WDC Puts Forward ‘Ending Wealthfare’ Plan

Reform blueprint offers new thinking on public election financing

May 3, 2011

Updated: May 11, 2011

The Wisconsin Democracy Campaign, with support ranging from senior citizen advocates to youth groups, today proposed a new campaign finance reform plan that breaks new ground on election financing and aims to replace “big-money plutocracy with a small-dollar democracy.”

The initiative, Ending Wealthfare As We Know It, sharply departs from traditional public financing systems – including one adopted in Wisconsin in the late 1970s – that require participating candidates to agree to limit their campaign spending in exchange for public grants.

“Elections have changed dramatically in recent years, and old campaign finance laws haven’t been able to keep up. Wisconsin repeatedly elected Bill Proxmire to the U.S. Senate a generation ago and he never spent more than $300 on one of his statewide campaigns. Last year, over $37 million was spent electing a governor,” Democracy Campaign director Mike McCabe said. “Accepting public financing under the old rules effectively forces today’s candidates to unilaterally disarm and more or less become bystanders in their own races, with their own spending limited while interest groups are able to spend as much as they want.”

The central aims of the Ending Wealthfare plan are to make candidates more relevant and competitive in elections, give citizens who lack the means to make large campaign contributions a more meaningful voice in elections by making small-dollar donations more valuable, and reduce special interest influence over state government by freeing candidates for state office from reliance on a few wealthy benefactors to fund their campaigns while enabling them to campaign competitively even in the face of outside interest group spending.

Growing economic inequality in Wisconsin and across the nation is one byproduct of a corrupted political process embodied by the current system of financing elections in Wisconsin.

“The rich are getting richer, the poor are getting poorer, and the middle class is disappearing. This is no accident. It is the result of a long series of deliberate policy decisions that add up to the establishment of a wealthfare system,” McCabe said.

Key features of Ending Wealthfare include:

  • Up to 4-to-1 public matches of small donations to participating candidates if the contributions come from people eligible to vote for them.
  • An Election Participation Incentive program providing a $25 tax credit to individuals ($50 for couples filing jointly) for small campaign contributions made to candidates the donor is eligible to vote for.
  • Sharply lower limits on campaign contributions to candidates for state office – cutting in half the allowable donations to legislative candidates and even larger reductions in the limits on donations to candidates for statewide office.
  • A change in state law to close the “magic words” loophole so interest groups are required to register as political action committees, fully disclose both the amount and source of money spent on campaign advertising and other forms of electioneering, and abide by contribution limits applying to PACs.
  • Requiring corporations and cooperative associations to notify their shareholders or members and obtain a majority’s authorization of any political spending.

Ending Wealthfare addresses a major change for the worse in Wisconsin elections, the shift away from candidate-centered campaigns to ones dominated by outside interest groups. The plan not only empowers candidates and small-dollar donors, but it also ensures that interest groups operate under the same kinds of registration, reporting and campaign financing rules as candidates. And it applies the rules of democracy to corporations that have been given the ability to spend freely on elections by the U.S. Supreme Court in its ruling in Citizens United v. FEC.

“The real people who supply corporations with their capital would get the final word on how and even whether their money is used for political purposes,” McCabe said.

A full description of the plan is available here.

Groups that have already endorsed Ending Wealthfare include the Coalition of Wisconsin Aging Groups, Wisconsin Retired Educators’ Association, Wisconsin Farmers Union, ABC for Health, Fair Elections Wisconsin, League of Women Voters of Wisconsin, Midwest Environmental Advocates, Progressive Dane, United Council of UW Students and Young Progressives.