Dumb Idea of the Day: Escrow Campaign Finance

If Congress is going to be on the take, then small donors should have the right to play the game.

One of the nice things about living in a Blue State is that most of the time, I don’t have to worry about my Representative or Senator.  To be sure, Dianne Feinstein can often be a moral cretin, but it could be worse: I could live in Connecticut and have to deal with Holy Joe.  Thank heaven for small favors.  My Congressmember, Howard Berman, is one of the best in the business.

But that puts me in a tough position on the eve of the historic health care vote: how do I influence a congressmember who does not represent my district?  Calls won’t work.

So here’s an idea.  Someone — probably Act Blue — should set up escrow campaign accounts, payable if the members on it vote the right way on a particular bill.  Note that there need be no direct contact with the Representative at all: somehow I get the impression that if these things were set up, members’ finance chairs would know how to check them.  Each member could have an escrow account that would pay off if certain conditions were satisfied.

Would the right try to hijack this?  Maybe, but I doubt it, because it would involve “centrist” Dems whom they want to knock off anyway (which is why these Dems shouldn’t vote their way, but that’s another story).

Most corporate lobbyists do this anyway, although with language that gets them out of the bribery trap.  This could be the way that small donors, who don’t stand to get legislative favors anyway, could influence congressmembers — and the congressmembers would have the transparency of knowing what they will get upon a particular vote.

What if the Congressmember votes the wrong way anyway?  The money could be stored in an escrow account with ActBlue, available for any other candidates on the ActBlue list.

And no — I have no idea if it’s legal, but I think it would be.  It’s no different that major lobbies promising to run ads under certain contingencies (either positive or negative).

In the wake of Citizens United and the corporate sloshing of money through the Hill, there has to be some way in which small donors can actually influence Congress.  This is a place to start.

Author: Jonathan Zasloff

Jonathan Zasloff teaches Torts, Land Use, Environmental Law, Comparative Urban Planning Law, Legal History, and Public Policy Clinic - Land Use, the Environment and Local Government. He grew up and still lives in the San Fernando Valley, about which he remains immensely proud (to the mystification of his friends and colleagues). After graduating from Yale Law School, and while clerking for a federal appeals court judge in Boston, he decided to return to Los Angeles shortly after the January 1994 Northridge earthquake, reasoning that he would gladly risk tremors in order to avoid the average New England wind chill temperature of negative 55 degrees. Professor Zasloff has a keen interest in world politics; he holds a PhD in the history of American foreign policy from Harvard and an M.Phil. in International Relations from Cambridge University. Much of his recent work concerns the influence of lawyers and legalism in US external relations, and has published articles on these subjects in the New York University Law Review and the Yale Law Journal. More generally, his recent interests focus on the response of public institutions to social problems, and the role of ideology in framing policy responses. Professor Zasloff has long been active in state and local politics and policy. He recently co-authored an article discussing the relationship of Proposition 13 (California's landmark tax limitation initiative) and school finance reform, and served for several years as a senior policy advisor to the Speaker of California Assembly. His practice background reflects these interests: for two years, he represented welfare recipients attempting to obtain child care benefits and microbusinesses in low income areas. He then practiced for two more years at one of Los Angeles' leading public interest environmental and land use firms, challenging poorly planned development and working to expand the network of the city's urban park system. He currently serves as a member of the boards of the Santa Monica Mountains Conservancy (a state agency charged with purchasing and protecting open space), the Los Angeles Center for Law and Justice (the leading legal service firm for low-income clients in east Los Angeles), and Friends of Israel's Environment. Professor Zasloff's other major activity consists in explaining the Triangle Offense to his very patient wife, Kathy.

4 thoughts on “Dumb Idea of the Day: Escrow Campaign Finance”

  1. It's not a dumb but a great idea–by which I mean one that somebody else and I already thought of and considered trying to set up on a free-lance basis a few weeks ago, though on reflection it's of course much easier if an established group does it.

    My friend and I thought of two variables:

    —escrow accounts for money alone, or for both money and volunteer time? The organizing model would suggest that the latter is just as important.

    —carrots only, or also sticks? That is: merely hold up money until the targets vote your way, or also threaten to fund primary challengers if they don't?

    Moveon.org is already taking pledges for the money/stick version at http://pol.moveon.org/hc_house_fund/survey.html/?…

    But there's one problem: they're not taking credit card numbers, merely pledges on an honor system. So it's not a true escrow account, since pledges not backed by cash are cheap.

    Maybe there's a reason they're doing it this way (campaign finance laws?). But a true escrow scheme, if workable, would be more effective.

  2. I'm pretty sure there are campaign law problems: If you're asked to deliver somebody else's campaign donation, and do anything except reliably and promptly proceed to do so, you're considered to have received the money yourself, and if you subsequently deliver it to the candidate, YOU would be considered the donor. That's what I would suspect the hitch would be.

  3. Isn't there also (in one of those distinction-without-a-difference rules) a law against conditioning donations explicitly on legislative acts?

  4. I think it could be done with the right wording. And with the appropriate level of trust between donors and the administrators of the account. There's a similar situation with the tax status of certain trusts set up to fund the educational and other expenses of sprogs of wealthy families: if the trustee is instructed to make payments to the sprogs at particular times and in particular amounts, then they payments are income to the sprog and taxable as such. If the money is doled out at discretion, then the money (while still income to the trust) is colorably a gift to the sprog.

    PACs and big donor/aggregators get away from the bribery rule by making the connection between contributions and particular votes implicit, or at least not in the form of a written or verbal contract. "This legislation is very important to us. It would be goo/bad for our industry. Our PAC has raised $X so far." Aggregators for smaller contributors simply need to do the same kinds of things. There is an agency problem, of course, but even in an escrow system you have that, because someone has to do the paperwork.

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