Globalist Perspective

Today’s Number: $6 Billion to Elect a President

Would American democracy be better served by shorter and less costly elections?

Barack Obama (Credit: Pete Souza/White House)

Takeaways


  • The United States is a divided nation where historical differences still run deep on anything from social and fiscal policy to race and the importance of religion.
  • As Canada or the UK show, electoral distractions can be minimized by statutory limitations on the duration of election campaigns and how much they cost.

After all the chips, chits and (hanging) chads are counted and voters in the United States have finally decided who will lead their country for the next four years, the total amount of money spent on the campaign by the Republicans, Democrats and a collection of political action committees (PACs) and Super PACs will total $6 billion.

The cost of the theater that was “Obama Vs. Romney” equals the annual GDP of small nations like Kyrgyzstan, Monaco or Haiti. The question has to be asked whether this kind of spend on an election makes any sense.

If you look at the electoral maps over the past couple of decades, you have to come to the conclusion that no election in recent memory has changed the division within the world’s largest economy and leading democracy.

You essentially have blue coastal areas enveloping a red center, with a few swing states giving a single percentage edge to either a Democrat or a GOP candidate.

Let’s face it, the United States is a divided nation where historical differences still run deep on anything from social and fiscal policy to race and the importance of religion in a political system that commits itself to the separation of church and state.

“Obama vs. Romney” will change nothing about the state of this “Divided Union,” an oxymoron that accurately describes the nature of contemporary American politics. As most of their predecessors, the winner of this election will have to find a way to deal with close to 50% of the population, and their congressional representatives, who wanted someone else in the White House.

No matter who occupies the White House in January 2013, they will have to deal with a continuously dysfunctional Congress that has been paralyzing political progress in the world’s leading economy for quite some time now.

In his song about the New York rat race, Movin’ Out, Billy Joe lamented, “Who needs a house out in Hackensack? Is that all you get for your money?” We could easily put new words to that tune: “Who needs this kind of election? Is that all we get for our money?”

The showdown of red, blue and purple that has unfolded over the last year is hardly worth the money put into it. Just imagine what $6 billion could do if invested productively: how many jobs could be paid for, how much innovation funded in small businesses, how much crippling infrastructure rebuilt.

But that’s not even the core issue. With $6 billion of contributor money at stake on either side of the Congressional aisle, politicians are spending too much time not doing the job they were elected to do.

Getting “their man” (or woman, some day…) into the White House takes precedent over dealing with the fiscal cliff, tax reform or any other hot issue in front of Congress.

If a president running for a second term wants to win, he has to prioritize campaign efforts over running the country for over a quarter of his term in office. Sound alarming? It should.

Distraction of politicians by elections every so often is part of the game, no doubt. It is the intended consequence of democratic process — and as such is unavoidable. But the American-style election madness is not.

As the examples of Canada and the United Kingdom show, electoral distractions can be minimized by statutory limitations on the duration of election campaigns — and the extent to which citizens, corporations and special interests can fund them.

The prime ministerial races in both countries get decided after a relatively painless campaign of four to five weeks. The U.S. presidential election takes over a year.

And contributions to elections in the UK and Canada run in modest eight figures, a minimal fraction of the mad money spent in the Land of the Free.

It is time for the United States to embrace election reform so that the people representing the citizenry can do their jobs and focus their efforts on the needs of their country.

How much money the Super PACs will throw into defeating that idea is anybody’s guess.

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About Beat Guldimann

Beat Guldimann is president of Tribeca Consulting Group and the author of "Inside Swiss Banking."

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