Give Money and They Call Back
`Soft money,' given to parties for generic uses, is new loophole in campaign finance
WASHINGTON — WHEN President Bush announced a plan Oct. 1 to widen the use of ethanol in automobile fuel, critics of current campaign-finance practices cried, "Aha!"
The change would greatly benefit the Archer Daniels Midland Co., which produces about 70 percent of the nation's ethanol, a corn-based alcohol. The company and its CEO, Dwayne Andreas, also happen to be the largest contributor to the Republican Party during this election cycle - more than $1 million.
Did ADM, in effect, buy this lucrative change in policy? "You can't show a direct link," says Joshua Goldstein, a campaign-finance expert at the Center for Responsive Politics. "But the fact that they gave the money gave them access and allowed them to state their position. In Washington, this is the name of the game."
Access. The word comes up repeatedly in conversations with large campaign contributors and experts on campaign finance. Washington calls back
The big-time donors don't always get what they want - it's not possible, since many represent competing interests - but they do get their phone calls returned.
And while political-action committees, or PACs, used to be the sole symbol of political influence-selling in Washington, it is now the so-called "soft money" - unrestricted and rising dramatically - that is attracting the most attention.
Soft money refers to donations to the party organizations for "generic" advertising and get-out-the-vote activities, but has become a major source of additional support to the federally-funded presidential campaigns. Critics charge that soft money is a loophole that renders virtually moot the Watergate-era campaign-finance reform, which was designed to eliminate big-money influence.
Nationally, the Republicans and Democrats have raised upwards of $70 million between them in soft money this election cycle (beginning Jan. 1, 1991); the state parties have raised another $50 million to $60 million, says Ellen Miller, executive director of the Center for Responsive Politics, a campaign-finance watchdog group.
In the 1988 elections, the parties' state and national organizations raised between $50 million and $100 million, says Ms. Miller. Exact figures are unknown, because until January 1991, the Federal Election Commission did not require disclosure of contributions.
In a recent study of Federal Election Commission records, the Center for Responsive Politics identified the largest soft-money contributors to each major party, as well as the top "double givers" - those that are hedging their bets and giving generously to both parties.
The finance-insurance-real estate sector has proved to be the largest category of donors to both parties so far. For the Republicans, the oil and gas industry and agricultural concerns, such as ADM and the large tobacco companies, were the key donors.
For the Democrats, labor unions and the electronics and communications industries dominated the list, though the amounts of money were much lower.
The top five double-givers included three tobacco firms. The five are: ADM, $1,150,000, RJR Nabisco, $779,000, Arco, $773,000, Philip Morris $597,000, and the Tobacco Institute, $236,000.
What are they really getting for their money? And why do some large companies and organizations give major sums while others give little or none at all?
"We give because we see ourselves as part of the political process," says Al Greenstein, an ARCO spokesman. "I won't deny it makes you a player, but you can't say it buys decisions."
Mr. Greenstein argues further that a company as large as Arco can have influence just because of its sheer size. Common Cause, a nonprofit group pushing for campaign-finance reform, sees it differently. It claims that Arco CEO Lodwrick Cook's "friendly relationship" with Bush helped clinch a change in the 1990 Clean Air Act that would allow the use of "reformulated gasoline" - an Arco product.
Professor Herbert Alexander, an expert on campaign finance at the University of Southern California, says some of the large campaign contributions come from an "arms race mentality" - companies feeling they need to keep up with their competitors. Many reasons for giving
"But people give for a multitude of reasons, not all of which are for financial gain," Professor Alexander adds. Company tradition and the political proclivities of management are important factors.
Dwayne Andreas is simply a "political animal," Alexander says. "But where are Cargill and the other big agricultural companies? Those companies have survived."
If elected president, Bill Clinton has pledged to enact campaign-finance reform. Congress passed legislation this year, but Bush vetoed it. The reforms related mainly to congressional campaigns, but would have placed some restrictions on soft money.
Typically, the Republicans have favored eliminating PACs because Democrats get more PAC money than Republicans, while the Democrats have wanted to get rid of soft money, where they have been weaker. But a new wrinkle has appeared: In both August and September, as the Clinton campaign picked up momentum, the Democrats raised more soft money than the Republicans for the first time ever. In Clinton wins, perhaps the Democrats won't be so quick to get rid of that stream of funding.