An Easy Way to Get More Political Bang for 3 Bucks

Commentary

By J. Kenneth Blackwell and Vic Fazio

The first question on your Form 1040 federal tax return is whether you want $3 of your federal tax to go to the Presidential Election Campaign Fund. "Checking 'Yes,' " you are informed, "will not change your tax or reduce your refund." Last year only 11% of tax filers checked off, down from a high of 29% in 1978.

This is too bad. Over three decades, the fund has supplied critical public matching funds to primary candidates and subsidized the general election â€" in exchange for limits on overall campaign spending. The program has enabled voters to consider lesser-known or lesser-financed candidates, from Jimmy Carter to John McCain. It has also helped replace the unlimited contributions that were allowed in past campaigns.

Yet today the system is in deep trouble. The presumptive 2004 Republican and Democratic nominees rejected public financing in the primaries, complaining about unrealistically low spending limits. The public financing formula â€" which matches contributions one-to-one up to the first $250 in individual contributions â€" has failed to prevent candidates from relying mainly on $1,000 to $2,000 donations.

A Campaign Finance Institute task force recommended higher spending limits to keep candidates in the system and a formula of three-to-one matching up to the first $100 in contributions, to increase the importance of small donors. But these reforms would require modestly increasing the amount of the voluntary check-off and taking steps to stem the decline in participation.

Opinion polls show that the reasons for this decline do not include a growing public distaste for the presidential financing system. Why then don't more taxpayers check it off? One likely reason is that there has been virtually no public education about the check-off.

Further, new electronic tax filing software discourages a "Yes" response by taxpayers. Nearly 40% of Form 1040s were filed electronically in 2003, four times the number in 1995. We know the most about the 11 million electronic filings from home computers. Two products dominate this market.

One, Intuit's Turbo Tax, displays the check-off question with the proper notice about not increasing your taxes, but the box is already checked "No." Unless you change it, it will read "No" on your final tax return. The other program, H&R Block's Tax Cut, asks if the taxpayer would like to "contribute" to the campaign fund without saying that checking the box would not increase your tax payment. Leading programs used by professional tax preparers have the same problems.

Congress should authorize the Federal Election Commission to use some money from the existing fund for a real education program (not propaganda) about its goals and operations. And the IRS should mandate that authorized electronic filing software not present a negative default on the check-off question. It should offer a "Yes" and "No" choice and clear notice that a "Yes" answer will not raise your taxes.

Kenneth Blackwell, secretary of state of Ohio and a Republican, and Vic Fazio, former California congressman and chair of the House of Representatives' Democratic Caucus, are on the board of trustees

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