Writing recently in the Daily Beast, John Pudner of Take Back Our Republic, a conservative reform group, offered an interesting proposal for improving our campaign finance system. He suggested that each political donor receive a tax credit worth up to $200:

If our ultimate goal is to restore citizens’ faith in their government, shouldn’t we also do what we can to make it easier for those same citizens to give a small contribution to the candidates of their choice? Citizens who write the small checks tend also to start talking to their friends, go knock on doors, or share information via social media. And when citizens get involved, the outcomes are better.

The nonpartisan group Represent.Us has endorsed a similar tax credit, which is worth considering. It might be a way to reduce the bad effects of money in politics without trampling on the First Amendment or doubling down on the failed campaign finance reforms of the last century. 

Campaign finance has been a problem since the initiation of party politics. When Thomas Jefferson and James Madison resolved to oppose the Washington administration, they enlisted poet Philip Freneau to publish the National Gazette. Jefferson financed Freneau’s operation by securing him a job at the State Department. Surely there is no better illustration of the ethical problems inherent in campaign finance: Freneau was hired by President Washington’s secretary of state for the express purpose of attacking the Washington administration, all on the taxpayer’s dime!

Party politics was firmly en--trenched by the 1830s, and parties had to find a way to fund their efforts. So they expanded upon and systematized the relationship between Jefferson and Freneau. Thus was born the patronage regime, which governed campaign finance from the 1830s until the 1880s. Patronage, aka the spoils system, was essentially public financing of campaigns, with party bosses directing government largesse to their most active supporters. 

The griminess of 19th-century patronage offends modern sensibilities, but it was a solution to a real problem the political class faced—a Gilded Age prisoner’s dilemma. As George Washington Plunkitt of Tammany Hall once asked:

How are you goin’ to interest our young men in their country if you have no offices to give them when they work for their party? .  .  . It can’t be done. .  .  . They say: “What’s the use of workin’ for your country anyhow? There’s nothin’ in the game.” 

Behind Plunkitt’s bombast and exaggeration is a legitimate point. By the middle of the 19th century, electoral politics was an expensive affair. The presidential election of 1860 already spanned the continent, requiring the concerted efforts of thousands of far-flung campaign operatives. Yet only Abraham Lincoln (who, incidentally, did not himself campaign) got to take the oath of office. How to motivate people to contribute? The answer: patronage. By winning the election, Lincoln acquired the authority to dispense jobs, contracts, and grants to his loyal supporters. 

The patronage regime was a breeding ground for inefficiency and graft, and it was outlawed at the federal level in 1883 by the Pendleton Civil Service Reform Act. Yet the laws of political economy cannot be repealed, so politicians had to find another way to deal with the dilemma that Plunkitt described so colorfully.

Thus was born the modern system, which in many respects is worse than the patronage system it replaced. Today, parties and candidates, especially in Congress, depend heavily on private individuals to fund their political operations. While many political contributions are public-spirited, many more are self-interested. Therein lies the problem. In exchange for campaign contributions and other benefits, politicians write laws to benefit their donors. 

Usually, the quid pro quo is not explicit; otherwise, the Department of Justice swoops in to indict the participants, as it did recently with New Jersey senator Bob Menendez. But political scientists and policy experts have noticed an unmistakable pattern over the years: Campaign contributions, lobbying, and the general lavishing of resources on members of Congress do influence policy-making, often to a remarkable degree. On the federal level, the locus of this systematic conflict of interest is the congressional committee system. Committees have extraordinary authority over their policy domains, and special interests direct their contributions accordingly. The range of policies up for sale is breathtaking. From Medicare to taxes to farm subsidies to housing to infrastructure and more, policy is designed to benefit the highest bidders.