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Step Three–Raise and Spend Money Well

The LNC should ask people to give the Party money. How should the money be handled?

First, spend more and more of the LNC’s money on doing real politics. The quick fixes mentioned above are going to free up very substantial chunks of change, though less than they would have, a few years ago. That money will be going into our most important Mission-Critical Activity, real politics.

Second, continue to move to fiscal transparency. Move to a budget that makes clear how your money is spent, as opposed to a budget that hides all spending under a few nebulous categories. Go to fundraisers that let you know how your money was actually spent, so you can see we’re not raising money for doing politics and spending the money on the back office.

Third, give financial reports that match what a political party should be doing, not categories appropriate if we ran a steel mill. We’re under entirely different rules on reporting, taxes, etc., than your local machine shop, so LNC reports to you should match our mission and our activities.

Fourth, move to a budget allocation processes that make sure that your donations are spent the way they should be. An example of this approach is provided by the Massachusetts budgeting plan. The Massachusetts state association adopted a budgeting scheme under which there is no need to guess how many people will join or renew their memberships this year. Instead of fixing spending totals, as though newsletter printing costs were independent of the number of members, LAMA tells members in advance how their membership dues will be divided. The division includes so much toward printing the newsletter, so much for sending renewal notices, so much for administrative costs, etc. Dues allocations center on items where the donation covers the marginal cost per member, and on targets where spending totals can be flexible, such as internet advertising. This scheme averts many pointless arguments about budgeting for an unpredictable membership count.

The Massachusetts budgeting scheme clarifies spending patterns. A member knows how her dues are being spent, and what his membership costs the party. If estimates of marginal costs are good, the cost of each member is covered by the member’s donation, so the party budget is not perturbed if the membership fluctuates. Adoption of the Massachusetts plan, with numbers suited to our particular needs, would allow the National Committee to center its attention elsewhere.

Having said that, you can be confident: These steps will revive the confidence of libertarian donors. They will see that their hard earned contribution dollars are being spent in ways that actually advance us into the Libertarian future. And then, once they see that their money is well-spent, they will give us more and more money. That’s not just the best way to revive our party’s finances. It’s the only way.

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