— President Abraham Lincoln, June 1864
Article by Dan Ekstein, Sagac Public Affairs
It’s almost cliché at this point to say it, but here it is: we have just come through what was perhaps the most unpredictable election cycle in modern history. Much of the media, the American electorate, and, of course, the polling industry are still asking, “What happened and what does it mean for future campaigns?”
One argument is that we have entered a period in which traditional political organizations, including corporate or association PACs have reduced influence. All elections will be “national”—that is, each election cycle and every race within it, has the potential to be defined by a single personality, or narrative—so supporting down ballot candidates won’t be especially important. Another argument is that elections have become so expensive that it is difficult for anyone to win unless that individual is personally wealthy or has a super PAC-like benefactor behind him or her. A subset of that second argument is the proposition that, because elections are so expensive, there is a great need to further restrict money in politics.
These arguments don’t carry water. First, while the man and woman at the top of the ticket last year surely set the tone for some Senate, House and state legislative races, it is not clear that either presidential candidate was the deciding factor in any down ballot race. Second, while super PACs matter nationally, they are less influential at the local level where corporate and association PAC contributions can make a difference in tight races.
On the question of how one national personality can affect state races, let’s examine the results. Looking across the ballot, there were wide variations in the margins of victory in a number states. President-elect Donald Trump won Wisconsin by one point while incumbent Sen. Ron Johnson (R) bested his opponent, former Sen. Russ Feingold (D), by nearly four points. In Missouri, president-elect Trump defeated Hillary Clinton by 19 points, but incumbent Sen. Roy Blunt’s (R) margin of victory was just three points. In Arizona, Sen. John McCain (R) won by 12 points, about three times the margin by which president-elect Trump won. West Virginia elected a Democratic governor even though Clinton lost the state by 42 points. (That’s right: 42 points.) Vermont elected a Republican governor (that’s right: Bernie Sanders lives in a state led by the GOP) even though Clinton won the state by more than 30 points. To paraphrase a great American, the late House Speaker Tip O’Neill: Politics are still local.
Moving on to the arguments about campaign finance, we know that for many House and Senate candidates corporate and association PAC contributions, comprised of hundreds of thousands of eligible employees giving voluntarily, helped provide the means to victory. While contributions from PACs were a very small percentage (less than one percent) of the total raised to support presidential candidates, they represented about one-third of contributions for House candidates and about one-sixth of all contributions for Senate candidates.
Election 2016 postmortems also have focused on the question of whether we need to eliminate or alter our institutions, including our campaign finance system. While we cannot ignore the forces of populism behind the movement toward reform, it’s unlikely Congress or the states will make any radical campaign finance changes in the near term. The landscape corporations and associations faced in 2016 is very likely the landscape they will face in 2018 and 2020.
So, for anyone arguing that the reach of corporate or association PACs will be limited in future elections, to paraphrase another great American, Mark Twain: the reports of corporate and association PACs’ deaths are greatly exaggerated.
So how do business PACs proceed? To paraphrase a great American, third President Abraham Lincoln: don’t change horses while crossing the river. In this new election cycle, PACs should do what they do best. They should:
- Focus on Education. If PACs have not already, it is now time to fully integrate the PAC into the company or association’s overall external affairs efforts. This will help government affairs officials provide a more consistent and clearer communications on the value, purpose, and role the PAC played in supporting advocacy objectives.
- Advance Bipartisanship. Yes, many state capitals and the national capital are ruled by the GOP, but the electorate is in an unpredictable mood and the party that holds the White House historically faces strong headwinds in its first midterm election. Republicans might not be in power for long and even while they are, many Democrats will seek compromise so they can show real results to their constituents. PACs should take advantage of this spirit and look for champions in both parties. Business leaders generally know their issues in advance on a bipartisan basis.
- Enhance Transparency. The best way to answer the forces calling for wholesale campaign finance reform is to improve and enhance compliance efforts by improving data infrastructure to support PAC activities.
It is not a cliché, it is a truism: We have just come through what was perhaps the most unpredictable election cycle in modern history. But that doesn’t mean the basic underpinnings of the system will change, or that they should. In fact, in times of anxiety, it is imperative to have a steady hand and a deep knowledge base. Corporate and association PACs provide both. These entities are some of the few equipped to educate both new legislators, and the Americans who will get out to vote for them in future elections, about the value of the business community.
We need these business PACs now more than ever.
Dan Ekstein is a partner at Sagac Public Affairs, a national firm that provides communications, market research, fundraising, and issue advocacy solutions to hundreds of political, nonprofit and corporate organizations. Sagac and Ekstein are industry leaders in the implementation of comprehensive strategies for political finance operations. The firm’s clients represent more than one-third of all federal qualified funds raised each election cycle by corporate and trade association PACs.