We are Entering the Era of the One Percent of the One Percent

A new report from the Sunlight Foundation shows that post-Citizens United we are entering an era where political spending is dominated not by the 1 percent but by the top 1 percent of the 1 percent. In 2012, just 31,385 people contributed $1.68 billion in the election cycle. The median donation from the donor group was $26,574, which is more than half the median family income today.

The Sunlight report also found that while super PACs spent $500.4 million, which includes almost $100 million just from the Adelsons, more money went directly to parties ($671 million). Only 5.5 percent of this tiny group of donors contributed more than $10,000 to super PACs. Direct candidate contributions totaled $410 million and $89 million went to traditional PACs

This small percentage of donors accounted for over 28 percent of all individual contributions and every single member of the House or Senate that won last year received financial assistance from this donor group. Even more incredibly, 84 percent of successful congressional candidates received more money from the 1 percent of the 1 percent than they did for all of their small donors—individuals who gave $200 or less—combined.

These numbers should be cause for great alarm. If one mega-donor can contribute more money than all small donors combined, there is no incentive for Congressional candidates to pay attention to anyone other than this tiny percentage of mega donors. As we highlighted in Stacked Deck, the priorities of the affluent differ from the rest of the country. The dominance of the affluent in electoral politics is why the minimum wage remains stagnant while capital gains rates are continuously cut. It’s why Washington focuses on deficit reduction and not job creation, even though the unemployment rate remains high. It’s also why states are gutting education budgets while giving away millions in corporate tax cuts.

The only way to preserve a functioning democracy is to get rid of the outsize influence of the tiny majority of mega-donors. In Connecticut, public financing of elections was able to reduce the influence of corporate and affluent interests and as a result, the state passed several big policies that help working and middle class families. Strong disclosure laws and accountability provisions have overwhelming public support and would make spending more transparent. Strengthening lobbying laws and stopping the revolving door between Congress and K Street would also help.

Unless meaningful action is taken, these spending numbers will get worse. More money from fewer people is bad for our democracy and bad for our economy.

Comments