Is $6 billion a lot of money?
Depends. To Bill Gates or Warren Buffett, perhaps not so much. To me and 99.99 percent of Americans, yeah, it’s a lot of money. But, like much in life, the assignment of value often lies in placing context around any piece of data. So what context should embrace the more than $6 billion that the Center for Responsive Politics says “was spent by federal campaigns, super PACs, political nonprofits and the party committees” in the 2012 election cycle?
In a Dec. 27 donation-seeking email to supporters, the center referred to “these massive sums” [emphasis added]:
Are these, in fact, “massive sums”? In the context of political spending, yes: They are the most in American history, surpassing the $5.3 billion in the 2008 election cycle, and that was double the $2.6 billion spent in the 2004 election cycle. Of course, what makes the 2012 election cycle even more memorable is that $1.2 billion spent by “outside groups.” They spent nearly as much as the presidential candidates alone.
It appears that, like death and taxes, record-breaking spending by politicians and “outside groups” is inevitable.
Giving money to a political entity, either anonymously (thanks to a variety of 501(c)s) or openly, is a voluntary act. No law requires a person (or a corporation) to surrender money to a candidate or an “interest” group. (Yes, much of that “surrender” is motivated by a simple goal — access to power.) For individuals, political giving involves “disposable” income. (I wonder how shareholders view corporate political giving: ROI?)
For giggles, let’s render a few comparisons in how Americans shed “disposable” income in the 2012 election cycle to put that $6 billion in context.
Americans drink. A lot. In the 2012 election cycle, extrapolating from 2011 spending, Americans spent about $320 billion to buy beer, wine, and liquor.
Americans smoke. Still. Again, extrapolating from 2010 figures, Americans bought more than 600 billion cigarettes, providing the six major U.S. tobacco corporations (extrapolating from 2010 data) more than $70 billion in profits in the 2012 election cycle. (Sadly, the National Cancer Institute only had about $10 billion to spend to defeat cancer.) On the bright side, all that smoking brought about $50 billion in sin-tax revenue to the states.
As we’ve heard lately, Americans have about 300 million firearms. Over the 2012 election cycle, gun manufacturers produced (again, extrapolating, etc.) about 7 million firearms, earning revenues of about $22 billion. The National Shooting Sports Foundation says the annual economic impact of hunting and shooting on the U.S. economy is about $28 billion, making that about $56 billion for the 2012 election cycle.
Americans are a generous lot. Extrapolating from recent figures, Americans gave about $600 billion — repeat, $600 billion, or about 100 times political spending — to charity during the 2012 election cycle. In 2011 alone:
Corporate donations remained flat at $14.5 billion last year, foundations made almost $42 billion in grants – an increase of 1.8 percent – while gifts from estates jumped more than 12 percent to $24.4 billion. The study estimated 117 million U.S. households, 12 million corporations, 99,000 estates and 76,000 foundations gave to charities during the year. Their money went to around 1.1 million registered charities and some 222,000 American religious groups. [emphasis added]
Yes, I know: A big chunk of all that money was given for less than altruistic reasons — such as tax advantages, currying favor, or, in Mitt Romney’s case, manipulating charitable giving to prevent him from being caught in a fiscal lie.
Well, that was fun, wasn’t it? A few comparative statistics can surely put the $6 billion spent on politics into a more credible light, eh?
Right. That’s a convenient fiction. So here’s the comparison that matters the most to me.
As a potential political donor, I have insufficient disposable income to permit a significant contribution to a candidate, let alone approach the legal maximum of $117,000 for an individual’s transparent contributions. That also means I cannot make an anonymous donation of any import to a “trade association.” I’m not Sheldon Adelson, the 12th richest American, who with his wife gave nearly $40 million to Republican causes. He and 39 other billionaires (and spouses, family members, etc.) gave hundreds of million of dollars in the 2012 election cycle to influence outcomes.
Bottom line: Their phone calls to presidents, members of Congress, and executive branch officials will get returned. Mine will not.
That’s the context that matters. And big-time donors are already vetting the field for 2014 and 2016.
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(The Center for Responsive Politics is a non-profit organization that tracks political money — lobbying, direct campaign contributions, soft money, and so on. It does not accept donations from corporations, unions, or trade associations. That makes it a relatively fair umpire for examining money in politics.)
Categories: American Culture, Business/Finance, Economy, Politics/Law/Government, United States
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