Campaign financing is by far the most important mechanism for overclass influence in government. The real two-party system in the United States consists of the party of voters and the tiny but influential party of donors. The donor party in the United States is made up of an extraordinarily small number of citizens. In 1988, according to one study, only 10.2 percent of the American public made a contribution to a candidate, party, or partisan group. . . . The group of large political donors is a still more exclusive club. According to a study by Citizen Action, in the 1989-90 election cycle only 179,677 individual donors gave contributions greater than $200 to a federal candidate, political action committee (PAC), or party: “Thirty-four percent of the money spent by federal candidates was directly contributed by no more than one-tenth of one percent of the voting age population.” One may reasonably doubt that this one tenth of one percent is representative of the electorate or the population at large.
Special interests buy favors from congressmen and presidents through political action committees (PACs), devices by which groups like corporations, professional associations, trade unions, investment banking groups – can pool their money and give $10,000 per election to each House and Senate candidate. Today there are more than 4,000 Political Action Committees (PACs) of various kinds registered with the Federal Election Commission; in 1974, when they were sanctioned by law, there were only 500. PAC money is driving campaign costs to new heights. In 1992, the average Senate incumbent spent more than $3.6 million for re-election; that is the equivalent of raising $12,000 a week in a single six-year term. Members of Congress, by comparison, spend only an average of $557,403 to be re-elected – a “mere” $5,000 a week for a two-year term. The average cost of a House campaign has risen to this level from $140,000 in 1980 – and $52,000 in 1974.
The chief beneficiaries of rising campaign costs and PAC contributions have been incumbents. In 1972, 52 cents of the average PAC dollar went to incumbents, compared to 25 cents to challengers (the rest went to candidates for open seats); in the 1988 House elections, incumbents received 84.4 cents of each PAC dollar and challengers only 8.6 cents. It makes more sense for lobbies to buy access to established members of Congress and senators – particularly those with important leadership positions – than to fund challengers, who, if elected, would have no seniority and little influence. . . . Former Senator Barry Goldwater has lamented, “The Founding Fathers would frown in their graves if they saw us rationing candidacies sheerly on the basis of money: who has – or can raise – the millions necessary to run for office.”
Democrats, when they were members of the majority party, received more PAC money than Republicans, though both parties are saturated with it. Contrary to conservative claims that liberal lobby groups dominate Congress, PAC funds come overwhelmingly from business: in 1990, 65 percent of PAC contributions came from business PACs, compared to 24 percent from labor and only 11 percent from ideological groups (including conservative as well as liberal pressure groups). “At one point,” John Judis has pointed out, “the American Petroleum Institute employed more lobbyists in Washington than the entire labor movement.”
One of the effects of the postpartisan PAC system is to weaken the link between members of Congress and senators and the districts and states they are supposed to represent. Out-of-state money from special interests often flowes into House and Senate elections. This means that many senators are, in effect, at-large representatives of free-spending national business constituencies.
Some argue that special-interest expenditures have no significant influence on public policy. If all of this money is not buying special favors from congressmen and senators, a great many groups and individuals who are otherwise careful with their resources are acting in a highly irrational manner, year after year.