Individual Political Donations Matter

Financialization Ideas and Issues Politics

            New Orleans      Many of us have become cynical about the big money in US election campaigns and all of the schemes used by the superrich, corporations, and special interests to flood the zone with cash.  There’s dark money.  There’s weird foundation scams like the recent $1.6 billion stock sale donation for the Republicans.  There’s bundling, which seems a definition for something akin to political cuddling with the rich.  Ok, maybe not everyone is cynical, because these techniques are certainly well-worn and popular.  Maybe it’s just me?

But wait, maybe the little people matter the most in predicting electoral success and not the megabucks?  Data crunching by the geeks at The Economist in their regular back page feature argue that in fact fundraising under the limit for federal races seems to be determinative in picking the winners.  Looking at the 2020 elections, they are quick to point out that being the candidate with the deepest pockets and the fattest coffers doesn’t guarantee a win, since Democratic candidates in Alaska, Iowa, Kansas, Montana, and South Carolina all were in that list, and all lost in the last round.

The data seems to indicate that “When a party’s share of these [smaller] donations has risen from one election to the next, its vote share has tended to increase too.”  Why? Perhaps because these smaller contributions “tend to flow to campaigns with hard-to-measure strengths like candidate quality or voter enthusiasm.”  This trend seems to exist despite the fact that out-of-state donations via the nationalized donation vehicles like ActBlue and WinRed are now huge and account for 68% of donations for candidates compared to 2012 when out of staters made up less than one-third of a candidate’s war chest.

What The Economist found, once everything was sorted out in the data, was that “good fundraisers have had unusual success.  In 2018-20, candidates with donation shares at least 15 percentage points above expectations beat their predicted vote shares by three points on average.”  Given how close these contested races are, that’s huge.

We also know that presidential candidates who have figured out the knack of getting popular donations in smaller quantities have had amazingly sustainable campaigns, think Bernie Sanders particularly.  Think harder and remember that was also what propelled Obama in 2008 and, like it or not, Trump in 2016 and beyond.

Money is fungible.  Politicians will figure out how to spend it no matter the source.  Nonetheless, it’s clear that our small ball dollars still carry huge weight because they reflect real votes and voter enthusiasm, not just bank accounts.  Whether they like us or not, they still need us, so that’s something to hang onto.