More Money, More Problems

Any serious campaign finance reform must recognize that money is the mother's milk of politics. A response to Mark Schmitt.

By Fred Wertheimer

Tagged Campaign FinanceCorruption

Did the Bipartisan Campaign Reform Act (BCRA), enacted by Congress in 2002, successfully limit the corrupting influence of big money in American politics? And are such anti-corruption laws necessary to have effective systems for public financing of elections? Mark Schmitt believes the answer is “no” to both of these critical questions. In his critique, “Mismatching Funds” [Issue #4], Schmitt holds two basic assumptions with which I disagree. The first is his view that the “modern campaign finance reform movement was born” 10 years ago, and mistakenly focused, at the national level, on enacting anti-corruption regulations instead of public financing of elections. The second is that it is possible to establish a workable public financing system that meets its goals and sustains public support without also having effective regulations to prevent the corruption of our democratic institutions. On the contrary, enacting BCRA to ban soft money and end a $500 million national scandal was not only essential to curbing corruption, but it was also a prerequisite to building public support for fixing the presidential public-financing system and extending public financing to congressional races–goals currently being pursued by the reform movement.

The battle for public financing of elections has always been exceedingly difficult. Among other things, it involves challenging the way private campaign funds are used to exercise power and influence government decisions. It also requires convincing incumbents to vote for legislation that would reduce the enormous financial advantages they have over their challengers. Needless to say, it is not an effort that can be assessed based on a decade’s worth of experiences–as Schmitt would have us believe.

The modern campaign finance reform movement began in 1971–not, as Schmitt asserts, in 1997–and was created and led by John Gardner, the founder of Common Cause. (As a Common Cause lobbyist, I began working for public financing in 1972 and have continued doing so to this day.) This is a critical difference: In moving campaign finance reform’s modern starting date up to 1997, Schmitt ignores numerous battles that were fought in Congress for public financing of elections in the 1970s, 1980s, and 1990s. He also ignores the reasons–important to understanding where we are today–why in 1997 the national reform effort switched its focus to banning soft money in federal elections.

Public financing of elections was at the core of the reform agenda from the modern movement’s earliest days. The Watergate scandals set the stage for the passage of landmark reform legislation in 1974, which included a system of spending limits and full public financing for the presidential general election and matching public funds for the presidential primaries. Congress also came close in 1974 to establishing public financing for congressional races: The Senate passed legislation, by a vote of 53–32, to establish a public financing system for Senate races similar to the presidential system, but the House rejected public financing for its own races by 228–187 and then blocked enactment of public financing for Senate races as well.

During the next two decades, numerous efforts were made to enact public financing for congressional races. But none made it into law–public financing legislation, for example, was blocked in the Senate by a filibuster in 1977 and defeated on the House floor again in 1978. Beginning in 1987, Senate Democrats took the lead in pursuing congressional public financing in various forms and repeatedly mustered Senate majorities for their proposals. Their persistent commitment to the issue was demonstrated by the fact that legislation was considered on the Senate floor in 1987, 1988, 1990, 1991, 1992, 1993 and 1994. Both the Senate and the House passed campaign finance reform bills in three Congresses in a row, from 1990 to 1994. The legislative efforts were all blocked, however, by a combination of Republican-led minority filibusters, stalling tactics by House Democratic leaders, and a presidential veto. In 1987, for example, Senator David Boren (D-Okla.) and Senate Majority Leader Robert Byrd (D-W.V.) were joined by 50 senators in sponsoring legislation to provide public financing for Senate elections. Despite a record eight cloture votes between June 1987 and February 1988, the bill was killed by a filibuster.

Schmitt incorrectly asserts that in the early 1990s the greatest concern for reform supporters was political action committees (PACs). In fact, the reform movement’s efforts during this period focused on enacting various forms of congressional public financing and on enacting a soft money ban. In 1992, legislation passed Congress and was sent to President George H. W. Bush that provided, for Senate candidates, publicly funded voter-communication vouchers, 50-percent-below-cost TV time, low-cost mailings, and public funds to respond to high-spending opponents and independent expenditures; and for House candidates, public matching funds. The legislation also included a ban on soft money, virtually the same ban that was enacted into law a decade later in BCRA. Bush, however, vetoed the bill.

In June 1993, the Senate passed legislation once again providing Senate candidates with 50-percent-below-cost TV time, low-cost mailings, and public funds to respond to high spending opponents and independent expenditures. In November 1993, the House passed legislation to provide publicly funded voter-communication vouchers for House candidates. House Democratic leaders, however, then killed the reform effort by intentionally delaying going to conference on the bill with the Senate for a year, until it was too late to enact the legislation.

The fight for congressional public financing that took place from 1987 to 1994 ran out of opportunities with the 1995 GOP takeover of Congress. Republicans, who led most of the successful efforts to block the reform efforts while in the minority, were now in control of the House and Senate. They and their House Democratic allies had won this stage of the battle–it was more than two decades after the passage of the Watergate-era campaign finance laws, and every significant effort since 1974 to reform and strengthen these laws had been thwarted. But to argue, as Schmitt does, that the modern reform movement’s timeline began only after all of this took place–and that it failed to understand the importance of public financing–is to overlook the repeated battles for public financing that took place during the previous 20 years.

Schmitt’s narrow focus also ignores the reasons why the reform movement switched in 1997 to pursuing a ban on soft money. During the 1990s, the use of corrupting soft money in federal elections became a national scandal. The president and members of Congress were soliciting huge, soft money contributions from corporations, labor unions, and wealthy individuals to be spent by their parties on their campaigns. In so doing, they were eviscerating the longstanding ban on corporate and labor union contributions in federal campaigns and the limits on contributions from individuals, and they were also fundamentally undermining and discrediting the presidential public financing system.

This was the context in which the reform battle moved in 1997 to focus on banning soft money in federal elections. The bipartisan effort was led by Senators John McCain (R-Ariz.) and Russell Feingold (D-Wisc.) and Representatives Christopher Shays (R-Conn.) and Marty Meehan (D-Mass.), and it resulted in the creation of the broadest campaign finance reform coalition since 1974, ranging from AARP to the Committee for Economic Development, a national organization of business leaders and educators. It took five years to win the battle and enact BCRA, and another year and a half to defeat the challenge to the new law’s constitutionality in the Supreme Court.

It’s all well and good for Schmitt to argue that these years should have been spent at the national level working to enact congressional public financing instead of a soft-money ban. But that belies the realities that existed at the time: two decades of numerous unsuccessful battles to enact congressional public financing; control of Congress by Republicans, who had blocked those efforts while in the minority; a campaign finance scandal of historic dimensions; and an inability to make a convincing public case that the goals of congressional public financing could be achieved in a system being flooded with corrupting, unlimited soft-money contributions from influence-seekers.

In criticizing the reform approach taken during the past decade, Schmitt is arguing, in effect, that we can ignore anti-corruption regulations and still have an effective, sustainable public financing system. But that argument simply does not hold up. Public financing cannot operate effectively or credibly in a vacuum. It has to exist in a system of broader rules if its basic goals are to be met: preventing the corrupting influence of large private contributions, eliminating arms-race-like spending, reducing the time spent on raising private contributions, and providing for competitive elections. As former Senator Warren Rudman (R-N.H.) said about soft-money contributions, “They affect whom Senators and House members see, whom they spend their time with, what input they get, and–make no mistake about it–the money affects outcomes as well.” Or, as former Senator Dale Bumpers (D-Ark.) said, “People are dreaming if they think a democracy can survive when elected officials and the bills they consider are beholden to big donors.”

Bill Clinton’s 1996 re-election campaign was a classic example of how the corrupt soft-money system eviscerated existing anti-corruption laws and undermined the presidential public-financing system. In exchange for receiving public funds, Clinton made a binding commitment to limit his spending on his 1996 reelection campaign. The president then proceeded to make a mockery of his public-financing commitment by conducting a parallel, privately financed campaign outside the campaign-finance laws, what amounted to a Clinton-controlled, soft-money-funded $50 million ad campaign run through the Democratic Party to directly support his re-election.

While Schmitt labels the 1996 Clinton soft-money scandals as “insignificant” in comparison with the Abramoff scandals, that is simply not the case. The Clinton scandals demeaned the presidency, severely undermined the integrity and credibility of the president, and turned the White House into an institution for sale in the eyes of the American people. As Johnny Chung, who gave $366,000 in soft money to help reelect Clinton, stated, “The White House is like a subway. You have to put in coins to open the gates.”

Despite Schmitt’s “disappointment” in the results, BCRA succeeded in what it set out to do. BCRA broke the corrupting nexus between federal officeholders and influence-seeking donors in the form of huge, unlimited soft-money contributions and ended the scandalous soft-money system. And it did so without the dire consequences for the parties wrongly predicted by reform opponents. The parties have thrived financially in the new BCRA world, with small donors now “the largest source of party money,” according to campaign finance scholars Anthony Corrado and Norman Ornstein.

BCRA supporters did not claim the law would solve all of our campaign finance problems, or that its purpose was to limit the aggregate amount of money spent in campaigns, or that it would deal with all of the problems of congressional campaign finances. What we claimed it would do–and what it did–was end the solicitation and use of unlimited, soft-money funds by federal officeholders and national parties, and thereby end the massive circumvention of anti-corruption laws that had prohibited the use of these funds by candidates and parties in federal elections for decades. “As one who has been skeptical of the claimed virtues of the McCain-Feingold campaign finance law [BCRA],” columnist David Broder wrote in a 2005 Washington Post column, “I am happy to concede that it has, in fact, passed its first test in the 2004 campaign with flying colors.”

The BCRA victory also accomplished another critical goal: It broke the stranglehold that reform opponents in Congress had exercised for 25 years, thwarting every significant campaign finance reform effort that had taken place during the period from 1977 to 2002. This, along with the Democratic takeover of Congress in 2007 and the Jack Abramoff scandals, has opened the door to again pursue public financing of congressional elections and to fix the broken presidential public-financing system. These battles are underway today–and though there is no way to know how long it will take until we prevail, the fight goes on. As John Gardner used to say, “reform is not for the short-winded.”

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Fred Wertheimer is the president and CEO of Democracy 21. He served as president of Common Cause from 1981 to 1995.

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