Is 2008 the most expensive election ever? Not if you use real dollars. Yes, Barack Obama is raising more raw money than any candidate ever. And yes, this is the first time an election has surpassed $1 billion. But in 1896, William McKinley spent an astonishing $3.35 million to ensure populist firebrand William Jennings Bryan got nowhere near the White House. As Paul Krugman notes, "As a percentage of gross domestic product, it was the equivalent of more than $3 billion today, five times what the Bush campaign spent in 2004." And Krugman is just highlighting one example; he isn't conducing a systematic study of all election spending adjusted for inflation.
This isn't to say the campaign finance system doesn't need to be reformed. It does. But let's keep context in mind when you hear shrill media claims that every election is the most expensive ever.