Legally Circumventing Campaign Finance Law

The Baltimore Sun outlines how easy it is to circumvent Maryland's campaign finance laws:

Maryland campaign finance laws say donors may not give more than $4,000 to a candidate for state office and cannot donate more than $10,000 overall to state candidates during a four-year election cycle. The limits are designed to ensure that a small group of wealthy contributors do not unduly influence the outcome of a race.

But those limits, albeit legally, are being circumvented in several ways. Donors, particularly to Republican Gov. Robert L. Ehrlich Jr. and his Democratic opponent, Baltimore Mayor Martin O'Malley, are giving through multiple companies or to state and federal campaign accounts controlled by state parties that then shift the money back to candidates.

Both Democrats and Republicans benefit from the system. I'm not quite sure how one would fix the system. The people usually don't seem very keen to pay for campaigns out of the public kitty even though public financing is a favored idea of reformers. I'm also not sure if it would be legal to ban transfers from federal accounts. One danger with limiting donations further is that candidates spend even more time raising money and the system becomes even more skewed to incumbents who are able to gather cash from many sources.

I don't worry too much in a gubernatorial campaign like this one where both sides are well-funded. While more money is always nice, the impact of more spending declines after a certain point. However, challengers like O'Malley must be able to reach a certain level of spending in order to be competitive. Even if O'Malley ends up outspent by Ehrlich, he will still have plenty of money to run a competitive campaign.

Reformers will still worry that both candidates end up politically indebted to various interest groups even if more optimistic observers think that interest groups simply give to their preferered candidates. Of course, it is difficult to avoid the appearance of impropriety even if nothing improper occurs. It is hard to differentiate between an official taking a position because of donations and an official receiving donations because of their position.