campaign finance reform | Normative Narratives

Original Article:

People who feel financially secure vote, people who aren’t secure don’t, according to a Pew Research Center report released this morning. And because financially insecure Americans disproportionately identify with the Democratic Party, Democrats face a structural disadvantage, especially in mid-term elections. In 2014, fully 94% of the most financially secure Americans were registered to vote, compared to only 54% of the least secure; 63% of the most secure were likely voters, versus only 20% of the least secure.

Not surprisingly, financial security is correlated with political knowledge and activism. The most secure Americans are more than twice as likely to know basic facts about the political system, and three times as likely to have contacted an elected official during the past two years.

40% of all Americans think that government does a better job than people give it credit for compared to 56% who believe that it is almost always wasteful and inefficient. Among the least financially secure Americans who would seem to have the most to gain from effective public programs, only 48% adopt the more affirmative stance, while 49% focus on waste and inefficiency. Government’s poor reputation is one of the many obstacles impeding political mobilization along economic lines.

One can only hope that elected officials will focus on this disparity more than they have in recent years. But as the report shows, the people who most need a hand up are those least likely to vote and to make their views known to elected officials. Unless average Americans feel secure enough to afford generosity, leaders who focus on the problems of those at the bottom are likely to reap meager electoral rewards.

People have many excuses for not participating in the political process. The rise of “Super-PACs” / money in politics makes many people feel they have no voice compared to wealthy interests. Gerrymandering can take the “punch” out of an individual’s vote. Whatever the reason, too many people in this country simply feel their vote does not matter, that the “costs” of voting outweigh the benefits (notably this feeling seems to coalesce at the bottom of the economic ladder).

Just 36.4% of eligible voters turned out for the 2014 midterm elections, the lowest level since WWII. But passive-aggressive resistance (abstaining from voting) is a counter-productive form of protest. Not voting will not make the political system go away, nor will it lead to meaningful changes in the political process. To paraphrase Thomas Picketty’s “Capital in the 21st Century“, everyone should be active participants in the democratic process; the wealthy never fail to promote their interests.

Reducing inequalities requires an active, informed citizenry. To this end, I have identified a few reforms which could have a meaningful impact on voter turnout among the financially insecure (aside from campaign finance reform measures):

1) Make National Election Day a national holiday:

Senator Bernie Sanders (I, VT.) wants to make national election days national holidays. While this is a sentiment I support, and one that should increase overall voter turnout rates, it may not directly address the issue of increasing turnout among the financially insecure.

Most of the poorest people in America are hourly wage earners. Therefore, making election day a federal holiday would not necessarily lead to higher turnout amongst the poor. In fact, since wage earners typically earn “time and a half” for working holidays, making election day a federal holiday could actually create an perverse incentive, keeping hourly wage earners away from the polls.

Perhaps in addition to making election day a national holiday, the government should consider providing businesses with tax credits in exchange for offering hourly wage employees paid leave on election day?

2) Include a political science / economics class as a required part of the high school curriculum:

I understand the federal government generally tries to stay out of educational curriculum issues, which are developed at the state level. But to me, this area seems like it should be an exception to that rule.

A primary goal of schooling is to help children develop into well rounded, successful adults. But regardless of what someone ends up doing for a living, every American citizen has a civic responsibility to be an active, informed voter. We cannot demand every American be a political buff, but we can and should empower every American citizen to make an informed decision at the polls.

Educating young adults about the functions of the different levels (municipal, state, federal) and branches (executive, legislative, judicial) of government, and the basics of economics, economic policy, personal finance, and taxation would go a long way towards producing informed voters.

A bipartisan committee could draft the curriculum, to ensure it is even-handed.

3) Remote Voting via the internet:

Assuming we can ensure security (and I see no reason why we would not be able to), it seems obvious to me that advances in ICTs should translate into greater ease of voting. Voters should be able to register and vote online, ensuring those who are strapped for time–a limited resource regardless of ones level of income / wealth–can vote.

Online voting would require registration based on SSN, allowing one vote per registered voter. Registration would have to take place ahead of time, to provide ample time to verify age, residency, and any other eligibility requirements.

Update: According to Politifact, At least 20 states currently offer online voter registration for new applicants and a few more are in the works…Experts who study online registration say there have been no reports of actual security breaches or fraud. If designed in a way to account for security, online registration reduces opportunities for fraud and errors.

While this is a promising start, I am advocating for online registration and voting in all 50 states.

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Voting is a voluntary activity. In order to increase voter turnout, we have to consider why people do things voluntarily.

Reducing the perceived “opportunity costs” of voting, both foregone wages and the time it takes to vote, is one side of the equation. Convincing people voting is in their best interests by teaching them the basics of political economy (and consequently explaining why the political system may have failed to promote their interest in the past), would increase the perceived benefits of voting.

Perhaps the financially insecure are not as “rational” as I am making them out to be. There is a strong argument that people who live in poverty do not act “rationally” (in the economic sense of long-run “utility” maximization). It may not be enough for voting to be in a financially insecure person’s “best interest”; to increase voter turnout amongst the poor, voting must be made a “no-brainer”.

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Politicians come in all shapes, sizes, and ideologies. Some are progressive, some are conservative. Some serve “the people”, while other are beholden to special interests.

One thing that is consistent among all politicians is their desire to be (re)elected. It is the responsibility of voters to make a populist agenda (by whatever name it goes by), a (re)electable platform.

A recent New York Times poll on the achievability of “The American Dream” produced some concerning yet unsurprising results:

Notwithstanding the bleaker view of upward mobility, the majority of those polled said they were more concerned about the possibility that too much regulation in Washington could stymie the economy than they were about the prospect of inequality. Fifty-four percent of respondents said that “over-regulation that may interfere with economic growth” was a bigger problem than “too little regulation that may create an unequal distribution of wealth.” Only 38 percent said that too little regulation posed a bigger problem.

That answer was particularly noteworthy given the persistent concerns among economists and politicians from both parties about a growing gap between the wealthiest Americans and the middle class.

Still, almost six years after the height of the financial crisis, Americans’ wariness about the banking industry that was at its center remains. Only 4 percent of respondents said they had “a lot” of confidence “in Wall Street bankers and brokers,” though 31 percent said they had “some” confidence in Wall Street. Nonetheless, 44 percent said they trusted their own bank “a lot,” and 37 percent said they trusted their banks “some.”

My question is, if not the federal government, who can regulate Wall St?

Recently attention has focused on the Federal Reserve Bank of NY, which plays an outsized roll in financial regulation as NYC is the world’s largest financial hub. However, the NY Fed’s role in financial regulation is complementary to federal regulation–it is not a substitute.

People may not be enamored with federal financial regulation, but the answer is more regulatory power, not rolling back key provisions of the already insufficient Dodd-Frank Act.

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These reported beliefs on government regulation are not surprising (to me) because the rationale behind them is clearly explained by Matt Taibbi in his book “Griftopia” (which he discusses in an interview on Wall St. Cheat-sheet):

Basically, government regulation is the kind of stuff a lot of them see on a day-to-day basis, but in a different form. If they’re a hardware store owner, they see a local health inspector or an ADA inspector coming by to make sure they’re in compliance with something. These are all little annoyances and costs that they see when they interact with government. Unfortunately, that’s what they think financial regulation is. They don’t get that it’s a completely different ball game when you’re talking about JP Morgan Chase (JPM), Goldman Sachs (GS), and that level of power requiring oversight.

This is how the GOP sells its agenda to the average Americans (aside from exploiting social rifts, which can only go so far): anything provided by the public sector (regulation, welfare programs) is ineffective and holds back growth, therefore the path to prosperity lies in deregulation and slashing the social safety net.

Over-regulation may be a problem for regular Americans at the local level. But federal under-regulation of the financial sector, environmental concerns, and campaign finance, threaten our economic stability, future, and democratic processes respectively (these also happen to be the areas where Republicans are rolling back regulations in the current government spending bill).

But the way the GOP is pushing its deregulation agenda is almost as reprehensible as the socioeconomic consequences. The environmental issue is divisive, but there is a broad consensus among Americans in favor of tighter financial regulation and campaign finance reform.

No Congressman or woman campaigned on financial deregulation or easing campaign finance restrictions, as such an agenda would never be popular enough to get someone elected. But the GOP has essentially tied the ability to run the country to these very issues.

Compromise should be measured not only quantitatively (how often did congress compromise) but also qualitatively (what did congress compromises on). While there certainly needs to be more bipartisan cooperation in Washington, there also needs to be red-lines.