That the lifecycle of city politics ends and begins with money was clear in two recent announcements from the Campaign Finance Board. On July 12, the CFB announced new payments or penalties for several candidates in the 2005 elections. A week later, the board accepted the first round of disclosure reports from candidates in the 2009 race. It’s likely that the process of raising and spending money for the next batch of races will be well underway before the books are closed on the contests that ended last November.
It’s all part of the game that, since 1988, Nicole Gordon has monitored in her role as executive director of the Campaign Finance Board. Come September, Gordon will be part of it no more as she leaves her post to become vice president of the JEHT Foundation, an advocacy group that works on criminal and international justice, health care and election reform. As the first and only head of the CFB, Gordon has seen the agency through five mayoral elections, dozens of controversies, and a steady rise in the cost of winning office in the city. She spoke with Power Plays for an exit interview:
PP: After 18 years in the job, why was now the time to go?
NG: Well, I’ve been very gratified, very pleased with how this agency has grown from an idea in somebody’s mind into a very integral part of New York City’s political system. There’s going to be a four-year hiatus now between elections, which is a long period of time; since 1988, there’s only been one other four-year hiatus and so if I was going to think about having another life besides this one, it was a good time for the agency and for me (and for a new person) for that to happen.
PP: In 1988, some of us were in the sixth grade. What was the campaign finance landscape like?
NG: What was going on in New York in the time was that there was a series of scandals in the city that culminated in the suicide of the Queens borough president, and Mayor Koch introduced a series of reforms that were intended to restore confidence in local government and the campaign finance reforms were a part of a number of different items. In fact, the scandals themselves didn’t have anything to do with campaign finance, but the civics groups had for a long time been pressing for campaign finance reform. The city went to Albany in the first instance to try to get the state to impose certain campaign restrictions on city races but Albany wouldn’t do it so the city, through a voluntary matching fund program, introduced those reforms through city laws. This was against a backdrop of state law that had no expenditure limits and had extraordinarily high contribution limits. The disclosure of campaign finances was abysmal and of course there were no matching funds available.
And those things have all been changed in a very dramatic way. If you want to see up-to-date information on contributions and expenditures you can go to the CFB website and look it up and study it and do statistical analysis, whatever you want. In 1988 you would have had to go to the Board of Election to look at files, probably illegible files. They certainly weren’t in any condition that permitted serious study. Another change of course is the [mandatory] contribution limits, which are much, much lower than state law permits. That’s a significant reduction in the influence that can be felt from large donors. . . . By far the majority of candidates do choose to be in the [voluntary] program and they have to abide by seriously enforced expenditure limits, which are an important part of leveling the playing field. And matching funds is perhaps the most serious avenue that opens up the system to serious people who want to have an impact on elections.
One of the most important things that happened was that when Mayor Koch and Speaker Peter Vallone made their initial appointments, they appointed a board that was prepared to take this job very seriously. That’s another element that, had it not existed from the very beginning, might well have doomed the program to no serious results. But a serious board that was truly independent and non-partisan and took a vigorous role—that was another essential ingredient.
PP: What were the most interesting cases the board dealt with during your tenure?
NG: I think any time the board has had to grapple with a high-profile race, particularly a mayoral race or a race that involves an incumbent or is a close race, that’s always going to be a challenge, not necessarily because the facts or the law don’t provide a sufficient guide. I think every time a serious action has to be taken that could affect the outcome of an important race that requires a board that is prepared to act in a timely way and under a great deal of pressure.
PP: Last year, taxpayers contributed $24,201,275 in matching funds to campaigns around the city. But only one incumbent who was seeking re-election was defeated. Did the system work?
NG: The system is definitely working but there are a number of things that have to be watched very closely. First of all in the law—which was done very wisely at the time—there’s a requirement that the board revisit the program after every election and our report will be forthcoming this fall. The law recognizes that a program of this kind is always going to be stretched to its limit by candidates, and rightly so. Obviously, there’s always going to a tug and pull and new ways of campaigning and new ways of raising and spending money that are going to challenge the law.
It’s crucial not just that the CFB prepare a report but that the mayor and the council pay attention to it. It’s not only crucial because of the way that campaigns change, it’s also crucial because in campaign finance reform, the devil is truly in the details. Too high an expenditure limit will protect officeholders, and expenditure levels that are too low will also protect officeholders. You want to find a number that permits people who aren’t in office to get their message out. You have to revisit those numbers every time to see that they are doing the job. Every single aspect of the program has the potential to keep the democratic process alive, or to deaden it.
One area that needs attention is the “sure winners” phenomenon—candidates that are either so well-liked or so well-entrenched or so well-known that their need for public funds may be zero but public funds become available, they get spent, and these candidates win by tremendous margins. That’s obviously going to be treated in our report.
I’m a big person to caution against the notion that the number of incumbents who win or lose is a test of the program. Any expert will say that incumbency is the greatest single predictor of success in an election. But what the program does do successfully is to give resources to people who want to take that challenge on and get their message out. Equally, when you have an open seat, it has given many, many people an opportunity.
I think also one thing that’s interesting about the whole subject of incumbency is if you look at the mayoral level since 1988 the program has made for extremely fair matches in elections in the sense that serious candidates have all had a more or less equal opportunity to face off. If you look at ’89, if you look at the two following elections, and you look at the last two elections in the Democratic primary—if you look at the closeness in these elections, the program has been very important in generating interest and competitiveness. I think those are more realistic ways of gauging whether any campaign finance program is helping
PP: Of course, in the past two elections, the big campaign finance story has been Mayor Bloomberg, who spent $75 million to get elected in 2001 and $85 million to secure a second term, well more than all other candidates for all other offices combined. Has his failure to join the program eroded reform in the city, and is that something the board should address?
NG: I think there are some challenges to any kind of campaign finance program that, because of Supreme Court rulings, are always going to be difficult when looking at the subject of leveling the playing field: Self-finance candidates is one, and independent spending is another, although we haven’t really seen it in the city. Those are difficult because whenever there are resources being spent—and the First Amendment permits that—there’s no way the government is going to commit itself to match dollar-for-dollar everything that can be spent. The question is, when a candidate has the opportunity to use public finds in addition to other funds, has the program at the very least put that candidate in a better position than they would have been otherwise? A key question is whether they get the opportunity to get their message out. If you look at 2001 and look at the results I think you have to acknowledge that candidates in the program got their opportunity to get their message out. It was a very close election. Elections are so complex, you can’t say how much money would have made a difference, whether anybody would have made a difference. Who knows? In 2001 the losing candidate spent more money than any other candidate ever had, except Bloomberg. Common sense tells you that there was enough money out there.
PP: The CFB recently received a report it had commissioned on the amount of contributions flowing to city candidates from firms “doing business” with municipal government. Is that something that reformers have tools to address?
NG: The issue of “doing business” contributions is another very, very challenging issue but there are a number of ways to address it. One is, of course, to get more disclosure out there. That’s important but the job’s not done. But we’ve made a lot of progress in working with the administration and there’s more to come.
A second part to it is the whole process of how “doing business” is conceived. I think a lot of changes were adopted over the years to improve procurement and other processes within the city. It’s an extremely important component of assessing if there’s a problem. If you’re convinced that city processes are fair, then the contributions side becomes a lot less interesting or important.
Then there are these other methods. The contribution limit was partly in response to this very issue. If the contribution limit is low enough then you can sort of say. ‘This is a difficult problem, there aren’t a lot of ways to handle it, but as long as the contribution limit is low, what kind of influence could someone be exerting?’ In addition to that contribution limit damping of any kind of influence there are other things that can be done. [Under a new law] contributions from those who are registered with the City Council as lobbyists won’t be matched with public funds. It is one way to minimize impact, and that avenue was chosen by the City Council to address it. But our initial research shows that the role of lobbyists as intermediaries or fundraisers is a much more significant role than their role as direct contributors. There’s another way where constraints could be placed if it’s determined that it’s good public policy to do it.
I think the most important issue here really is whether the city is prepared to look at this from the point of view of the entity that’s getting business as opposed to the point of view of a contributor. What you need to do is, when someone wants to do business with the city, say to them, ‘If you want to do business with the city, you have to do this.’ It should come from the side of governing people who do business with the city rather than people contributing. You run into serious First Amendment problems [with the latter approach]. What’s important about that approach is that is an approach that has been used and worked extremely well in the securities industry. There is a rule that was passed by the SEC that says you can’t do bond business in a jurisdiction where your employees have made more than a certain level of contributions to local candidates, and you lose your business if they do, and that has apparently been so successful that even though there is a meaningful enforcement body there—the SEC—the firms themselves are very, very cautious in their approach. It’s virtually a self-enforcing program because the consequences are so serious.
PP: Over the years you’ve seen on a daily basis how well campaigns comply with campaign finance laws. Has this affected how you cast your own vote?
NG: I think all of us going into the voting booth take with us what’s important to us and if in our working lives we care about the subjects we work with, and I certainly care about mine, it’s certainly going to be an ingredient.