Political campaigns are also known for drawing in significant financial backing, which is especially apparent in the crowded field of candidates vying to become California’s next governor.
Democratic candidate and billionaire Tom Steyer has spent more than $132 million of his own money funding his campaign, while major companies and wealthy contributors have also spent millions of dollars backing — or opposing — other candidates.
Sacramento State Political Science Professor Wesley Hussey spoke with CapRadio’s Laura Fitzgerald on Insight about the role of money in politics and elections, and how it can shape the perceptions of voters.
This interview has been edited for length and clarity.
Interview highlights
What does all the money raised by a campaign or candidate actually get used for?
For California, it's all about TV. Even now as we're moving to streaming and digital, TV is extremely expensive. Second largest media market in the country, Los Angeles alone. Throw in the Bay Area, San Diego, Sacramento, Fresno, it adds up quickly. We're talking maybe 70% to 80% of your entire budget going to TV, digital or streaming. Digital and streaming is cheaper, but you have to throw yourself out there on a lot of platforms to get out there.
If we look at the current candidates running for governor, what stands out about how much they're fundraising?
Well, Tom Steyer has spent more money than any candidate ever [in] the history of California governor. Meg Whitman in 2010 spent a little less than $150 million of her own money running against Jerry Brown. But it wouldn't surprise me if Steyer somehow makes it into the second round, he will easily eclipse that. That's an incredible amount of money running for office of governor.
Steyer is a billionaire, and has become well known for self-funding his own gubernatorial campaign, to the tune of $132 million as of last month. What do you make of that?
When I ask my students in my class if they've seen any commercials on streaming or TV, they'll always say “Steyer” first, easily. Sometimes that's the only thing they've seen. He's run a lot of ads in favor of his campaign, maybe run ads targeting other candidates. He's really trying to get out there with a message; he doesn’t have the years of experience in government like some of the other candidates, so he's trying to appeal to voters and remind voters who he is.
Do you have a sense of how voters feel about wealthy candidates putting their own money into campaigns?
I think in some sense voters get skeptical with that much money being spent, particularly of your own money. But on the other hand, they know that campaigns are expensive and that candidates are raising vast amounts of money. There's something about a person using their own money that sometimes voters like, that they appreciate, that they feel like maybe they're not going to get bought or influenced by special interest groups.
But then it also does remind them how much more money this person has than them. How much more money they have than even wealthy people in California. And yeah, that does have people kind of take a second and think, “do I want someone like that to be my governor?”
What are the limits of self-funding a campaign? Does the best-funded candidate usually end up winning?
Not always. Having over a certain critical amount of money is key to winning races. Sometimes we do see candidates who spend the most money lose because they're desperately trying to compete with the name brand of their opponent, or someone who's been in office for a long time. It's harder for challengers against incumbents.
Now, in an open race like this, there's a lot of opportunities for candidates. We can go all the way back to the 1998 gubernatorial race in the Democratic primary, where Gray Davis has two wealthy Democratic opponents who are spending a lot more than him. And yet, he's able to still advance out of that Democratic primary by pointing out that his opponents had all of this money and he doesn't.
Sometimes you can backfire, but if you're a candidate who doesn't have a long record in government, you have to show that you're a credible candidate. One of the ways you do that is [to] be on TV. Show the voters that you can raise money to be someone that the political insiders think is credible and a viable candidate to run. So there is a need for candidates to spend money to be out there, but how much they spend is really based on the circumstance.
There's a lot of wealthy supporters and special interests involved in campaigns. Democratic candidate Matt Mahan has the backing of Silicon Valley tech giants, and groups like PG&E are spending a lot of money to oppose Steyer. What does it mean for elections overall to have these major wealthy contributors making donations?
I think a lot of your listeners and voters are used to this idea of super PACs now. Here in California, we call them independent expenditures. There's the ability for people to run campaigns on behalf of candidates where they're not allowed to coordinate, but the rules on that are very murky. And so sometimes you're going to see corporations, special interest, wealthy people put tons of money into a campaign to support a candidate, or to attack a candidate. That message isn't always as perfectly clear as a candidate with their own message.
I think that Steyer may have an advantage over Mahan because it’s his money, his campaign. But if you start seeing a commercial, you might not know that’s not actually Mahan’s campaign — there’s a super PAC or independent expenditure on behalf of him. And you're like, "now I know more about that candidate," or, “”I might know something about a candidate I might vote for that's negative.” And one of the other candidates has a super PAC running those ads.
Which industries are big spenders when it comes to California politics? Are you noticing any trends?
I think the last few election cycles we've seen this huge increase of tech money. I think tech was always a little uncomfortable understanding the rules of politics. They kind of created this aura of “they’re libertarian, they’re outside of the realm of government.”
And now, as they become more important in society, people want to regulate them, and they’re like “whoa, we need to have candidates [or] elected officials who will listen to us.” I have seen an incredible amount of more money from tech backing candidates, backing initiatives, backing ideas.
But [there’s also] the classic things you'd see in California; you might see oil giving money, larger corporations that aren’t involved in tech. Hollywood has always been a great source of money — both individuals like celebrities, but also the money behind studios and companies there. So if there's money being generated in California, there's going to definitely be campaign contributions from it.
A lot of candidates also tout small contributions or grassroot support. Has it been easier for campaigns to attract these donations, and how are they regarded compared to other financial support from these tech giants?
I think candidates like them because they can say they have X amount of supporters. They have people like you and me giving money to campaigns. Historically they weren't very helpful because it took more work to find small donors, and then get them to contribute and do all of the logistical work then maybe the amount of money you would get.
But these days with the internet, ActBlue, all these companies [where] you can just go to a website and donate, the cost is basically zero. Now you get not only the financial benefit, but also get [that] extra bonus of “how many people have contributed to my campaign.”
A controversial wealth tax might also get on the ballot this year, and it’s drawing opposition from millionaires and billionaires. What stands out to you about how opponents are moving to stop it from passing?
I think that the wealth tax has not officially qualified yet, but it probably will pretty soon. It's going to target a very small group of people who happen to be incredibly wealthy. We're talking billionaires, maybe only 200 [to] 300 people in the state.
Some people have left. But a lot of really rich people have given money to a variety of super PACs, independent expenditures, political groups that are going to oppose this measure if it's on the ballot. But others have put up potentially rival measures that, if passed at the same time, would ban wealth taxes. So the wealth tax could pass, but another measure would say if a wealth tax passes now or in the future, it wouldn't qualify in California.
I think part of that is different strategies to defeat the wealth tax, but it also might be if both of those measures pass there's a time for negotiation. Maybe they both get pulled, but some additional income taxes added to the tax roll. And so the ability to have a measure on the ballot gives you more leverage, and that might just be part of the strategy they're involved with.
The amounts of money being spent on campaigns might be hard for people to wrap their head around. What do you want people to keep in mind when they're seeing these numbers mentioned during the election season?
I read once that we spend more in America on advertising for potato chips than we do for elections. We spend a lot of money on advertising in America; we're a capitalist society, we're trying to convince people to buy things. Candidates are commodities; they’re ideas, they’re people who have suggestions of what they want to do, and they're trying to convince us that they're the best choice.
It doesn’t surprise me that a lot of money is in politics, because there’s a lot of consequence to who's elected and the decisions they make. I'm always surprised by how much money is in politics, but I have to remind myself there's a lot of money in the United States [and] in California. A candidate spending $150 million might be an incredible amount of money.But a campaign raising $70-80 million to run for governor when you're the fifth largest economy in the world, may not be such a big thing to worry about at that point, particularly if I want to see them run ads and communicate with the voters of California.