The Hagel Bill
The President's Ideas on Campaign Finance
Is There Too Much Money in Politics?
Is Campaign Spending Excessive?
and Government Mistrust
Public Cynicism and Mistrust of Government
The Cause of the Soft-Money Problem
Soft-Money and Regulation
The Controversy over Campaign Finance Reform
Elections Are Not Decided by Money
Case Studies of Campaign Spending
Buckley v. Valeo
If McCain-Feingold Became Law
Real Campaign Finance Reform
Senate Majority Leader Trent Lott
announced on January 26, 2001, after receiving general agreement on
a timetable with Senator John McCain (R-Arizona), that the Senate
would start debate on campaign finance legislation (Bipartisan Campaign
Reform Act of 2001 [Introduction to the Senate]) [S.27.IS] see http://thomas.loc.gov/cgi-bin/bdquery/z?d107:s.00027:
) in mid to late March . On March 19, 2001 the debate began for a
period of two weeks. (1)
The Majority Leader said, "I think it's a win-win
for all concerned." He also agreed that the timetable gives President
Bush, "The opportunity that I thought he deserved…to roll out his
agenda" and grants McCain's insistence that the issue come up for
a vote early in the year. (2)
In a reply statement, Senator McCain said he was
pleased with the agreement and looked forward to working out remaining
details to govern Senate action.
Large, unregulated "soft money" donations from
corporations, unions and individuals would be outlawed by the campaign
finance measure. The proposed legislation would also include other
provisions to regulate the influence of money in politics.
In recent years, similar bills have become victims
of fillibusters and have died in the Senate. This year Lott has indicated
he has no plans to support such blocking tactics: "I want to get this
issue done and out of the Senate."(3)
An alternative bill to the McCain-Feingold Bill
is being offered by Senator Chuck Hagel, (Republican-Nebraska), whose
less-sweeping proposal would limit but not totally ban, "soft-money"
contributions to political parties. (4)
Soft-money would be capped at $60,000 per elections
and the amount that individuals could give candidates would increase
to $3,000 from $1,000 by the Hagel measure.
Three Democrats support the Hagel measure including
Senator John Breaux (Louisiana), the only member of his party who
has publicly said he cannot support McCain-Feingold in its present
form, Senator Ben Nelson (Nebraska) who opposes the soft-money ban
but supports the issue and restrictions, and Senator Mary Landrieu
(Louisiana) who supports Senator Hagel’s bill as a backup measure
to McCain’s legislation. (5)
According to figures complied by the Federal Election
Commission (FEC), the Democratic and Republican national party committees
raised a record $487 million in soft-money for the 2000 election up
from $263 million during the last Presidential campaign. When comparing
Republicans to Democrats on the raising of soft-money, the two parties’
totals were very close. $243 million was raised by Democrats and $244.4
million by Republicans. (6)
In soft-money donations, the Democrat's House
and Senate campaign committees out raised their Republican counterparts,
with Democrats raising $120 million to the Republicans $94 million
on the Congressional front. (7)
In hard-money contributions, Republicans enjoyed
a huge advantage. During the 2000 race, Republican Party committees
took in $447.4 million in such contributions compared to the Democrats’
$270 million. (8)
In part since Democrats have eliminated the one
time Republican domination in soft-money donations, they might give
Senator Hagel's bill a second look despite their backing of McCain's
soft-money ban and restrictions on some advertising by unions and
PRESIDENT'S IDEAS ON CAMPAIGN FINANCE REFORM
On March 15, 2001, President Bush presented his
ideas for campaign finance reform legislation. His three main goals
*A ban on soft-money donations by corporation
and labor unions
*Protection of the rights of individuals and
groups to express their views
*Prohibiting of unions or corporations from
using stockholder or member funds for political activities without
their permission (9)
And, unless the McCain-Feingold bill includes
"paycheck protection" for union members and other provisions that
Democrats consider unpalatable, Senator McCain’s measure will not
be signed by the President even if it makes it through Congress. (10)
The Administration remains deeply skeptical of
what many conservatives consider unconstitutional abridgment of free
speech although the White House has publicly refrained from threatening
to veto the bill's restrictions on campaign fund-raising.
On March 18, 2001 Senator John McCain said that
his effort to ban unlimited large donations to the nation's political
parties will rise or fall on how the Senate votes on a large number
of proposed changes being drawn up by opponents and supporters. (11)
Particularly those changes aimed at organized
labor could drive apart the fragile coalition of Democrats and some
Republicans supporting the bill. As many as 30 amendments will be
considered according to some senators, as well as the bill being offered
by Republican Senator Chuck Hagel.
THERE TOO MUCH MONEY IN POLITICS
Congressional campaign finance is not out of control
contrary to the opinions of reformers. Money is nowhere near the dominant
force that reformers claim. Over a two-year period, general election
candidates spent $740 million for the 1998 election. (12) This amounts
to about $4 per eligible voter, although even that spending set a
record. Some predict that campaign spending in 2000 might have reached
as high as $3 billion, a record increase over the previous Presidential
cycle that ended in 1996. However, that increase still would amount
to no more that about $15 per eligible voter.
To compare campaign spending to personal spending,
more money is spent on chewing gum, greeting cards, and frozen yogurt
than on political campaigns throughout an election cycle. (13) Once
this is realized, the McCain-Feingold legislation will lose its appeal
to limit the freedom of speech in the name of cleaning up the political
election process. Contrary to what many reformers claim, private campaign
finance does not have nearly as severe a corrupting effect on elections
as they say it does.
CAMPAIGN SPENDING EXCESSIVE?
Although it is true that politicians devote an
enormous amount of time to fundraising, most of the money problems
have resulted from the 1974 campaign finance reform laws. (14) Analysts
believe that by imposing tight limits on contributions, legitimate
campaign fundraising is hampered.
The purchasing power of the 1974 contribution
restriction laws has been reduced over 25 years of inflation by two-thirds.
This has resulted in politicians seeking out other sources of money
such as "soft money" donations of any size to a party or committee
that are not technically federal election activities. Every "reform"
inspires new evasions note critics of campaign finance reform.
SPENDING AND GOVERNMENT MISTRUST
What most reformers want people to believe is
that a major cause of the public's repugnance for politics is campaign
finance. There is no doubt campaign spending has increased rapidly
and the public’s trust in government is low but it cannot be all attributed
to campaign finance.
Historical records will show that citizens lost
faith in the government before excessive spending began on political
campaigns. Therefore, the increase in spending could have not been
the cause for the resulting mistrust in government. (15)
CYNICISM AND MISTRUST OF GOVERNMENT
According to Senator John McCain and other proponents
of campaign finance reform, excessive spending on campaigns by candidates
has caused public cynicism about and mistrust of the United States
(U.S.) government. In fact, the reformers claim that Congress should
move immediately to pass new campaign finance laws because of the
public’s outcry over this issue.
However, according to statistics on public opinion,
the cynicism about politics was the result of events occurring in
American's history that the government was responsible for, not the
issue of campaign contributions to candidates. During a period that
included the Vietnam War, Watergate, and the economic mistakes of
the Carter administration (1964-1980) public trust declined steadily.
(See Money and Politics: People's Chief Concerns; http://www.publicagenda.org/issues/
Also, other clear examples of chicanery, corruption, deceit and incompetence,
occurring during this time, caused people to become cynical and to
mistrust government. The citizens of this nation were responding to
actual events that politicians created, not a general sense that the
electoral process had failed.
It is Senator McCain's belief that the public
supports his efforts in reforming campaign finance laws: "I believe
that the country wants this reform. There is no doubt about the explosion
of soft money. There is no doubt that it has grid-locked us here in
Washington and the message of the last election is that Americas do
not want that." (16)
However, the senator's perception is refuted
in many polls. For example, Hart and Teeter Research Companies conducted
a telephone interview poll of 1,010 adults between January 25-26,
2000, that was sponsored by NBC News and the Wall Street Journal.
Individuals were asked the following question:
"As you may know, several Presidential candidates are making campaign
finance reform a major part of their platform. How important is the
issue of campaign finance reform to you-very important, fairly important,
just somewhat important, or not that important? Only thirty-one percent
of the respondents indicated that campaign finance reform was very
important. Similar results were observed by an ABC News/Washington
Post Poll conducted between September 4-6, 2000, that polled nationwide
1,065 registered voters. (See Election Issues, page three of PollingReport.com
htm ) The
surveyed individuals were asked "How important will...holding taxes
down/ protecting the Social Security system/ reforming election campaign
finance laws/ improving education and the schools/ improving the health
care system/ handling the national economy/ handling the issue of
gun control/ handling foreign affairs/ encouraging high moral standards
and values/ managing the federal budget/ handling crime/ protecting
the environment/ handling the abortion issue/ handling the issues
of prescription drug benefits for the elderly/ handling national defense
and the military budget/ helping the middle class/ reducing the political
partisanship in Washington..be to you in deciding how to vote in the
2000 Presidential election in November: very important, somewhat important,
not too important, or not important at all?" Only thirty-two percent
responded that campaign finance reform (ranked overall at the bottom
of the poll) is very important while education (77 percent), the economy
(72 percent), Social Security (71 percent), Health care (69 percent)
and Moral/Values (69 percent) were the top five issues that respondents
believed to be very important.
Furthermore, several polls have indicated that
campaign finance reform should not be top priority for the government
to address. For example, a Newsweek poll conducted by the Princeton
Survey Research Associates from December 14-15, 2000, that surveyed
nationwide 1,001 adults, asked the following
question: "As George W. Bush begins his Presidency, which ONE of the
following do you think should be his top priority: education, Social
Security reform, prescription drugs for seniors, tax relief, upgrading
the military, or campaign finance reform?" Twenty-nine percent responded
education, followed by Social Security (18 percent), drugs for senior
(17 percent), tax relief (16 percent), upgrade of the military (10
percent) and campaign reform (6 percent). (See Election Issues, page
three of PollingReport.com at http://www.pollingreport.com/prioriti.
htm ) A CBS
News/New York Time Poll conducted between March 8-12, 2001, that surveyed
nationwide 1,105 adults, asked the following question: "What do you
think is the single most important problem for the government--that
is, the President and Congress--to address in the coming year?" The
top eight issues were taxes/IRS (18 percent), followed by education
(10 percent),economy (9 percent),. Social Security/Medicare (8 percent),
health care (6 percent), budget deficit/national debt (6 percent),
defense/military (3 percent), and youth crime/violence (3 percent).
Campaign finance reform did not even make the "Top 8" list. (17)
For more than a decade, soft-money (money that
has been raised and spent outside the regulatory structure for a federal
election campaign) has played a growing and increasing controversial
role in politics.
Constitutional limits on government power, the
relative ease with which political activists avoid targeted regulations
that are constitutionally valid and difficulties in defining targeted
activities complicate efforts to ban, limit, or regulate soft money
and other types of similar spending like issue advertising.
The Supreme Court has already approved as an exercise
of First Amendment rights most soft-money activities. Although some
authority to regulate national political parties is given to Congress,
this regulation must be narrowly focused on preventing corruption
and fraud. Subject to both the strictest constitutional scrutiny and
nearly always unconstitutional is the regulation of soft-money activities
of non-party groups and individuals. Also unconstitutional is the
regulation of advertising which includes the name or likeness of a
public official. (18)
Clearly, incumbents benefit from campaign laws
and regulations. (19) Their proposed legislation to limit soft-money
issue advertising may also be interpreted as an effort to suppress
criticism of their actions and decisions on past and current legislation
and to reduce the number of citizens participating in the political
CAUSE OF THE SOFT MONEY PROBLEM
The result of the size of certain soft money donations,
certain practices involved in the raising of soft money, and the growing
use of soft money by labor unions, political parties and other groups,
has resulted in today’s controversy over campaign finance reform.
The source and size of donations to federal election campaigns were
first limited by a series of laws passed in the 1970s.(The Federal
Election Campaign Act of 1971, which was amended in 1974, 1976, and
1979, and the Presidential campaign funding provisions of the Tax
Act of 1971.) These regulations caused extensive reporting and disclosure
of campaign expenditures. Contributions made directly by individuals
and political action committees (PAC) to candidates became known as
hard money which is based on limited, reportable funding. Exempt from
most regulatory requirements was certain spending, like internal communication
by corporations and labor unions and spending on headquarters space
by political parties. Federal statutes did not address other activities
like spending on state campaigns.
MONEY AND REGULATION
Today’s efforts by politicians to skirt the rules
of campaign finance reform are direct responses to previous attempts
at regulating political activity and should be considered by reformers
in any limited steps now taken against soft money. Tactics for raising
money were simply modified by activists when "hard money" or direct
expenditures on campaigns were limited and regulated. Lesson from
history — minimizing not expanding government controls is the real
solution to the problem of soft money.
CONTROVERSY OVER CAMPAIGN FINANCE REFORM
The Bipartisan Campaign Finance Reform Act of
2001 (S. 27), commonly called McCain-Feingold, would weigh heavily
against soft-money contributions. According to citizen action groups
like Common Cause, Public Citizen and Campaign for America, this legislation
is an important first step toward the real goal — the full public
financing of elections. (20)
Tragically, reformers believe that campaign finance
reform is a necessary measure to end the dominant role money plays
in politics. According to this tenacious group of activists, there
are two fundamental tenets in the view of money and politics:
- Special interest groups use soft-money to
buy favors from politicians
- Incumbent politicians then use this dirty
money to buy re-election with massive campaign expenditures
Tragically, the mainstream press treats these
claims as self-evident more often than not. Lists of contributor names
and dollar amounts are offered alone apart from rational argument
or explanation. Such analysis can be found by visiting the Web sites
of the Center for Responsive Politics (http://www.crp.org),
Common Cause (http://www.commoncause.org),
or Public Citizen (http://www.citizen.org).
The gaudy spending advantage enjoyed by congressional incumbents,
the absence of able challengers, the well-known correlation of contributor
interests with the committee assignments, voting records of incumbents
and the ever-increasing amount of money spent on elections comprise
many arguments made by these activists for campaign finance reform.
There is no doubt that total campaign spending
has increased faster than the rate of inflation over the past two
decades. In addition, the turnover rate in Congress during this time
(defeats plus retirements divided by the number of seats) was quite
low – less than 10 percent in 1984, 1988, and 1990. (21) In fact,
it was actually more common for an incumbent to be unopposed than
to be defeated. Furthermore, more races were one-sided even when incumbents
were challenged. This election trend allowed many incumbents to take
advantage of the lack of competition and build up large reserves of
campaign cash for use in future elections. Unfortunately, the resulting
statistics showed many incumbents in a very unfavorable light because
of their accumulated campaign funds, allowing many campaign finance
reformers to jump at the inflated statistics to prove their point
for needed reform.
A closer examination of the same statistics would
reveal that the inferences drawn by campaign finance reformers were
not always accurate. For example, the increase in real campaign spending
in the House and Senate has not caused a decrease in turnover. On
the contrary, the highest turnover rate in more than 40 years has
occurred since 1992 (about 20 percent).
ARE NOT DECIDED BY MONEY
In deciding the outcome of November general elections,
campaign contributions were not as important a consideration as other
factors according to findings by researchers at the Center for Voting
and Democracy. (22)
Presidential Races are a Factor
Their analysis was based on the results of the
1996 election in the House of Representatives. Compared to campaign
spending, the way the district voted in the Presidential race was
a much stronger predictor of the public’s congressional choice in
a review of contests in districts with open seats. Nearly one-third
of Republican winners in open-seat races were outspent by Democratic
contenders. However, from districts where former President Clinton
received less than 50 percent of the vote, Republican candidates were
the winners. Republicans consistently won easily where the President
ran poorly, and Democrats won easily where he ran well. And most races
were close in districts where the former President ran poorly.
Redistricting is a Factor
When the redistricting process takes place every
decade — when the political map is re-drawn to create "safe districts
and protect incumbents" — most elections are already decided by the
changes. As a result, "swing" districts where the vote is still undecided
become prime targets for spending disproportionate amounts of money
on election races.
According to researchers at the Center for Voting
and Democracy, the whole process of redistricting should be taken
out of the hands of the politicians and vested in an independent nonpartisan
commission which would use nonpolitical criteria to draw district
Each Candidate is a Factor
In any given election year, there is no doubt
that winning candidates spend more than losing candidates, despite
the fact that social scientists are unable to establish a cause-effect
relationship between these two factors. (23) Common sense says that
contributors are more apt to give money to candidates with a greater
probability of winning. Unfortunately, this principle cannot be measured
to determine the electoral effects of campaign spending.
Furthermore, attributes among candidates, like
leadership, integrity, and perseverance, are important determinants
of both fundraising and electoral success and are equally difficult
to quantify. Biased estimates of spending that exaggerate the impact
of candidate spending on elections are produced by studies that ignore
these unobserved factors. For example, candidates in election fare
better who spend more money, but how much did money alone actually
cause the victory? Is it not true that part of this association is
a result of the winning candidate’s ability to be articulate, hard-working
and intelligent. Part of the correlation promoted by campaign finance
reformers is deceptive because those qualities help both fundraising
and vote getting.
Examining changes in candidates’ share of the
votes in association with changes in candidates’ spending is the most
promising approach to deciphering how large a role money plays in
electoral success. (24) To the extent that the other factors that
affect elections are constant over time, they will not affect changes
in vote getting or fundraising. What does matter are the factors that
do change. For example, all else constant, House incumbents who transfer
onto powerful committees or are promoted to leadership positions receive
an extra $50,000 in campaign contributions. (25) This does not result
to any significant increase in vote share but it does translate into
higher campaign spending. Therefore, marginal spending is unimportant,
at least for incumbents. However, it might appear very differently
to candidate challengers.
STUDIES OF CAMPAIGN SPENDING
The effects of challenger spending are provided
by a unique case study of the Second Congressional District in Utah.
(26) In 1992 in a race for an open seat, Democrat Karen Shepard beat
Republican Enid Greene.
In a 1994 rematch, the incumbent Shepard was defeated
by Enid (Greene) Waldholtz. After the election, it was found that
the Waldholtz campaign had spent almost $2 million in stolen funds.
In 1996, Waldholtz declined to run for re-election as a result of
the scandal. Since the infusion of illegal funds was not caused by
Waldholtz's political acumen, but by the activities of her then-campaign
manger and husband Joe Waldholtz, this case provides an ideal experiment.
The final question concerning the two election
cycles is the effect money had in determining their outcome. Only
36 percent of the vote was obtained by Waldholtz in 1992. She won
with 56 percent in 1994. If money had been the only factor to change
the outcome of the election, then each percentage point she increased
would have cost her $100,000, if all of the 20 percentage point increase
in Waldholtz's vote were due to this ill-gotten windfall. However,
other factors also contributed to the Waldholtz victory. Many voters
were alienated by Shepard's surprisingly liberal voting record. Also,
overall, 1994 was a good year for Republicans. (27) For example, six
percentage points was the average electoral swing to Republicans challenging
From 1978 to 1990, all repeat meetings of House
candidates (such as Waldholtz-Shepard) were examined by Steven Levitt,
a Harvard University economist. An extra $100,000 in candidate spending
(whether spent by an incumbent or challenger) led to an increase in
the candidate's vote share of almost 0.2 percentage points according
to Levitt’s findings.
Still more evidence was found in a 1996 study.
In House races, stockpiles of unspent contributions, or incumbent
war chests, had no deterrent effect on challengers. (Included on the
agenda of many reformers is a ban of personal war chests and self-financing.)
It is often assumed that potential challengers would shy away from
taking on well-financed incumbents. However, there is no evidence
that an incumbent’s personal wealth affects either the presence or
quality of challengers. Since money simply is not that important in
congressional races, challengers are not deterred by incumbents’ war-chests
or personal fortunes.
Therefore, why are there so few good challengers
in congressional races if challengers are not deterred by personal
wealth and war-chests. The answer is quite obvious that even good
challengers will lose. Most survey respondents indicated that they
would vote to re-elect their own representatives and senators even
when congressional approval ratings were at an all-time low.
As evident by the wide variety of activities to
which the term is applied, the problems in regulating soft money started
with its definition. Soft money is a donation which is outside the
limits established by the Federal Election Campaign Act (FECA), either
because it is above specified dollar limits ($20,000 annually for
an individual) or because it comes from a "prohibited source." (a
corporation or labor unions) Literally anything other than donations
to or spending on behalf of federal election campaigns is soft money,
in terms of spending.
It has long been made clear that the right to
spend unlimited amounts for politically oriented issue advertising
is possessed by political parties, or any other group of Americans.
For such purposes, the Supreme Court has clarified that contributions
may not be regulated. Spending by political committees and unlimited
campaign contributions to committees that may be subject to limits
are distinguishable through Buckley v. Valeo (Buckley v. Valeo,
424, U.S. 1, 14-15 )
In 1996, the Court stated very clearly that the
"FECA permits unregulated 'soft money' contributions to a party for
certain activities," in the court case, Colorado Republican
Committee v. FEC (28) Even when those contributions are made
by, to, or through national political parties, Congress has no authority
to regulate contributions for or spending on state elections according
to implications from the Colorado Republican Committee v.
Efforts to regulate anything other than campaign
funds and "express advocacy" for or against a candidate has consistently
been denied by the Supreme Court. Also, under Colorado Republican
Committee v. FEC, if groups other than political parties can
collect unlimited donations for soft money activities arguably political
parties have that same right. To demonstrate a potential for corruption
(which is required to justify donation limits) through donations to
political parties, Colorado Republican Committee v. FEC
suggests that it will be difficult.
The U.S. Supreme Court struck down significant
portions of the FECA in the 1976 case, Buckley v. Valeo (29)
Because of their ruling, strict limits were place on the government’s
ability to regulate certain political activity. Various activities
by parties and other groups were also declared exempt from the FECA
and other government regulation by subsequent decisions expanding
on Buckley v. Valeo.
Today, donation limits of $1,000 (for individuals)
and $5,000 (for political action committees), bans on union and corporate
donations, and requirements for disclosure of donors and spending
do not apply to activities exempt from the FECA including soft money
donations which have increased as parties and other groups took advantage
of these exemptions and adjusted their tactics.
The term "soft money" was first applied to labor
union spending on political advocacy among union members. Union dues
from the general treasury could be used to fund internal activities.
Voluntary contributions could be used to finance political communications
with the general public and were reported to the FEC. Legislative
prohibition on union donations to, or spending on elections going
back to 1943 and 1947, was where the distinction between "hard" and
"soft" union activity originate.
The term "soft" was applied to unregulated party
activities, including voter registration, headquarter construction
and state and local political activity after passage of the FECA,
as political parties explored the distinction between regulated, federal
campaign activities and other party functions.
Because of the Supreme Court’s landmark decision
in Buckley v. Valeo in 1976, the courts have insisted that
congress be limited to regulate only direct campaign spending that
calls explicitly for the election or defeat of a particular politician:
what the Supreme Court called "express advocacy." The right to free
speech would be lost if Congress had the ability to regulate all forms
of campaign spending. If citizens or organizations had to wonder whether
every statement was or was not permissible, open political debate
would be impossible. Regulation on political discussion would therefore
require a "bright line" test, with specific words like "elect," "defeat"
or "vote for" to trigger regulation.
Under the "express advocacy" exemption specified
in the Buckley v. Valeo ruling, politically active groups started
to provide voter score cards and other printed material. Starting
in 1994 when independent term-limits, tax reform and conservative
religious groups ran ads to alert voters on candidates' positions
on various issues, a significant factor in campaigns became issue-related
television and radio advertising. Extensive use of such issue advertising
was made by unions and environmental organizations in 1996. Responding
in kind were business and independent conservative organizations.
Seen, for the first time, as a major factor by
organizations independent of candidates and political parties in many
1996 races was "issue advocacy." In 1994, only a few races were affected
by this form of advertising. Before 1994, issue advocacy was rare.
Without expressly advocating a candidate's election
or defeat, issue advocacy is the discussion of issues and candidates'
position on issues in debate during an election cycle. Issue advocacy
is capable of influencing an election or the defeat of particular
candidate, a factor the Supreme Court recognizes. However, that does
not convert it into express advocacy. In fact, no matter what the
effect it has on an election, issue advocacy is absolutely protected
by the First Amendment and cannot be subjected to regulation.
Politicians do not want to contend with citizens
bringing up issues they would rather ignore and try to limit issue
advocacy as a result. Many of their colleagues "feel threatened by
negative advertisement and want to control what is said during a campaign"
remark some politicians. (30) Some would also like simply to reduce
the level of spending devoted to political campaigns. (31)
House Minority leader Richard Gephardt, (Democratic-Missouri)
said in 1997 that, "What we have is two important values in conflict:
freedom of speech and or desire for healthy campaigns in a healthy democracy.
You can't have both." (32) Contrary to what Representative Gephardt
wants people to believe, these values are not in conflict. Designed
to ensure a healthy republic is the First Amendment's guarantee of freedom
of speech. And without one, there can not be the other.
From the standpoint of Americans who want a greater
say in who is elected and which policies public officials will pursue,
the supposed problems with the current campaign finance system that
have been identified by "reformers" and echoed by the media are not
problems. In fact, during political campaigns, too little money is
actually spent considering the enormous power and influence of government.
(33) ("as the level of government benefits increases, competition
for government transfers of wealth will naturally tend to increase
Reforms pursued by Congress must be constitutional,
and any law that attempts to limit citizens' freedom of speech and
association must be avoided.
MCCAIN-FEINGOLD BECOME LAW
If it becomes law, the McCain-Feingold bill poses
fundamental free-speech questions and faces inevitable court challenges.
(34) The Supreme Court will probably have to resolve the restrictions
imposed by the measure.
Lawrence Noble, a former general counsel of the
Federal Election Commission who is executive director of the pro-reform
Center for Responsive Politics said, "Everyone recognizes that there
are constitutional issues in McCain-Feingold, and everyone assumes
it will end up at the Supreme Court if it passes and is signed." (35)
A section that bars unions and corporations from
purchasing "issue advertising" on any television and radio stations
that mentions federal candidates during a specified period prior to
elections is the most vulnerable provision in the McCain-Feingold
legislation. The same section would also subject other interest groups
that purchase ads to new funding disclosure rules.
However, since the Supreme Court has said issue
ads are a form of political expression a loophole exists that must
be left untouched by federal regulation.
The Constitution permits the government to regulate
the flow of money in politics to prevent actual or apparent corruption
in the ruling of the Supreme Court in Buckley v. Valeo in 1976.
However, this regulation is subject to "strict scrutiny" by the court
to ensure that they do not unduly impede the free expression of the
political ideas for which the money was spent.
The court upheld limits on contributions as disclosure
requirements by applying that balancing test to a 1974 campaign reform
law. However, on political communications "relative" to federal elections
it struck down limitations. Part of the statute was so vague it could
stifle too much political speech according to findings by the court.
Only limits on "express advocacy" political communications
that specifically tells voters to cast their ballots for or against
a candidate-have been upheld since Buckley v. Valeo. As long
as they do not urge a vote for particular candidates, parties, unions,
corporations and interest groups, they have been able to purchase
issue ads freely.
However, based on the view that the court would
accept an alternative to the "express advocacy" standard as long as
it is not as vague as the one the justices struck down in the Buckley
v. Valeo case is McCain-Feingold's issue-ad provision.
By creating a new category "electioneering communications,"
defined as broadcast ads that refer to clearly identified candidates
and appear within 30 days of a primary or 60 days of a general election
the bill seeks to provide such an alternative.
However, by creating artificial definitions, Congress
cannot convert a category of constitutionally protected speech into
speech subject to regulation. Electioneering communications and federal
election activity are two terms adopted by the McCain-Feingold bill.
" Federal election activity" is defined to include any "communication
that refers to a clearly identified candidate...and is made for the
purpose of influencing a Federal election regardless of whether the
communication is express advocacy" and "electioneering communications,"
which is defined as any television or radio broadcasts that merely
"refers to a clearly identified candidate for federal office" within
60 days of a general election or 30 days before a primary election,
and is broadcast to an audience that includes the electorate for such
The freedom Americans have enjoyed to engage in
unregulated issue advocacy would be eliminated by the McCain-Feingold
bill's restriction on "electioneering communications." Subject to
strict reporting requirements would be non-corporate and labor organizations
that spent more than $10,000 in total on issue advocacy during the
pre-election period specified in the bill. Regarded as contributions
to candidates and thus becoming subject to the FECA's contribution
limits would be expenditures on issue advocacy during the pre-election
periods that were deemed "coordinated" with a candidate (under a new
expansive and unconstitutional definition). During the pre-election
periods corporations and labor unions alike would be banned from engaging
in issue advocacy.
Becoming subject to the same reporting requirements
currently imposed on PACs would be any person that expended more then
$50,000 total with respect to "federal election activity." Reported
within 24 hours of making the expenditure on issue advocacy would
be these disbursements made within 20 days of an election.
McCain-Feingold is in direct opposition of the
First Amendment's broad protection of issue advocacy. Impermissibly
broad under the First Amendment are campaign finance statutes regulating
more than explicit words of advocacy of the election or defeat of
clearly identified candidates. Therefore, unconstitutional would be
the McCain-Feingold bill.
Unions and corporations would be barred from spending
their own funds on such ads under the measure. Airing of such ads
would be allowed by interest groups however they would have to use
individual contributions to pay for them and disclose where the money
Joel Gora, a professor at Brooklyn Law School
who represented the plaintiffs in Buckley v. Valeo and is working
with the American Civil Liberties Union to defeat McCain-Feingold
said, "To the extent the bill would... make illegal or burdensome
the funding of speech that has been protected up till now, it is vulnerable
to challenge." (36)
A group that opposed McCain-Feinold (if it was
law) however had no position on whether McCain should be a senator
would be subject to regulations if it wanted to run an ad attacking
it in Arizona within 60 days of a Senate election involving McCain
said Gora. (37)
The same kinds of constitutional questions would
not be raised by the only alternative to the McCain-Feingold bill,
a reform proposal by Senator Chuck Hagel that does not include restrictions
on issue ads by corporations and unions.
CAMPAIGN FINANCE REFORM
If Senator McCain and his supporters were serious
about campaign finance reform, they would consider repealing the limits
on individual and PAC contributions to candidates and parties as well
as party contributions to candidates, and making them all constitutional.
(38) For Presidential election campaigns, taxpayer financing would
be eliminated. Unless specific disclosure requirements were met, bar
acceptance of contributions. Campaign reports would be required to
be filed electronically and during the three months preceding an election
they would be required to be filed every 24 hours. The Federal Election
Commission (FEC) would be required to post campaign reports on the
Internet. Each state party would be required to file with the FEC
a copy of the same disclosure form as it files with the state and
parties would be required to distinguish between federal and non-federal
The playing field between challengers and incumbents
would tend to be leveled by repealing contribution limits because
of the built-in advantages that incumbents possess. The problems with
the current system could be addressed by the reforms stated above.
The influence of outside fundraisers would be lessened by such reforms
and the need for candidates and public officials to engage in constant
fundraising would decline. Also, the overtly complex regulatory process
would be simplified and intrusive FEC investigations that last for
years would be lessened. The transparency and political accountability
of the electoral process would be improved but most importantly would
not infringe on the freedom of speech afforded to by the First Amendment.
Espo, "Lott OK's Campaign Finance Debate, The Associated Press, January
Squitieri, "Bush back's new 'soft money' reform, USA Today, March
Balz and Ruth Marcus," Bush to Offer Campaign Finance Guidelines.
Aides Signal White House Desire to Fashion Reform Legislation the
President Can Sign," The Washington Post, March 15, 2001
Marcus and Dan Balz," Democrats Have Fresh Doubts on 'Soft Money'
Ban," The Washington Post, March 5, 2001
Balz and Helen Dewar, "Bush Outlines Ideas On Campaign Finance. Plan
Differs From McCain-Feingold Bill," The Washington Post, March 16,
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Washington Times, March 20, 2001
Mitchell, "McCain Sees Amendments Playing Big Role in Campaign Bill,"
The New York Times, March 19, 2001
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as you think," Reason, July 1997 v29 n3 p47(3)
Samuelson, "Is Campaign Finance 'Reform' Needed?," Dallas Morning
News, October 8, 1999
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Feingold Plan to Introduce Campaign Finance Bill," January 4, 2001,
M. Mason, "Why Congress Can't Ban Soft Money," Heritage Foundation
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11, 1993 and Bradley A. Smith, "Campaign Finance Regulation," Cato
Institute Policy Analysis No. 238, September 3, 1995
Milyo, "Money walks: why campaign contributions aren't as corrupting
as you think," Reason, July 1997 v29 n3 p47(3)
Richie and Steven Hill, "In Politics, Money Isn't the Root of All
Evil," The Wall Street Journal, January 19, 1998
Milyo, "Money walks: why campaign contributions aren't as corrupting
as you think," Reason, July 1997 v29 n3 p47(3)
Republican Federal Campaign Committee v. Federal Election Commission,
No. 95-489, 135 L. Ed. 2nd 795
v. Valeo, 424 U.S. 1, 14-15 (1976)
of House Majority Whip Tom Delay (Republican-Texas), Money &
Politics Report, Bureau of National Affairs, Inc., May 26, 1999,
statement of Senator Russel Feingold (Democrat-Wisconsin) on the introduction
of S. 26: "The prevalence-no-the dominance of money in our system
of elections and our legislatures will in the end cause them to crumble."
Cong. Rec. S422, 423 (daily ed. January 19, 1999)
Lewis," A Question of Honors. The Subversive," The New York Times
Magazine, May 25, 1997, p.32
James Bopp, Jr., Constitutional Limits on Campaign Contribution
Limits, 11 Regent U.L. Rev 235, 284-85 (1998-1999)
Lane, "Court Challenge Likely if McCain-Feingold Bill Passes. Foes
Cite Free-Speech Issues as Debate On Campaign Finance Reform Begins,"
The Washington Post, March 19, 2001
Bopp Jr., "Campaign Finance "Reform": The Good, The Bad And The Unconstitutional,"
Heritage Foundation Backgrounder, No. 1308, July 19, 1999