Dollarocracy (41 page)

JON KATZ, “THE AGE OF PAINE,” 1995

Web 2.0 is a formula to kill the middle class and undo centuries of social progress.

JARON LANIER, “YET MORE QUESTIONS”

I
f there was one assessment of the 2012 campaign that the campaign consultants loved above all others, it was the analysis that said, “Thar's gold in them thar iPhones.” Even the Republican consultants delighted in the notion that Barack Obama won, at least in part, because his campaign better mastered the new rules of digital politics—and poured twice the resources into
the Internet than the Romney camp spent.
¹
After two decades of trying to figure out how to monetize bits and bytes, the consulting class is now all in for the digitalization of our politics. Indeed, the final election-season issue of
Campaigns & Elections
(“the magazine for people in politics”) featured “10 Bold Ideas for the Future of Consulting.”
²
This was the money-and-media election complex talking to itself, and there was no mistaking the message. Yes, of course, there were the calls for more spending: “Money in Politics: Time to Embrace It.” And complaints about even the most minimal restraints on campaign donations: “Give Candidates the Ability to Fight Back: With Contribution Limits Intact, What's a Candidate to Do?”
³

But the primary focus of the “bold proposals” was on spreading the political pathologies of the “old media”—brutal negative campaigning, crude messaging, divisive tactics, and, above all big spending—to the “new media.” “Political Technology Is Best Served Partisan,” declared one headline, which was sandwiched between “The Future of Direct Mail Is Digital” and “Software Will Revolutionize Local Politics.”
⁴
Any fleeting talk of ideals and values was mostly muffled by the drooling over dollars: “The political technology field is still relatively new and whenever a new industry shows promise and money is being made, venture capitalists are quick to notice and search out promising opportunities for investment,” noted one of the more thoughtful commentators. “Some in the political technology space have been quick to meet these new players with a ready grin and an open palm.”
⁵

There is no question that the towering variable that remains for those seeking to understand American elections and the nature of the money-and-media election complex has to do with the emergence of the Internet and the broader digital revolution.
⁶
The political players who have mastered television and radio and direct mail, the Karl Roves
and
the David Axelrods, as well as the thousands of consultants you've never heard of, are deep into a process that they believe will allow them to master the Internet. The reality is that the consulting class no longer views the Internet as a “new frontier” or a tool that needs to be understood. Those are the discussions of five, ten, even fifteen years ago.

Where the consultants are now with regard to the Internet is best understood as roughly where they were in the mid-1960s, around the time the Johnson campaign's 1964 Daisy ad highlighted fears about Barry Goldwater's extremism, with regard to television. They do not know
everything
that they will do
with a relatively new tool. But they are sure that they will eventually do everything
with
it. The question is whether they will define the future as they did with television, as a constant process of cashing in that ultimately warps the promise of the media to such an extent that it too becomes a “vast wasteland” or “the place where ideas go to die.”

We know that some of our friends and readers believe this is impossible, that the Internet is too vast, too uncontrollable, too ripe with opportunity for discourse and dissent to be conquered by new players with a ready grin and an open palm. We respect their hopes, but we would caution that the better part of fifty years ago, critics as wise and worldly as Clive Barnes were saying of television, “It is the first truly democratic culture, the first culture available to everyone and entirely governed by what the people want.”
⁷

Barnes was wrong about television. It's not “democratic”; it's definitional. And the people who do the defining are, more often than not, the people with the best political connections and the most money. The question now is whether those who maintain faith in the transformative power of the Internet will recognize that there is a competition for that power. And some of the smartest and most innovative, sly and determined, crude and cutthroat players in American politics and media are already in the thick of that competition.

If they prevail, and they surely intend to do so, America will have the digital equivalent of the Daisy ad and all the pathologies of current campaigning coming through our iPhones. That's why it is so very vital to unpack the details of the digital debate.

The place to begin is where everyone agrees, even those more comfortable with the status quo, and that is on the reality that the United States is in the midst of a thoroughgoing digital transformation of election campaigns. “Online communication has increased by orders of magnitude since the last election cycle,” Satwant Kaur wrote after the 2012 election. “Internet users have doubled. Facebook users have increased ten times. Tweets have increased 1,000 times.”
⁸
Only the extent of the conquest remains in debate. “JFK is the first television president. [This] year's victor may well be determined by the impact of Facebook and Twitter,” Jordan Bittermann of
Digitas
argued early in the fall campaign.
⁹
To Paul Springer and Mel Carson writing in
Forbes
, the 2012 election “will ultimately be tagged the first full digital election—the first to exploit the spectrum of live, real-time digital media.”
¹⁰

The only question in this regard is how far along in the process the digital transformation is. Silicon Valley's Marc Andreessen is not ready to acknowledge the torch has been passed. “There is going to be a national election that is going to be about the Internet the way that 1960 was about TV for the first time with the Kennedy/Nixon debate. That hasn't happened yet. Best guess would be 2016, but could be 2020 or conceivably one of the midterms 2014 or 2018. . . . When it happens, everything changes. The spending will tip, and the campaigning methods will change.”
¹¹

Andreessen is correct: spending did not come close to the tipping point in 2012. Obama's “aggressive Internet strategy” saw the president's campaign spend roughly double what Romney's team allocated to the task: $52 million for the Democrat, $26 million for the Republican.
¹²
Indeed, in the overall scheme of 2012 political spending, expenses for digital campaigning could have been taken out of the spare change jar.
¹³
Romney's total spending for online ads was less than what one donor, Sheldon Adelson, gave in the final weeks of the campaign to the Romney-friendly American Crossroads super-PAC.
¹⁴
David Banks, managing director of equity research at RBC Capital Markets—and, yes, it is striking that with the tidal wave of corporate and millionaire money into politics, investment advisors have become authorities on election campaigns—observed, “If you had asked someone four years ago would the next election be the game changer for internet and social media, many would have said yes. It hasn't quite played out that way, and if anything, the spending has been remarkable for how unremarkable it's been.”
¹⁵
In 2012, like 2008, the
Wall Street Journal
concluded that “television remained king. The great digital migration just isn't happening.”
¹⁶

Matthew Dowd, who ran polling for George W. Bush's two presidential campaigns, blamed campaign consultants for the slow migration: “Because media consultants are such a powerful part of the campaign team, doing something different is very hard.” Like generals, they have the tendency to fight the last war.
¹⁷
But the thing to understand about consultants is that their war never ends; they slowly but surely master new tools and tactics. And their professional journals are now packed with ads that scream “Big Data. Bigger Results” and “Canvassing Tools for the Mobile Campaign.”
¹⁸
The digital tipping point has not been reached, but we can see it from here—and so can the consultants, slow as they may once have been. They are now racing toward
it because they have come to understand, thanks to the innovations and successes of the Obama campaign, that there could well be another pot of gold just beyond the tipping point.

Truth be told, there's already a good deal of gold being spread around. By our calculations, the total amount of campaign money spent online for political advertising in 2012 was in the range of $300–350 million.
¹⁹
This was a good tenfold increase from 2008, and what was spent on the Internet in 2012 was almost twice what was spent on television candidate ads in the entirety of the 1972 election, even when inflation is factored in. Recall that in 1972 this level of TV advertising was widely considered scandalous and could have had no small number of Americans fantasizing about burning their TV sets in effigy. So 2012 Internet political advertising was hardly chopped liver, and by all accounts its exponential growth rate will continue through election cycles for the foreseeable future.

Online advertising is, of course, the easiest measure of political activity on the Internet. But it is neither the beginning nor the end of the Internet's role in American politics. In our view, the focus on advertising understates the Internet's overall role in campaigns. In 2012, the Pew Research Center determined that 47 percent of voters categorized the Internet as a “main campaign news source,” second only to television, well ahead of newspapers and radio, and up from 36 percent in 2008 and 21 percent in 2004.
²⁰
Pew research also determined that 55 percent of registered voters watched political videos online and nearly 25 percent watched live videos online of candidate speeches, press conferences, or debates.
²¹
Moreover, 45 percent of smartphone owners used their phones to read other people's comments about a campaign or candidate on a social networking site, while 35 percent of smartphone owners actually used their phones to “look up whether something they just heard about a candidate or the campaign in general was true.”
²²
A Google poll found that 64 percent of battleground-state voters used the Internet to fact-check the candidates.
²³
After the first Obama-Romney debates, there were more than 10 million tweets, making it to that point the most tweeted about event ever in U.S. politics.
²⁴
By November 2012, there were 110,000 political Facebook pages in the United States and more than 11,000 pages just for American politicians.
²⁵
Nearly 25 percent of all the time that Americans spend online is spent on Facebook.
²⁶

In short, these aren't your grandfather's elections, or your father's, or even your older sister's. “Shaking hands and all the traditional campaign stuff has not gone away. You must still do it to win,” Alan Rosenblatt of the Center for American Progress put it, “but if you don't have a complementary online strategy you can't win either.”
²⁷
Of course, digital political ad spending matters, and, yes, it will matter a whole lot more in the elections to come. But emphasizing digital political ad spending over all other aspects of the Internet as a source of political insight and inspiration does a grave injustice to the digital revolution occurring in political campaigns. The Internet is already in the bone marrow of the American election system. In this chapter we examine how the Internet has evolved and has altered election campaigns. But we are interested in much more than a mere stroll through the digital garden. Our primary concern is with the great question of the digital age: Will the Internet substantively derail the money-and-media election complex and empower people to tackle Dollarocracy, or could the Internet make matters worse?

When the Internet burst on the scene in the early 1990s, propelled by the World Wide Web, it generated euphoric enthusiasm for its capacity to overcome institutional obstacles and launch an unprecedented—even revolutionary—democratic surge. The early days of the Internet were characterized by a sort of digital utopianism that suggested everything was possible online and that everything would be better: more transparent, more open, more free.
²⁸
The Internet would make it possible for all people to communicate freely with each other and have near-instant access to a treasure trove of information; the bad old days of media monopolies, commercial interests, and politicians—not to mention dictators—controlling the public sphere would soon be gone. People could bypass traditional gatekeepers and organize effectively among themselves. Digital technology could draw everyday people into actual policy formation and governance in a manner that had been unimaginable previously. Authoritarian regimes would be placed on the endangered species list, while weak democracies would get muscled up. The development of Google search, broadband, smartphones, and social media—such as YouTube, Facebook,
and Twitter—in the following decade only accentuated the power now in the hands of the many.

In this technological utopianism, the Internet would be a godsend for elections. Voters would be able to get for free in-depth material on candidates and issues online. The digital record would not allow candidates to make one claim to one group and a contradictory claim to another group without it coming back to haunt them. Lying and manipulation would be nowhere near as effective or possibly toxic. Online it would be much easier to spawn dissident challenges within the major parties as well as to the major parties as the costs of participation would be radically lower. In some countries, such as Britain, it appears that the Internet has been a factor in actually lowering the costs of national campaigns while they have skyrocketed in the United States.