Golden Parachutes, Rubber Checks, and Strategic Retirements from the 102nd House

Political scientists have long been interested in the occupational decisions of politicians. At least two events prior to the 1992 congressional elections brought journalists and the broader public into emotion-rich but data-poor discussions of how and why to achieve greater turnover in Congress. The House Bank scandal gave rise to standard arguments that voters should “throw the bums out.” An initially obscure provision in the Federal Election Campaign Act, which allowed certain grandfathered members personally to pocket their campaign warchests, gave rise to somewhat more sophisticated assertions about “buying the bums out.” Using pre-election data on incumbents’ decisions to retire or seek reelection, this paper estimates the effects of these special features of the 1992 election while improving upon prior estimates of strategic retirements more generally. By embedding an explicit occupational choice model into a maximum likelihood equation, we find strong evidence of strategic retirements, and we quantify precisely the turnover that can be attributed to rubber checks and golden parachutes.