company president) {and no, a few extreme exceptions that don't disprove the general rule}. Study after study has shown that the dollar amounts beyond $1 million year / $20 million banked are just status markers; people work just as hard to beat their neighbor from $750,000/year to $1 million as they do to beat him from $75 million to $100 million.

In any case, no one that I know of, even the most communitarian-leaning, begrudges a person who /builds a new business from the ground up/ a good chunk of "his"[1] fortune. Most of the big fortunes these days have been accumulated through salary rake-offs not Carnegie-like business creation.

Cranky

[1] "His" in quotes because, again per Bill Gates, without the structures of society the conditions to create that new business would never have arisen.

Posted by Cranky Observer | January 24, 2008 12:37 PM

"I can hear motivated, smart, ambitious entrepreneurs all over the nation clamoring to have this bill pass."

Do you really think that after the first 100 million or so the money makes much difference? Most of "motivated, smart, ambitious entrepeneurs" I've known or read about are motivated more by the satisfaction than the money.

Posted by converse | January 24, 2008 12:42 PM

Presumably Mr. Duncan is aware that the real Bill Gates agrees with Matt's point to a large extent, and has been saying so for 10 years.

Bill Gates may support reform of the tax code to make it somewhat more progressive, but I'm pretty sure he would strongly oppose policies intended to prevent any individual from amassing a large fortune.

Posted by Mixner | January 24, 2008 12:46 PM

Well, in strong support of Matt's general point, I'd argue that there's no real evidence that unlimited money-making per se is a prime motivator of the most productive individuals in our society.

For example, consider the open source software movement. The best people there have developed exceptionally important products, and done so in no particular hopes of major financial reward.

I think that generally the quickest, surest, and easiest way to make vast quantities of money in our current system is through non-productive activities like reshuffling paper on Wall Street by inventing dangerous new derivatives.

This is a *severe* design flaw in our current social/economic system, and is having disastrous consequences all around us. It's similar to the problem that in Nigeria and many other African countries, the surest route to success is simply corruption...

Posted by RKU | January 24, 2008 12:48 PM

"Most of the big fortunes these days have been accumulated through salary rake-offs not Carnegie-like business creation."

That's just about dead wrong. It's true that most income inequality is driven by over-salaried upper management, but in order to achieve the scale of wealth necessary to play political spoiler, you have to found (or inherit) a supremely successful buisness.

Gates, Buffet, Soros, Bloomberg, the Waltons, that is the league we're talking here. You can't make it to the bigs on a salary.

Posted by heedless | January 24, 2008 12:48 PM

Yes, yes, Trent Lott, Robert Byrd, and others are well situated to dictate to people how wealthy they should be allowed to be.

Posted by Will Allen | January 24, 2008 12:49 PM

I firmly believe that Sheldon Adelson has the right to use his money to influence politics as he wishes. I also believe that another 527 can use its money to attack Mr. Adelson for his use of his money and any shady behavior from the past. Mr. Adelson makes himself a public figure with his expenditures and opens himself to public scrutiny. Shouldn't the public know all about the person who is trying to influence our government?

Posted by Th | January 24, 2008 12:52 PM

It should be pointed out that John Rawls was not in favor of a political system that ensured absolute economic hegemony. He believed it was important to have significnat variations in income throughout society. Without these variations in income Rawls believed inovation and motivation would suffer.

What Rawls opposed was the massive inequality we see in our world today. A world where the wealthiest continue to get wealthier. Where the poor continue their economic decline despite the fact that they have no control over their economic circumstances. For Rawls, just because someone got lucky does not mean they should have a leg up over everyone else. For example, in an "ideal" Rawlsian world where the principle of justice is directly related to an idea of fairness, there would be consequences for the poor decisions that lead to the current mortgage crisis. Unfortunately, if history tells us anything, those resposible for "The Big Shit-Pile" will likely be rewarded for their actions.

So, the problem is not so much that there are wealthy people in the world. Rather, there are so few of them and they continue to become more concentrated. And there are so many people who are economically disenfranchised and their number continue to grow as well.

Posted by rawls | January 24, 2008 12:55 PM

It seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur.

Wow.

So, since your suggestion is completely and totally unfeasible in every way, shape, and form....what should we do about massive political spending by rich individuals? Just let it go?

Certainly, the case that political spending is "free speech" is far from air-tight. Without digging too deep into the complex world of First Amendment law, even if one concedes that political contributions are "speech," campaign finance limitations would seem to constitute a content-neutral, time, place and manner (TP&M) restriction. As such, strict scrutiny would not apply. Rather, TP&M requires that the restriction be narrowly drawn and leave ample alternative channels of communication. Arguably, campaign finance laws do just that, allowing contributions up to $2000 (or whatever) while permitting individuals to influence politics in innumerable other ways.

Posted by owenz | January 24, 2008 1:00 PM

seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur.

Shorter Matthew: Ponies for everyone!!!

Posted by Al | January 24, 2008 1:04 PM

The ability to spend money in political campaigns is already regulated. The equation of spending with speech is ridiculous -- and yes, I'm disagreeing with the Supreme Court on this.

Posted by El Cid | January 24, 2008 1:06 PM

Al, not ponies for everyone, but maybe some ponies for these people?

http://www.guardian.co.uk/news/video/2008/jan/23/america.poverty

Posted by David | January 24, 2008 1:07 PM

What conservatives refuse to accept is that there is a significant element of a zero-sum game about freedom of speech. If Sheldon Adelson decides to spend his Vegas casino billions on convincing religious cultural conservatives to vote for the political allies of casino owners, he is diminishing the effect of my freedom of speech because of the sheer concentration of material resources behind his speech. He is drowning me out. That's how wealth inequality impinges upon my First Amendment rights. If no one can hear you speak, how is it speech?

As for Rawlsian expropriation, the only western government I can think of to have had a good crack at trying it was the Labour government of the 1970s in England with their immensely high top rates of income tax. The irony is that, after economic growth started to accelerate in 1977 and 1978, labor unions decided they resented that same government's tough line on inflation (after all, you don't cut inflation from 27 percent to nine percent in the space of four years in the midst of an oil crisis without being a hardass on things like incomes policies), and to make their point they all went on strike, thus ushering in Margaret Thatcher.

Posted by DBX | January 24, 2008 1:14 PM

Yes, David, we can really count on a left-wing anti-American British newspaper to give an honest account of "poverty" in America.

For some actual facts and figures on just how rich America's "poor" are, see here.

Posted by Mixner | January 24, 2008 1:14 PM

This is a silly post.

First of all, it's generally impossible to prevent massive accumulations of wealth short of revolutionary socialist measures. I'm all in favor of policies to make it more difficult to accumulate massive wealth and pass it along to one's heirs, but there will still be billionaires and they will still have political influence.

More importantly, there isn't much point to having a democracy at all if we're going to accept Chicounsel's framing of wholesale corruption and influence peddling as a First Amendment right. Wealthy Americans certainly have the right to blow their money on think tanks, policy shops, lobbyists, and issue ads to their heart's content. They do not, however, have a Constitutional right to give large sums of money to political campaigns in order to buy client services from politicians or influence the outcome of a free election.

That was the principle behind McCain-Feingold, and it's worth fighting for. I find the recent tendency of liberal activists to back away from this principle highly disturbing.

Posted by LaFollette Progressive | January 24, 2008 1:16 PM

You can't get money out of politics. You also can't (realistically) redistribute wealth from the top down in a capitalist democratic society. 'Specially when it's global (don't these billionaires often have their money overseas where the U.S. government can't touch it?). Best you can hope to do is preserve accountability in governance and preserve the equality of opportunity (so that anybody can in theory become rich). But rich people are always going to run the show.

Posted by Bill | January 24, 2008 1:17 PM

John Rawls thought extreme concentrations of wealth were bad precisely because that much money led to disproportionate political power

Spinoza said more or less the same thing 300 years earlier. Economic inequality undermines democracy insofar as the rich have enough money to disproportionately influence elections or bribe the government. In this respect, America's democracy is probably already beyond repair; but it's still interesting to talk about.

Posted by Gary Sugar | January 24, 2008 1:19 PM

Ah, yes. Questioning the absolutely unprecendented accumulation of wealth in the hands of a tiny few makes Matt a communist. Luckily all of you are more realistic.

By the way, another historical figure who was deeply opposed to extreme wealth inequality was that noted socialist Thomas Jefferson.

Posted by Freddie | January 24, 2008 1:22 PM

Mixner:

Oh man that was a good one. I still have tears in my eyes from laughing so hard. I forgot that the food pantry and those people interviewed don't exist because the Heritage Foundation said so.

Posted by David | January 24, 2008 1:23 PM

"simply to prevent such utterly massive concentrations of wealth to occur."

Or, uh, simply reduce the power of government so people are less interested in buying that power. Basic premise here:

http://www.reason.com/news/show/124549.html

That is, multibillionaire prudes will be less interested in buying Congress if Congress had no say on what you do in the bedroom. Multibillionaire owners of sports teams will have less interest spending millions of dollars to control city hall if city hall didn't dispense hundreds of millions of dollars to build stadiums. Quaint, I suppose. But worth considering.

Posted by Sam M | January 24, 2008 1:38 PM

David,
You need to read what the Heritage Foundation said more carefully.

Freddie, DBX, et al.,
It's not enough to simply argue that how loudly you can speak depends on how much money you have. We know that. If you think this is a problem that can be fixed, you need to explain how to fix it. Something rather more specific than "prevent massive concentrations of wealth."

Posted by Mixner | January 24, 2008 1:41 PM

Best MY post ever!

Matt, I think you've found the subject for your seecond book.

Posted by lemuel pitkin | January 24, 2008 1:46 PM

Al, not ponies for everyone, but maybe some ponies for these people?

I don't think you understand the concept of the pony. Matthew likes to write about ponies - maybe you should inquire of him...

And in any case, what do those people have to do with "prevent[ing] such utterly massive concentrations of wealth to occur"? You can give them ponies regardless of whether we prevent Bill Gates from accumulating $X billion.

Posted by Al | January 24, 2008 1:46 PM

I don't see why it's "unrealistic" to redistribute wealth from the top down in a capitalistic democratic society ¿didn't FDR and the New Deal did exactly that? It's not as if Matt is talking about a Communist revolution after all, rather he's talking about the levels of concentration of wealth that existed in the USA 30 years ago or that exist today in most of Europe. Another option is to counterbalance the influence of big money by creating well funded opponents; Perón gave the health insurance business to the unions essentially with that intention.

Posted by Charrua | January 24, 2008 1:53 PM

Or, uh, simply reduce the power of government so people are less interested in buying that power.

Yes, Reason Magazine has a foolproof plan for diminishing the power and influence of concentrated wealth:

First, reduce taxes and regulations on billionaires.

Second, reduce the power of democratic government, in which every vote counts equally, and allow all the functions of government to be carried out by private enterprise, in which every dollar counts equally.

Third, wait for the power and influence of concentrated wealth to recede to the levels it had during the quaint era known as the Gilded Age, when billionaires had no power or influence.

It's a brilliant, foolproof plan. Thanks, libertarians!

Posted by LaFollette Progressive | January 24, 2008 1:54 PM

I basically agree with LP. The whole idea that money = speech is crazy. In a democracy, the goal should be that each citizen has the same amount of political power regardless of how much wealth they posess. Regulation of political spending that serves to promote political equality is all to the good. The first amendment should only come into play if the content of speech is regulated.

On the other hand, setting a goal of out and out preventing large conentrations of wealth is an awful idea. The heavy handed regulations required to make that happen would almost certainly be economically counterproductive.

That's not to say that we shouldn't make the tax code more progressive, make it easier for unions to organize, etc. But there's a difference between policies designed to limit the economic inequality caused by untrammelled free markets, and policies that subvert the free market system altogether.

Posted by RC | January 24, 2008 1:55 PM

Yeah, this is a silly idea. I mean, sure, a more progressive tax scheme would mitigate wealth inequality (possibly at the expense of overall wealth of everybody, but that's not the issue here). But there will still be billionaires. In fact, if there are fewer billionaires, they will have proportionately louder voices, not softer ones.

Unless you really are arguing an actual communist line of, "We will take away all wealth beyond a certain point" (and I don't believe that Matthew is arguing this), then you're still going to have people who can buy lots of airtime for their views.

Things that you could do that would actually reduce inequality of speech: as LaFollette Progressive notes above, limit what people can legally buy in the way of speech; alternatively, make lots more very wealthy people who can feasibly afford to buy speech, and hope that in large enough numbers, they cancel each other out.

I am dubious of the utility of making it expensive to buy political speech. I think that the very wealthy are good at finding loopholes, and you'll more likely end up with a regulatory capture situation where you squeeze out the top 5% people's speech while not affecting the top .1% people's speech. I also think that if you really do close enough loopholes, you'll just encourage the most politically active billionaires to suborn politicians directly, rather than go through a nominally democratic process with a louder voice than their fellows.

Posted by Michael B Sullivan | January 24, 2008 1:56 PM

It's amazing how deferent the middle-class commenters here are to the perogatives of private wealth. Men fit to be slaves.

Posted by Mark | January 24, 2008 1:58 PM

LaFollette Progressive-

You really ought to learn something about what your namesake thought on this subject. He supported steeply progressive taxes on incomes and estates precisely in order to, yes, prevent extreme concentrations of wealth and power. If you think that's "silly," you probably should choose a different handle.

Posted by lemuel pitkin | January 24, 2008 1:58 PM

I take issue with the proposition extremely wealthy people reach an income/personal wealth level and then feel sated and thus de-emphasize the importance of additional earnings. Example: Tiger Woods has a personal net worth running to the hundreds of millions. He has contracts with various sports and motor vehicle corporations guaranteeing him many more millions for years and years to come. Yet despite all this present and future wealth he chose to do a commercial for a shaving razor. Whatever he was paid, large or small, certainly represents a pittance of his bank account. He didn't do it for the exposure, to stay in the public eye. A lark? Yeah, that's what he has to do with his spare time, shaving commercials. It was for the money. Money he in no way needs. But hey, a million or two for an afternoon in a studio, why not? Easy money. I don't think we want to decide rich people don't care about money beyond a certain amount because of some psychological studies. More than a few might say "Screw your studies, I want more" and that's their right. Oh, they can say screw whatever Thomas Jefferson thought also.

Posted by steve duncan | January 24, 2008 2:02 PM

Could it possibly be that capitalism and representative democracy, being man-made systems, are imperfect, and that, perhaps, the two are incompatible with each other? That, maybe, because God didn't set down the two perfect pillars of capitalism and democracy and call them good, it could be that capitalism (which grants power to money) and democracy (which grants power to the people) could be working at cross-purposes? And could it be that a nation could, while believing in both and attempting to preserve both as best possible, might need to make policy decisions that benefit one over the other? Perhaps, just maybe, that nation might think it best to privilege democracy over capitalism, acknowledging that the decision may have negative consequences for capitalism, but that the decision is still necessary to preserve its democratic ideals?

Nah. Too crazy.

Posted by Freddie | January 24, 2008 2:05 PM

Wealthy Americans certainly have the right to blow their money on think tanks, policy shops, lobbyists, and issue ads to their heart's content. They do not, however, have a Constitutional right to give large sums of money to political campaigns in order to buy client services from politicians or influence the outcome of a free election.

That was the principle behind McCain-Feingold, and it's worth fighting for.

Huh? That was certainly NOT "the principle behind McCain-Feingold". McCain-Feingold banned issue ads (at least in proximity to an election), and banned giving large sums of money to parties. Giving large sums of money to candidates was illegal long before McCain-Feingold came around.

Posted by Al | January 24, 2008 2:06 PM

Let's recall what this post is about: not a general referendum on whether progressive taxation is a good idea, but whether it will prevent the very wealthy from having such a disproportionate say in politics.

There may be good reasons to support efforts to prevent concentration of wealth, and they may be successful in mitigating the degree of wealth inequality. But preventing the wealthy from having a disproportionate say in politics is not one of those reasons.

Posted by Michael B Sullivan | January 24, 2008 2:08 PM

The whole idea that money = speech is crazy.

The whole idea that money DOESN'T equal speech is crazy.

I mean, if money doesn't equal speech, then presumably there would be no First Amendment complaint if we passed a law saying that the New York Times could only spend $2000 per year printing its newspaper.

Posted by Al | January 24, 2008 2:09 PM

I wouldn't worry too much about wealth concentration; it tends to take care of itself in a generation or two (call it reversion to the mean).

The thing to worry about are the restrictions to which that fortune can be wasted upon: politics being a really good one. Of course our current set of elected federal officials seem to have no difficulty improving their net worths, hence their desire to keep their gravy train running, i.e. campaign finance reform. I read a paper about senators' net worth accretion once they hit office -- I can't seem to find the link.

I like full and real-time disclosure of campaign spending; I like only citizens (e.g., not corps or unions or foreign governments) to contribute or provide advocacy advertising.

If we reduce the constant money-grubbing that currently taxes Congress, perhaps we'll have better government -- I need to dream bigger, I know.

Posted by mike c | January 24, 2008 2:13 PM

Lemuel Pitkin-

I agree with my famous namesake on said issue and I'm uncertain as to where you got the idea that I don't. I think it's silly to assume that steeply progressive taxes will "simply prevent" the accumulation of extreme wealth. Progressive taxation is not a substitute for campaign finance regulations, which my famous namesake also supported.

Posted by LaFollette Progressive | January 24, 2008 2:17 PM

A couple of simple ways to rebalance power and income in our society would be to repeal Taft-Hartley and pass the EFCA.

That would allow workers, as individuals and as a class, to go after concentrations of wealth and power directly. And that kind of action was essential to the way that wealth was distributed in this country in the New Deal years.

Note: I don't think either of these will happen, even with a Dem House, Senate, and White House. But it's not complicated conceptually.

Posted by Pesto | January 24, 2008 2:21 PM

Al- "McCain-Feingold banned issue ads (at least in proximity to an election), and banned giving large sums of money to parties."

Yes, because large sums of money were being funneled to candidates through the parties and campaigns were coordinating the purchase of "issue ads" that were actually campaign attack ads. The principle behind McCain-Feingold was that it was wrong for individuals to give large sums of money to political campaigns in order to buy client services from politicians or influence the outcome of a free election. Neither one of us is naive enough to believe that direct donations to the candidate are the only way to corrupt an election.

Posted by LaFollette Progressive | January 24, 2008 2:25 PM

I think it's silly to assume that steeply progressive taxes will "simply prevent" the accumulation of extreme wealth.

And I think it's silly to lean too heavily on the difference between "make more dificult" and "prevent". It's like the difference between "big" and "very big". Matt Y. is just saying here what LaFollette (and Roosevelt and lots of other smart people) said in the 1930s. Namely, that once economic inequality passes a certain point it becomes incompatible with political equality.

Posted by lemuel pitkin | January 24, 2008 2:27 PM

As another point, I'd really, really raise questions about whether more than a relatively small slice of the people in our (or any other) society are primarily motivated in their behavior patterns by the desire for financial reward, i.e. "greed."

This certainly doesn't seem the empirical case to me, and it would seem pretty doubtful from the perspective of evolutionary-psychology.

Obviously, most people desire/require some minimal level of financial well-being, just as they desire/require some minimal level of food consumption. But above that, I'd suspect things turn very nonlinear indeed.

Admittedly, mass advertising can partially overcome this, by providing strongly induced desires for otherwise unimportant but expensive goods. But it's not clear that this is particularly desirable for the long-term benefits of a society.

For example, promoting massive levels of addiction to high-priced drugs like crack or heroin would similarly increase the pressure to acquire wealth, but without too many benefits that I can see.

What exactly is the historical evidence that societies whose individuals focus narrowly on wealth-acquisition are more successful over an extended period of time?

Posted by RKU | January 24, 2008 2:29 PM

Pesto is right.

Campaign finance isn't a bad idea, exactly, but it's sort of irrelevant, and contrary to the whole spirit of (real-world, historical LaFollette progressivism.) LaFollette's single biggest idea was that to challenge the power of concentrated, organized money you needed forms of concentrated, organized power for working people. Unions, consumer groups, neighborhood organizations. Especially unions.

And in practice, campaign finance often reinforces the power of money, because it is easier for the usper-rich to manipulate the law, find loopholes and bear the legal penalties than it is for unions and other mass-based organizations to do so.

If you wnat a more democratic politics, you need to build up the power of working people and tear down the power of the rich. Not try to create a purified realm of politic insulated from the distribution of resources in the rest of society.,

Posted by lemuel pitkin | January 24, 2008 2:33 PM

I meant to add:

If you want a more short-term campaign finance program, you should forget about getting private money out of politics and focus on getting public money in.

Preventing rich people from spending money on elections is a program without a constituency, and has to run contantly just to maintain its effectivenessas as people find loopholes and create new backchannels to funnel support to candidates. Public financing creates a whole new class of potential candidates and the loophole issue doesn't really arise.

Getting outspent even ten to one you can still win, but under the current system the problem is in many races candidates without a big money base can't get into the game at all.

Posted by lemuel pitkin | January 24, 2008 2:44 PM

For some actual facts and figures on just how rich America's "poor" are, see here.

Ah, the Heritage Foundation, that model of dispassionate judgement, shilling their McArdle Brand™ Poverty Sensitive Sunglasses, aka "B-B-But They Have Cell Phones!"

I'm with lemuel pitkin: public financing of elections. Oh, and how about a 95% tax on advertising revenue generated by political advertising on FCC-regulated airwaves? The South Carolina affiliates must be rolling in it right now.

Posted by pseudonymous in nc | January 24, 2008 2:52 PM

Lemuel- I think we all agree that once economic inequality passes a certain point it becomes incompatible with political equality. The problem is that we've been past that point for a very, very long time. Matt Y. is saying that the McCain-Feingold reforms were "off-base." He's suggesting that reduced economic inequality will solve the problem of political inequality. But how are such policies going to be enacted in the present climate of political inequality?

Since we're talking about Senator LaFollette, I'd note that he also supported a large number of political reforms to democratize the political system and break the power of machine politics. This is not a coincidence. I think it's silly to suggest that the ends of progressive politics-- reduced inequality-- are also the means. There will always be concentrations of wealth, and the influence of that wealth in our politics has to change before we can change anything else.

I'm perfectly happy to consider public financing and any other suggestion to reduce the influence of wealth in politics. Banning soft money was hardly a panacea, but it was unquestionably a positive step. It's going to take a lot of small changes to bring about big changes.

Posted by LaFollette Progressive | January 24, 2008 2:58 PM

I mean, if money doesn't equal speech presumably there would be no First Amendment complaint if we passed a law saying that the New York Times could only spend $2000 per year printing its newspaper.

If only the New York Times and no other newspapers were subject to this restriction, that would basically be discriminating against them based on content, and thus against the first amendment. On the other hand if this restriction were applied to all newspapers, that would amount to a ban on all newspapers, which would rather obviously be a subversion of the first amendment as well.

On the other hand, if you really believe that any money spent in propagating political discourse should automatically count as first amendment protected free speech, then the New York Times should be free to spend money in any way it chooses, exempt from environmental laws, zoning laws, tax laws, anti-trust laws, etc.

The first amendment means that the government can’t discriminate against the newspapers based on what they print. It doesn’t mean that any government regulation of them is automatically unconstitutional. The same should be true of private political spending as well.

Posted by RC | January 24, 2008 2:58 PM

I'm with lemuel pitkin: public financing of elections.

What a great idea. Give politicians the power to control the funding of elections. No danger they'll use that power to rig the system against their opponents.

Oh, and how about a 95% tax on advertising revenue generated by political advertising on FCC-regulated airwaves?

That would seem to make it even harder for anyone but the superrich to buy political advertising.

Posted by Mixner | January 24, 2008 3:04 PM

Al puts in an amazing performance as Dr. Pangloss in this thread.

Posted by Matthew | January 24, 2008 3:07 PM

And in practice, campaign finance often reinforces the power of money, because it is easier for the usper-rich to manipulate the law, find loopholes and bear the legal penalties than it is for unions and other mass-based organizations to do so.

True. The other side of the story, however, is that unions and other mass-based organizations are far better at providing volunteers and manpower for campaigns than Citibank is. Citibank's primary advantage is that they can cut bigger checks than you or me. All the small-bill fundraising and the massive GOTV drives that Democrats have put together in the past several election cycles are positive developments. And I don't think it's entirely unrelated to the soft money ban.

Posted by LaFollette Progressive | January 24, 2008 3:10 PM

"It should be pointed out that John Rawls was not in favor of a political system that ensured absolute economic hegemony. He believed it was important to have significnat variations in income throughout society."

yeah, it would be useful in these discussions to be able to refer to some well-defined point in between plutocracy and socialism.

Maybe 50%? That is, the top income and inheritance tax rate should not be much more, or much less, than 50%? The top rate could kick in at about 10 times the average income, and about 50 times the average estate.

I think Ted Turner at some point accumulated land area equivalent to the state of Montana. I've asked libertarians a couple of times if they thought Ted Turner should be able to pass on and control an entire state's worth of land and resources to his heirs, in perpetuity. Have never really got a reply.

Posted by roublen | January 24, 2008 3:16 PM

No danger they'll use that power to rig the system against their opponents.

You don't get out much, do you?

That would seem to make it even harder for anyone but the superrich to buy political advertising.

Let me be clearer: the affiliate pays a 95% tax on whatever it receives from a buyer for political advertising. Thus diverting the bi-annual transfer of wealth from individuals to network affiliates. Perhaps that means the ratecard is distorted, but tant pis.

Posted by pseudonymous in nc | January 24, 2008 3:29 PM

I'm tickled that Matt found my post to be worthy of further discussion and am sorry that I came to the discussion so late. Damn work interfering with my blogging activities. lol

Anyway, the only thing worse than campaign finances law (which is one of the many reasons why I will not support or vote for McCain under any circumstances) would be public financing that some here are advocating and seems to me as constitutionally questionable as the McCain-Feingold law that is currently on the books.

Posted by Chicounsel | January 24, 2008 3:36 PM

I find it very difficult to believe that Ted Turner owned land area equivalent to the state of Montana. Wikipedia (http://en.wikipedia.org/wiki/Ted_Turner) suggests that he owns about 1.91 million acres. Montana is about 94 million acres in area.

His net worth is allegedly around $2 billion. Even if that's off by an order of magnitude, and his actual net worth is around $20 billion, if he actually had 94 million acres of land, that would imply that the land was worth less than $212 per acre (and his only major asset was the land).

That all strikes me as grossly implausible.

But, if we hypothesize that someone (not Ted Turner) held an amount of land amounting to the tens of millions of acres, and asked could they pass that on to their heirs in perpetuity, I think that my response, as a libertarian, is, "I don't have a problem with some kind of estate tax, but, honestly, I doubt it would cause any horrifying problems for someone to pass on that amount of land without taxation to their heirs. Conversely, I don't think that the current estate tax is by any means the most horrible or intrusive part of the government in general or the taxation scheme in particular, and am pretty happy to just let it be."

So, there. You've now had a reply from a libertarian about your seemingly incorrect assertion about Ted Turner's land.

Posted by Michael B Sullivan | January 24, 2008 3:38 PM

Here's a libertarian reply to roublen(and probably not the only one):

why not? he'll give it to his kids or to his favorite charity (which he does have). One or more of the above won't want ranch land or buffalo meat and will sell to someone else. And the money will be spent on something (including taxes from the capital gain), perhaps on old jane fonda videotapes or upgrades to a cable news channel or even, gasp, something really productive. No matter, the wealth will be dissipated over the 25 years after his death.

He made open market transactions -- he offered the right price to get the land -- I haven't heard that he forced anyone to sell. Time will tell if it was a good investment. To restrict him would be to essentially say to ranch owners that they cannot sell or leave their land -- I really thought serfdom went out of fashion long ago.

Posted by mike c | January 24, 2008 3:38 PM

How about if, instead of an extremely progressive tax rate, a system caps accumulation of wealth at a certain (probably obscene) amount. After that, the individual has to put the money into a somewhat independently run foundation - like the Bill and Melinda Gates foundation.

This idea just occured to me and I'm sure it has some incredible flaws. Just thought I'd throw it out there for the discussion.

Posted by es | January 24, 2008 3:55 PM

"I find it very difficult to believe that Ted Turner owned land area equivalent to the state of Montana. Wikipedia(http://en.wikipedia.org/wiki/Ted_Turner) suggests that he owns about 1.91 million acres. Montana is about 94 million acres in area."

Ha, thanks for the correction. I probably read somewhere that he was buying land *in* Montana, equivalent to the land area of some smaller state, and got mixed up.

This recent, and very interesting Fox news article
has more on Ted Turner's land purchases:

http://www.foxnews.com/story/0,2933,313607,00.html

Thanks for the replies, the Libertarians have spoken! mike c, for me the issue is not so much whether he should be able to buy so much land during his lifetime, as whether he should be able to pass on so much land to his heirs, forever and ever amen. The issue for me is whether a wealthy family in a democracy should be able to use their wealth to control not only the present, but the future as well.

Posted by roublen | January 24, 2008 3:56 PM

LFP-

I don't think we fundamentally disagree.

I do think, tho -- based in part on working on a number of campaigns -- that it is very hard to write a law effectively limiting the power of the rich to influence politics, and even harder to do it in a way that doesn't disproportionately affect groups on our side (which do have to spend money -- mobilizing volunteers isn't free!) Getting public money into elections seems much more likely to actually result in a more level playing field.

reduced economic inequality will solve the problem of political inequality. But how are such policies going to be enacted in the present climate of political inequality?

Right. That is the big question. (And the one Matt Y. should write a book about!)

I don't have the answer, obviously, but as a general heuristic I'd suggest you want to look for policies that not only produce a good outcome but that also are helpful to further organizing -- that create constitutencies to defend and extend the policies and that empower organizations of working people. In my opinion, McCain-Feingold-style campaign finance reform does not meet this test. Labor law reform, for instance, does.

Posted by lemuel pitkin | January 24, 2008 3:59 PM

You don't get out much, do you?

You don't make much sense, do you?

Let me be clearer: the affiliate pays a 95% tax on whatever it receives from a buyer for political advertising.

Which means the affiliate will have to charge its buyers much more in order to cover its costs. Which means your tax will price all but the richest buyers out of the market for political advertising. Brilliant.

Posted by Mixner | January 24, 2008 4:24 PM

Lemuel- I think we all agree that once economic inequality passes a certain point it becomes incompatible with political equality. The problem is that we've been past that point for a very, very long time.

Not a terribly meaningful assertion without a reasonably clear definition of "political equality" and an explanation of where the region in which economic liberty and political equality are compatible is supposed to lie.

I think you'd have a hard time making the case that there is less equality of political speech today than there was a generation or two ago. Yes, there is greater economic inequality, and yes, speech depends on money, but I think the democratizing, diversifying effects of technological advances have swamped any changes arising from economic inequality. We now have dozens or hundreds of national TV channels, rather than just the three or four of a generation ago. The TV audience is much more fragmented and widely distributed. There is a much greater diversity of political programming. And we have the internet, which allows any two-bit pundit with a modem and an opinion to reach an audience potentially in the millions.

Posted by Mixner | January 24, 2008 4:43 PM

Let's see, the income tax system is progressive but is a disincentive to work, also it undertaxes passive income. The solution is easy, wealth taxes. We have it to a limited extent at the state level (most states tax real property, many also tax personal property and Florida taxes intangible wealth as well).

There is an argument that wealth taxes are "direct taxes" and thus unconstitutional, however federal estate taxes are a form of wealth taxation and no one has gotten those thrown out by the courts. The other way to get it through would be to use the $400 billion in revenue sharing to states (and the existing tax code) as a gun to their head. Put in your state-level wealth taxation or you don't get federal funds and your residents will still have to pay federal income taxes.

To replace all existing federal taxes and reduce inequality, start over with a sales tax (or better, a VAT-- harder to evade) and a wealth tax. An element of most federal sales tax proposal is a rebate to every taxpayer to recover a portion of the sales tax paid. The Fairtax, for example, would give a single adult a rebate of $2,348 and a a family of four a rebate of $6,297. If the rebate was automatically deposited into an investment account (so inertia keeps them invested instead of requiring them opt in to an IRA), their net worth would quickly grow.

On the top end, the top 1% of wealthholders have net worths over %6 million, the top 5% over $1.375 million, the top 10% over $800,000. By net worth, that includes the equity in their home but doesn't count home values that are mortgaged. This is in contrast to local property taxes which are on the gross value of the house irrespective of any mortgages. You could put a wealth tax of (depending on how high you put the sales tax rate) of between 1% to 5% on one's net worth over $800k, $1.375 million or $6 million.

If Uncle Sam wanted to let states integrate their own tax system, the Feds might tax only the top 1% and let the states collect from the top 10%.

Replacing the income, corporate, FICA and estate taxes with sales and wealth taxes would simplify the tax system, eliminate disincentives to work and invest, compress the wealth gap from the bottom and the top-- and I'm afraid, is as politically unimaginable as putting a transactions tax on the stock market.

Posted by beowulf | January 24, 2008 4:45 PM

When Pat Brown, former Dem gov of CA, ran for the Dem prez nomination ('88 or '92 forget which) he took campaign contributions only if written on personal checks and limited to $1500 per person. So, no organization money (PACS, etc.) of any kind. Since this was voluntary, no legal problems/challenges arose.

What's really needed is a political party that operates the same way. Its funding rules alone would win it many votes. Instead, people go on wasting their time with the same old republicratic bullshyt.

Posted by kafka | January 24, 2008 4:58 PM

Good luck with that. Even Sweden has billionaires.

Posted by Mixner | January 24, 2008 12:26 PM

I agree. Changing from a system in which marginal income tax rates scale up progressively to one in which we simply seize all wealth beyond $X would be a completely moronic idea.

Posted by Consumatopia | January 24, 2008 12:32 PM

Well, if you want all the rich to give up U.S. citizenship then I suppose it would be smart. Outsource the rich, too, along with the jobs!

I remmber how the Rolling Stones and the Beatles put their money where their "revolution" mouth was when the confiscatory rate in the 1970's UK came calling...a quick google finds that the racer Jackie Stewart moved to Switzerland....Sean Connery fled to the U.S....

Nowadays it might be Shanghai where they let the rich be glorious. :-)

Posted by artappraiser | January 24, 2008 5:01 PM

When Pat Brown, former Dem gov of CA, ran for the Dem prez nomination ('88 or '92 forget which) he took campaign contributions only if written on personal checks and limited to $1500 per person.

That was Jerry Brown, son of Pat. Both were governor of California.

Posted by lemuel pitkin | January 24, 2008 5:50 PM

Nowadays it might be Shanghai where they let the rich be glorious.

If the Chinese want Paris Hilton, they can have her. Tax away!

Posted by lemuel pitkin | January 24, 2008 6:02 PM

Hey, Lemuel, Paris is on your side. She's redistributing her family's wealth to the less fortunate.

...Or do you think that Paris is somehow a net earner to the Hilton's fortune?

Posted by Michael B Sullivan | January 24, 2008 6:32 PM

Which means the affiliate will have to charge its buyers much more in order to cover its costs. Which means your tax will price all but the richest buyers out of the market for political advertising. Brilliant.

Yes, because in Mixner's basement bunker of a world, there's no point at which the cost of ads inhibits their use.

If paid political ads are taxed to fit the Super Bowl rate card, with the majority of the cost diverted to a public election fund, then Sheldon Adelson gets his ads, but in doing so pays for non-billionaires to get airtime.

Posted by pseudonymous in nc | January 24, 2008 6:32 PM

lemuel,

Just to be able to chase Paris Hilton out of the country, you would turn down the 65% she'd probably be willling to fork over to stay here? Demand 95% and say goodbye to Warren Bufffet George Soros, Steve Jobs etc. as well...leaving on the next private jet after her. Warren said he should pay more than his secretary, he didn't say he wanted to give the Federal government every single cent.

Nine Swedes on Forbes list of billionaires 2005. Strange, they haven't seen fit to nationalize IKEA yet.

It's a globalized world, have you heard? The Russian billionaires all live in London now.

Posted by artappraiser | January 24, 2008 6:45 PM

Yes, because in Mixner's basement bunker of a world, there's no point at which the cost of ads inhibits their use.

Your proposal would inhibit political ads by making them much more expensive. The more expensive they are, the more they would be restricted to wealthy buyers. The exact opposite of what you're trying to achieve. It's not exactly rocket science. Maybe in your confusion of a brain it is.

Posted by Mixner | January 24, 2008 6:46 PM

I do not think that you need any further explanation of Liberal Fascism.....you just graduated.

Posted by robertl | January 24, 2008 7:17 PM

do you think that Paris is somehow a net earner to the Hilton's fortune?

Good point. It's too bad we don't also tax unearned income, like inheritances and dividends.

Wait, what's that? We do? Well, ok then.

Posted by lemuel pitkin | January 24, 2008 10:24 PM

Just to be able to chase Paris Hilton out of the country, you would turn down the 65% she'd probably be willling to fork over to stay here?

No, no, we'll take the 65%. I'm the one arguing for taxing the rich; you're the one saying they'll just leave the country. If they won't, well, the case for steeply progressive taxation just got stronger.

Nine Swedes on Forbes list of billionaires 2005.

The proposal under discussion is to greatly reduce concentration of wealth, which we believe can be done without severe harm to the economy. For instance, we think that appropriate policies could result in Bill gates ending up with a fortune of $1 billion rather than $100 billion without reducing his productivity one iota.* Sweden argues for the feasibility of this idea rather than the reverse.

[* No, I am not suggesting that we seize $99 billion from Gates tomorrow. I'm talking about over the course of his career.]

Posted by lemuel pitkin | January 24, 2008 10:31 PM

lemuel,

For instance, we think that appropriate policies could result in Bill gates ending up with a fortune of $1 billion rather than $100 billion without reducing his productivity one iota.* Sweden argues for the feasibility of this idea rather than the reverse.

Er, Sweden, once an economic superstar, has been in economic decline relative to Europe and (even more) to the U.S. for decades. And yet even with its vast public sector, confiscatory tax rates, and hobbled economy, it still has nine billionaires. Adjusted for population, that's equivalent to 300 billionaries in the U.S.

Of course, the idea of enacting Swedish-scale redistributive policies in the U.S. is a paleoliberal fantasy, but even if you could somehow pull that off, you'd still have huge concentrations of wealth.

Posted by Mixner | January 24, 2008 10:46 PM

Matt: "It seems to me that the only way to prevent the super-duper-rich from having an unjustly large ability to influence the political process is simply to prevent such utterly massive concentrations of wealth to occur."

Guess what? The only way to do that is to eliminate the concept of the corporation - which is a function of the state.

Eliminate the state, you eliminate the corporation - and thus the ability, except in rare cases, to raise excessively large sums of capital for companies. You also eliminate monopolies, which can only exist if supported in some way by the state. ("Natural" monopolies rarely exist, and can be competed against by other means of supplying the same functions.)

I don't see Matt going that far. Unfortunately, that's exactly how far you have to go to get rid of "excessive" wealth.

Personally, I have no problem with "excessive wealth". I don't dislike Bill Gates because he's rich. I dislike him because his software sucks rocks and he's personally a greedy asshole who rips off his customers and everybody else he comes near.

A rich person can't have political power UNLESS POLITICAL POWER IS TO BE HAD.

Morons. You still think all you have to do is find some really wonderful people and make them President and it will all work out.

Leave the crack pipe at home, Matt, I've told you before.

Posted by Richard Steven Hack | January 24, 2008 11:58 PM

Ah, I see Mixner's problem: first, s/he can't read; second, s/he is so sheltered that s/he can't conceive of a state of affairs whereby federally-regulated broadcasters might include in their license requirements limited, designated political ad time as part of a public funding system, and then permit political advertising on top of that designated time, but at a punitive tax rate.

In that model, the tax on Adelson's paid ads subsidise ad time for everyone else.

It's almost as if, say, Canada didn't have a paid/unpaid model that couldn't be adapted to fit the existing money=speech interpretation of the First Amendment.

Poor sheltered thing, Mixner.

Posted by pseudonymous in nc | January 25, 2008 6:30 PM

What I can conceive of is irrelevant, pseudo. I was criticizing your stated proposal. It's utterly stupid for the reasons I have explained. Pretending that you made a completely different proposal (which is also stupid) doesn't alter this fact.

Posted by Mixner | January 25, 2008 7:44 PM