After a series of corruption scandals rocked Albany, the Moreland Commission to Investigate Public Corruption was appointed by Governor Cuomo and Attorney General Eric T. Schneiderman and “tasked with thoroughly reviewing the adequacy of existing state laws, regulations and procedures involving unethical and unlawful misconduct by public officials, and the electoral process and campaign finance laws.” Pursuant to an executive order, they must issue a preliminary report with findings and recommendations by December 1, 2013.
No one knows what the Commission will recommend. What follows is the Brennan Center’s argument that the Commission must recommend and prioritize comprehensive campaign finance reform, with small donor public financing at its core.
Over the last several months, the Commission has been presented with an array of potential reforms to cure Albany’s ills. Many of these recommendations focus on ways to increase prosecutions and penalties for corrupt acts that are currently illegal, such as eliminating state pensions for public officials who have been convicted. While many of these reforms have merit and should be adopted, the single most important recommendation the Commission can make is for comprehensive reforms to the state’s campaign finance laws.
If recent history in Albany has shown anything, it is that closing loopholes and increasing penalties in response to specific scandals — while certainly necessary — too often merely results in incumbent politicians finding new loopholes to exploit, laws to break, and other ways to unfairly favor the small group of special interests that dominate the state’s campaign finance system. Each scandal in Albany over the last decade has been different, but all have come down to politicians forgetting that they are public servants, elected to represent their constituents above all else.
As United States Attorneys Preet Bharara and Loretta Lynch explained to the Commission in September, no matter how many tools prosecutors are given to hold corrupt politicians accountable, the state will never be able to prosecute its way out of a corrupt culture. Systemic change can only be achieved by ending lawmakers’ financial reliance on a small number of special interests, and by giving more New Yorkers a stake in state politics. Most importantly, this means creation of a small donor matching system that lowers contributions, increases disclosure and transparency, and ensures independent and robust enforcement of the state’s campaign finance laws.
As Long As Money Drives Policy in Albany, the Capitol’s Corrupt Culture Will Persist
As the Commission’s hearings have demonstrated, money drives policy in Albany, often to the detriment of the public. As the Brennan Center and others pointed out in theirtestimony, much of the corruption in Albany is perfectly legal — from earmarks aimed at big donors to retroactive tax breaks benefitting a few elite interests, a quick glance at the legislative agenda confirms that legislators favor their financial backers. While big money will exert disproportionate influence in nearly any political system, public financing with a small donor match substantially limits the potential of such money to overwhelm the system. What the Feerick Commission wrote in 1990 is just as true today: “Public funding strengthens the relationship between candidates and the public they represent, and will allay the cynical belief that current campaign fund-raising practices are a form of ‘legalized bribery.’” That is because public funding fundamentally changes the relationship between candidates and their donors: more money can be raised from small constituent donations than from a few special interests. As the Feerick Commission put it, “Public funding would make the citizens of New York the special interest of every candidate.”
Systemic Reform is Critical to Addressing All Types of Corruption
Comprehensive campaign finance reform centered around public funding has a proven record of success. In both Connecticut and New York City, public financing systems similar to the one we propose have changed the political culture. Chris Donovan, the former Speaker of the Connecticut House of Representatives, explained that because of the public financing law, “there is less pressure because you don’t have to worry about offending potential special interest donors. You can just raise the money locally and then vote how you want to.” Former New York State Senator Jose Serrano, who once served on the City Council, explained that under the state system, his campaign “started seeing more high-dollar fundraisers” because it could not get matching funds from local people, but the city’s match system “really made  small donors very important.” Data supports these conclusions,showing that candidates using public funding are less reliant on corporations and special interest funding: As of late October, candidates running for New York City office in the November 2013 election had raised 93 percent of their contributions from individuals. In 2012, state candidates got 69 percent of their contributions from special interests and corporations.
These reforms have had an impact not only on the “legal” corruption discussed so extensively during the hearings, but also on the systemic, illegal corruption that previously overwhelmed these two jurisdictions. No political system will ever be free of political corruption, and New York City and Connecticut still have their share. Still, since public campaign financing became law, New York City has not seen another corruption crisis remotely resembling that of the 1980s. In Connecticut, a series of corruption scandals had earned the state the shameful sobriquet of “Corrupticut.” But in the four years since reforms were implemented, the state has had the fewest federal convictions of any four consecutive years since federal officials started reporting this data.
Public Financing Increases Competition, Which is Essential to Fighting Corruption
Experience also shows that public financing systems increase electoral competition, something that New York sorely needs. When scandal-plagued politicians such as Vito Lopez can be re-elected because they do not face serious opposition, it is clear that reform is needed to make challenges more feasible and allow New Yorkers real choice at the ballot box. Public financing systems in Arizona, Maine, Connecticut, and New York City have all been shown to result in more competitive elections. Because they provide candidates with a way to win without relying on big money and the political machines, public financing systems encourage candidates to challenge politicians whose campaign war chests might otherwise insulate them from opposition. More opportunities for challengers and options for voters will incentivize elected officials to cater to their constituents over special interests.
Small Donor Public Financing Depends Upon and Strengthens Independent Enforcement
As the Commission’s October 28 hearing made clear, New York’s system of campaign finance enforcement is woefully inadequate. While any proposed law should create a new state agency to enforce campaign finance rules, creation of a public financing system will also ease the enforcement burden and encourage candidates to comply with the law. Candidates who depend on public money disbursements to operate their campaigns will be much more likely to adhere to reporting requirements and contribution limitations since failure to comply will cause them to lose those disbursements. Successful candidates participation in public financing and observance of the rules will encourage others to emulate their example.
Testimony from the New York City Campaign Finance Board demonstrates that the agency is a model for a successful enforcement body. In New York City, the CFB “carries out a thorough audit of every campaign’s expenditures and contributions,” and candidates who cannot show that they used public funds for a qualified purpose must pay the city back. As a result of the CFB’s diligence, “candidates in New York City know that their campaign will be held to strict standards.”
Small Donor Public Financing Is the Only Reform Proposed that Can Re-Engage a Cynical Public
Recent scandals in Albany have seriously eroded New Yorkers trust in our state government. A small donor matching system can bring people into the system at a time when many may be inclined to withdraw from that system entirely. The experience in New York City shows this system is particularly effective in increasing participation and encouraging support from a broad base of voters, many of whom are new to the political system. Just as importantly, this is a change that is currently supported by a broad range of New Yorkers. Almost three-quarters of New Yorkers support comprehensive campaign finance reform that includes small-donor matching funds, including strong majorities across party affiliation, upstate and down. A Zogby poll of New York business leaders found that 80 percent support the elements of a small donor public financing system the Brennan Center and others have recommended.
We are under no illusion that it will be it will be easy to convince the legislature to adopt this change. Entrenched interests, particularly special interest donors and many legislators, are certain to continue to oppose it. But, if anything, this is an argument for making sure this reform is not just one of many recommendations the Commission makes, but is prioritized among them. The governor and other statewide leaders have championed small donor public financing, as have good government groups, editorial boards from around the state, and several courageous members of the legislature. It is imperative that the Commission — which, after all, was established for the very purpose of shaking things up in Albany and forcing real change — ensures that this change remains the focus of efforts to reform Albany.
Over the next several weeks, the Brennan Center for Justice at NYU School of Law will send regular updates to this list of Friends of Reform in New York State on efforts to secure comprehensive campaign finance reform centered on public financing of elections. These updates will be sent to good government advocates, allies of the Fair Elections New York campaign, legislative and opinion leaders, scholars and engaged students, reporters, and other advocates for reform. They will also be posted on the Brennan Center’s New York blog at ReformNY.blogspot.com.