How about a quick visit to the blogosphere on the topic of money in politics? UMass Boston’s Black Student Center hosted a forum on the topic yesterday featuring Senator Jamie Eldridge, who was somewhat more optimistic than me on the topic. So what are the best academics saying about the Supreme Court’s recent decision on campaign finance, and does plutocracy bring any policy consequences – like government subsidies for too big to fail banks, for instance?A monkeycage post last week by UMass Amherst Professor Ray LaRaja makes the enticing case that McCutcheon v. Federal Election Commission, the most recent Alice in Wonderland campaign finance decision by our plutocrat enabling Supreme Court may not be so bad after all. Professor LaRaja sees several possible benefits from McCutcheon; First, parties and party leaders will control more money and they generally avoid extremist candidates, so we may see more compromise. Second, we’ll at least know who is making the contributions (less dark money). Third, corporations and unions can’t exploit McCutcheon since they are limited to one “connected” PAC. Fourth, the FEC may have a greater role and that agency is better able to understand campaign finance than the IRS.
By the way did anyone else notice that on the very day the McCutcheon case was announced, Charles Keating died? Keating was convicted in the savings and loan scandal of the Eighties. When asked if he thought there was any connection between his political contributions and his beneficiaries’ intervention on his behalf with regulatory authorities, Keating responded: “I want to say in the most forceful way I can: I certainly hope so.” I’ve always loved that quote.
Also at themonkeycage political science Professor Larry Bartels is dismayed that Rich people rule! Professor Bartels cites a paper forthcoming from Professor Martin Gilens (author of Affluence and Influence) and Professor Benjamin Page that shows that “economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.” The advance of Gilens and Page is the quantitative nature of their study; the conclusion may not come as a great shock but political scientists have struggled to provide quantitative proof. As Professor Bartels points out, some very good political scientists including my UMass Boston colleague Tom Ferguson are “following the money” and exposing the dominance of economic elites.
That’s about all I can stand on McCutcheon though so let me move on to wonder if we’ve solved the question of whether the American government is subsidizing “too big to fail” banks, if the subsidy is big, and does it matter? Well as MIT Professor Simon Johnson reports based on an International Monetary Fund Report, the big banks have indeed bullied their way past EBT recipients to feed at the red white and blue trough. The subsidy is sizable, and “yet this large scale of implicit support is small relative to the macroeconomic damage that is likely to be caused by the high leverage and incautious risk-taking that the subsidy encourages.”
As Diddy said, “It’s all about the Benjamins” folks.