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11/06/2005

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Larry Horse

Gary,

It's McCain, not McCann. Just giving you the heads up on that.

Mike Liveright

Eliminate Bundled Money

Corporations, Unions, Associations, etc. should be prevented from participating in our elections.
Separate organizations could be set up to only influence elections and if anyone wanted to coordinate their money through such an organization, e.g. 527's type, so be it.

In this way, people could contribute directly or indirectly to the elections but no organization that was not specifically formed to only influence elections could. Thus would prevent people's money from being used without their direct permission. It seems to me a distortion of the system for a Union member, or a Stock Holder to have some of their money spent on the political system where as individuals should be able to voluntarily band together to coordinate a political message

Obviously there should be full disclosure of any significant amount of money that is used in an election, even through an intermediate organization and it should be illegal for a normal organization to pressure its members to contribute to a candidate or a 527 type organization.

fred

The best campaign finance "reform", I am aware of, involves a few simple rules: No cash, no foreign contributions, and immediate disclosure.

Not much beyond that.

Anonymous

It should be noted that there is a constitutional guarantee to political free speech. So, one could argue that by donating to a political campaign one is inherently exercising a constitutional right. I guess I am asking is campaign finance "reform" even constitutional?

josh

"This is because I interpret democracy not simply as extending the right to vote, but also in good part as competition among interest groups for political support. Interest groups compete in many ways, such as influencing voters indirectly to favor particular points of view, and they also compete through campaign contributions."

Isn't this just socially costly rent-seeking?

Wes

This is because I interpret democracy not simply as extending the right to vote, but also in good part as competition among interest groups for political support.I would argue that democracy is more about cooperation than about competion. The fundamental idea in the US constitution is to prevent the government from having too much power over the people. Since governments are human institutions this amounts to trying to preventing one group of people from having too much power over everyone else.Democracy is supposed to be a mechanism for making decisions that benefit everyone by taking everyone's preference into account. Freedom of speech isn't just the idea that people should be able to express their opinions. Freedom of speech is the idea that better decisions are made when everyone's opinion is listened to.Recently, the religious right has set a tone that democracy is about competing to force one's beliefs on others. That is exactly the opposite of democracy. Democracy is actually about cooperating to take everyone's opinions into account.On the subject of campaign finance reform, it's not the money that matters specifically. What matters is that the American people put a lower priority on forcing their views on others and a higher priority on electing politicians that are committed to listening to everyone's opinion. When a politician has close ties to specific special interests people should be outraged regardless of whether they happen to agree with those special interests.

W

BECKER: I believe that competition among advertisers of products and services usually leads to better, not worse, outcomes to consumers. The arguments behind this conclusion appear on the whole to hold with equal, if not greater, force in the political arena.

One might say that it is good when less efficient companies are prevented from entering the marketplace -- if you can't compete, you don't belong in the market. That is what happens when advertising is curbed in oligopolistic markets, isn't it?

If one were to limit competitors in an oligopoly from blasting each other with negative advertising, they would start slashing prices instead. They'd offer rebates and package deals and free merchandise and prizes. They would no longer be able to tacitly agree to keep the price of Product X supracompetitive by refusing to slash prices and instead engaging in phony advertiser wars. Instead, they'd slash prices.

Consequently, the barrier to entry would be higher. A lower price for consumers means greater efficiency demands on new market entrants. This is easy enough to prove. If you can sell your product for 5, then you can spend 4 to make it and turn a profit of 1. If, suddenly, you can sell your product for no more than 3, then spending 4 to make your product no longer turns you a profit.

However, natural oligopolies often form precisely because those competitors who collectively possess market power are the most efficient competitors. In other words, banning advertising doesn't discourage new entry; at most, it kicks out inefficient parasites to the natural oligopoly as the price drops.

All other things being equal, how is it that consumers are worse off with lower prices? Or, if you prefer a different formulation: All things being equal, how is it that consumers are better off with higher prices?

Aggiornamento Antivirus

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Otto Klemperer

Professor Becker,

With liberalism underlies freedom, with freedom we have democracy, but is freedom always good? what about when in countries like bolivia, venezuela, etc. We do not have the privilege the U.S has of having "farily descent" people running from office. When we have uneducated people, who is highly influenced by fake promises made by lousy polititians, and we end up with a Hugo Chavez in office, is it good to have freedom?

Barrett

What about simply imposing a cap on total campaign expenditures so that all parties are on a level playing field? This would make the election process more equitable and reduce politicians' reliance on contributions. They would be less beholden to special interests and better policies aimed at maximizing social welfare - instead of their special-interest beneficiaries - would result.

As stated above, a reduction in advertising may reduce the demand for voting, but people who make decisions based solely on advertising probably aren't sufficiently informed and don't deserve to vote anyway. Any thoughts?

Martin Bento

Professor Becker,

This paragraph

"This conclusion on the relative unimportance of campaign contributions is supported by the many scholarly studies of the determinants of who wins elections. This literature generally finds a tiny effect of spending on the outcomes of election. For every Bloomberg or Corzine whose spending seems to have been decisive in their winning, there are many more Forbes', Kerry's, Michael Huffington's, and others who failed despite spending large amounts of their own money."

seems to conflate two different things, which you yourself place in opposition in the next sentence - campaign contributions, that is to say, money given to candidates by supporters, and self-funding, that is, money provided by candidates themselves. All your examples seem to fall in the latter category, yet the general conclusion you draw concerns the former. Since you don't cite any specific studies, but simply assure us of all their conclusions, it is impossible to resolve the conflict at the putative source. In any case, to be a valid metric of the influence of spending, a study would have to make assertions about the relative position of the studied candidates absent any spending, or, perhaps, absent inequalities in spending. As bad as Steve Forbes did, one has to address the notion that he might have done even worse without his pile of money, in which case his money did indeed have a significant effect, just not one sufficient for his objectives.

Regardless of the validity of the arguments concerning advertising in general, they are not to the point, since the purpose of advertising is to induce consumption among the interested, which others can generally ignore, whereas political advertising has consequences that affect everyone directly and significantly.

As for the comparison with Europe, there are two many variables to simply claim that the differences can be used to measure the effect of this specific variable. Furthermore, though unions may have more influence in Europe, corporations have less. I think taking the First World as a whole, corporations are more influential than unions, so the loss of interest group influence here probably outweighs the gain. Although it may not be obvious that Europe's system produces better electoral choices, I don't think there has been a European leader as low in IQ as the current President for decades, if not centuries, and this President did indeed ride in on a vast wave of corporate money.

"Perhaps the most common reason for trying to restrict campaign contributions is the fear that otherwise rich and well organized interest groups, such as the oil industry or trial lawyers, will have an undue influence over legislation by helping candidates who they hope will push their interests. Some groups clearly have influenced legislation, in part through provision of financial and other support to particular candidates. But there are also many more "unfair" influences over election outcomes and public policies that have little to do with campaign contributions."

I'm sorry, but this is a plain logical fallacy. The fact that there may be other unfair influences is simply no argument for failing to address this influence, whose existence you concede. If I said "Cancer kills people. But other diseases kill people too. So we should not object to cancer." It would be transparently absurd, but would be structurally identical to your argument.

Trucchi e Guide

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Gracias a Dios alguien que informa sobre algo!

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Anonymous

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