The Public Financing Question

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A lot has been made in recent days over Barack Obama’s reversal of his pledge* to stay within the federal campaign finance system in the general election. Today’s USA Today editorializes:

Sen. Barack Obama sells himself as the candidate of “change,” the candidate of reform, the man who’ll shake up Washington’s business-as-usual mentality.

But before the Illinois Democrat has even gotten on the November ballot, he is waffling on one of his earliest reform pledges: to pursue public financing rather than gather money from high rollers and special interests if he is his party’s nominee.

Early last year, Obama’s campaign sought and won a ruling from federal election officials to make it easier for candidates to use the public financing system in the general election. Asked three months ago by the Midwest Democracy Network whether he would participate in public financing, Obama wrote: “Yes. … If I am the Democratic nominee, I will aggressively pursue an agreement with the Republican nominee to preserve a publicly financed general election.”

Sounds straightforward. But now that Obama is raising money at a clip of more than $1 million a day and, if he is the Democratic candidate, could enjoy a large financial advantage over presumptive Republican nominee John McCain, he’s adding asterisks and provisos just like, well, some Washington politician.

But I just talked to someone who told me that it would be crazy for Obama–or anyone else–to stay within the legal spending limits in exchange for federal matching funds. And that someone is none other than the most recent chairman of the Federal Election Commission.

“It would be insane to, because they will lose control of the message of their campaign,” says Robert Lenhard, who chaired the FEC until a standoff between the Senate and the White House effectively put the commission out of business on Jan. 1.

Already, candidates put themselves at a disadvantage of they stay within the law, because outside groups are spending something like five times as much money as politicians are allowed under the spending limits. The Supreme Court’s decision in the Wisconsin Right to Life case–which happened after Obama made his pledge–makes that disadvantage even worse, because it allows outside groups to spend right up until election day. All expectations are that the amount spent by corporations, labor and other outside interests is going to skyrocket.

“It just provided a lot more freedom for outside groups to talk about candidates right before an election,” Lenhard says of the Supreme Court decision. “It is among the most dramatic shifts in this area of the law in decades. It completely changed the terrain.”

Obama still says that if he gets the nomination, he wants to reach “a meaningful agreement in good faith that results in real spending limits.” But by Lenhard’s analysis, he’d better be worried about a lot more than the Republican nominee.

*Commenters correctly point out this was not a “pledge” on Obama’s part. I was sloppy in my language in describing it that way. But the larger point I was trying to bring into the debate here was Lenhard’s contention that the landscape of the finance laws has changed significantly since Obama made his comment. I had not seen that argument in all the back and forth that has been going on over this. Anyway, here’s the quote:

Q: If you are nominated for President in 2008 and your major opponents
agree to forgo private funding in the general election campaign, will
you participate in presidential public financing system?

OBAMA: Yes. I have been a long-time advocate for public financing of
campaigns combined with free television and radio time as a way to
reduce the influence of moneyed special interests. I introduced public
financing legislation in the Illinois State Senate, and am the only 2008
candidate to have sponsored Senator Russ Feingold’s (D-WI) bill to
reform the presidential public financing system. In February 2007, I
proposed a novel way to preserve the strength of the public financing
system in the 2008 election. My plan requires both major party
candidates to agree on a fundraising truce, return excess money from
donors, and stay within the public financing system for the general
election. My proposal followed announcements by some presidential
candidates that they would forgo public financing so they could raise
unlimited funds in the general election. The Federal Election Commission
ruled the proposal legal, and Senator John McCain (R-AZ) has already
pledged to accept this fundraising pledge. If I am the Democratic
nominee, I will aggressively pursue an agreement with the Republican
nominee to preserve a publicly financed general election.