Apparently I will be continuing my recent trend of riffing on Kevin Drum's posts. He points to this fascinating chart:
Kevin notes the surprisingly stable Presidential campaign costs from 1964-2000. I was especially surprised by 1992. I would have thought that a three way race with the closest thing this country has had to a third party in almost a century would certainly have skyrocketing costs. But it turns out they didn't. He goes on to note that the costs skyrocketed for 2004 and 2008. The thing that immediately struck me about that time period is that those were the only elections which were 'restricted' by the McCain-Feingold Bipartisan Campaign Reform Act.
Why did campaign expenditures skyrocket in the only elections where outside spending was supposed to be sharply regulated? I don't know, but I'll throw out some factors that come to my mind, and what I think about them.
1. The parties thought that with a lack of outside spending they could get much more bang for their buck. I'm not sure this would explain why they didn't spend much more in previous years but it might be a factor.
2. The parties were able to raise more money because other political spending outlets were closed (or were perceived to be closed). I might buy this one.
3. The parties felt they had to raise more money because the loopholes in McCain-Feingold were so big that they didn't actually rein in any spending by groups outside the campaign. This one is interesting. The history of spending through 527 organizations suggests that it wasn't ridiculously difficult to get around McCain-Feingold if you wanted to (though both Swift Boat Veterans for Truth and MoveOn.org got hit with fines for failing to register). But this raises an interesting question, what about 2000 (or 1996)? Was McCain-Feingold somehow worse *even by its own standards* than the regulations that came before it?
4. Those two elections were hotly contested with a very fired up base, so more fund raising/spending was possible. This is a very plausible candidate. Bush was already a well hated president by 2004, and by 2008 the Republican party was looking like a complete mess in the aftermath of the Bush years. But this would suggest that spending should go down soon, which doesn't initially seem to be the case (ask again after the election).
It is possible that McCain-Feingold is unrelated to this chart. But it seems very odd the skyrocketing costs took place in the only two elections where the law was in force.