Campaign Finance, Iron Triangles & the Decline of American Political Discourse

Abstract:     
The Constitution protects the rights of Americans to participate in politics through assembly and membership in private interest groups. Yet the Founders recognized that interest groups and factions posed a particular danger in a democracy. According to James Madison, there was no way to remove the causes of faction without destroying liberty itself. The only solution, he said, was to control the effects of faction by encouraging the proliferation of factions to oppose and counter the influence of any particular faction.

This is a legalistic judicial discourse that ignores the realities of power imbalances in contemporary society. The modern theoretical incarnation of counterveiling power was premised on the idea that individual interests would be adequately represented by either large corporations or large unions. But the suppression of organized labor (the rollback in legal protections for union organizing and collective bargaining) should be seen as the disfavored first method for curing the mischiefs of faction. Here the cause of a particular faction is undermined by destroying the liberty of people to organize into interest groups. With the labor faction neutralized, institutions and policies of government have fallen under the influence of big business and management interests.

Using empirical records of campaign finance reports, this Article describes the iron triangles and captured sub-governments that plague our liberal pluralist order. The capture of federal communications policy by self-interested media companies has reduced the range and level of political discourse, and effectively privatized the public commons. A review of early American history of postal rate subsidies for newspapers provides support for present-day proposals to mandate free air time for political candidates across broadcast, cable and satellite mediums.

Without reform of communications policy, the campaign finance system will continue to contribute to a public and political discourse devoid of meaning.

Keywords: Campaign Finance, Federal Communications Commission, Regulated Industries, Agency Capture, Broadcast Regulation

JEL Classifications: H10, H11, H19, H40, H51, H52, H70, H73, I22, K23

Accepted Paper Series