Stone’s Throw: Big Donors, Small Donors, Our Local Congressmen and Reform

The funding of political campaigns, as we already know, is heavily influenced by big money contributions, to put it mildly.

In fact, here in New York, just the top 200 donors last year contributed nearly $16 million, surpassing the combined donations of $250 or less from all 206,000 small donors throughout the state, an analysis from the Brennan Center and Open Secrets concluded.

Whether it’s industry-specific deregulation on the right or pet policy programs on the left, rich donors, private enterprise and special interests wield outsized influence over how our country gets governed.

But a new public financing program in New York could increase the financial power of small donors six-fold in legislative elections and seven-fold in statewide elections, according to the Brennan Center and OpenSecrets analysis, which was published in late January.

Called the New York State Public Campaign Finance Program, the initiative allows candidates running for statewide or state legislative office the ability to qualify for public matching funds based on small donations ($5 to $250) from residents in their district.
It began about six months ago, this past November.

Matchmaker 

As you would expect, matching funds must be used by the candidate’s authorized committee for campaign expenses, the New York State Public Campaign Finance Board explains.

And hey, if financial donations are a form of speech, then it seems prudent to empower and strengthen the potency of speech rights of the everyday people who elected officials are supposed to serve.

Are we really ok with a federal system that, in practice, encourages policy prescriptions to be shaped all too often by the highest bidders? How about federal reform modeled after New York’s approach?

Most anyone working inside of politics will tell you just how much time and attention is spent on fundraising. It’s frequently the animating force of daily campaign and governing life. We’ve become pretty numb to that dreadful reality.

Elected officials and new candidates have almost no choice in terms of whether to play this game, given the inability to wage a serious election or re-election campaign without considerable dough. If that’s a given, we should at least enact rules that motivate candidates to value smaller contributions as much as possible.

With all this in mind, I figured it would be useful to review some of the funding that helped underwrite the campaigns last year of the congressmen representing The Examiner’s coverage area, explore where some of those dollars were directed and ask them about potential reform.

Moneyball

Freshman Rep. Mike Lawler (R-Pearl River) received $11,600 from Supreme Medical Management, a company headquartered in Spring Valley, according to OpenSecrets, a fabulous research and government transparency group that monitors money in politics and its impact on elections and policy.

Rep. Jamaal Bowman (D-Yonkers), for his part, was given $15,500 by the American Federation of Teachers.

To be clear, there’s absolutely nothing unusual or inherently suspect about these funds. It’s simply helpful to know as much as possible about the major funding sources of our local elected officials. Ya know, sunlight being the best disinfectant, yada, yada.

Real estate interests were particularly keen on Lawler’s candidacy last year, giving the candidate $97,225 in all, of the $1.5 million he received from all donors.

The majority of Lawler’s funding came from large individual donations, with $831,631, or 54 percent, coming from the bigger checks, according to OpenSecrets. Small contributions of $200 or less constituted just 8 percent of the total. Political action committees and other sources accounted for the rest.

Lawler campaign disclosure forms also show how he paid Checkmate Strategies – a political consulting firm he previously co-founded – hundreds of thousands of dollars since 2020, including while he was an assemblyman. (All of it legal, his campaign noted in a City & State article last year.)
The article last October from City & State, a local and state politics publication, explained how the Lawler payments were to cover expenses associated with digital and print advertising, as well as fundraising.

Even though using campaign funds for personal gain is prohibited, “the sale or transfer of a campaign asset to either the candidate or a third party does not constitute personal use as long as the transaction is made at the fair market value,” Federal Election Commission (FEC) rules state.

By George I Think He Got It

Separately, Lawler has come under fire from at least one liberal group for keeping thousands of dollars he received from now-indicted Rep. George Santos. He hasn’t returned $2,900 he previously accepted from Santos, even though he’s emphatically declared how the disgraced, truth-phobic, loony representative from Long Island should resign.

End Citizens United, a political action committee that supports Democrats, has called on the congressman to donate the money to charity. (Lawler’s spokesman declined my request for comment on the Santos donation but we touched on other pieces of the puzzle, which I’ll get to in a moment.)

More recently, as a sitting congressman, Lawler has received $580,312.43 in total contributions since the start of this year, according to a review of Federal Election Commission (FEC) data. (Only $600 has gone to Checkmate Strategies so far in 2023, for a disbursement on Feb. 3, the records show.)

Interestingly, one of the biggest recipients of the year of funds from the Lawler for Congress committee was Flavor on Board, for what was itemized on Jan. 10 as a $11,879 expense for a “donor appreciation event” shortly after the lawmaker joined the people’s House. (Flavor on Board makes high-end kosher charcuterie boards.)

I asked Lawler’s spokesman for the congressman’s comment about the small donation push in New York, about the Santos donation and the Checkmate expenditures. While he declined to comment on the Santos aspect, he did weigh in on the other two topics.

“The Congressman does not support using state or federal taxpayer dollars to fund political campaigns – especially at a time when we’re dealing with near-record inflation,” Nate Soule, a spokesperson for Lawler, stated in prepared remarks. “We do not need welfare for politicians.”
Given the fact that there are ideological objections to public financing, Lawler would serve his constituents well by proposing change that a Republican in a swing district might find palatable, whether via increased transparency, reasonable new contribution limits, expanded disclosure requirements, enhanced enforcement or whatever change should look like to him.

Trumpeting a more conservative version of reform would help illustrate that he remains committed to being a policymaker on all meaningful issues, not just a politician zinging opposing ideas.
As for the Checkmate payments, I asked whether the congressman might be concerned about a perceived conflict of interest. In other words, even if legal, is it ethical, or could it at least reasonably seem unethical to the average Joe or Jane?

“The Congressman contracted and continues to contract Chris Russell, a partner at Checkmate Strategies for advisory services to his political campaign,” read a prepared reply from Soule. “At no time did the Congressman ever profit from his campaign and he has been completely fire-walled from any funds Mr. Russell earned. Congressman Lawler has received no compensation from Checkmate Strategies since taking office in January and is in the process of parting ways with the company.”

Education Nation

As for Bowman, education cash poured into his coffers last year, comprising $93,847 of the $1.8 million he raised from all contributors for the 2022 campaign.

Bigger contributions, as defined by OpenSecrets, made up the majority of the haul, with 60.65 percent, or $1.1 million, coming from more major individual contributions, the OpenSecrets database reveals. Overall, $515,759 of the donations, or 27.62 percent, were from smaller contributions of $200 or less.

Other big donors to Bowman include $23,704 from J Street, a nonprofit liberal advocacy group focused on ending the Israeli-Arab conflict, and the City University of New York, which donated $14,213.

In terms of 2022 expenditures, Greenlight Media Strategies, which provides campaign consulting services, topped the list for Bowman at $197,593.

So far this year, Bowman has taken in $138,138.26 in contributions, the most recent FEC records show.

One of the biggest 2023 expenses to date for the Bowman for Congress committee was $10,244.40 to Angerholzer Broz Consulting, a political fundraising firm specializing in, yes, you guessed it, fundraising and compliance for Democratic members of the House.

I interviewed Bowman on the phone last Friday, and he stressed how the Citizens United Supreme Court decision should be overturned. He also pointed out how he doesn’t accept any corporate political action committee money.

“Too many people in Congress and too many elected officials don’t only spend a lot of their time communicating with big donors, they also communicate with corporations who oftentimes undermine democracy for their own benefit,” Bowman observed. “So, yes, we need to get big money out of politics, for sure.”

While as a federal officeholder Bowman wasn’t familiar with the granular detail of the New York State Public Campaign Finance Program specifically, and whether the model should be applied on the national level, he pointed out how he enthusiastically supports H.R.1, a bill passed in the House in 2021, when the Democrats still controlled the House.

The bill addresses voter access, election integrity, election security, and, relevantly, campaign finance and ethics for all three branches of government.

It would expand the prohibition on campaign spending by foreign nationals, require additional disclosure of campaign-related fundraising and spending, mandate additional disclaimers regarding certain political advertising and establish an alternative campaign funding system for certain federal offices.

I asked Bowman, who worked in public education for 20 years, if big money from unions, teachers or otherwise could interfere with worthwhile reform proposals.

“Well, first and foremost, I fight for the policies that my constituents want me to fight for,” he replied in part. “So we are in consistent communication and engagement with our constituents. We do surveys. We take data. We do town halls. The issues that they care about are the issues we fight for.”

I also inquired about the potential pitfalls of public financing, and whether it could have the unintended consequence of helping entrenched politicians. But he said the structural changes would allow more regular people (my phrase, not his) to run for office.

“Well, from a congressional perspective, more than half of Congress are millionaires, if I’m not mistaken,” he told me. “So when you come from means it’s easier to run for Congress because you don’t have to make the personal and financial sacrifices that someone who comes from a working class background has to.”

Bowman resigned from his position as a school principal when running for office in 2020, absorbing significant financial risk.

“I had to take out a personal loan and pretty much put my family and myself at risk, because if I lost this race, who knew where I was going to end up from a job and career standpoint?” he said. “So, yeah, publicly financed elections, public matching, in my opinion, in a democracy is the way to make sure our democracy stays kosher, if you will, because the big money has distorted so much.”

99 Problems

Here’s the obvious structural problem, or at least a random example of it, under the status quo: If, say, responsible education reformers in the state proposed prudent ways to reform tenure, and even modestly expand the ability of school districts to terminate problematic teachers, there would be financial incentive among Democrats to resist good public policy.

And if environmental advocates proposed reasonable regulation to widen protection of natural resources, there’s lots of real estate industry money even a Republican moderate might jeopardize by joining the cause.

Atop the fundraising heap in New York is Gov. Kathy Hochul, who last year set records and raised eyebrows with her intake, bringing in $21.6 million, including from super-rich Manhattan builders who hopped on the bandwagon after the candidate committed to proceed with a plan to restore Penn Station and construct offices around it.

As The New York Times reported at the time, Hochul got checks for $69,700, the legal limit, from some of the city’s mega real estate tycoons, in the aftermath of pledging her support.

Bankrolling legislators who can protect real estate industry tax breaks while weakening regulation and oversight is also something of a favorite pastime of big donors/Albany political chess players.
It might not be realistic to eliminate this dynamic entirely from our politics in the immediate future but reducing the excesses seems possible.

Almighty Dollar

I didn’t hear back on an interview request to the Brennan Center but, in an article about the organization’s analysis, authors noted how the “growing influence of wealthy donors in New York resembles a broader trend nationwide.”

Not surprisingly, the article cited the impact of the Supreme Court’s controversial Citizens United split decision.

The court ruled that the First Amendment and free speech prohibit the government from restricting independent expenditures for political campaigns by corporations, including nonprofits, unions and other associations.

“In 2022, donors fueled a record-breaking $16.7 billion in spending on state and federal elections, with the biggest donors consistently increasing their share since 2010, when the Supreme Court’s Citizens United decision opened the floodgates to big money in politics,” the article explains.
But the Brennan Center boasts of having pioneered what it describes as “the most effective and promising solution to the problem of big money in politics: small donor public financing.”
It’s a system where public funds match and multiply small donations.

“New York City’s multiple match system, in which a $50 donation generates a total of $350 for the candidate, has helped reduce the influence of special interests and empower average voters, and the idea is gaining traction across the country,” the Brennan Center observed in an article.

Candidates are incentivized to seek out as many supporters as possible under the Brennan system, and not focus as much attention on a few larger donors.

“It enables more candidates from diverse backgrounds to run and it amplifies the voices of regular people,” the Brennan Center elaborated. “Designed right, small donor public financing also permits candidates to raise and spend what they need to compete in the super PAC era, should they choose to opt in. And, because it doesn’t restrict political spending, it stands up to the current Supreme Court’s requirements.”

O, Canada

Various approaches to public campaign financing are not rare elsewhere in the world.
Our friendly neighbors to the north in Canada, for instance, established a system where public reimbursements are provided to political parties.

So if a party complies with financial reporting provisions and receives at least 2 percent of votes cast nationally or 5 percent of the vote in local Canadian electoral districts, they are eligible for reimbursement. Fifty percent of their paid election expenses are reimbursed.

Some worry that public financing of political campaigns can unfairly benefit incumbents who already have name recognition and access to resources.

Critics also argue that various forms of public financing can make it harder for challengers to compete with established politicians who already have significant donor networks.

But some public financing can actually help level the playing field by reducing the reliance on big money donors and opening up the process to a wider pool of candidates who might not have been able to run previously due to financial constraints. It also reduces the influence of special interests.

Herding Cats

The misuse of public money and the potential burden on taxpayers are more than legitimate concerns.

Also, encouraging candidates to seek small donations from average people can create more pandering to potentially problematic ideas, and the exploitation of voter fears.

Yet it’s also very easy to see how some public financing reduces the influence of big, self-interested donors in politics, while also promoting democracy and potentially saving long-term costs through better government.

While there’s no perfect system, the current state of affairs creates fundamental problems in our politics. Constant catering to the economic and political interests of the already powerful exacts incalculable damage.

Being leery of public financing is understandable but the current circumstances are abominable. Officials like Lawler need to propose their own approaches for reform if they object to existing proposals. Embracing what we currently have in place is an indefensible position.

The goal should be a system that best serves the public, rather than narrow agendas. Leaders need to work backwards from that basic premise.

Adam Stone

Adam has worked in the local news industry for the past two decades in Westchester County and the broader Hudson Valley. Read more from Adam’s author bio here.