Conscious Choice: The Best Government

July 1996

The Best Government

That Money Can Buy

by Ben Lilliston

How bad is it? Last summer on the floor of the House of Representatives, Congressman John Boehner (R-Ohio) handed out money from tobacco lobbyists to some of his colleagues — while the House was in session. Boehner was chastised by many of his fellow representatives for his bumbling break in decorum, but no action was taken because, remarkably, no laws were broken.

Boehner was simply taking advantage of one of a multitude of legal loopholes which allow special interest money to pollute our political process. It is a system that rewards backroom deals and punishes principled stands. It is a system so addicted to money that nearly every night members of Congress flock to phone banks not far from the Capitol and begin calling lobbyists, corporate executives, labor leaders, and other big money contributors in their quest for the green fuel they need to win re-election.

Our political system essentially supports a form of legalized bribery, that rewards corporations and the very wealthy with federal contracts, subsidies, tax breaks, legislation, and regulatory loopholes. In the end, the issues that most Americans are concerned about: jobs, health care, education, and the environment — are given only rhetorical flourishes before they disappear under the rubble of special interest money.

Neither party has demonstrated the political will to change the current finance system. Increasingly, we find that both parties are addicted to the same money. One of Bob Dole’s biggest contributors is Dwayne Andreas, the CEO of the Decatur-based Archer-Daniels Midland. Since 1979, ADM has given more than $200,000 to Dole’s senate and presidential campaigns, leadership PAC and think tanks. Dole has taken more than 35 rides on ADM’s corporate jet. In exchange, through his position on the Senate Agriculture Committee, Dole has been a champion of ethanol, of which ADM is the nation’s leading producer. Thanks in part to Dole, ADM took in an estimated $425 million in federal subsides from the United States Department of Agriculture from 1985-1995.

This is the same Andreas who since 1993 has given $245,000 to the Democratic Party, and recently gave $100,000 to help pay for the Democratic Convention in Chicago. Not surprisingly, President Bill Clinton’s Environmental Protection Agency did its part for ethanol by designating it for more subsidies. Andreas then loaned the Party another $100,000.

Like Dole and most successful politicians, Clinton knows how to reward his patrons. According to the Center for Public Integrity, the Clinton Administration has pursued and serviced the American business community more aggressively and more systematically than any previous administration. The CEOs of Sara Lee, Seagram, and Xerox among others are already publicly supporting Clinton. Through former Commerce Secretary Ron Brown, Clinton has worked hard to expand the overseas markets for his big business contributors. After AT&T gave the Democratic Convention $400,000 in 1992 and loaned them another $100,000 for the inauguration, the company had Brown peddling its wares to Saudi Arabia, and since 1993 the company has been awarded $4 billion worth of overseas contracts.

The amount of money flowing into federal elections is expected to increase. Estimates are that it will cost $1 billion to elect all 470 people to federal office in 1996. This is approximately twice what it cost in 1992. As has been shown repeatedly in numerous analyses of campaigns, candidates who raise the most money (primarily incumbents) usually win. In 1994, incumbents outspent challengers by more than two and a half to one. Because the raising of money is such a reliable predictor of victory, Roll Call newspaper has declared that only 48 of the 435 House races this fall are not considered foregone conclusions.

If promises were gold there would be reason to be optimistic about reforming the current system. In Clinton’s inaugural he stated eloquently, "Let us resolve to reform our politics, so that power and privilege no longer shout down the voice of the people.... Let us give this capital back to the people to whom it belongs." The bad news is that there are virtually no rules.

As recently as last fall, Clinton and House Speaker Newt Gingrich shook hands in New Hampshire and agreed to reform the current system. But thus far, they have produced nothing. A Dole presidency offers even less reason for optimism. According to Fred Wertheimer, former head of Common Cause, "In the past decade, Bob Dole has been in the forefront to block every serious effort to reform the campaign finance system."

Thankfully, there is more local control at the state level which makes it less likely to be impacted by the corrupting influence of money, right? Well, the good news is that Illinois campaign finance laws are very straightforward with practically no loopholes. The bad news is that there are practically no rules. Illinois was rated the worst state in the union when it comes to restrictions on giving money to candidates, according to a recent Illinois Common Cause study. Believe it or not, Illinois has no limits on how much can be given to candidates, and the money can come from any source — including corporations. To make matters worse, Illinois gives an unhealthy amount of power to leaders of the House and Senate, who are allowed to funnel huge amounts of political money directly to candidates in various districts.

"The multiplying effects of legislative leaders battling for control of their chambers, the deep pockets of special interest groups and the rising expense of running elections are driving the costs of Illinois legislative campaigns into previously unimaginable realms," says Ed Wojcicki, of the Illinois Campaign Finance Project (ICFP), and publisher of Illinois Issues magazine. Overall spending on Illinois legislative races nearly doubled between 1990 and 1994. According to Kent Redfield, at the University of Illinois at Springfield and author of a study on Illinois campaign finances, the House races in Illinois this year are expected to be the most expensive in the state’s history.

Predictably, a study released earlier this year by the ICFP found a smorgasbord of special interest money flooding into Illinois politics. In 1994, gambling interests gave more than $1 million to candidates. Of individual groups, the Illinois State Medical Society topped the list giving $1.32 million, the Illinois Education Association gave $936,000, followed by the Illinois Manufacturers Association at $441,000. Corporate contributors were led by tobacco giant Philip Morris ($225,000), Waste Management ($207,000), and Household International ($174,000). Of the top 50 groups and associations that made campaign contributions, only one issue group and no social service, consumer, environmental or good government groups are on the list.

Illinois also doesn’t do much to regulate the personal use of campaign funds — which regularly are used to pay for country club dues, out of state travel, no interest personal loans, parking tickets, professional sporting event admissions, and funeral expenses.

What are the repercussions of our democracy’s being sold to the highest bidder? Disgust, cynicism, political nausea, and of course lower voter participation. Hostility toward government and politicians is reaching boiling point levels. A recent survey by the League of Women Voters found that 69 percent of voters and 73 percent of non-voters believe government is run by a few big interests. The study found that non-voters don’t believe elections have any impact on the issues that matter to them — many said they would rather take advantage of a once-a-year sale, or watch a new episode of their favorite TV program than vote.

Illinois is consistent with national voting trends. In 1994, only 53 percent of registered voters in Illinois voted, a drop of four percent since the last non-presidential election in 1990, and the second lowest turnout in a general election in Illinois history.

Federal rules aren’t exactly stemming the tide of special interest money either. Under the federal system, individuals are allowed to give $1,000 per candidate, per election. You could give a candidate $1,000 in the primary and another $1,000 in the general election. Political Action Committees (PACs) which represent specific interests, like labor or business, can give $5,000 per candidate, per election. The big loophole in the federal system involves what is known as "soft" money contributions, or money that can be given directly to political parties. There are no limits on "soft" money contributions, so individuals and corporations can give as much as they want to the various parties, which is then filtered out to the candidates.

In the Presidential race the same limits for giving exist. The candidates are also eligible for federal funds if they agree to spending limits. But once again, there are loopholes. Bob Dole reached the federal spending limit of $37 million while competing in a spirited Republican primary. If he wants to remain eligible for federal funds, Dole will not spend any more money until the Republican convention. Yet, Dole has managed to travel the country and continue campaigning because his work is funded through the Republican National Committee, which simply categorizes his campaigning as "party-building activities."

The current system allows for a variety of other ways around contribution limits. Presidential candidates such as Dole, Lamar Alexander, Pat Buchanan, and House Speaker Newt Gingrich have all gotten around campaign finance limits by forming their own non-profit public education groups, which raise money, gather lists of supporters, and promote their ideas, prior to the actual running of the campaigns. These groups are all exempt from campaign finance laws.

Corporate interests are being extremely creative in expanding their influence over government beyond campaign contributions. Legislation concerning regulatory reform, the Endangered Species Act, and the Clean Water Act, were all partially drafted last session by corporate lobbyists. Gingrich has allowed this influence to reach new heights by allowing a telecommunications company executive to work out of his office while Congress was completing a major overhaul of the telecommunications law.

We are now entering the era of shadow campaigns, where interest groups run public relations campaigns advocating or trashing legislation. The "Harry and Louise" ads run by the insurance industry killed health care reform in Congress. Labor successfully utilized an ad campaign to push for an increase in the minimum wage. These ad campaigns are often coupled with so-called "Astroturf" action, where professional firms are hired to generate calls and letters to Congress to create the illusion of real "grassroots" support for specific issues.

Why Isn’t Anything Being Done?
The corrupting influence of money in politics is the nation’s worst kept secret. Our campaign finance system is not just broken, it has been decapitated, shredded, and dropped in boiling acid, and everyone knows it. There is overwhelming support nationally, and in Illinois for some kind of reform. In Illinois, a poll by the Illinois Campaign Finance Project found that 85 percent of Illinoisians are concerned about the role of money in Illinois politics. While the excesses of the system have become painfully public, why hasn’t the system been changed? Well, as House Speaker Gingrich bluntly stated in 1995, "There is zero [grassroots] pressure for campaign finance reform."

Gingrich wasn’t referring to public support for reform, but rather, the inability to focus that support into grassroots action to force legislators to change a system they have benefited from. David Bollier, an independent journalist and consultant to activist groups, was commissioned by Ralph Nader’s Essential Information to analyze the lack of success by campaign finance reform groups. He says one problem is that those against reform are extremely powerful and entrenched. In late April, the AFL-CIO met with a group of unconventional bedfellows including the libertarian Cato Institute, EMILY’s List (which gives to pro-choice Democrats), National Association of Business Political Action Committees, and the National Education Association, to devise a plan to defeat federal finance reform.

"But there is also a lot wrong within the progressive community working on reform," says Bollier. "Common Cause and Public Citizen [(two Washington-based reform groups)] haven’t got the running political organization to advance their agenda. The Washington groups like to feel like they are representatives of the citizens, but they don’t activate their members. It’s the environmental movement all over again."

"This is in contrast with what is being done on state initiatives which are quite focused and goal oriented, where people are not just viscerally connected," Bollier says. "National groups are not especially interested in the state groups and the reformers have not been engaged with a number of highly motivated activists at the state level."

Bollier does feel that one Washington-based group is going about it the right way, and that’s USPIRG (U.S. Public Interest Research Group). "They are a national group, tapped into local state activists," he says. According to Derek Cressman of USPIRG, "In the past, most of the organizing had been done for the federal level. I know that at PIRG we took a look at what was happening a few years ago, and decided to start working more at the state level, where we have our strengths."

In fact, there is a virtual groundswell of activism revolving around campaign finance reform at the state level. Led by the PIRGs, ACORN, and state chapters of Citizen Action and Common Cause, citizens have been successful in getting statewide initiatives on the ballot. Such initiatives will appear on the ballots in Arkansas, California, Colorado, and Maine this fall. Alaska would have had a reform initiative on the ballot, but the state legislature voted it through almost entirely intact. In 1994, statewide voter initiatives in Missouri, Montana, and Oregon established contribution limits for state races well below the current limits for federal elections. In other states there are active efforts to push reform measures through the legislature.

The activity in California points to some of the potential and limitations of state reformers. CALPIRG and California Common Cause were unable to agree on how to reform the system, so there will be two reform initiatives on the ballot. If both initiatives pass, the one with the most votes will become law. Despite the infighting, activists have led some of the nation’s most spirited protests, marching on Sacramento and city halls around the state with bulldozers, chain saws, and shovels calling for a clean-up of big money and special interest influence in California politics.

Unfortunately, no such level of activism currently exists in Illinois. And without a high level of activism, meaningful reform in Springfield is not likely to happen.

Redfield says "This has always been a wide open, individualist culture where being a politician is a profession, and where you don’t have the kind of citizen activism that you do in Minnesota and Wisconsin," Redfield said. "I suspect that this system has become such an embarrassment — that we are so far out on a limb compared to other states — that some changes might come through next year."

"Illinois is a corrupt state," says Tracy Litsey, of Illinois Common Cause. "The general philosophy in this state is that you go along and get along. If you rock the boat, you’re on the outside looking in."

Cressman of USPIRG believes the biggest obstacle to reform is the 1976 Supreme Court decision in Buckley v. Valeo, in which the court found that limits on how much a candidate can spend in an election, and how much of their own money they can spend (See Steve Forbes, Ross Perot, Al Salvi, etc) are unconstitutional, and protected as a form of free speech under the First Amendment. While Senators Bill Bradley, Arlen Specter, and Ernest Hollings have introduced Constitutional Amendments in the Senate that would overturn Buckley v. Valeo, there is virtually no chance that they will come up for a vote this year.

The fallout from Buckley v. Valeo has been problematic for reform activists. The decision took away the most obvious method of reform, which was to set limits for the cost of campaigns. Most groups believe an ideal solution would be some form of public financing, but this idea is considered highly unpopular with the public — which calls it "welfare for politicians."

Another major obstacle has been the issue of PACs. Many traditionally progressive constituencies including labor, environment, and women’s groups have actively fought attempts to eliminate or reduce PACs, because they believe it gives them a voice in the political process. The idea of PACs was to create a fund where everyday citizens with common beliefs could pool their resources and support candidates. Prior to Watergate, PACs were dominated by labor. However, since Watergate there has been a huge upsurge of business PACs to the point where they now outnumber labor by seven to one. According to the Center for Responsive Politics, two out of every three dollars given by PACs in 1994 came from business interests — business PACs gave $130 million, labor $42.3 million and ideological PACs $16.3 million.

An answer to the quandary about PACs may come from the CALPIRG initiative in California. That initiative would limit PAC contributions to the same as can be given by individuals, and create what is known as a Citizen Contribution Committee, which is allowed to give up to $10,000 to a candidate, but must be made up entirely of contributions of $25 or less. These stipulations would return the PAC to its original intention, as a mechanism to give everyday people a voice in politics. This approach is supported by some unions. In California, the CALPIRG initiative is being supported by the Service Employees International Union (SEIU) and the California Teachers Association.

Because of these various stumbling blocks, some reformers have moved toward non-legislative tactics to improve the finance system. Attorney John Bonifaz, director of the National Voting Rights Institute has filed suit against the Federal Election Commission charging that under the current campaign finance system, winning elections is based on the candidate’s ability to raise large amounts of money, which violates lower and middle income voters’ constitutional right to participate in the process. Bonifaz believes that the current system denies citizens rights of equal protection in the same way that poll taxes and whites-only primaries did. In March, a federal appeals court denied his claims, but Bonifaz will likely appeal the case to the Supreme Court.

The PIRGs and ACORN are working together to get every federal candidate to sign a pledge committing them to campaign finance reform. Illinois PIRG is considering a similar pledge for Illinois state senators and representatives up for election this year.

Former Washington Post reporter Paul Taylor successfully led a crusade to get the major TV networks to give free air time to the major presidential candidates. Many believe that free TV and radio time for candidates will reduce the dependency on money, and limit the role of negative attack ads. Unfortunately, free TV time is not being provided where it is really needed, in the House and Senate races. Exposure to Presidential candidates is usually not a problem, but exposure to candidates running in the House and even the Senate would be a significant step toward cleaning up the system.

What Must Be Done?
Scholars, activists, and legislators who want reform have not been able to agree on everything when it comes to desirable solutions. While the specifics are arguable, these are some of the key elements that should be part of any reform efforts.

• The passing of a Constitutional Amendment that would overturn Buckley v. Valeo and place limits on the spending of campaigns is the number one most important element of campaign finance reform.
• We need an approach to spending limits and public financing similar to the carrot-and-stick approach in Minnesota. That system sets voluntary spending limits for candidates. Public financing would only be available to a candidate if their opponent does not agree to the campaign spending limit.
• It doesn’t make sense to approach spending and giving limits in campaigns without significant free TV and radio time for candidates. The federal government owns the public airwaves, and it simply needs to invoke its authority and force radio and TV stations, as a condition for their license, to provide significant time for all presidential and congressional candidates.
• There needs to be an immediate ban on "soft" money contributions, which allow individuals and corporations to give unlimited amounts of money to political parties [for certain activities, i.e. party building etc.]
• We need to reform the PAC system, following CALPIRG’s lead, by limiting PACs to the same amount as individual contributors, and allow for Citizen Contribution Committees which could contribute up to $10,000, made up of contributions of $25 or less.
• Only the well-off can afford to give $1,000. We need to reduce that limit to $100 per person, regardless of whether it is a state race or federal race.
• Candidates should be required to receive at least 75 percent of their contributions from within their district, or in statewide races, from within their state.
• In Illinois, we need to ban the leadership funds, which allow the Party leaders to hold the rest of their party members in a permanent half nelson; and in the U.S. Congress we need to ban leadership PACs.
• Illinois needs to ban the practice of corporations giving directly to candidates. Corporations are not citizens, and thus should not have the same rights as individual citizens.
• Illinois needs to place sharp restrictions on the personal use of campaign funds.

Coming up with a laundry list of reforms is the first and easiest part in the battle for serious campaign finance reform. Activating our fellow citizens to create the grassroots pressure necessary to rid our government of the powerful and entrenched special interests that threaten our democracy is where the real fight lies.

For more information on efforts to reform the campaign finance system, contact: ILPIRG at 312-341-0814. For information on Illinois reform contact Illinois Common Cause at 312-663-4424.

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