Monday, March 25, 2013

Money Makes The World Go Around? In American Politics, Perhaps.

One preliminary survey suggests that this might be the case:

Over the last two years, President Obama and Congress have put the country on track to reduce projected federal budget deficits by nearly $4 trillion. Yet when that process began, in early 2011, only about 12% of Americans in Gallup polls cited federal debt as the nation's most important problem. Two to three times as many cited unemployment and jobs as the biggest challenge facing the country.
So why did policymakers focus so intently on the deficit issue? One reason may be that the small minority that saw the deficit as the nation's priority had more clout than the majority that didn't.
We recently conducted a survey of top wealth-holders (with an average net worth of $14 million) in the Chicago area, one of the first studies to systematically examine the political attitudes of wealthy Americans. Our research found that the biggest concern of this top 1% of wealth-holders was curbing budget deficits and government spending. When surveyed, they ranked those things as priorities three times as often as they did unemployment — and far more often than any other issue.
If the concerns of the wealthy carry special weight in government — as an increasing body of social scientific evidence suggests — such extreme differences between their views and those of other Americans could significantly skew policy away from what a majority of the country would prefer. Our Survey of Economically Successful Americans was an attempt to begin to shed light on both the viewpoints and the political reach of the very wealthy.

The survey is a pilot study and cannot be used to draw conclusions about the whole country.  But it might suggest one reason why certain topics (the deficit!) are pushed into greater prominence  than the "will of the voters" suggests. 

After all, the money to run for office comes disproportionately from the very wealthy, and if we compare getting the same total amount from a very large number of small donors, the wealthy retain more individual power.  What they want to receive for their support (even if only hinted at) can be very clear-cut and obvious, while what, say, a million small donors wish to receive can get quite muddled on the aggregate level.

And the bargaining power of any small donor is nonexistent, while the bargaining power of a wealthy donor is very strong indeed.  He or she can withdraw sizable support if the results don't match the implicit expectations.

The problem is ultimately in the way the American political system is financed.  But it becomes more acute when income and wealth differences increase and when what the wealthy are concerned with deviates more and more from what the rest of us are concerned with.