Does Money Matter? (Part 1)

In the Citizens United case in 2010, the Supreme Court effectively removed all constraints on spending for political advertising. The Supremes argued — in a 5-4 decision – that the First Amendment prohibits the government from restricting free speech or, by extension, from spending money to speak freely. For all practical purposes, this means that corporations, unions, and just plain rich people can spend as much as they want to promote a candidate or a cause.

As a result, we’ve seen a tidal wave of money — and a few bizarre billionaires — injected into this year’s presidential campaign. My question is: does it matter?

I come from the tech world and I can think of many examples where a small, poorly funded company took on a well-entreched giant and ate not only their lunch but also their breakfast and dinner. Think of SUN Micro versus IBM. Or Google versus Microsoft. In the political world, the Arab Spring revolts in Tunisia, Libya, and Egypt suggest that money (and even coercion) can’t stop a good idea once it starts spreading.

I’ve also seen many expensive promotional campaigns that yielded little or nothing. A recent example from the tech world is Nokia’s big push for the Lumia 900 smart phone. A massive promotional campaign yielded minimal sales. (Anybody remember the Lumia 900?) A well-documented example in the political world was George Bush’s big push in 2004/5 to partially privatize Social Security. Bush launched a well-funded, well-coordinated nationwide campaign and spoke on at least 65 occasions to promote the idea. The more he spoke, the less popular the idea became. (I have an article in the works on this topic).

I see a big difference between changing your mind and changing your values. (In fact, this is a major insight of classical rhetoric). I don’t think many people will change their values just because they see a 30-second commercial. An angry commercial may activate people (and that’s important) but I don’t think it will change people. In fact, an angry and cynical ad may push people in the opposite direction. I’ll discuss reasons for this in my next article.

Of course, if I were running a political campaign, I would prefer to have more money than my opponent. But money isn’t everything. For instance, I’ve worked for small companies battling against larger companies for my entire career. I wouldn’t say that all my adventures ended happily but many of them did.

So, will the massive spending in the 2012 election affect the outcome? It’s a grand experiment. One possible — perhaps probable — outcome is that we’ll get to November 7 and find the politicos saying, “Wow, we just spent a massive amount of money and it had no impact whatsoever. There must be a better way to spend our money.” If that happens, the 2016 election will be a lot more pleasant.

(Speaking of 2016, what do you think? Condoleezza versus Hillary?)