Get Special-Interest Money Out of Politics

Fat cats can always find another loophole in donation limits; the answer is in public funding of campaigns

CAN the campaign-finance mess be reformed? Yes, but most of the proposals being considered will provide only limited and temporary relief. The reforms that might actually clean up the system are unlikely to be enacted.

Meaningful reform depends on understanding how political action committees (PACs) currently operate. Many critics see the problem as one of quasi-bribery: A member of Congress switches positions on a key roll-call in response to PAC money. Corporate PAC directors insist that rarely happens.

As a top executive at a major manufacturing company says, "You certainly aren't going to be able to buy anybody for $500 or $1,000 or $10,000. It's a joke." While many people are probably quick to dismiss this claim, I think it is true for roll-call votes on widely publicized bills. Members who supported PACs against their constituents' clear preferences would pay too heavy a price.

But corporate PACs focus relatively little attention on such votes. They don't need to: They can win most of what they want in other ways. If the public opposes pollution and wants clean air, then the final vote on the Clean Air Act will be overwhelmingly in favor of "environmentalism."

But behind the scenes, all kinds of private deals can be struck for loopholes that undercut the stated intention of the bill. Once that has happened, one corporate executive explained, "It doesn't much matter how people vote afterward." Companies are therefore willing to support members of Congress with "anti-business" voting records because those same people help craft loopholes that gut the law.

Corporate PACs have found that it does not take large sums to gain access. The average corporate PAC contribution to representatives is only $925, and one corporate vice-president cheerfully told me that "I can get to [Rep. Henry] Waxman [(D) of California] for $250 probably." Access does not insure immediate success: If corporations totally dominated politics they would not have to make deals behind the scenes. But usually something can be worked out. This, a PAC director told us, is "the fun of the gam e."

Given this situation, reforms aimed at limiting the maximum size of a PAC donation are unlikely to make any difference. President Bush has proposed abolishing corporate and labor PACs altogether - a proposal that would cost Democrats $30 million more than it would Republicans, since labor unions heavily favor Democrats, and corporations give to Democratic incumbents just to gain access.

Moreover, it would not reduce the impact of money on politics, but would just make that impact harder to monitor. When I asked corporate PAC directors what they would do if PACs were abolished, they said they would simply find other means to funnel money to candidates:

* "My salary would go up and I would make a lot more personal contributions."

* "All that would happen is that a member [of Congress] would say to you, `I want X thousand dollars,' and you'd have to get it some other way than through the PAC."

* "It would be the pits. How many times can you show up at a $2,000 fund-raiser by going around and hitting everybody on the eighth floor for a contribution?"

Any viable campaign-finance reform requires that we take these PAC directors seriously. Most proposals rely on multiplying regulations, but the PAC directors can always keep one loophole ahead. As a corporate executive explained, no matter what changes are made in the campaign-finance laws, "There are ways around it. The system is dynamic. By the time they change it, it's too late.... I can tell you right now how I can give untold sums of corporate money to anybody in the country that I want to give it t o."

IF we want to end the influence of big money, we need to move to a system of public financing with a meaningful enforcement mechanism. In each of the last four elections, better than 95 percent of incumbents have been reelected - a fact that drives the term-limitation movement. Campaign finance is a major reason for this: The key problem most challengers face is an inability to raise enough money to make the race competitive.

Under one constructive public-financing proposal, total campaign spending would stay about the same as at present, but the incumbent and challenger would each receive the same amount of money, and in return would have to commit themselves to not accepting any private money. If one candidate chose to forgo public spending in order to raise a larger amount from special interests, that candidate's opponent would be given a matching amount from public funds. This undercuts any incentive to take special-inter est money and guarantees a level playing field.

With adequate public financing and a guarantee that special-interest money could not be used to give opponents a fund-raising advantage, members of Congress would no longer have an incentive to cut deals with actual or potential campaign contributors. Senators and representatives could spend their time on legislation rather than fund-raising, on the stated purpose of a bill rather than on its secret loopholes. Equal funding for the incumbent and challenger would also make races much more competitive.

One of the corporate executives I interviewed explained the likely business objection to this proposal. Under such a system, he said, "I think the members [of Congress] would be less accessible because I think they might start running it strictly for the votes." Objections would not be presented in these terms, of course. Rather we would hear complaints about the cost of the system, even though a reduction in loopholes could save billions.

The new government expenditure required is minimal - about $200 million a year, or one-quarter the cost of a single B-2 bomber. The improved public policy that would result from such a system would drastically reduce special-interest deals brokered through PAC money, the source of much of the gridlock in Washington.

If people's ability to make their case to lawmakers depended on the merits of their arguments, not the size of their campaign contributions, this would help to restore public confidence in government.

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