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Report: Democracy For The People
Oregon’s Multi-Million Dollar Democracy
It is well-established that Oregon’s elections often attract large donors from both within and outside the state and that this is all permissible through a combination of state and federal court decisions as well as Oregon’s longstanding lack of campaign finance regulation.
Less has been written, however, about the disparity between large and small donors in Oregon. To shine some light on this aspect of our elections, OSPIRG Foundation staff examined cash contributions from individuals, business entities, labor organizations and nonprofits reported to Oregon’s campaign finance reporting system (ORESTAR) by Oregon ballot and candidate committees between January 1 and November 4, 2014. For simplicity’s sake, we did not look at contributions from political committees or party organizations.
1. In 2014, Oregon candidate and ballot campaigns reported receiving just over $6.5 million from donors giving $100 or less. Oregon law does not require the identity of these small contributors to be public, but we estimate that these contributions came from between 46,000 and 91,000 donors.
2. In contrast, the approximately one thousand large political donors who gave $5,000 or more contributed over $64 million, nearly ten times more than all small donors combined. On average, each of these large donors gave about five hundred times more than one $100 donor. The top 25 donors alone gave almost six times as much as all small donors combined and on average over 15,000 times the contribution of one $100 donor.
- Two-thirds of these top donors were businesses, labor groups, nonprofits and other entities, giving eight times more than all small donors ($53 million).
- One-third of these top donors were individuals. Despite being outnumbered and outspent by entities, the top individual donors still gave almost twice as much as all small donors combined ($11 million).
- One-third of the top donors, individuals and entities combined, were from out of state, giving nearly seven times as much as all small donors combined (over $44 million).
3. Major disparities between small and large donors remain even without the very largest donors. Even without accounting for the fourteen donors who reported giving over $1 million, the remaining large donors who gave over $5,000 still gave over $33 million in total, or five times more than all small donors combined.
4. Major disparities between small and large donors exist across the board, not only for major statewide candidate and ballot races. We estimate that between 5,000 and 10,000 small donors contributed nearly $800,000 to state legislative candidate committees in 2014. In contrast, just over 200 of the top donors gave over five times as much as all the small donors combined (nearly $4 million).
Four decades of court decisions, including the infamous Citizens United case, have blocked some of the simplest and most intuitive ways to restore an equal political voice for citizens, striking down many efforts to limit the size of cash contributions and independent expenditures on campaigns. It will likely be some time before the U.S. Supreme Court or Congress restores the rights of Americans to restrict money in politics.
In the meantime, the next best option for restoring some degree of political equality is to amplify the voice of small donors in elections. There are three ways Oregon could achieve this end:
- Match small contributions with public funds. This is one of the most tested approaches to date. The country’s largest city – New York – has seen encouraging success with such a program, which matches small contributions from city residents up to $175 at a six-to-one ratio. After the 2013 general election, the winners for 54 out of the 59 open elected positions participated in the program, with 61% of all funds raised coming from small donors, costing just 0.06% of the city’s 2013 budget.
- Small donor vouchers. Seattle voters just approved a new program to boost the power of small donors by distributing four $25 vouchers to every voter in the city, which voters can choose to contribute to the city candidate(s) of their choosing.
- Enhance Oregon’s political tax credit. Oregon’s political tax credit already allows taxpayers to receive up to a $50 tax credit per year ($100 per household) for political contributions. Streamlining the program so that taxpayers could expedite their tax credit could increase the participation of small donors.
Several variations of these approaches are in effect or have been proposed at both the federal and local levels. Combined with improved transparency of political contributions and spending and other reforms, a small donor matching program could help restore some balance to our democratic process.
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