As the House of Representatives was about to begin debating a modest campaign finance reform bill, former Enron CEO Kenneth Lay was taking the Fifth before the Senate commerce committee. As the disgraced exec sat grim-faced at the witness table, Democratic Senator Fritz Hollings, chairman of the committee, used the nickname George W. Bush once conferred upon Lay, noting that there is "no better example than Kenny Boy of cash-and-carry government." Lay and Enron dumped millions of dollars into the political system--in hard-money contributions to candidates and soft-money donations to political parties--and spent millions more to hire politically wired lobbyists (including Republican Party chairman Marc Racicot) and to snag high-profile opinion leaders (like Bush economic adviser Lawrence Lindsey) as consultants. Executives were coerced to cut campaign checks to Bush and other politicians, Republican and Democrat. The goal was to game the system in Enron's favor--in regulatory agencies, in Congress, in state capitals, in the White House.
Enron, of course, was not unique in this regard. Why else would corporate executives invest millions in candidates and parties? If they're not receiving a return, shareholders should sue. (Enron may well have received favors from federal and state officials in the months and years before the company started collapsing and became too controversial to assist; the various Enron inquiries on Capitol Hill should be digging into this.) And the system seems to be working fine for most donors and the recipients, for the flow of money keeps increasing. In 2001 the two parties bagged $151 million in soft money--the large unlimited contributions given mainly by corporations, unions and millionaires--almost a 50 percent increase over 1999, the last nonelection year. The Republicans out-collected Democrats, $87.8 million to $63.1 million.
The Shays-Meehan bill, at the center of the latest House campaign finance debate, called for something of a ban on soft money for the national parties--a good move. But the legislation, similar to the McCain-Feingold bill in the Senate, still contained soft-money loopholes and, just as unfortunate, raised the limits on certain hard-money donations. If Shays-Meehan had been enacted years ago, it would have done little to slow down the Enron racketeers. That's why it's important for the debate to move beyond Shays-Meehan/McCain-Feingold. The long-term solution must be a system of public finance in which candidates can receive most of their campaign dollars in clean money, that is, funds that come from the no quid/no quo public till rather than the private pockets of the rent-a-politician crowd. The first run of clean-money systems in Maine and Arizona showed that such an alternative can work: There were more contested races, more women and minorities running and a more level playing field. The vast majority of both states' legislators and statewide officials will run "clean" this year, and it looks as though the Massachusetts Supreme Court will force the implementation of that state's clean election law for this year's election. Legislation is advancing in several other states.
In the past few years, the reform debate in Washington has been too modest. The authors of the reform bills deserve credit for pushing against a mighty tide of self-interest, but Enron shows how far special interests will go to rig the system. True reform has to go as far.
The success of Michael Bloomberg's $69 million race for Mayor of New York against Mark Green was widely seen as a setback for campaign finance reform. But the Bloomberg campaign demonstrated the limits of campaign finance reform under the Supreme Court's interpretation of the Constitution, not its failure.
Hurray for campaign finance reform--well, kind of.
If you believe President Bush, Kenneth Lay--one of his top financial backers and his "good friend"--was merely an equal-opportunity corrupter of our political system, buying off Democrats and Rep
Enron is Whitewater in spades.
The Supreme Court, in the final week of June, handed down three decisions, each of which seems to endorse a valuable social principle.
In the first, involving the right of legal immigrants who have pleaded guilty to crimes in the past to a judicial review of deportation proceedings, the Court upheld the principle that no matter who you are, you are entitled to your day in court.
In the second case, the High Court affirmed the right of writers and artists to share in the wealth made possible by the new media. The case was brought by a group of freelancers who objected to the inclusion of their work in electronic databases without permission or remuneration; the group was led by Jonathan Tasini, the president of the National Writers Union and a man with an admirable mission.
In the third case, the Supreme Court made it more possible for Congress to provide correctives to the influence of money in politics by upholding Watergate-era limits on how much political parties can spend in coordination with candidates for federal office. Had the Court eliminated the restrictions, it would have legitimized the parties as cash-laundering machines for donors.
Left to be determined, in all three cases, are the appropriate remedies for the ills the rulings addressed, and the difficulty of fashioning these should not be underestimated. But it is heartening to see the Court acting in its proper role as the guardian of both the individual and society.
It's fitting that the first senator to become an independent in more than thirty years hails from Vermont, the state with the most advanced independent politics in the nation. Vermont gave maverick Republican John McCain a solid victory in the 2000 presidential primary--nearly half those voting were self-described independents, and one in seven said that campaign finance reform was their top concern. The Vermont Progressive Party, which has tenaciously focused on the needs and interests of average people, is firmly entrenched in Burlington, the state's largest city, and its gubernatorial candidate, Anthony Pollina, got 10 percent of the vote last year in a hard-fought three-way race.
Thus, Senator Jim Jeffords's decision was helped enormously by the political space for an independent path that had already been created back home and by the steady pressure from the state's Progressives, which kept the local center of gravity far to the left of the Bush-Gore mainstream. Says Pollina, "Jeffords is a smart politician, and he recognizes that Vermonters are really fed up with politics-as-usual, big-money-driven, major-party politics." Indeed, two-thirds of Vermonters polled said they approved of Jeffords's move, and his approval rating topped President Bush's by almost twenty-five points.
The question of the moment is whether more independents are about to come out of the Senate cloakroom. Conditions for such surprises are favorable and getting more so by the year. Since 1990 we've seen a remarkable proliferation of these free birds. Not only has Vermont's Representative Bernie Sanders become a Congressional institution, independents and third-party candidates have been elected governor in four states--Maine, Alaska, Connecticut and, most spectacularly, in Minnesota. After Ross Perot got nearly 20 million votes in 1992 as an independent, press speculation about the possibility of other maverick candidacies has become a fixture of pre-primary presidential coverage. Recall the fuss over Colin Powell in the fall of 1995 and the hyperventilating over Jesse Ventura, Warren Beatty, Donald Trump et al. in the fall of 1999. There's a market for outside-the-box politics, and demand is rising while supply is tight.
Even with all the barriers imposed by the two-party duopoly--discriminatory access to the ballot, unequal campaign financing, closed debates--public support for Congressional outsiders ticked upward throughout the 1990s. In his indispensable newsletter, Ballot Access News, Richard Winger reports that the vote for non-major party candidates for Congress rose to more than 4 percent of the popular vote in 2000, a level not seen since 1992, when anti-incumbent sentiment last peaked. Before that, you have to go back to 1938, when strong third parties in a few states skewed the total higher, to find such a strong expression of discontent with the duopoly.
Between 1990 and 1998 the proportion of voters registered as independents or third party increased more than 50 percent, while the percentage of registered Democrats and Republicans fell. Voter statements of their political preference--a looser definition than party registration--show the same trend. About 35 percent of the electorate identifies as independent, according to the University of Michigan's National Election Studies. Anecdotal evidence from the implementation of the motor-voter law suggests that a higher proportion of new voters are registering as independents, and the tilt is most pronounced among people under 30.
These are all signs of turbulence in the electorate. The Democratic and Republican parties are not as solid, or dominant, as they seem. Their ties to average voters through local political clubs and chapters have almost disappeared, replaced by manipulative TV ads driven by consultants and expensive market research. Add the weakness of their current leaders--their inability to articulate a clear philosophy or to govern effectively on behalf of anyone but the well-off, their petty feuds, negative attacks and their subservience to special interest campaign contributors--and you can see why there's widespread disenchantment among voters and a yearning for authentically democratic representation and strong, honest leadership. As more politicians see that there is less to be lost and more to be gained from maverick behavior, there will be more eruptions of independents.
For government to represent the interests of average people, public officials have to be liberated from their dependence on private interests to finance their campaigns.
The Senate's passage of McCain-Feingold was
welcome if only as a comeuppance to the Trent Lotts and Mitch
McConnells who had arrogantly defied popular sentiment by keeping the
bill under wraps for six years. There were several factors that made
the time right for McFein--including a strategic calculation by the
parties that they had reached soft-money parity--but paramount among
them was the prevailing climate of popular disgust with the sale of
the government to the highest bidder. For this the interest groups
that helped raise public consciousness with a steady flow of
statistics and gamy anecdotes about the American way of bribery and
extortion deserve great credit. Even George Bush has mumbled that he
would sign a campaign finance reform bill, which doesn't say much for
present legislative efforts but is a tribute to the critical mass
reached by pro-reform sentiment in the country.
that the Senate was even able to debate the bill seemed a freshet of
democracy released by a spring thaw. Once the threat of filibuster
and suppression by the leadership was lifted, a feisty debate bloomed
on the floor. During the colloquy ending in the 60-40 rejection of
one "compromise" that would have repealed a 1907 law banning direct
contributions from corporations, some of the fiercest denunciations
of corporate influence were heard since, well, 1907. Although Paul
Wellstone's amendment to allow states to apply public financing
systems to their own federal office races failed, it drew the support
of thirty-six senators and more than seventy major groups--labor,enviro, black, Latino, religious.
But let's not get carried
away. The bill that finally passed does little to alter a system
pushed to the brink of plutocracy by the obscene power of money (note
Bush's tax cut, incorporated in the budget bill the Senate next took
up, so blatantly weighted toward his wealthy supporters). And it bore
little resemblance to the measure John McCain and Russ Feingold
originally proposed, which promised a ban on unregulated soft money
and "bundling" (whereby givers maximize their influence by pooling
their contributions), limits on spending by candidates and political
action committees and provisions for free TV time.
struggle to win Republican co-sponsors cost the bill all these
reforms save the soft-money ban. But coming off a 2000 campaign that
saw an unregulated $500 million flush through the political process,
the passage of that ban was a meaningful achievement. Not nearly so
meaningful, however, as it would have been in combination with the
original McCain-Feingold reforms, and even less meaningful after a
final round of compromises doubled "hard money" contribution limits
for individuals from $1,000 to $2,000, increased the amount
individuals can donate to candidates and parties during an election
cycle from $25,000 to $37,500 and limited communication between
advocacy groups and campaigns so much that the bill could be read to
restrict legitimate public-interest lobbying.
"poison pills" proved too much to swallow for former McCain-Feingold
backers at Public Campaign, the US Public Interest Research Group and
the Alliance for Justice. Representative Jesse Jackson Jr.
complained, "When you talk to people I represent about campaign
finance reform, the first thing that comes to mind is not doubling
the amount wealthy donors can give to campaigns."
and others can raise questions about the compromises that warped the
Senate bill when the House finally debates its version of McFein, but
they'll have a hard time making themselves heard in a body under the
iron thumb of Tom DeLay, poster boy for everything that's corrupt
about the current system. Also, Democratic leaders are having qualms,
fearing that the GOP advantage in hard-money raising may kill their
chances of financing a winning take-back-the-House-drive in '02. Even
if a bill passes, it could be defanged in conference committee,
giving Bush the innocuous bill he really wants to sign. And beyond
that stretch inevitable court challenges.
keep the heat on Congress with a new focus on the hard money system
that constitutes the vast bulk of all campaign dollars. They should
also understand that the real action will continue to be in the
states, where "clean money" bills, which contain the true and only
solution--full public financing of campaigns--are proliferating. Such
laws have already been adopted by Arizona, Maine, Massachusetts
(though statehouse Dems are shamefully trying to eviscerate the law)
and Vermont, and drives to pass them are now under way in
Connecticut, Minnesota, North Carolina and Wisconsin--and
municipalities like Austin, Texas. Americans are well aware that
their system is sick, and the Senate debate over McCain-Feingold has
left them more open than ever to the heroic remedies needed to cure
US Senator Russ Feingold, the Wisconsin Democratic side of the McCain-Feingold juggernaut that is on the verge of winning Senate approval of the most significant campaign finance reform initiative