PDF Ebook What Money Can’t Buy: Self-Financed Candidates in Gubernatorial Elections
Critics are quick to accuse wealthy gubernatorial candidates of attempting to “buy” elections. But although wealthy gubernatorial candidates sometimes win, their electoral success does not necessarily imply that voters can be bought. To the contrary, I present evidence that self-financed campaign spending has a far weaker marginal effect on electoral results than externally financed campaign spending. For every Corzine, there’s a DeVos who spent record amounts in his 2006 attempt to unseat Michigan’s incumbent governor, only to lose by an embarrassingly wide margin. Money can’t buy the governor’s mansion.
This empirical finding presents a theoretical puzzle why would externally financed spending trump self-finance? The solution lies in strategic incentives facing would be campaign donors. A candidate’s ability to raise funds serves as a crucial indicator of her electoral viability. When it comes to influencing voters, a candidate’s ability to raise money matters far more than her ability to spend it.
After earning hundreds of millions of dollars at the helm of Goldman Sachs, Jon Corzine turned his eyes to politics. He spent $62 million of his own money in his successful 2000 bid for New Jersey’s vacant Senate seat an amount that more than doubled the previous self-finance record.1 Long before the campaign ended, his extravagant spending began to attract national media attention. In June of 2000, for example, Newsweek covered Corzine’s campaign under a headline that read, “The New Jersey Purchase: Jon Corzine’s $36 Million Campaign for the Senate.” Five years later, Corzine sought a promotion to the governor’s mansion. Again, he financed his campaign out of his own pocket,this time spending $42 million. In total, Corzine spent over $100 million on these two successful campaigns.
Of course, Jon Corzine is not the only gubernatorial candidate to have lavishly self financed his own campaign. Between 1998 and 2006, four candidates spent $30 million or more of their own money on a gubernatorial campaign2; another seven spent at least $5 million; and another fourteen spent at least $1 million. Of the 268 major-party gubernatorial candidates for whom campaign finance data are available during this period, 24% gave $50,000 or more to their own campaigns.
Critics are quick to accuse wealthy gubernatorial candidates of attempting to “buy” elections. But although wealthy gubernatorial candidates sometimes win Corzine, Romney, and Schwarzenegger come to mind their electoral success does not necessarily mean that voters can be bought. To the contrary, the electoral record of self-financed gubernatorial candidates is surprisingly poor. Of those who spent $50,000 or more of their own money, only 24% won; of those who spent $1 million or more, only 20% won.3 Oddly enough, then, it appears that self-finance actually hurts gubernatorial candidates on election day at the very least, it does not appear to help. By contrast, campaign funds raised from outside sources do help candidates; between 1998 and 2006, whichever major-party candidate raised the most money from outside sources won over 83% of the time. I present statistical analysis later in this paper that confirms this general pattern: Self financed spending does not lead to victory, but externally-financed spending does.
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PDF Ebook What Money Can’t Buy: Self-Financed Candidates in Gubernatorial Elections
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