Human Rights
Volume 25
Number 1
Winter 1998
The Reform Quandary As McCain-Feingold awaits final judgment, the debate continues about the merits and finer points of campaign finance reform.
by Jeremy LehrerIn June of 1997, a prominent elected official wrote to the Federal Election Commission appealing for reform of the country's campaign finance system: "The rules governing our system of financing Federal election campaigns are sorely out of date. Enacted more than two decades ago when election campaigns were much less expensive, the rules have been overtaken by dramatic changes in the nature and cost of campaigns and the accompanying flood of money."
The politician, of course, was none other than William J. Clinton, the 42nd President of the United States, and the appeal for change is one often made by politicians and advocates as campaign finance abuses escalate and as the public begins to wonder whether elected officials are accountable to their constituencies or to large donors. Advocates of reform argue that the current system has distorted the process to such an extent that special interests dominate Congress and that there are no real choices on election day.
Since government, politics, and economics are so intrinsically linked, money and politics will be forever wedded. As Micah Sifry, a senior analyst for Public Campaign, a non-profit organization advocating campaign finance reform, observes, "You cannot legislate money out of politics."
Even so, the history of reform goes to the end of the 19th century, when the Pendleton Act was passed to ensure that government employees would not solicit funds for political parties on government property. Vice President Al Gore is quite familiar with this particular statute, since he has been accused of violating the Pendleton Act when he called donors from the White House. Another piece of reform legislation, The Corrupt Practices Act of 1907, was signed into law during the tenure of President Theodore Roosevelt (his second term) and was designed to prohibit corporations from financing congressional and presidential elections. (The first President Roosevelt, who President Clinton has evoked more than once, had money problems of his own which provided impetus for the reform.)
More recently, comprehensive campaign finance reform legislation was passed in 1974 following revelations of corruption and payback that occurred during the Nixon administration. As initially passed by Congress, the legislation, known as the Federal Election Campaign Act (FECA), limited contributions to candidates and imposed spending limits on candidates running for office. In one of the legislation's most significant reforms, the 1974 act provided for matching public funds during presidential primaries and public financing during the general elections in an attempt to liberate presidential candidates from private money and special interests. The presidential subsidies are funded by a checkoff on income tax forms. If a candidate raises a certain amount of money and voluntarily agrees to honor spending limits, the candidate is eligible for public matching payments during the presidential primaries.
In Buckley v. Valeo, 424 US 1, 19 (1976), the Supreme Court overturned sections of FECA while it upheld other parts. The Court concluded in the 1976 ruling that mandatory spending limits were unconstitutional and a violation of a candidate's First Amendment right to free speech. However, the justices ruled that contribution limits were an acceptable means of undermining corruption and added that regulatory systems were constitutional only so long as they were voluntary. Independent expenditures on behalf of a candidate and a candidate's spending of personal funds fell under the realm of protected free speech.
While Buckley sets the tone for the current debate, there are challenges to the ruling from both sides of the reform divide. As Donald Simon, the executive vice president and general counsel of Common Cause, notes, "Those who oppose regulation believe that Buckley permits too much regulation and those who support regulation believe that Buckley permits too little."
Supporters of increased regulation look no farther than the last presidential election, when large amounts of "soft money" were raised by both political parties, funneled to state party and other organizations, and used to fund campaign commercials, a tactic forbidden by current campaign legislation. "Soft money" is money given to political parties that is not subject to contribution limitations imposed on individual candidates. The money is intended to be used only for party building activities such as get-out-the-vote drives and voter registration initiatives sanctioned by a 1979 amendment to the FECA legislation. But since 1988 observers cite the Dukakis campaign as the culprit in the development soft money has been used to circumvent limits on contributions and spending.
According to Common Cause, in the 1996 election cycle, Democrats raised $124 million in soft money and Republicans raised $138 million. In the first six months of 1997 up until June 30, the Democrats raised over $11 million, and the Republicans raised more than $23 million, more than twice that raised during the same period in 1993. Though the 1979 amendment states that these contributions cannot be spent in support of specific candidates unless the expenditures comply with limits, they were nevertheless used in the last election to do just that. Among other issues, advocacy organizations have charged that the Federal Election Commission, the organization created to enforce Federal election law, has failed to fulfill its mandate. Indeed, in a 1987 court ruling, Common Cause v. Federal Election Commission, a federal court found that the FEC's approach to regulating soft money failed to reflect the intent of the law.
Though many voices are calling for reform, the effort to achieve it is an exercise in negotiating a legal mine field. Some commentators have noted that campaign finance reform brings First Amendment values into conflict with values of democracy and equality. Bradley Smith, an associate professor at Capital University Law School in Columbus, Ohio, has written articles about campaign finance reform and its First Amendment implications for the Wall Street Journal and the Yale Law Journal. Smith is an ardent supporter of the Buckley position that political spending amounts to speech protected by the First Amendment and argues that current reform proposals contain provisions that impinge on free speech.
"Most of the things that are being proposed are I think both unwise policy and unconstitutional as a matter of First Amendment law," he says.
The ACLU holds a similar position, though there has been some internal debate regarding the organization's position on campaign finance reform. The ACLU supports public financing but opposes contribution limits, and though Buckley allows voluntary compliance with spending limits, the ACLU opposes these limits and has been participating in litigation to challenge them. As Laura Murphy, the director of the ACLU's Washington, D.C. office, explains, "There are always unique circumstances where a spending limit becomes arbitrary."
Beyond spending limits, issue ads are another contentious subject in the campaign finance reform debate. Paid for by organizations or individuals, issue ads are intended to focus on a political or legislative issue without advocating the defeat or election of a particular candidate. Supporters of issue ads, like Bradley Smith, claim that the Buckley decision establishes a clear allowance, and Smith adds that "talking about politics requires people to use the names of candidates and to talk about them in the context of issues." Critics maintain that issue ads sometimes cross the line into express advocacy without being subject to the disclosure required of campaign advertisements. While reformers appeal for some level of disclosure for issue ads, opponents such as Murphy argue that this could have "a chilling effect on free speech."
"There may be forms of disclosure that are not as burdensome as some others," says Murphy. "But the forms of issue disclosure that are in the prevailing or the most prominent campaign finance reform proposals are not acceptable to the ACLU."
Donald Simon would like to see a refined approach that would distinguish between issue ads and express advocacy but acknowledges that there are "substantial constitutional questions about how to deal with that problem." The problem, as Simon sees it, is how to draw a line between campaign ads, which are subject to regulation, and issue ads, which are not. "The line that is in place today is a clear line but it's also clearly the wrong line because it allows ads that are unquestionably campaign ads to escape regulation."
Specific proposals to refine the current campaign financing system range from those who would like to see the system fully financed by public funds to those who would like to see the current system entirely deregulated.
McCain-Feingold, also known as the Bipartisan Campaign Reform Act of 1997, is a reform bill that sought to solve a number of problems in the current campaign finance system. Among other things, McCain-Feingold had provisions for banning soft money, distinguishing between issue ads and express advocacy, providing greater public disclosure, and codifying the Supreme Court's Beck decision, a ruling that stated that workers could not be forced to pay dues or fees to subsidize union activity unrelated to collective bargaining. Because of a Republican filibuster, voting on McCain-Feingold did not occur in 1997. However, due to pressure by Democrats and by the Senate Governmental Affairs Committee hearings on campaign finance abuses, the bill will be brought again to the Senate floor in March 1998. And there seems to be parallel pressure in the House to achieve some level of reform.
On another end of the spectrum is legislation introduced by Representative John Doolittle, a California Republican, which would eliminate restrictions on contributions and spending but require electronic disclosure of donations within 24 hours. This legislation has the support of those who would like to deregulate the campaign finance system entirely as well as legal scholars who argue that limits on contributions and spending actually end up benefiting incumbents, who have significant fundraising and organizational advantages over their challengers.
From some corners, there have even been rumblings and suggestions that a constitutional amendment should be made that would limit campaign spending. The prospect of a campaign finance amendment has reformers on both sides of the divide worried that core political speech would be curtailed. But since it would be difficult if not impossible to pass such an amendment, Micah Sifry argues that the proposal is a red herring, coverage for politicians who don't really want to see reform of the system.
While campaign finance reform stalls at the federal level, some states have successfully passed campaign finance reform legislation. In 1996, voters in Maine passed a ballot initiative that provided full public financing to candidates, and Public Campaign, led by Ellen Miller, a former executive director of the Center for Responsive Politics, supports this system as a model for reform on a wider level; Kerry-Wellstone, another reform proposal presented in the Senate, is based on the Maine reform bill.
The Maine Clean Elections Act provides full public financing to candidates who accept no private money and agree to abide by spending limits. Candidates qualify for the financing by initially collecting a threshold number of $5 donations to demonstrate broad support among constituents. If a candidate accepts private funds at any time, the offender is subject to stiff penalties that include forfeiting, returning the grant, and paying fines.
Regarding the Maine system, Sifry observes that full public financing arrangement frees candidates from commitments that develop when accepting money from large contributors.
"If the candidate has an alternative source of financing that essentially frees them in the first place from needing to raise any money then in effect you're rewarding them for virtuous behavior rather than trying to coerce them away form what you think of as less than virtuous behavior," he says. "There will still be 'old-fashioned,' privately financed candidates, and there will still be money in politics, you can't get rid of it. But what finally we will have is a choice between candidates who are beholden to special interest donors and candidates who are beholden to nobody."
Bradley Smith argues that in the public financing scenario, candidates will be beholden to other groups, such as the media and academia, that would end up wielding greater influence if donors are removed from the political equation. "I reject this sort of notion that money is in some ways an illegitimate source of power but being a television broadcaster is legitimate. Being an academic is legitimate but donating $10,000 is not."
Broadcasters wield influence in many ways, and some campaign finance reform advocates have suggested that purchases of television time are one of the most pernicious influences on modern campaigns. Because television time costs so much money, candidates are forced to raise the inordinate amounts of money that have become commonplace in electoral drives. To eliminate the need for these sums of money, reformers have suggested that television stations provide free or reduced air time to candidates running for office.
In addition to objections from broadcasters who do not want to lose advertising revenue, the free TV proposal raises objections from First Amendment advocates who argue that it is an imposition on free speech and an unconstitutional "taking." Laura Murphy, of the ACLU, contends that there are "compelled speech issues" involved with the proposal and supports instead a system of publicly-financed vouchers that would enable candidates to purchase advertisements in media ranging from television to newspapers. Micah Sifry, of Public Campaign, argues that the television stations are obligated to give something back to the public in return for using the public airwaves and notes that stations are also required to provide a certain amount of children's educational and public service programming.
Advocates of free TV seem to agree that the government missed out on an opportunity to require free air time for candidates when the government essentially gave away additional sections of the broadcast spectrum earlier this year in preparation for the transition to digital television. The additional spectrum was given away to broadcasters without requiring them to give back a single red cent or even a programming concession, though the spectrum's value was estimated as close to $70 billion.
The broadcast spectrum giveaway gets back to an idea about the value of campaign donations and the lucrative payback industries can reap if the legislative wind blows in the right direction. While not necessarily a quid pro quo, donors have certainly benefited from certain aspects of legislation or policy which might otherwise have benefited the public good. The spectrum's estimated value of $70 billion is a financial leviathan compared to the Mickey Mouse millions that communications and entertainment companies donated to the major parties over the course of the last election cycle. Don Simon observes, "That's why campaign contributions are viewed as investments, and they're viewed as good investments."
Investments or not, campaign finance reform remains a thorny issue that will undoubtedly stir heated debate for some time to come.
Jeremy Lehrer is a writer in New York.