Schipaanboord 1

Jamie Schipaanboord
Professor Magnusson
Economics 1010
August 3, 2015
The Erosion of Democracy
Abraham Lincoln spoke of a government that was of the people, by the people, and for
the people in his famous Gettysburg Address, creating hope and optimism during the Civil War.
Does this same hope and optimism still resonate with the American people now as it did in 1863?
Is President Lincolns idealistic vision of a democratic government, where cooperation and
equality prevail, the reality in 2015? Eric Gomez would probably say no. In his article titled The
Erosion of Democracy he focuses on the issue of lobbyists, special interest groups, and big
donors having a major influence in directing election campaigns and controlling our elected
officials, which he in turn feels is undermining our democratic system. In this paper I will
discuss why I agree with Eric Gomez and also feel that lobbyists, special interest groups, and big
donors can hurt society as a whole, and will also discuss a possible solution to help lessen the
impact they currently create.
Gomez defines democracy as a government by the people, a government in which the
supreme power is vested in the people and exercised by them directly or through a system.
Democracy encourages collective efforts, and a belief in equality. Capitalism, on the other hand,
does not encourage explicit improvement of society. Capitalism is about the individual and the
profit the individual can acquire.
In this Econ 1010 course we learned about Adam Smith and his idea that a free market
(market capitalism) would increase economic prosperity. Smith believed that society would
benefit the most by the government adopting a laissez faire policy, meaning that the government
would not intervene and instead, let the invisible hand of the market work alone. He felt that
this invisible hand of the market would eventually lead to an equilibrium price, a compatible
price point for both buyers and sellers. This unobservable hand is the cornerstone of market
capitalism, but does such a thing exist with lobbyists, special interest groups, and big donors
using financial leverage to sway democratic leaders? I believe lobbying can be valuable and
helpful. Politicians in Washington cant be experts on every societal issue needing to be
addressed. Lobbying allows specific groups in society to bring the issues of their constituents to

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the attention of politicians. However, it seems that the more money the lobbyists wave around,
the more government influence they acquire. In Chapter 9 of our textbook we learn about groups
having vested interests and how sometimes these special interest groups will try to steer the
search away from the social optimum. We learn that money talks and these large companies and
special interest groups may use their wealth to finance the campaigns of sympathetic
politicians. Government intervention can fail and if it does, market outcomes will decline.
In a New York Times article written in December 2014, author Robert Pear discusses a
large spending bill that was signed off by Congress. Pear mentions quite a few special interest
groups who received a cut of the pie, one of them being Blue Cross Blue Shield. Pear states a
typically arcane provision of the bill provides relief to nonprofit Blue Cross Blue Shield plans,
which have special tax breaks that were threatened by the Affordable Care Act. He goes on to
say that Blue Cross had been lobbying Congress since 2010 and the deduction in question is
available only to Blue Cross Blue Shield plans. It appears, then, that lobbying addresses the
wants and desires of very few. This is anti-democratic and definitely not a system designed to
benefit society as a whole.
In Chapter 16 of our textbook another example is told of Senator Ted Stevens in 2005
when the economy was building momentum and fiscal restraint was needed. However, elections
were coming and no one wanted to jeopardize their position by increasing taxes or slashing
spending. Senator Stevens had promised his Alaskan constituents $233 million for the Bridge to
Nowhere and announced that he would rather resign from the U.S. Senate than cut spending.
Congress approved the spending and in the end the economy suffered. Gomez talks about this in
his Erosion of Democracy article. He mentions that large discrepancies in funds available to
candidates not only gives one candidate an advantage in campaigning but it also makes the
candidate accountable to the interests of his or her contributors. He also brings up the fact that
if a candidate wins the election they must consider the interests of their contributors during their
term or risk losing major source of funds when it comes time for re-election. In 2005 market
outcomes declined, in part, because government intervention failed.
Another example of government failure is discussed in the Erosion of Democracy
article. Gomez mentions the food industry being an interest group constituency that seeks to
benefit from certain government agricultural policies. The U.S. Department of Agriculture
services these constituencies. If these policies receive opposition from government

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representatives and officials in areas that produce a large amount of agriculture, these
representatives and officials most likely will not obtain or maintain their position. This results in
certain agricultural products being subsidized by taxpayers which leads to over-production of
agricultural output and then the problem of government finding ways to sell off or store the
surplus at more tax-payers expense. Again, this creates a decline in market outcomes and
government failure occurs.
Not only can a democracy be hurt by wealthy lobbyists and special interest groups, big
donors during election campaigns can also influence election results, taking power away from
the people and giving it to the few who can pay for it. In a Huffington Post article written by Jay
Mandle in February 2015, he discusses how individual voters and small donors tend to feel they
cant compete with big, wealthy donors. He states how small donors might feel
unable to approach the level of the big donors, they could well conclude that their small
donations represent a waste of money. Similarly, the decline in voter participation most
likely is influenced by the same kind of calculation. Why vote when big donations dictate
who is running for office and when those candidates respond to campaign contributors
rather than the electorate?
I have felt the same sentiment when I have cast my ballot. I go and fulfill my duty, yet it is hard
to convince myself that my one vote actually makes a difference when I assume that behind the
scenes, any influence I have at the ballot box is drowned out by the influence of big donors.
Gomez introduces a solution to help even out the political playing field. He suggests
adopting Voter-Owned Clean Elections or Fair Elections where any citizen can run for public
office and there is equal and limited funding offered to qualified clean candidates. This would
stop erosion of democracy and might help boost participation in government. Citizens would be
paying for elections and possibly have more interest in how their money is spent. Lobbyists and
interest groups could not give candidates advantage. Mandle admits that
the implementing of a public funding option for candidates could dismantle the political
stranglehold now possessed by the wealthy. By allowing individuals who are neither
wealthy themselves nor possess access to private wealth to run for and hold office, the
public could come to see the political process as a toll for progress rather than a source of
alienation.

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I agree with Gomez and Mandle and think that public funding of elections could have potential
positive effects and it is definitely an option that would be worth considering.
In conclusion, I believe that lobbyists, special interest groups, and big donors can create
an unfair playing field for individuals of society, can worsen market outcomes, and ultimately
break down democracy. Fair Elections could be a solution to help curtail the political advantage
that lobbyists, interest groups, and big donors currently possess. Fair Elections could also
encourage individual citizens to become more politically involved, and ultimately provide a
democratic government constructed of the people, by the people, and for the people.