It’s a question we get fairly often. And it’s an important one.
Here’s a simple analogy to explain why we think corporate money in politics is a bad thing.
Comparing Corporations And Politicians
Corporations have shareholders. When a corporation wants to raise more money, it issues and sells more shares. This helps the corporation because it now has more money to spend on its business. But every time it does this, it dilutes the existing shareholders. A shareholder with one share of a company that has a total of ten shares has more of a voice in how that company is run than it does after that same company issues ten more shares to new shareholders. The shareholder is diluted from a 10% ownership stake to 5%.
In other words, the more money the corporation raises, the more diluted each share becomes. But shareholders are usually OK with this. That’s because they hope the total value of the company will go up with the cash infusion and thereby offset this dilution.
Now lets compare this model to politicians raising money.
It’s a fact of life today that political campaigns are won and lost based on how much money each politician raises. There’s therefore a strong incentive for each politician to raise as much money as possible. And much like a shareholder in a corporation, the more money the politician raises, the more diluted the voice of each campaign contributor (and constituent) becomes.
If you give $1,000 to a politician that only raises $10,000 in total campaign contributions, for example, your political voice is more likely to be heard by that politician than if you give $1,000 to a politician that raises $10,000,000 in total campaign contributions.
On the flip side, however, unlike a corporation that often becomes more valuable as capital is invested, a politician does not become smarter or a better leader simply by raising more money. In fact, the opposite is true. The need to raise so much money often forces politicians into spending most of their campaign time calling people, and particularly company leaders, begging them for money.
Enter corporate super PACs
Corporate campaign donations through super PACs not only increase the total amount of money politicians raise in each election—thereby diluting everyone else’s voice—corporations also generally have much more money than individuals. This poses another problem. If a company can give a politician millions of dollars through a super PAC, then the self-interested politician is certainly going to prioritize that company and its views more than the individuals the politician represents. This also undermines our democracy.
At Goods Unite Us, we’ve made it our mission to get corporate money out of politics. And by making it easier for consumers to see where corporations and their senior employees are spending money, we are allowing those consumers to reclaim their political voices.
If we want to change corporate money in politics, we’ve got to hit corporations where it hurts most: their bottom lines.
Download the free Goods Unite Us app today. And start putting your money where your vote is!