Campaign Finance Reform: the Unfinished Agenda

Campaign Finance Reform: The Unfinished Agenda By FRED WERTHEIMER ABSTRACT: In 1974, following the Watergate scandal, Congress enacted major campaign finance reform legislation. The legislation created a revolutionary new public financing system for our presidential campaigns, but it left congressional campaigns to be financed totally by private money. The presidential public financing system has worked well. Despite some incremental problems, the system has accomplished its basic goal of allowing individuals to run for the presidency without becoming dependent on their financial backers. The system for financing congressional campaigns, on the other hand, is out of control and in need of fundamental reform. The inappropriate role of special interest political action committees (PACs) in influencing congressional elections and congressional decisions is the single biggest problem facing the political process. Congress needs to complete the unfinished campaign finance reform agenda of the 1970s by enacting public financing for congressional campaigns and establishing new restrictions on the total amount that PACs may give to a congressional candidate. Fred Wertheimer is president of Common Cause, a national citizens’lobbying organization. He joined the organization as a lobbyist in 1971 and became president in 1981. He has been Common Cause’s chief lobbyist on campaign finance reform and served as director of its Campaign Finance Monitoring Project. Before joining Common Cause, he served as minority counsel to the House Small Business Committee, as legislative counsel to Congressman Silvio Conte, and as an attorney with the Securities and Exchange Commission. Mr. Wertheimer is a graduate of the University of Michigan and Harvard Law School. NOTE: The author wishes to acknowledge the important contributions made in the preparation of this article by Common Cause staff members Marcy Frosh, Carole Geithner, Randy Huwa, Ann McBride, and Jane Mentzinger. 86 87 nUR democracy is founded on the any other sweet old lady in a calico dress just concept of representation. Citizens does not know anything about politics:’ elect leaders who are given responsibil- Beginning in the early 1970s, Com- to all the and ity weigh competing mon Cause and other election reform conflicting interests that reflect our groups pressed for fundamental changes and to decide what, in their diversity in the campaign finance statutes. The judgment, will best advance the interests goals were to end secrecy in campaign of the citizenry. financing, to limit the influence of large It is a system. It obviously rough contributions, to enable candidates of often does not measure up to the ideal modest means to seek office without we might hope to attain. But we con- becoming beholden to campaign donors, tinue to our trust in this system place and to increase competition in the polit- because we believe our best chance at ical process. The reform called ourselves lies in the agenda governing obtaining for: best judgment of elected representatives. Unfortunately, that is not happening -effective campaign contribution today. We are not obtaining the best and expenditure reporting require- judgment of our elected representatives ments ; are not free to in Congress because they -limits on the size of individual and it to us. As a result of our give present group campaign contributions; congressional campaign financing sys- -a of of tem-and the increasing role of political system public financing candidate action committee (PAC) campaign con- campaigns, including access to federal funds and limits tributions-members of Congress are on and rapidly losing their ability to represent spending; the constituencies that have elected -effective enforcement by an inde- them. pendent agency. We have long struggled to prevent This reform agenda took on a new from used to influence money being importance in the wake of Watergate, government decisions. We have not our nation’s greatest political scandal. always succeeded, but we have never lost Watergate revealed that our govern- sight of the goal. Buying influence vio- ment was literally up for sale. The lates our most fundamental democratic came in the form of funds con- values. We have recognized that money long tributed for the presidential campaign. the to make con- ability large campaign As the then chairman of American Air- tributions does, in fact, make some lines explained: more equal than others. In the mid- 1960s, for example, Senator Russell The law ... is based on a system by which Long, Democrat of Louisiana, observed, candidates for public office must seek funds from persons affected by the actions of such One sweet woman was on the side opposite candidates when elected to office. The sys- [in an election] and thought they were going to lose and came charging in there with a 1. U.S., Congress, Senate, Committee on of hundred thousand dollars to couple pump Finance, Hearings on S. 3496, Amendment No. up their side.... Anybody who would 732, S. 2006, S. 2965, and S. 3014, 89th Cong., 2d suggest that she had no more influence than sess., 1966, p. 78. 88 tem provides no limits on the total amount Reflecting on the meaning of Water- that may be raised or spent and hence places gate, John Gardner, founder and former a premium on pressure to raise greater and chairman of Common wrote at 2 Cause, greater amounts . the time: In its final the Senate Water- report, In almost every aspect of Watergate, there as a gate Committee concluded that, was one common element: the flow of secret result of the systematic solicitation of campaign cash. There are honest donors to corporate donors, 12 major corpora- political campaigns and honest recipients; tions gave approximately $749,000 in but the existence of these does not outweigh illegal contributions to the Nixon cam- the fact that the present system legitimizes paign.’ Corporate executives testified the buying and selling of politicians. The cash bribe has been that they succumbed to such solicitations old-style, flat-footed replaced by the campaign gift, its all-purpose, as a way of access to administra- gaining modern tion decision makers and also out of fear prepackaged equivalent.’ of experiencing competitive disadvan- The result of these revelations, not tages if they failed to contribute. Said surprisingly, was an alarming drop in one Gulf Oil executive, &dquo;I considered it citizens’ confidence in their government. considerable pressure when two Cabinet Pollster Louis Harris in 1973 told a officers and an agent of one of the Senate committee that &dquo;public confi- committees that was handling the elec- dence in government generally must be tion ... ask[ed] me for funds-that is reported as being lower than a constit- just a little bit different than somebody uent democracy can afford.&dquo;’ 4 collecting for the Boy Scouts.&dquo; The nation’s greatest political scan- The Milk Producers Association’s dal led to one of the nation’s most pledge of $2 million to President Nixon’s historic and revolutionary reforms, the reelection campaign was linked in the public financing of our presidential public’s mind to the increase in milk elections. Congress enacted public price supports. More than $1.8 million financing to prevent private campaign in contributions to the Nixon campaign contributions from being used as a vehi- came from people who received ambas- cle for obtaining influence with the sadorial appointments during his president of the United States. Under administration.’ this system, limits were placed on the 2. D. Michal Freedman, The Watergate size of contributions, overall expendi- Reforms: Ten Years After (Washington, DC: tures were capped, and an alternative Common Cause, 1983), p. 16. source of campaign money was created: 3. U.S., Congress, Senate, Select Committee public funds generated by the dollar on Presidential Campaign Activities, Final checkoff on the federal income tax.’ Report, 93rd Cong., 2d sess., 1974, p. 446. 4. Ibid., p. 471. 5. Ibid., pp. 127, 492-93, 579. See Fred 6. Freedman, Watergate Reforms, p. 17. Wertheimer and Randy Huwa, "Campaign 7. U.S., Congress, Senate, Committee on Finance Reforms: Past Accomplishments, Future Government Operations, Hearings on a Survey of Challenges,"New York University Review of Law Public Attitudes, 93rd Cong., 1st sess., 1973, and Social Change, 10:44 (1980-81). Unless pp. 6-8. otherwise noted, figures used in this article are 8. FECA Amendments of 1974, Pub. L. No. based on analyses prepared by Common Cause of 93-443, §§ 101-302, 88 Stat. 1263 (1974) (codified campaign finance disclosure statements filed with as amended in scattered sections of 2, 5, 18, 26, 47 the Federal Election Commission. U.S.C.). 89 Unfortunately, the same progress new problems that have arisen, such as was not made at the congressional level. soft money and independent expendi- Although Congress established limits tures, these changes are required to on contributions by both individuals preserve the integrity of an existing and PACs and placed limits on overall system that has accomplished its basic expenditures,9 members of Congress goals. were unwilling to take the last crucial step-to establish an alternative public PRESIDENTIAL source of campaign funds for their own PUBLIC FINANCING campaigns. While congressional public Simply stated, the presidential public financing was passed by the Senate, the financing system is an idea that works; it House narrowly rejected it, by a vote of is the crowning achievement of the 187 to 228, and the provision was amendments adopted in 1974 to the dropped in conference. At the same Federal Election Campaign Act. Under time, in a major step backward and over the system, candidates who agree to the objections of reform groups, Con- abide limits on overall the door for an increased by campaign gress opened and the of role in special interest giving by repeal- spending expenditure per- sonal wealth are able to receive federal ing a prohibition on the formation of tax dollars, funds to a PACs by government contractors.

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