Finance – Columbia Journal of Law & Social Problems

Facing the Coordination Reality: Removing Individual and Party Limits on Contributions to Presidential Campaigns

By Zachary Morrison

Since Citizens United, a new era of campaigning has emerged in which traditional campaign functions have been outsourced to candidate-centric outside groups. In the 2016 presidential election, ten campaigns had raised less money than their allied Super PACs and other outside groups. Federal election regulations that restrict coordination between these outside groups and campaigns are outdated and poorly enforced. American democracy is weakened by this unprecedented electoral activity because of decreased donor transparency, increased negativity without accountability, and voter confusion.

This Note concludes, after examining outside group political activity in the 2012 and 2016 presidential cycles, that candidate-centric outside groups create the same risk of corruption as direct contributions to campaigns. Therefore, this Note proposes that proponents of stricter campaign finance regulation should consider removing limits on individual and political party contributions to presidential campaigns. Allowing individuals and parties to provide unlimited funds to campaigns would diminish the appeal of outside groups and increase the political pressure on campaigns to disavow their use. This realistic, if not pessimistic, proposal offers a simple legislative solution to some of the concerning elements of an increased reliance on outside groups, while leaving the possibility for a different Supreme Court to permit radical change.

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Gubernatorial Impoundment: An Implied Solution for a Budgeting Challenge

Issues Volume 53, Issue 4

By Zachary Blair

In recent years, states have had to make drastic cuts to their budgets even as the economy flourished in the wake of the Great Recession. The task of balancing state budgets has always been a formidable one, but recent shifts in revenue sources and their ability to generate reliable funding have made this challenge increasingly common and difficult. Historically, states have viewed budget balancing as a fundamentally legislative obligation and prerogative, which is often delegated to the executive branch in the form of impoundment statutes because of the executive’s superior budgeting capabilities.

In several states, however, the legislature has either kept the power to balance the budget for itself or has delegated insufficient discretion to the executive, hampering the state’s ability to meet its constitutional obligation to balance the budget. Consequently, this Note presents an alternative interpretation of the power to impound. It conceives of impoundment as a shared constitutional power exercisable by either the executive or legislature that can be constrained by statute. This interpretation permits the executive to better leverage its strengths in fiscal matters to resolve budget deficits quickly and efficiently, ensuring that the state meets its constitutional obligation to balance the budget.

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Expanding Employee Ownership in America: A Proposal for a National Equity Compensation Mandate

Issues Volume 55, Issue 2

By Tyler Ross

Individual and household wealth is most often derived from three sources: real property, human capital, and productive capital. The modern economy has developed financial tools, such as mortgages and student loans, to help individuals accrue real property and human capital, but there is no meaningful way for the working class to accrue ownership of productive capital. And, so long as the growth rate of capital exceeds the growth rate of wages, wealth inequality in the United States and elsewhere will continue to grow. This Note explores existing methods to extend capital ownership to the working class, such as Employee Stock Ownership Plans, and proposes a federal, national, mandatory equity minimum wage as an effective solution to three problems in our modern economy. Specifically, (i) employees do not benefit when the companies for which they work are tremendously profitable and provide outsized returns to investors; (ii) wealth inequality is worsening and will continue to do so; and (iii) there is a savings deficit among nearly one-half of American households. This Note explains how a mandatory equity minimum wage will help ameliorate these three problems by meaningfully extending ownership of productive capital to the working class.

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Don’t Break the Bank, Build a New One: How Investing in Public Banks Can Solve Pensions’ ESG Problem

Issues Volume 56, Issue 4

By Geeta Minocha

Pension funds are significant institutional investors with massive capital. Attractive, prosocial investment opportunities abound. Nevertheless, several roadblocks limit American pension managers from engaging in ESG investing, including ERISA, fiduciary rules, anti-ESG state laws, and institutional inertia. This impasse creates an opportunity for public intervention because the private sector may be failing to meaningfully adjust to meet societal goals. This Note argues that public banking may be an appropriate tool to distribute some pension capital to ESG goals, effectively enabling pensions to outsource their present ESG burden. Though currently a rarity in the United States, public banks can serve as sound investments for pensions while in turn using this invested money for prosocial initiatives.

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