57. Does Money Really Buy Elections?

Episode Summary

Executive Summary: The episode argues that campaign money is more a symptom than a cause of electoral success. Through New Hampshire and Iowa primary examples, Stephen Dubner contends that fundraising tends to follow popular candidates rather than create them, so spending heavily does not reliably buy votes. The segment frames political fundraising as an arms race driven by perception, not simple electoral effectiveness.

Main Topics: New Hampshire primary and Romney’s financial advantage: The conversation opens with Mitt Romney’s New Hampshire win and uses it as a case study in how a well-funded candidate is often assumed to be winning because of money. Money versus electoral outcomes: Dubner argues that campaign spending has only a small effect on vote share and that large spending differences often produce trivial changes in election results. Correlation without causation in politics: The segment emphasizes that candidates who raise lots of money are often already attractive to voters, so money and winning move together without money necessarily causing victory. Iowa as a counterexample: Examples from Iowa are used to challenge the idea that higher spending guarantees success, showing inconsistent returns on advertising and fundraising. Politicians’ incentives to keep fundraising: The discussion notes that politicians cannot easily admit money is overrated because campaign fundraising has become a self-perpetuating arms race. Rudy Giuliani’s perspective on money and popularity: A former candidate is interviewed to illustrate a more nuanced view: money helps, but it mostly signals that a candidate is already popular or viable.

Key Arguments: Campaign money does not buy elections nearly as much as commonly believed. The relationship between spending and winning is largely correlational: popular candidates attract both votes and donations. Economist Steve Levitt’s study suggests that even doubling campaign spending changes vote share by only about 1%. Election fundraising behaves like an arms race, where candidates feel compelled to keep up regardless of real effect. Examples like Steve Forbes, Linda McMahon, and Meg Whitman show that heavy self-funding does not guarantee victory. Iowa results suggest that low-spending candidates can still perform well, undermining a simple money-wins narrative. A candidate with the most money is often just the most popular candidate, not necessarily the best-financed cause of success.

Data Points: Romney fundraising in last quarter: almost $24 million - Romney campaign said it raised this amount in the last three months. Romney fundraising in 2011: more than $50 million - Total raised during 2011 as referenced in the discussion. Romney self-spending in prior campaigns: $54 million - Money Romney spent of his own funds in past campaigns for senator, governor, and president. Levitt study effect of doubling spending: 1% extra of the popular vote - Estimate from a congressional elections study controlling for other factors. Levitt study effect of halving spending: 1% loss of the popular vote - Mirror result from the same study showing small marginal effects. Rick Perry Iowa ad spending: $4.3 million - Spent on advertising in Iowa, nearly triple Romney’s amount. Rick Perry Iowa vote share: 10% - Outcome in the Iowa contest despite heavy advertising spend. Rick Santorum Iowa ad spending: $30,000 - Spent on ads in Iowa. Santorum Iowa margin: lost to Romney by 8 votes - Illustrates weak relationship between ad spending and result. Mike Bloomberg example: $100 million spent; won by 4% - Used by Rudy Giuliani as an example of heavy spending plus victory.

Pivotal Quotes: "Money does not buy elections, at least nowhere near what we've always been told." — Stephen Dubner: Core thesis of the segment after discussing Romney’s fundraising. "That is what we know as correlation without cause." — Stephen Dubner: Explains why candidates who raise lots of money also tend to win without money being the direct cause. "It's always better to be the candidate with the most money because that means you're the most popular." — Rudy Giuliani: Giuliani’s nuanced view that money often reflects popularity rather than creating it.

Implications: Listeners should be skeptical of claims that campaign spending directly determines election outcomes. The bigger lesson is that fundraising often measures candidate strength, so future campaign finance debates should focus on voter appeal, not just spending totals.