Campaign Finance as Wealth Redistribution

Stephen Dubner, one of the Author of Freakanomics discusses why the media covers campaigns and particularly horse race aspects of campaigning like campaign finance and polls. I will get to Dubner's main point in a second, but one commenter to the post noted:

It’s cheap to cover. It’s the equivalent of local news covering the police blotter. It’s always easy to find talking heads for on-air video. The campaigns pay for a lot of the travel, etc.

It’s cheap. Whereas, it’s expensive to do investigative reporting on the shenanigans of guvment.

Another commenter offered a modified version:

Cheap and easy = lazy. It’s lazy coverage.

Cmapaign finance reporting is cheap and easy. Any intern with internet access and a word processor can look at cash-on-hand totals or the amount of receipts and disbursements and then put together a story. Likewise, writing up poll results is cheap and easy.

But Dubner noted that media coverage also results in media buys. After payroll, campaigns spend more money on advertsing than anything else. When the media covers campaigns, they get some ratings/circulation numbers, which drives their ad costs, which are then paid by the campaigns. The symbiotic relationship should not surprise anyone.

But Dubner's closing neatly corralled the hypocrisy of the media calling for campaign finance reform:

Although we argued in Freakonomics that the importance of campaign spending is greatly overvalued in electoral outcomes, there is no doubt that campaign spending has a huge impact on the finances of an awful lot of people — media companies, political consultants, web designers, hotels, audio-visual technicians, caterers, direct mailers, paraphernalia manufacturers, and on and on.

The bottom line is that political campaigns are really good for the bottom line, especially the bottom line of media outlets. They are also great news for fans of wealth redistribution: campaigns take money from wealthy contributors and spread it around to everyone else.

So while you can expect to see a lot of articles and TV pieces in the next 16 months that bemoan how much money the candidates raise and spend, you should know that they don’t really mean it.

While major media outlets don't make as much money on political advertising as say a local newspaper, the plethora of adversiting formats means that campaigns are spending even more money in terms of real dollars than ever before, that is leaving aside the inflationary aspects of advertising.

While the bulk of advertising dollars may go to television and radio, many newspapers and those with national online presences will see an increase in advertising revenue on political ads. Not only is political reporting on polls and campaign finance cheap and easy, selling political ads is similarly cheap and easy. While national goods and services producers come to media outlets for commercial time, there may need to be signficant wooing and dealing to close a contract. Candidates on the other hand, while legally entitled lower per unit costs, come to the media outlet with not only a want to advertise, but a need to advertise. Thus, selling political ad time is an easy sell for the media outlet.

In this respect, campaign finance is not only an easy topic to cover, it is an easy money maker. The redistributive nature of campaign finance means that media outlets get a lot more money for a lot less effort than other types of advertising. Thus, editorial boards might decry the powerful presence of money in politics, they certainly don't want their share going anywhere. That is teh reason why broadcasters balk at providing free air time to candidates.