Raja CampaignFinanceLaws 2015

Chapter Title: Campaign Finance Laws, Purists, and Pragmatists: Who Benefits?
Book Title: Campaign Finance and Political Polarization

Book Subtitle: When Purists Prevail
Book Author(s): Raymond J. La Raja and Brian F. Schaffner
Published by: University of Michigan Press
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Chapter 1
Campaign Finance Laws, Purists,

and Pragmatists: Who Benefits?
Politics in Washington appears hopelessly polarized. The widening ideologi-

cal gap in the U.S. Congress has received most of the attention (McCarty,
Poole, and Rosenthal 2006; Rohde 1991), but similar dynamics have been
playing out in many state legislatures (Shor and McCarty 2011). While the
consequences of such polarization are not always clear, there seems little
doubt of one effect: partisan rancor in legislatures has increased dramatically.
In recent decades we have observed an unusual degree of policy gridlock
and the deterioration of Congress as a deliberative body (Mann and Orn-
stein 2012). A complete lack of compromise appears to block government
from acting on pressing issues such as immigration or tax reform, which are
widely acknowledged in both parties as ripe for policy transformation.
The problems do not stop there. A strong case has been made that policy
gridlock exacerbates wealth inequality through a basic failure to adjust poli-
cies to new economic and demographic realities (Hacker and Pierson 2010;
McCarty, Poole, and Rosenthal 2006). Perhaps most worrisome for the
long-term health of American democracy is the possibility that our institu-
tions do not adequately represent citizens, with parties standing for highly
ideological policies that are at odds with the preferences of the vast majority
of voters (Fiorina, Abrams, and Pope 2005).
Why We Write
As close observers of American politics, we worry about polarization and

its potential impact on the democratic process. That is why we are writing

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2 Campaign Finance and Political Polarization
this book. We see no magic remedy for this problem, but we can help iden-
tify underlying causes, which might lead to fruitful reforms. Our experience
in analyzing elections and governing suggests to us that a link might exist
between the ideological distancing of the parties and the weakened state of
party organizations in the United States. In an era when money is an essen-
tial electoral resource, party organizations have often struggled to finance
politics because campaign finance laws and court jurisprudence constrain
political parties more tightly than they limit interest groups or individual
donors.
Party-Centered versus Candidate-Centered Financing
Given our concerns, the question posed in this book is a practical one,
although it is informed by theory and research about political parties. Would
a party-centered campaign finance system improve our politics? In other
words, we ask whether rules giving political parties more freedom to raise
and spend money on candidates would attenuate the excesses of ideological
polarization between the major political parties.
We present our detailed response to this question in the remaining chap-
ters of this book. Our argument is that financially strong party organiza-
tions should reduce party polarization. It may seem odd that making parties
stronger organizationally would abate their programmatic intensity, but we
will present evidence that this is so. As we explain in the following chapters,
party organizations behave somewhat differently from other political actors
in the campaign finance system. Specifically, parties are the sole political
organizations whose primary goal is to win elections. We will argue that this
unique characteristic forces parties to exercise a moderating effect on those
who win office. One of the main thrusts of our argument will be that the
introduction of party-friendly campaign finance laws would moderate the
distancing of the major political parties in Congress and the states.
Aside from seeming paradoxical, our position may not be popular. Politi-
cal parties are not the most admired institutions in American life. Accord-
ing to a recent poll by Rassmussen, 53 percent of U.S. voters think that
neither party in Congress is the party of the American people.1 The disdain
for political parties is an American tradition dating to the Founding and
expressed anxiously by George Washington in his Farewell Address; Wash-
ington admonished his compatriots to shun the “incongruous projects of
faction,” which often serve “a small but artful and enterprising minority of
the community.”2

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Campaign Finance Laws, Purists, and Pragmatists 3
Despite Washington’s urgent call to avoid organizing by faction, politi-

cal parties soon became mainstays of American democracy. However, their
place in the political culture took a decidedly negative turn during the Pro-
gressive era of the early 20th century when political reformers recast politi-
cal parties as institutions that damaged democracy and governance (Milkis
2009; Milkis and Mileur 1999; Rosenblum 2008). To this day, the image of
the corrupt party machine lives on, even during an era when machines and
party bosses are rarities. Many citizens continue to visualize these quasi-
public organizations as doing business behind closed doors and interposing
themselves between voters and candidates in ways that thwart the will of the
people. The idea of empowering these organizations, which have been the
object of distrust during the past 100 years or so, may seem uncomfortable
to many readers.
Our position may also be unpopular because our findings suggest that
increasing or entirely removing limits on how much money party organiza-
tions can raise and spend would be a step toward reducing polarization. As
we will see in chapter 6, this is quite at odds with the opinion of a significant
segment of the public, which supports the imposition of low contribution
limits on groups such as political parties—or even the prohibition of con-
tributions by such groups entirely. This opinion reflects the understandable
fear that allowing parties to raise a lot of money will increase the potential
for corruption, or at least afford moneyed interests an undue influence con-
trary to the public interest. There is the perception that allowing parties to
take large donations increases the risk that wealthy individuals and special
interests will have their way in statehouses across the nation. This very con-
cern was at the heart of arguments for Congress to pass the Bipartisan Cam-
paign Reform Act (BCRA) of 2002, better known as the McCain-Feingold
Act, which banned so-called party “soft money.”3
We are sympathetic to such concerns and we acknowledge that our book
cannot completely address the problem of corruption and undue influence.4
However, we will make the argument that the intense focus of campaign
finance policy on preventing corruption has blinded policymakers to the
broader effects of these policies on the political system. We will argue that
a zealous anticorruption approach can lead to unintended negative conse-
quences. We will make the case that this approach reflects an overly roman-
ticized view that democracy is solely about individual citizens having a direct
and equal voice in public affairs (Pildes 2015). A less naïve view is that democ-
racy functions primarily through intermediary organizations—like parties,
interest groups, and the media—that help inform, mobilize, and channel
citizen preferences (Cain 2014). We make the point that the anticorruption

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strategy, which seeks to “level down” contributions through low limits, has
had the ironic effect of pushing political money toward obscurely named
groups, sometimes called “super PACs,” that now pervade federal and state
campaigns. We are concerned because such groups lack transparency and
accountability. But we have another major concern.
Campaign Finance Reforms and Polarization
A major hypothesis in this book is that laws that push money away from
party organizations to partisan interest groups have accentuated the highly
polarized political environment in many American states. We expect too
that our findings can legitimately be generalized beyond the states to the
U.S. Congress, where many of the same polarizing forces are clearly at work.
Through our discussion of the research and observations supporting this
hypothesis, we hope to broaden the policy debate beyond a narrow focus on
preventing corruption, without repudiating longstanding efforts to main-
tain integrity and equality in the political system through campaign finance
reform.
Our study depends on a system-level approach that is attentive to the
broader flows of political money rather than the one-to-one exchanges that
occupy most research on the political influence of donors. Instead of study-
ing the dyadic relationship between donors and officeholders (e.g., to see if
money buys votes or effort), we propose a holistic framework that applies
itself to what is referred to as the “hydraulics” of campaign finance rules. In
our view, regulations do not tend to keep money out of politics but mostly
redirect its currents through different channels. We have mentioned the
super PACs that raise and spend millions of dollars outside the formal struc-
ture of campaign finance laws.5 These groups arose, in part, because the
limits on contributions to candidates and parties were tightened with the
BCRA of 2002. Money constrained from flowing directly to candidates and
parties was squeezed in another direction.
Historical data also suggest that the relationship between campaign
finance laws and campaign spending in U.S. elections is surprisingly inelas-
tic. One study shows a roughly linear relationship over time between GDP
and election-related spending, suggesting in economic terms that campaign
spending is akin to a consumption activity (Ansolabehere, deFigueiredo,
and Snyder 2003). In other words, spending is relatively immune to laws
that attempt to restrain it. Campaign finance laws may change the paths that
money takes, but the total amount in the system appears to depend on other

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factors, such as the availability of money, the electoral stakes, and political
competition (Hogan 2000).
The crux of our argument is that, although laws fail to stop the flow of
money into politics, they do affect the channels through which it flows.
By constraining one set of players—namely party committees—campaign
finance laws force candidates to rely more heavily on other sources of funds.
These funds may come from individuals, interest groups, and a variety of
“party-like” organizations that emerge to replace the formal parties. These
nonparty actors may all be partisans in the broader coalition, but their pri-
orities differ from those of the party organization. And as we will see, by
making candidates more reliant on nonparty supporters than on party com-
mittees, the rules have broad effects on the electoral system and governing.
We will demonstrate that one of these effects is to push candidates away
from the center and toward the ideological poles.
In our view, the architecture of campaign finance laws in most Ameri-
can states is not party-friendly. The laws have institutionalized a “candidate-
centered” system of financing, which encourages candidates to reach out to
nonparty sources for funds. At the same time, the role of party organiza-
tions has been circumscribed; they are permitted to give only relatively small
amounts of money to candidates precisely because reformers fear that party
organizations might be used as conduits to funnel large contributions to
them. As we have noted, the unintended consequence of imposing lower
limits on parties is that candidates seek a greater share of donations directly
from highly ideological individual and group donors.
Perhaps more consequentially, under this system “the center cannot
hold”: the party coalition unbundles organizationally. That is, partisan fac-
tions that compose the party, including party-aligned issue groups (e.g.,
environmental groups, gun rights advocates, etc.), choose to engage directly
and independently in elections rather than work through the umbrella of the
formal party organization. In this way, constraints on parties enable partisan
interest groups to assume a larger and less constrained role in elections. The
dynamic is especially acute in states where control of the legislature hangs
in the balance and where partisan organizing is imperative. The outcome
is to tilt the playing field toward ideological candidates favored by “policy
demanders,” and to put pressure on moderate officeholders to defend highly
ideological policy positions or risk loss of financial support.
To be clear, we are not arguing that the candidate-centered campaign
finance system caused partisan polarization. There has been much else going
on, and scholars continue to unravel the dynamic that spurred the distanc-
ing of the parties. In the category of “causes” one might include changes in

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demography and technology, or any range of institutional transformations,

including how candidates are nominated by an increasingly ideological par-
tisan electorate.6 We also recognize that the nationalization of policy issues
may have allowed ideological debates to seep into the politics of statehouses
where such debates were muted before.
Our theoretical argument about partisan polarization builds on an emerg-
ing scholarly view of political parties as an extended network of partisan
activists who care deeply about some contentious issues (Bawn et al. 2012).
These activists have worked through interest groups and party-affiliated
organizations to press their cause with candidates and officeholders. They are
influential because they volunteer for campaigns, attend conventions, pro-
vide expertise, make endorsements, mobilize their constituencies in primary
elections, and raise money. Many of them run for office too. The financing
of campaigns is but one element in their drive to shape the direction of party
politics and policies. But we think it is an important one, given how critical
money is in financing modern campaigns.
For this reason, we think campaign finance laws matter greatly.
Political Parties and Democracy
We start with the premise that political parties are key institutions in a
democracy because they help mediate between citizens and governing elites.
In theory and practice, parties help link government to citizens by recruiting
candidates, waging campaigns that inform and mobilize voters, and ulti-
mately organizing the government to implement broadly supported poli-
cies. Voters generally comprehend what the major American parties stand
for with respect to principles about the role of government, and they have
the opportunity during elections to hold party candidates accountable for
campaign promises and policy outputs. Because the party wants to con-
trol government, it is motivated to tailor policies that will attract votes and
win elections. Moreover, parties typically serve as interest aggregators that
pull together various factions into a coalition that pursues broader public
purposes than any single faction. In this way, parties help to overcome the
inherent fragmentation of interests in a diverse country by forging alliances
among constituent groups; this gives the parties legitimacy in claiming to
govern for the common good.
To be sure, political parties have a controversial history, rife with examples
of monumental corruption and “back-room deals” that serve narrow inter-
ests rather than the wider public. But, on the whole, the major American

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political parties have tended to be broad-based entities with mechanisms

strong enough to hold political elites accountable. Despite shortcomings,
their enduring party “brand” and institutionalized roles across all levels of
government have promoted stability, collective action, and responsiveness in
the American political system.
Many contemporary observers seem to blame the parties themselves for
pushing politics to the extremes. A common (if inaccurate) argument is that
parties have insulated themselves through redistricting so they do not have
to be responsive to the broader electorate.7 Two noted economists specifi-
cally indict the so-called party duopoly on campaign money for the current
climate of hyperpartisanship in American politics and the failure of govern-
ment to tackle problems (Hubbard and Kane 2013). They claim that the
FECA reforms of 1974 enriched the parties and cut money off from indi-
vidual candidates and groups that might have challenged party orthodoxy.
For them, the decision in Citizens United v. FEC allowing corporations and
unions to spend without limits ended a “four decade period of repression of
independent voices” (133).
We believe that such thinking reflects a one-dimensional understanding
of political parties. In particular, critics who fear financially well-off political
parties fail to understand that “the party” is made up of many factions and
is hardly monolithic in its pursuit of political goals. Some factions focus
intensely on influencing specific policies while others tend to engage in the
game of winning elections. We think parties behave differently based, in
part, on which factions control resources within the party. In our view, par-
ties (like any organization) survive and thrive based on the availability of
resources, and the factions that provide those resources have more power
over the direction of the broader party.8 Importantly, for our argument, the
rules on how people control and use resources affect the leverage of various
factions within the party.
Two Conceptions of Political Parties
Our theory of resource dependency is informed by two different concep-

tions of political parties. One view sees parties primarily as unitary actors,
controlled by “insiders” who seek electoral gains that will give them power
and its perquisites. The other view sees parties controlled mostly by “outsid-
ers” who work through issue coalitions to advance policy objectives. At this
point, it would be helpful for us to explain more clearly what we mean by
“parties” and how these two conceptions of parties inform our analysis.

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Parties Controlled by Insiders
There is a lengthy scholarly tradition that views political parties as controlled

largely by leaders inside the party organization (Michels 1949; Ostrogorski
and Clarke 1902). These party leaders might emerge in the legislature, as
is common in the United States today, or they might be unelected party
bureaucrats, as in much of Europe. Historically, 19th-century party com-
mittees in the United States, like those in Europe, were controlled by non-
elected officials. These were the local party “bosses” of the machine era. With
the weakening of local organizations during the Progressive era, party leaders
in legislatures have assumed more responsibility for recruiting candidates
and supporting them in elections.
The primary vehicle for partisan activity remains the party organization,
although the contemporary party is less oriented than in earlier years toward
providing patronage to campaign workers in exchange for their support.
Moreover, the modern party organization is chiefly a technical operation for
waging political campaigns rather than a broader source of social activity,
as it was in the past.9 To be sure, the party continues to hold meetings and
conventions to rally activists around party platforms and (in some states)
preprimary nominations; but day-to-day activities are carried out by expe-
rienced campaign professionals, called “executive directors,” appointed by
a party chair. The party chair, in turn, is accountable to an executive party
committee that includes elected officials, donors, and activists.
The main objective of insiders is typically to use the party committee to
win elections. Only by winning elections and pursuing majorities can insid-
ers hope to gain the power and wherewithal to reward supporters. For this
reason, insiders have a deep interest in seeing the party organization survive
as a means of securing control of government. Certainly insiders can create
nonparty entities to help advance their electoral goals (and they often do),
but they generally prefer the vehicle of the formal party organization to
deploy electoral resources. The organizational label conveys a sense of public
legitimacy among voters and gives its leaders legal status to place candidates
on the election ballot. Moreover, the organization can exploit the historical
loyalties of donors and activists from all factions who identify strongly with
the party.
Insiders often contend with other factions for control of the party organi-
zation. It is typical of modern parties to allow for elections in which activists
can run for positions on the executive committee. However, when insiders
control the party apparatus completely (as they did in the 19th century), the
organization is dedicated almost exclusively to serving the goals of insiders,

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which means winning elections. Elections are the path to securing power
and status. And by controlling government, leaders can reward followers
with material benefits such as jobs, high-level appointments, contracts, and
other forms of favoritism. These rewards, in turn, enable leaders to foster the
commitment of followers who sustain the organization with their contribu-
tions of labor, money, or knowledge.
We consider the insiders to be the pragmatist faction of the party with
a decidedly Hobbesian view of the world in their quest for instrumental
power. The pragmatists are materialists and assume that individuals have a
basic animal nature, which compels self-interested behavior. For this reason,
the insider creates mutually beneficial arrangements to satisfy those will-
ing to join the party coalition against rivals who might take benefits away.
The rampant bargaining and horse-trading that inevitably ensue may appear
unprincipled, but the byproduct tends to satisfy large constituencies that
help the party to win elections. This dynamic is captured nicely in the words
of famed 19th-century Tammany Hall boss, George Washington Plunkitt:
When the voters elect a man leader, they make a sort of contract
with him. They say, although it ain’t written out: “We’ve put you
here to look out for our Interests. You want to see that this district
gets all the jobs that’s comm’ to it. Be faithful to us, and we’ll be
faithful to you.”10
The party-as-insider approach offers several different models that vary by

the degree to which the party focuses exclusively on electoral goals at the
expense of policy goals. The classic model, for example, understands par-
ties as “unitary teams” that are overwhelmingly concerned with winning
elections. This approach is best reflected in Anthony Downs’s economic
theory of democracy in which party teams move toward the median voter
to maximize electoral opportunities, assuming that the ideological distribu-
tion of voters is single-peaked (Downs 1957). In the Downsian perspective,
the party is simply a collection of people who seek office solely in order to
“enjoy the income, prestige and power that goes with running the govern-
ing apparatus.” Downs’s theory has motivated a significant body of empiri-
cal research on party behavior. His approach, however, has been weak in
explaining the puzzle of why parties diverge from the median voter. While
Downs acknowledges the role of core activists in shaping a distinctive party
brand, he fails to convincingly explain why the parties would move consid-
erably away from the center.11 This weakness has become more glaring today
as we observe two highly distinctive and distant U.S. parties.

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A second insider model also sees parties as unitary actors but with dis-
tinctive policy preferences. The teams are not exclusively seeking to win, but
want to implement policies they strongly prefer. This is emblematic of the
conception of party proposed by Edmund Burke in the 18th century, that
parties are “a body of men united for promoting by their joint endeavors the
national interest upon some particular principle in which they are agreed.”12
In Burke’s view, members mostly agree about the governing or policy direc-
tion of the party. Given solidarity on principles and the electoral resources
of the party organization, the insider party has significant bargaining advan-
tages over narrowly backed interest groups. The party can avoid the “drift”
in governing that occurs when officeholders are incessantly picked off by
special interests or seized by local prejudices. At the same time the party is
inured from being pulled too far to the extremes by issue factions whose
policies could undermine the insiders’ broad governing philosophy in pur-
suit of the common good.
This model of a “responsible party” is exactly the one extolled by the
American Political Science Association (APSA) in its 1950 report on strength-
ening American political parties.13 At the time, scholars feared the parties
were too loosely organized and decentralized to address major challenges
facing the nation. The authors would be pleased to learn that the party sys-
tem has strengthened since the report was issued, but its responsible model
of political parties at the national level is not necessarily what we have today.
We argue instead that contemporary national parties have been controlled
increasingly by narrow interest factions—the ones that George Washington
may have feared—that do not necessarily sustain the Burkean goal of put-
ting forth a coherent governing philosophy in the national interest.
A third model of the insider approach sees parties as more heterogeneous
than the other two models. This is the party-in-service model theorized by
John Aldrich (1995), which argues that the party comprises ambitious office-
holders who campaign on their own individualistic terms. The institutional
party helps to solve collective action and social choice problems by manag-
ing the coordination of members on legislation and political campaigns. It is
not necessary, however, for party officeholders to agree on all policies; only
that they agree to stick together as a long-term coalition to help pass their
different policies. Moreover, officeholders do not necessarily have to cham-
pion the same causes when they campaign—they can pursue their own set
of home style issues in getting reelected (Cain, Ferejohn, and Fiorina 1987;
Fenno 1978). At the same time, however, they can use the campaign ser-
vices offered by the party organization (voter files, consulting, etc.) to help
mobilize electorates. In this fashion, the party sticks together for activities

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that require collective action, but allows considerable discretion to insider

officeholders to use the party apparatus to the degree they need it to advance
personal goals.
The strength of the party and its leadership varies depending on agree-
ment over policy preferences. As members become increasingly similar on
policy preferences they will give power to leaders in the legislature to enforce
party discipline that aids in passing legislation overwhelmingly favored by
party members (Rohde 1991). Conversely, greater heterogeneity of pref-
erences leads to a decentralized power structure in the legislature, which
typically results in shifting legislative coalitions, including bipartisan law-
making. The important distinction in Aldrich’s approach is that the party
primarily serves the goals of the personal ambitions of individual legislators
rather than the goals of a unified party leadership.
In each of the three models the party organization serves the pragmatic
insiders who want to stay in power or acquire more power. Elections have
high stakes because the insiders have something tangible to lose: an incum-
bent legislator might fail in a bid for reelection, or a party boss might lose
access to patronage and other spoils. For this reason, insiders have strong
incentives to avoid extremism that might jeopardize seats in the legislature.
In general, when insiders control a significant share of electoral resources,
they will use them in ways that keep the party close to the median voter,
thereby precluding high variance in ideology that might hurt the party
brand. While the parties are “big tents,” keeping low variance on party posi-
tions is essential for conveying clear information to voters (Snyder and Ting
2002). Consequently, when the political environment favors strong party
organizations (e.g., depending on rules, culture, etc.), the pragmatist insid-
ers will use their control of the party to screen out extremist candidates and
convey a slightly off-center partisan message to attract persuadable voters.
The clear implication of the insider conception of parties is that they will use
party organizations in ways that attenuate partisan polarization. Moderation
is a byproduct of their pursuit of power.
Parties Controlled by Outsiders
A second theoretical approach views parties as entities controlled by groups

and activists outside the formal party structure. This emergent view, which
is attributable primarily to scholars associated with UCLA’s political sci-
ence department, provides an important challenge to traditional models
of parties.14 The proponents of the UCLA approach argue that theories
based on Downsian electoral incentives fail to explain the strong ideological

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divergence of parties. Even a watered-down version of Downs’s theory that

makes room for policy-motivated activists is not a convincing explanation
for why political parties take strong—indeed risky—policy positions that
are often at odds with the preferences of most voters.
The group-centric approach gives greater attention to the role of interest
groups and activists in parties. Indeed, theorists espousing this view argue
that groups and activists constitute the party. Such partisans do not merely
provide shades of color for the party brand (as Downs or Aldrich would have
it), but forge its very principles and governing agenda. The party, then, is not
a big-tent coalition reflecting blocs of voters, but a dense core of committed
issue activists and networked groups with relatively narrow policy goals. By
helping to elect candidates who bear the party label, these policy demanders
seek to capture and use government to achieve their distinctive policy goals.
The goals are typically ideological, although they do not have to be. They
range from high-minded idealism, such as a commitment to protecting the
environment or the unborn, to material self-interest, such as pushing for
progrowth policies that serve particular business interests. Not surprisingly,
the goals often reflect a mix of idealism and self-interest. Thus, a conserva-
tive group like the Club for Growth, which favors limited government and
low taxes as a means to achieving national prosperity and freedom, attracts
business elites who would benefit materially from such policies. More typi-
cally, however, the dominant issues form the basis of the so-called “Culture
War,” which pits political elites—social liberals and social conservatives—
against each other on a range of issues (Hunter 1991; Lindaman and Haider-
Markel 2002).
The standoff between activists on the pro and con sides of these issues
shapes the contours of partisan strife in the political system. For example,
narrowly focused abortion rights groups such as NARAL in the Democratic
coalition oppose conservative Christians in the pro-life movement who con-
stitute a faction in the Republican Party. Similarly, the organization Defend-
ers of Wildlife, which seeks to protect gray wolves and other endangered
species, faces off against hunters and ranchers who oppose government
intervention. Critically, the groups do not typically represent broad seg-
ments of the population, but small, cohesive memberships or constituencies
focusing intensely on narrow policy issues.
The glue that holds the groups together as partisans is not mutual admi-
ration but necessity. The issues they embrace are often disparate, seemingly
disconnected. Ironically, this disconnection helps activist coalitions stick
together because factions focusing on different issues can avoid internal
battles over broader policy.15 Since no single group could achieve the task

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of taking over government alone, they form “long coalitions” that stay uni-
fied under a party label. Through the umbrella of the party they are able to
coordinate an agenda of mutually acceptable policies. These policies are not
at the top of the list of concerns for the broader public, but politicians give
them disproportionate attention because the political system rewards groups
that are highly organized, provide electoral resources (members, money,
expertise), and lobby intensely over the long haul (Grossmann 2012).
Importantly, these groups and activists do more than simply lobby like
a special interest; rather, they behave collectively like a party coordinating
their actions in recruiting, nominating, and electing candidates who favor
their policy positions. Groups do this because a traditional lobbying strategy
on their core issues would not yield the same results. As with any lobby-
ing effort, groups would encounter the principal–agent problem whereby
freestanding politicians might shirk or cut side deals that would undermine
the groups’ goals. At the same time, incumbents might be reluctant to take
electoral risks on issues that could jeopardize their standing among core con-
stituencies in the district.
The surest strategy for groups is to help elect people who agree with them.
By serving as gatekeepers for those who enter office, the policy demanders
in the coalition largely shape the priorities of legislators. The key strategy
of the long coalition is to coordinate on candidate vetting and support. If a
challenger or open-seat candidate meets its approval, the coalition converges
to support the candidate and markedly improves her prospects of winning
the seat (Desmarais, La Raja, and Kowal 2014).16 To the casual outsider, the
“party” is nowhere to be seen because the action—endorsements, fundrais-
ers, voter mobilization, and so on—takes place outside the formal party
organization (Masket 2009).
The group-centric approach offers a powerful explanation for why parties
are polarizing ideologically. Adherents of this approach can point to highly
influential groups of citizens who constitute the party and who are dispro-
portionately ideological relative to American voters. They are emblematic of
what Fiorina and Abrams (2009) call the “the purists,” a term they borrow
from Wildavsky (1965) and one that we will use in this book. These two
classes of party activists were first conceptualized by James Q. Wilson more
than a half-century ago in his prescient book, The Amateur Democrat. Wil-
son termed those concerned primarily with the outcomes of winning and
losing the “professionals,” and those who care intrinsically about ideas and
principles the “amateurs” (Wilson 1962). Essentially, the amateurs—whom
we call purists—have come to dominate public life because of the decline
of material incentives that once attracted poorer Americans to participate

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in electoral politics (Fiorina and Abrams 2009). Civil service reforms at the
turn of the 20th century winnowed the patronage that attracted material-
oriented followers to the party. The consequence is that the party includes
fewer activists drawn from the ranks of people having a personal stake in
political participation relative to those who have lifestyle or moral concerns.
For this reason, the group-centered party has been more willing to take elec-
toral risks by staking out extreme positions.
If party insiders are materialists, then party outsiders might be considered
idealists. Rather than focus on the world as it is, they prioritize principles
and values over concrete realities. Kant, not Hobbes, is their lodestar. To be
sure, we are oversimplifying our distinction between insider pragmatists and
outsider purists; we concede that motives often overlap. But we tend to agree
with Fiorina that the purists now have more clout in party affairs. And this
explains some of the gridlock in Congress. While Hobbesian pragmatists
concerned with material gains are more likely to compromise when neces-
sary to get half a loaf, Kantian purists are less likely to do so. Compromise
devalues the moral underpinnings of their commitments and dissipates the
passion of followers. Better to lose a standoff and use that fear-inducing loss
to raise more money from membership, than to allow politicians to compro-
mise far short of the policy goals sought by activists.
Let us be clear that we are not arguing that polarization is simply the con-
sequence of changing the reward system for partisans. Demographics and
changing technology play a role as well. For example, because of government
programs and a larger middle class, fewer citizens today need the material
rewards or social services that party organizations once offered. Addition-
ally, contemporary campaigns require capital more than labor, which makes
donations from wealthier segments of the population more important than
previously. On the left, donor activists are concerned with promoting social
issues like abortion and the environment, which are not necessarily top
priorities for low-income voters. On the right, in contrast, donors appear
concerned with promoting limited government and championing economic
policies that are not necessarily desired by the middle-class constituencies
that Republicans claim to represent (Bartels 2008; Gilens 2005; McCarty,
Poole, and Rosenthal 2006).
An important part of the argument in the group-centric approach is that
activists are able to pull parties to the extremes because of an inattentive
public. While passionate partisans follow politics closely, the mass public
remains barely aware of campaigns and policies being debated in state-
houses. Lack of sophisticated media coverage of politics widens the gap in
knowledge between activists and the typical American voter. In this way the

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parties find the public “blind spot” that allows them to embrace policies
that their broader electorates would not necessarily agree with, much less
consider a policy priority. For this reason, the outsider model implies an
unsettling disconnect between party activists and the American electorate.
The party loyalists that constitute the Democratic and Republican brands
reflect a bimodal ideological distribution with peaks on the right and left. In
contrast, the ideological preferences of American voters tend to look more
like a normal distribution, with most citizens near the median voter.17
Our Theoretical Approach: Parties as Competing Factions
Both the insider and outsider perspectives are ideal conceptual models and
have much to commend them in explaining party behavior. At the same
time, we see critical weaknesses in each approach. We start by observing that
these party models largely reflect the facts on the ground at the time. The
insider models were developed during a postwar period in which candidates
seemed to have lots of individual discretion in campaigning and legislating.
Some prominent scholars, in observing the seeming “wishy-washiness” of
American parties, believed that the party system was ill-equipped to address
the pressing social and economic needs of citizens. Not without reason, they
feared democracy in a large, industrialized nation could not function well
without cohesive Westminster-style political parties. Such parties could pro-
vide distinctive governing philosophies that offered voters real choices and
the organizational strength to implement the party platform. Given this set
of assumptions, theorists in the 1940s and 1950s buttressed their norma-
tive views of party with proposals to fortify party organizations, including
allowing them greater access to finance (both private and public money)
and mechanisms to give additional power to party leadership, as means of
ensuring discipline and accountability among rank-and-file party members
and candidates (American Political Science Association 1950).
Paradoxically, contemporary parties are now viewed as too ideologically
rigid, and current scholarship reflects the new dynamics of the party system.
The emergent “group-centered” approach has taken root during a period in
which the two major parties display the kind of ideological distinctiveness
that many leading political scientists appeared to desire back in 1950. In con-
trast to previous efforts to explain why the major parties displayed all the dis-
tinctiveness of Tweedledum and Tweedledee, scholars today seek to explain
party divergence and the formidable obstacles to effective governance that
American democracy faces. While the parties of the 1940s and 1950s seemed

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adrift, we now have parties that appear perhaps too highly disciplined, with
members of Congress voting almost exclusively with their party (McCarty,
Poole, and Rosenthal 2006). Indeed, party members appear so distinctive
that congressional and White House leadership look hapless in trying to
forge bipartisan compromises to pass laws. The value of the group-centric
model is that it explains persuasively why parties find it difficult to cooper-
ate and converge on policies that appear to be in the national interest, even
when a majority of voters support compromise.
In our view, neither model does a good job of explicating the periods
outside the immediate era in which they were constructed. The insider mod-
els developed by Downs, Schattschneider, or Aldrich come up short in the
contemporary era of highly partisan politics. And the more recent group-
centric model proposed by the UCLA school does not adequately explain
the extended periods of limited ideological warfare during the postwar era.
The outsider model does not take seriously the possibility that parties were
previously dominated not so much by issue factions as by politicians, includ-
ing the party bosses and officeholders accountable to blocs of voters rather
than to narrow policy demanders.18 Indeed, the rise of ideological activists
as party gatekeepers might be an anomaly in American history. Given the
relatively high levels of education and affluence in American society, politics
is no longer a matter of survival for access to jobs and opportunities, but an
arena for intensely political citizens to push for principled social and eco-
nomic commitments.
Factional Struggle: Pragmatists versus Purists
We think the theoretical insights contained in both perspectives help to

explain party dynamics through time, if we assume a broader view of the
party coalition than either set of models warrants. Both perspectives see par-
ties too narrowly. At times parties can be issue interests in pursuit of narrow
policy objectives, but not always. They can also be Downs/Aldrich teams
of politicians, or bureaucratically sustained formal organizations like the
machines, or the professionalized staff envisioned by Schattschneider (1942).
These two perspectives are subsets of the whole picture.19
We are not merely splitting the difference between the two perspectives.
We tend to side closely with those who view parties as broader than the legal
and formal definition portrays them. Like the UCLA school, we see parties
in the United States as large, factional coalitions. They are mostly a decen-
tralized group of actors who are bound by both formal and informal ties to

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other partisans. These factions work together to help each other gain power
and status, and to implement preferred policies of important factions.
Our difference with the pure outsider perspective is this: factions might
have overlapping political goals, but the coalition is fraught with tension.20
We argue that the push-and-pull of factional strains shapes the direction of
the party. The UCLA school assumes that partisans unite by offending no
one in the party coalition. Yet keeping the peace in a large coalition is no
easy task. The group-centered approach appears to neglect the bitter internal
politics of major parties. We contend that factions are ceaselessly trying to
gain the upper hand in party affairs. While the overarching goal of parti-
sans is to beat the rival party, each faction has its own set of priorities. And
the clashing of priorities is exactly what drives the dynamics of the major
parties (DiSalvo 2012; Frymer 1999). Partisans fight internally to put their
goals above others, and they do this by supporting the ambitions of politi-
cians who give priority to their issues. This includes helping them advance
to leadership positions in Congress and nurturing presidential aspirations.
We can observe such fights today between conservative Tea Party activists
and establishment Republicans. A recent victim of this particular factional
strife is Republican Eric Cantor, the former House majority leader, who
was defeated by an extremist faction of Republican voters in the 2014 pri-
mary when a small primary electorate, dominated by the most conservative
voters, selected David Brat, a political newcomer and economics professor
espousing hard-right policies.21 Such tensions also exist in the Democratic
Party between progressives who favor a strong regulatory state, such as Mas-
sachusetts senator Elizabeth Warren, and business-friendly centrists such as
Hillary Clinton or Mark Warner.
We acknowledge that parties comprise more than two factions, but for
analytical purposes we organize them into broader conceptual categories
consisting of pragmatist insiders and the purist outsiders. As noted, prag-
matists are concerned primarily with staying in power, while purists pursue
policies. Not surprisingly, the purists have the moral high ground because
they endow the party with the backbone of principles and legitimacy. The
pragmatists, however, help make the American system of separate govern-
ment work through daily betrayals of principle in pursuit of power. Such
betrayals often lead to bipartisan compromise. At any given point in his-
torical time, the degree of power controlled by these two archetypes of fac-
tions can stimulate or suppress ideological polarization in the party system.
Today, the political environment—its media, its demographics, and its elec-
toral rules—favors the purists. And for this reason we are living with highly
polarized politics.

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Resources and Factional Power
We contend that factions gain leverage in party affairs by having control over
valuable political resources. Politicians need these resources to get elected,
to get their message out, and to implement policies. Some equate resources
with money, but that view is too narrow. Other types of resources are valu-
able to politicians. In politics, affiliation with membership organizations,
especially those that are distributed broadly throughout the nation, is valu-
able because it provides direct access to voters. Having access to informa-
tion, knowledge, and expertise is also prized. Politicians, for example, need
expert testimony and the lobbying muscle of interest groups to help pass
legislation. Politicians also value endorsements from groups that are viewed
positively by many voters (e.g., firefighters, nurses). And, of course, politi-
cians value campaign money, which helps them to get their message out, set
governing agendas, and win elections.
The relative value of different kinds of resources may vary over time,
which is one reason why some factions emerge more powerfully with
changes in technology or shifting demographics. To provide one example,
the value of labor relative to capital has changed considerably over the last
century. Gains in productivity from emerging technologies allow all kinds
of organizations, including political groups, to reach voters and keep track
of them, without having to rely on armies of partisan workers walking the
precincts. This is not to say that walking the precincts is unimportant, but
only that the need for such people has diminished and that other means of
communication have emerged—TV advertising, social media—to identify
and mobilize key voters.
In this book we focus on campaign funds as a source of factional influ-
ence. While we emphasize that influence in the party is not solely a product
of the resource environment, we admit that the availability of such resources
is especially important during an era when money matters so much for
reaching voters. The ability to finance political campaigns shapes whether
pragmatists or purists have more influence in pushing the direction of the
party coalition.
The Importance of Campaign Finance Laws

in Shaping Factional Power
Access to resources is shaped, in part, by the electoral rules. In the realm of

campaign finance, rules that allow unlimited contributions from partisan

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interest groups allow purist outsiders to play a large role in financing candi-
date elections. This gives issue groups additional leverage in deciding who
runs for office and who wins. In contrast, rules that restrict issue groups but
do not similarly constrain party organizations tend to give the Hobbesian
insiders greater influence on candidate selection and support. Today’s rules
at the national level and in most states favor the purist outsiders in the party.
The creation of rules, of course, is not exogenous; that is, rules are not
only imposed from without. This makes our analysis rather challenging. We
acknowledge that factions fight over the nature of these electoral rules pre-
cisely because they confer access to resources and influence. Given the coali-
tional nature of American parties, scholarship has not only focused on the
battles over political rules between the parties, but on fights within the large
and unwieldy party coalitions.
Historically we know that pragmatists and purists have fought for domi-
nation. In the modern era, the policy-demanding purists have pursued a
variety of rules and regulations to weaken the influence of party pragmatists.
California politics provides a good example with regard to rules governing
its party nominating process. According to Masket (2009), California party
activists pushed to eliminate the cross-filing of candidates, a practice that
allows candidates to run in the primary election of more than one party.
Cross-filing (also called a “fusion ballot” in some states) can enable a can-
didate in the primary to win the general election by emerging from the
primary as the first choice among multiple parties, thereby eliminating or
reducing the strength of other competitors. Importantly, cross-filing helps
candidates get a slot on the general election ballot without the vetting of
party purists in the primaries. If the candidate, for instance, cross-files with
both the Democratic and Liberal parties, she could get on the general elec-
tion ballot as a Liberal Party candidate even if she loses the Democratic
primary vote. In short, with cross-filing, candidates have a multiparty path
to get on the ballot. Without cross-filing, they would have to earn their
place on the ballot by going through just one party nominating process. The
abolition of cross-filing in California in 1959 made candidates more atten-
tive to the policy preferences of activists in the major parties and, as Masket
argues, encouraged the kind of ideological politics for which the state is
known today.
Moderate factions fight back too. Once again California provides a telling
example. In 1996, a centrist faction in the Republican Party introduced Prop-
osition 198, which called for a “blanket primary” in which voters could select
one candidate for each office, regardless of party affiliation, in an attempt to
weaken the grip of the conservative wing that routinely nominated extremist

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candidates who lost in the general election. The proposition was ultimately
declared unconstitutional by the U.S. Supreme Court, but that did not stop
pragmatists like Governor Arnold Schwarzenegger from introducing in 2010
a “top-two” primary reform, by which voters could pick any candidate for
an office, regardless of party affiliation, and the two candidates receiving the
most votes would engage in a runoff vote in the general election. This mea-
sure, like the blanket primary, had the purpose of moderating the parties.22
This law, now in place, appears to have withstood constitutional scrutiny.
With respect to campaign finance regulations, we know from studies of
European parties that such rules tend to alter the nature of power within
parties. Specifically, the introduction of generous public financing of politi-
cal parties appears to make party organizations less attentive to the concerns
of issue activists. Political parties in Europe that rely heavily on state funding
rather than membership dues appear to lose their ideological edge. Activists
complain that their parties become more concerned with staying in power
than pursuing the parties’ historical agenda (Katz and Mair 1995). We argue
that U.S. campaign finance laws have also affected the balance of power
within parties. In contrast to Europe, however, the parties have not become
more tame, but more ideological, precisely because of the heavy reliance of
candidates on ideological sources of support. That is, compared with the
past, candidates now rely more profoundly on issue activists (rather than the
party organization), which is counter the trend in Europe.
Party Organizations and Insiders
Party organizations are the natural home of pragmatists (insiders), and not
purists (outsiders). This is so for three reasons. First, the party organization
is not a venue for the development and deliberation of policy issues. In the
United States that activity has been outsourced to partisan think tanks and
interest groups, while the party organization has traditionally been focused
on the electoral machinery of campaigns. To be sure, purists bring issues to
formal discussions of the party platform during conventions hosted by the
party organization. But the party organization itself is a rather inhospitable
place to incubate policy issues and energize issue activists. The instrumental
role of the party organization as a campaign operation makes it more attrac-
tive to pragmatists.
Second, the party organization is the broadest representation of the
party, which perforce requires the balancing of multiple interests. While
narrow-issue activists might have a significant voice in the affairs of the party

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committee, their clout is muted in Madisonian fashion by the multiplicity

of interests affiliated with the organization. The governance structures—
which involve elections to the executive committee and the appointment
of party chairs—compel party officials to be accountable to a broad con-
stituency. The leadership of party organizations typically includes elected
officials, campaign consultants, issue activists, and longtime partisans whose
dedication to the party exceeds their loyalty to any particular issue group.
The fact that these partisans are under “one roof ” of the formal party organi-
zation allows for the kind of bargaining that naturally mutes the ideological
shrillness of any particular faction within the coalition.
Third, the party is a legally distinctive entity with a strong history attached
to its label. Pragmatists, particularly elected officials, are most covetous of
controlling this label so that the party brand does not become electorally
poisonous to their careers. Since the party organization coordinates elections
up and down the ticket it cannot stake out extreme or narrow positions,
which might hurt individual candidates in particular districts at the federal
or state level. To be sure, there are abundant fights over the control of party
committees in many states. But purists typically find working solely through
the party organization to be overly constraining and compromising to their
ultimate goals. For this reason, they remain committed to the organizations
outside the formal party structure, while pragmatists invest their energies
within the formal organization. The party label is vital to the careers of prag-
matists, while purist issue activists, in contrast, may regard the label mostly
as a convenient vehicle to push their policies. Thus, purists have weaker loy-
alties to the party label and even weaker loyalties to the party organization.
A recent example illustrates the point. The 2014 primary for the U.S.
Senate in Mississippi pitted six-term incumbent Thad Cochran against
Tea Party–backed Chris McDaniel. Party insiders wanted Cochran to be
reelected and took the unusual step in a primary of throwing the finan-
cial weight of the National Republican Senate Committee (NRSC) behind
him. McDaniel and his purist supporters cried foul; among these support-
ers was the newly minted senator from Texas (and champion of the Tea
Party), Ted Cruz.
The Senate Republican leadership had appointed Senator Cruz as vice-
chair of the NRSC, hoping to tame him of his bomb-throwing efforts to
radicalize the GOP. But despite his status as a member of the party’s inner
circle, Cruz has been a relatively inactive NRSC fundraiser. His lethargy on
behalf of the NRSC contrasts with his energetic fundraising for the Senate
Conservatives Fund, a nonparty organization that seeks to make the party
more conservative by supporting hard-right candidates. Cruz clearly felt that

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the NRSC should have stayed out of the primaries (presumably to help
the conservative candidate win). In contrast, the pragmatists in both the
state and national party spoke publicly about their fears that candidates like
McDaniel would shrink the party with their narrow appeal to highly con-
servative voters.23
The distinctions between pragmatists and purists are not impermeable.
Individuals representing the purist faction may at times work for the formal
party organization. However, organizational location shapes behavior: where
you sit changes your incentives. Purists who work for party organizations
become more pragmatic, because even a former issue activist who consents
to be adopted, however temporarily, by the party is more likely to view
objectives from the electoral perspective of the party. This may well be why
the GOP leadership wanted to bring Senator Cruz into the NRSC leader-
ship. An ideologue who becomes a party leader will be pulled in new direc-
tions that diverge at times from former factional loyalties. Again, the case
of Republican majority leader Eric Cantor comes to mind. At the time he
lost in the primary to an obscure and inexperienced candidate in Virginia’s
conservative Seventh District, he was almost as conservative as the insurgent
who beat him. However, in his role as a party leader, he had taken on the
responsibility of raising money from broader party constituencies, such as
corporate and Wall Street elites, who were intensely disliked by his own
constituents. He was also amenable, on occasion, to making compromises
with the opposition when it suited the broader strategies of the party. This
pragmatic work as a party leader put him in jeopardy electorally because he
could no longer satisfy the purist activists in his district.
We want to make one more point about party organizations and insid-
ers. Legislative parties (such as the DCCC and NRCC) are more likely to
provide a natural home for insiders than executive-centered parties (such
as the DNC and RNC).24 Legislative parties—sometimes called “caucus”
committees—are controlled by leadership in the legislature, with minimal
direct influence of activists. These leaders embody the hard-headed realism
of insiders who want to control majorities in the legislature by winning elec-
tions. In contrast, executive-centered committees—sometimes called “state
central committees”—have governing boards in which factions vie to get
their members into positions of influence. State central committees are usu-
ally umbrella organizations that provide formal representation for county-
based committees, which nurture some of the most ideological activists in
the party. Indeed, activist insurgents from local parties often try to take over
the central party apparatus to create party platforms and recruit statewide
(and sometimes legislative) candidates who conform to their ideological

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preferences (Conger 2010; Green, Rozell, and Wilcox 2003). A strong local
party with highly mobilized and well-resourced membership, such as the
Republican Party of Orange County, California, can have disproportionate
influence in shaping the state party platform and vetting statewide candi-
dates. This is one reason why the California Republican Party has seemed
well to the right on issues, compared to rank-and-file GOP voters and mem-
bers of the state legislature who belong to the GOP caucus.
The national parties are better insulated against purist capture because
there are so many factions contending for influence that no single one can
dominate. (In this way, the Madisonian argument in Federalist 10 about how
an extended republic attenuates tyrannical factionalism applies to the party
system as well.) Additionally, by tradition the DNC and RNC are largely
controlled by the president or presidential candidate who assigns his loyalists
and experienced campaign advisors to control the party apparatus in pursuit
of the instrumental goal of winning the upcoming election.
In our analysis, we do not distinguish between state legislative and cen-
tral party committees because of the limits of the data. But we point to the
distinction because our findings may be attenuated or even somewhat biased
against our contention that stronger party organizations help to moderate
politics. In many states, such as Florida and Minnesota, the state central
committees are highly active not only in statewide races but in legislative
contests as well. And since state central committees can be more easily cap-
tured by purists from local parties, these committees may not always support
moderate candidates.
The Moderating Influence of Party Organizations
There are two main ways in which strong party organizations moderate poli-
tics. The first is through financial support: because party insiders are chiefly
interested in winning elections, their priority is to invest in candidates who
will be most competitive in a general election—candidates whose views are
closest to those of the median voter. This means that party insiders prefer
to support moderate candidates. This contrasts with the riskier investment
strategy of outsiders, who prefer to support candidates with positions as
similar to their own as possible. The hope of outsiders is that voter inatten-
tion to issues will enable the election of candidates whose views are at odds
with the preferences of the median voter.
The second way party committees moderate politics is in their role as finan-
cial mediators. The party can receive money from ideological donors—who

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would otherwise give most of their contributions to ideological candidates—

and reinvest it in moderate candidates. However, we want to be clear that
party organizations are not interested in moderation as a goal; they are simply
interested in winning. They give to candidates based on their likelihood of
winning—in other words, they support candidates who take more moderate
positions. This mediation role helps to insulate candidates from ideologi-
cally driven donors who might pull candidates in their direction, either by
threatening to withhold funding or by financing other candidates who agree
with them. When the party organization mediates the funding, the candidate
is less concerned with ideological purity. Indeed, studies show that formal
party organizations do not typically punish candidates financially for taking
positions that stray from the party line (Bianco 1999; Damore and Hansford
1999; Herrnson 1989; Leyden and Borrelli 1990; Nokken 2003).
A purely “party-centered” campaign finance system would allow parties
unlimited access to funds (no source or size restrictions) and permit parties
to finance their candidates without limits. We will argue in this book that
a party-centered system is most likely to attenuate ideological polarization
between the major parties because (1) more money flows to moderate candi-
dates, and (2) money is rinsed of its ideological origins. On this latter point
we acknowledge that the party can only go so far in ignoring the kind of
ideological candidates preferred by outsiders. We will elaborate on this point
in chapter 2 when we examine the giving patterns of activist donors, espe-
cially conservatives, who view parties as too moderate. On the other hand,
party organizations benefit from attracting resources from multiple constitu-
encies, which makes them less dependent on a narrow faction of the party.
The Polarizing Influence of Candidate-Centered Politics
Candidate-centered systems, which restrict party financing, tend to incite

ideological polarization. As we will see in chapter 2, when party organiza-
tions face financing constraints, candidates rely more heavily on direct sup-
port from interest groups and activist donors, who are the purist outsiders
with strong policy preferences. In this way, candidates’ positions are pulled
toward the ideological poles, especially in the early stages of an election
when money is particularly important in elevating the name recognition
and electoral viability of new candidates. This is the point in a campaign
when interest groups already have a built-in advantage: party organizations
typically cannot become directly involved in primaries because of laws or
norms preventing them from supporting a favored candidate.

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Some argue that laws constraining parties do not matter because the
larger party (the coalition, not the organization) will adapt amoeba-like to
new constraints.25 We agree about the tendency to adapt, but we are not san-
guine about the form the adaptations take. Party adaptations are not equal
in style or substance to those undertaken by pragmatist factions through
the formal party organization. When much of the coalition campaigning
takes place outside the party organization, purist factions benefit as can-
didates are forced to rely more heavily on issue-based interest groups. And
while “shadow parties” might emerge, they are no replacement for actual
party committees. These nonparty campaign organizations, typically run by
former party operatives (i.e., pragmatists), focus their efforts primarily on
running TV ads in a few targeted races. They do not contribute to long-
term party building, and they cannot work closely with local parties at the
grassroots level. According to an experienced election lawyer, the “outside
shadow parties are not accountable at all for the messaging. And the con-
sultants want to spend it all on media. Field programs and canvassing are
too labor intensive. The consultants want to get paid, get in and get out.”26
A related problem is that constraints on the formal party organization
will encourage partners in the party coalition to pursue campaign finance
strategies through nontransparent organizational forms.27 As we will argue
later in this book, this dynamic imposes a heavy social cost on the political
system. But here we attend to the ways in which political reforms can affect
the balance of power within parties by giving advantages to some factions
over others. We argue that laws that constrain the party organizations give
the purists in the party greater influence than the pragmatists to shape the
direction of the party coalition. The outcome is a party system that is decid-
edly more polarized than it would otherwise be. And such a party system
engenders political fragmentation among factional interests because party
leaders cannot impose sufficient discipline on coalition members to advance
broad interests. This proclivity toward fragmentation leads to problems of
governance (Pildes 2015).
Our contention that campaign finance laws strengthen one faction of
the party over another challenges the conventional wisdom of party scholars
about what makes a party “strong.” In theory, parties can be strong pro-
grammatically (they offer distinctive policies) and organizationally (they
have significant control over the political process, including nominations,
organizing campaigns, and governing). The classic scholarship on political
parties, as embodied in the 1950 report on political parties by the Ameri-
can Political Science Association, implies that strong party organizations
are tightly linked to strong programmatic parties. In other words, when

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organizational leaders have significant control over rank-and-file members,

they can discipline them to follow a coherent party program. Our sugges-
tion is that the two aspects of party strength are not necessarily linked and
may even be inversely related. A strong party organization may serve as a
buffer against ideological programmatic parties because the pragmatists who
dominate the party organization would have the power to challenge policy-
demanding purists, based within partisan interest groups, who favor uncom-
promising positions on policies.28 In this way, strong party organizations may
lead, paradoxically, to party coalitions with softer policy edges.
A State-Based Empirical Approach
In this book we examine the effects of campaign finance laws on ideo-

logical polarization. While polarization has been most commonly studied
in national politics—particularly in the U.S. Congress—it has also been
occurring across the 50 state legislatures. Shor and McCarty have recently
provided an excellent data source to scholars of state politics by compiling
the roll call votes from state legislatures over nearly two decades and using
those roll call votes to derive estimates of the ideology of each state legisla-
tor (Shor and McCarty 2011). This exercise has allowed Shor to document
increasing polarization in state legislatures. He reports that from 1996 to
2010, 59 of the 99 state legislative chambers experienced increased polariza-
tion.29 In only 16 of those chambers was polarization decreasing, and in the
remaining 24 chambers polarization remained steady. Thus, a majority of
state legislative chambers were polarizing, but polarization was not by any
means universal.
It is on the state legislatures that we focus our study for one important
reason: while there is only a single set of campaign finance laws in place at
any given point of time at the national level, different states have imple-
mented very different types of campaign finance laws for state legislative
elections over the past several decades. This fact provides us with a way of
assessing the impact of different campaign finance laws. Specifically, we can
compare states that empower parties to raise and spend unlimited amounts
of money on legislative candidates with states that impose strict limits on
what parties can spend in elections.
For this book we collected information on campaign finance laws in the
50 American states for the years 1990 through 2010. For each election year
in each state we determined whether the state placed limits on how much
money parties could raise from various sources and whether the state placed
limits on what parties could contribute to candidates. We used several sources

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Figure 1.1. Limits on Contributions to Parties from Various Sources. (Note: Lines
show proportion of states with laws for each type of limit for state legislative
elections in a particular election year.)
to construct this information, including data from the National Council of

State Legislatures and various secretary of state or election agency offices.30
We also wanted to account for whether the state placed limits on the other
types of political actors we have discussed so far—individuals and interest
group organizations. Fortunately, we were able to draw on (and supplement)
data collected by Jeff Milyo for those entities.31
Figure 1.1 shows the proportion of states that placed limits on how much
money parties could raise from four different sources across the two decades
for which we have data. Several points are worth making from this figure.
First, states have been consistently more likely to limit what corporations
and unions can contribute to parties compared to PACs and individuals.
Second, states have been increasingly likely to implement limits on what
parties can raise from all sources over time. This is especially true for PACs
and individuals. In 1990, only about one state in five limited how much
individuals could contribute to a political party and only about one in ten
placed such limits on PACs. However, by 2010 the proportion of states
placing such limits on individuals and PACs had more than doubled. This
reflects an increasing tendency of states to limit the role that parties can play
in financing candidates.

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A third point from this figure, however, is that throughout the time period,
there has always been significant variation in how states regulate parties. Even
in the more recent election years, a significant number of states have allowed
corporations, unions, PACs, and individuals to contribute unlimited sums to
party organizations, while other states have limited what all of these organi-
zations can give. Such variation in state laws provides leverage in evaluating
the impact of campaign finance laws on who donates, who gets money, and
how these arrangements affect partisan polarization. These factors will be the
subject of detailed analysis in the later chapters of this book.
Figure 1.2 shows the proportion of states that limited what parties, indi-
viduals, and interest group organizations could contribute to candidates in
each of the election years between 1990 and 2010. The pattern in this graphic
is similar to that in figure 1.1. Specifically, the proportion of states limiting
what parties can contribute to candidates started relatively small (about one
in five states had such limits in 1990), but has increased significantly during
the past two decades. Indeed, in 2010, just under half of the states placed
limits on party contributions to candidates. While limits on contributions
from individuals and organizations have always been more common than
limits on parties, the prevalence of such limits has not increased as much
during the period. Indeed, in 1990, 26 states placed no limits whatsoever on
what parties could raise from individuals or contribute to state legislative
candidates. By 2010, only 15 states had no limits on party fundraising from
individuals and spending on candidates.
The patterns in figures 1.1 and 1.2 have not been good for party organiza-
tions, which are now much more constrained than they were two decades
ago in what they can raise and spend in many states. But the changes in
those figures provide us with additional variance to aid in our investigation.
Indeed, we are able not only to examine the consequences of differences in
campaign finance laws across states in a given year, but also to consider the
effects of different campaign finance laws within several states that changed
their laws over time.
Of course, it is important to confirm that these limits actually have an
effect on how much of a role parties play in state legislative campaigns.
Figure 1.3 shows the amount of money raised, per capita, by state political
parties in 2012. These figures come from the National Institute on Money
in State Politics, a data source we use extensively in our book and which we
describe in more detail in chapter 3. The light bars in figure 1.3 represent
states that do not limit what individuals can contribute to parties and the
dark bars are for states that do have such limits. The horizontal lines identify
the means for each group of states. There are two important points to draw

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Figure 1.2. Limits on Contributions to Candidates from Various Sources. (Note:

Lines show proportion of states with laws for each type of limit for state
legislative elections in a particular election year.)
from this figure. First, the type of campaign finance laws a state has in place
clearly matters. Indeed, parties in states with no limits on what can be raised
collect, on average, more than twice as much money as those in states where
such limits do exist. It is quite simply the case that when parties are limited
in what they can raise from any given individual, they are less likely to be
able to raise large sums overall.
The second point from this figure, however, is that there is significant
variance in how much parties raise in a given state, even beyond what can be
explained by the types of laws a particular state has in place. Indeed, cam-
paign finance laws are only one of many factors that are likely to influence
how much of a role parties play in financing campaigns in a particular state.
In some states parties are simply more powerful and active than in others,
for reasons that may have more to do with historical factors than the current
legal regime. Thus, it is important to recognize that while campaign finance
laws are influential, they are not determinant.
In the next few chapters, we will use the significant variance in cam-
paign finance laws and actual party financing that the states exhibit during
the period we study to draw strong inferences about the role of campaign

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Figure 1.3. Per Capita Fundraising by State Parties, 2012 Elections. (Note: Data
from authors’ analysis of data from the National Institute on Money in State
Politics and Federal Election Commission. Bars show the amount of money
raised by party committees in each state per capita.)
finance in affecting polarization in the states. We will examine, for example,

(a) whether parties are more active when they are not limited by campaign
finance laws; (b) whether parties tend to contribute to more moderate can-
didates compared to other actors; and (c) whether legislative polarization is
lessened when parties are more active in state legislative elections. In short,
the varied experiences of the states over the past two decades will provide us
with significant insight about how campaign finance laws matter for parties
and for legislative polarization. We also expect that the insights we gather
regarding the individual states will generalize to the U.S. Congress, where
polarization and gridlock are likewise apparent. Congress, no less than the
states, feels the effects of campaign finance laws and policies; it is reasonable
to expect that findings drawn from, and recommendations applied to, state
legislatures will be roughly applicable at the federal legislative levels.
A Note About Determining Whether Campaign

Finance Laws Matter
Testing whether campaign finance laws matter is not simple. For example,
elected officials tend to select the types of campaign finance laws that a state

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enacts, and they undoubtedly make these decisions based at least partly on
strategic considerations.
As a basic example, consider the results we present in figure 1.3. In that
figure, we show that political parties in states that limit what individuals
can contribute raise significantly less money per capita than parties in states
without such limits. This finding makes sense, but can we be sure that it
results from the laws? Perhaps it is the case that states where people contrib-
uted less money to parties in the first place were more likely to adopt restric-
tions on what individuals could donate. After all, passing such a restriction
may have been easier if the state’s population was not that interested in
donating to parties anyway.
In this book, we take care to support with the data the causal claims we
make about the impact of laws. For example, whenever possible, we use
temporal data to consider how changes in laws may have created changes in
the behaviors of donors, politicians, and other political elites.
As a first step, let’s examine here whether states that adopted restrictions
on political parties and states that did not do so are systematically different
in ways that might affect the conclusions we draw. For example, let’s ask
whether states that restrict what individuals can give to parties have popula-
tions that are less supportive of parties generally. One way to investigate this
question is to compare the donation behavior of state residents to the fed-
eral party committees. Because the laws limiting donations to national party
committees are consistent across all states, if we find that individuals in some
states donate more money to the national party committees than individuals
in other states, we cannot attribute this difference to campaign finance laws,
but rather to the underlying preferences of those populations.
Using Federal Election Commission data from the same election cycle
(2011–2012) to make this comparison, we find no support for the notion
that the state electorates in these two groups had different preferences in
contributing to parties. Table 1.1 compares the per capita giving to state and
national parties based on whether the state has limits on what individuals
can give to state parties. The results from the table show that states that
limit contributions to state parties contribute $1.15 less per eligible voter to
those parties than states with no limits (the same result shown in figure 1.3).
However, those same states actually give about 28 cents more per capita to
the national party organizations than states without limits (though this dif-
ference is not statistically significant). Thus, the results in table 1.1 provide
us with additional support for the notion that it is the laws that matter in
reducing what individuals contribute to the state parties, not some other
unaccounted-for difference in the state populations.

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TABLE 1.1. Comparing Per Capita Contributions to Parties (2011–2012 Election Cycle)
States with Limits States with No Limits
on Giving to on Giving to
Measure State Parties State Parties Difference
Per capita contributions $1.11 $2.26 –$1.15*
to state parties
Per capita contributions $1.26 $0.98 $0.28
to national parties
*p < .01, difference of means test.
Many of the outcomes we will focus on in this book have to do with

the involvement of parties in state elections and the amount of polarization
observed among elected officials as a result. If we are to attribute to the cam-
paign finance laws some responsibility for these effects, then we will be on
stronger footing if the states that did and did not enact restrictions on parties
are similar on other variables that might account for party activity and polariza-
tion. That is, our argument is stronger if these states are as similar as possible
aside from the fact that some enacted restrictions on parties and others did not.
Table 1.2 shows how states that limit the ability of parties to either raise
or spend money compare to those who have no such limits on four variables
related to party activity and polarization. The 1912 vote for Taft is a measure
of the state’s progressive tradition, as those states voting more heavily for
Taft were much less supportive of the progressive movement, which tended
to be hostile to political parties. The second measure is David Mayhew’s
Traditional Party Organization index, which is a measure of the extent to
which a state had a history of strong party organizations (Mayhew 1986).
The measure ranges from 1 (no history of strong party organizations) to 5
(for states with a history of strong party organizations). The folded Ranney
Index is a measure of the amount of competition between the two major
parties in each state.32 And the mass polarization measure is the difference
between issue positions of the average Republican in a state and the aver-
age Democrat based on data from the Cooperative Congressional Election
Study (described in more detail in chapter 2).
Each of the measures in table 1.2 shows only small and statistically indis-
tinguishable differences between states that enacted limits on parties and
those that did not. Remarkably, whether a state placed limits on party fund-
raising or spending appears to be unrelated to the progressive tradition in the
state, the extent to which party organizations have a history of being strong
and active in the state, the extent to which there is competition between the

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TABLE 1.2. Comparing States With and Without Limits on Political Parties
States Limiting Party States Not Limiting Party
Measure Fundraising/Spending Fundraising/Spending Difference
Vote for Taft (1912) 21.73 21.98 –.24
TPO Index 2.20 2.06 .14
Folded Ranney Index .87 .86 .01
Mass polarization 12.56 12.38 .18
Note: None of the differences in this table approach conventional levels of statistical significance.
parties in the state, and the extent to which the electorate is polarized. This
is crucial for the analyses that follow in this book, because it means that we
can rule out the above characteristics as potential alternative explanations
for why we might find differences between states that have limits on parties,
and those that do not.
Plan of This Book
To this point, we have discussed the history and nature of political parties,
noting that, contrary to popular belief, parties perform positive functions in
practical politics by aggregating disparate interests, reducing fragmentation
of interests and policies, moderating extreme advocacy positions, and dimin-
ishing partisan polarization. We have drawn a distinction between insider,
party-centered politics and outsider, candidate-centered politics, which will
serve us well as we develop our argument and analysis in the next chapters.
We have stated our contention that, to the extent that campaign finance laws
limit the level of funding flowing to and from the organized (insider) parties,
they have the unintended consequence of exacerbating (outsider) factional
polarization. We have argued that such laws affect not only campaigns, but
also governance, by empowering highly ideological positions and helping
to elect candidates whose views are distant from those of the majority of
voters. By tracing the effects of campaign laws on parties, we have begun to
establish our case for enacting campaign finance policies that loosen or even
annihilate restrictions on the financial participation of political parties in
electoral politics at the state and federal levels.
In the next chapters we expand and develop our argument through an
analysis of data relating to campaign financing. Our analysis unfolds in three
parts as we look, in essence, at the effect of campaign finance laws on who
gives money, who gets it, and how it affects polarization in the legislature.

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In chapter 2, we begin by examining the link between donors and cam-

paign finance laws. We first illustrate the unique characteristics, motivations,
and behaviors of political contributors in state legislative elections. Not sur-
prisingly, we find that those who contribute are unique compared to most
Americans. Our results at the state level confirm prior research on federal
elections, showing that political donors tend to be highly polarized and par-
tisan compared to the rest of the population. A key part of our analysis is
to examine how donors make choices about where to give money. Using a
rich collection of surveys, voter files, and campaign finance data we reveal
intriguing patterns of political contributions based specifically on donor ide-
ology. Our analysis will shed light on the direction that both major parties
have taken in recent years. In doing so, we will take notice of a surprising
asymmetry that emerged from our data. For while both parties have strayed
from the center, it appears that the Republican Party has made a particularly
hard turn to the right. We will suggest in our analysis some reasons why this
phenomenon has occurred.
In chapter 3, we turn our focus to the candidates. Specifically, we look
at how campaign finance laws affect which candidates get political funds.
Our theory of parties suggests that, compared to interest groups and activ-
ist donors, they will choose to invest in moderates and challengers precisely
because parties uniquely want to maximize opportunities to win legislative
seats. Using data from the National Institute on Money in State Politics we
observe the flow of money to different types of candidates across Ameri-
can states with different campaign finance laws. Our system-level approach
shows how the source of funds to candidates varies depending on the ideol-
ogy of the incumbent and her incumbency status.
In chapter 4, we examine the consequences of campaign finance laws on
the ideological extremism of officeholders and the polarization of the par-
ties. Our main hypothesis is that money that flows outside party channels
tends to promote ideological polarization between partisan officeholders.
Conversely, we propose that money that is controlled by the party will tend
to moderate politics. We test our hypotheses by comparing the polarization
of legislators in states with party-centered versus non-party-centered laws.
The last two chapters pull together our findings and address their implica-
tions. In chapter 5 we summarize the findings from the analytical chapters
and extend the analysis to the impact of antiparty laws on the emergence
of independent spending, including spending by PACs, which has drawn
concern especially at the federal level. Importantly, we connect independent
spending to our broader argument about how laws constraining the political
parties tend to increase ideological polarization.

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Finally, in chapter 6 we offer policy recommendations for reforming the

campaign finance system. Some of our recommendations may be controver-
sial, either because they challenge the conventional wisdom about campaign
finance reform, or because they appear to lack broad public support. Still,
we feel obliged to suggest potential strategies that might attenuate the kind
of polarization that makes governing so challenging in a system of separated
powers. At the very least, we hope our study establishes that the prevailing
reform strategy of putting limits on party financing has potentially adverse
consequences on our political system. These effects should be considered
against other goals of reform, such as preventing corruption. A more bal-
anced approach to campaign finance might gain public legitimacy, improve
political representation, and promote better governance (Cain 2014).

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Chapter Title: Campaign Finance Laws, Purists, and Pragmatists: Who Benefits?

Book Title: Campaign Finance and Political Polarization

Stable URL: https://www.jstor.org/stable/j.ctvdtpj2w.5

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Campaign Finance Laws, Purists,

Politics in Washington appears hopelessly polarized. The widening ideologi-

As close observers of American politics, we worry about polarization and

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Party-­Centered versus Candidate-­Centered Financing

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Despite Washington’s urgent call to avoid organizing by faction, politi-

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Campaign Finance Reforms and Polarization

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demography and technology, or any range of institutional transformations,

Political Parties and Democracy

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political parties have tended to be broad-­based entities with mechanisms

Two Conceptions of Political Parties

Our theory of resource dependency is informed by two different concep-

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Parties Controlled by Insiders

There is a lengthy scholarly tradition that views political parties as controlled

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The party-­as-­insider approach offers several different models that vary by

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that require collective action, but allows considerable discretion to insider

Parties Controlled by Outsiders

A second theoretical approach views parties as entities controlled by groups

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divergence of parties. Even a watered-­down version of Downs’s theory that

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Our Theoretical Approach: Parties as Competing Factions

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Factional Struggle: Pragmatists versus Purists

We think the theoretical insights contained in both perspectives help to

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Resources and Factional Power

The Importance of Campaign Finance Laws

Access to resources is shaped, in part, by the electoral rules. In the realm of

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Party Organizations and Insiders

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committee, their clout is muted in Madisonian fashion by the multiplicity

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The Moderating Influence of Party Organizations

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would otherwise give most of their contributions to ideological candidates—

The Polarizing Influence of Candidate-­Centered Politics

Candidate-­centered systems, which restrict party financing, tend to incite

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organizational leaders have significant control over rank-­and-­file members,

Party-Centered versus Candidate-Centered Financing

political parties have tended to be broad-based entities with mechanisms

The party-as-insider approach offers several different models that vary by

divergence of parties. Even a watered-down version of Downs’s theory that

The Polarizing Influence of Candidate-Centered Politics

Candidate-centered systems, which restrict party financing, tend to incite

organizational leaders have significant control over rank-and-file members,

A State-Based Empirical Approach