Oct. 11, 2001
The Feel and Touch of Soft Money
By J. Barlow Herget
RALEIGH - If you have some cash in your pocket, take out a few bills and feel them. Can you tell which ones are what politicians call "soft money?" Probably not, because such money refers to the method by which people make political contributions and has nothing to do with the feel of the currency itself. Soft money is one of those terms thrown around by political insiders, and it is confusing to many of us.
So, what is soft money and who gives it?
Soft money is a contribution that is given to a political party rather than directly to a political candidate. When today’s federal, state and local campaign finance laws were adopted, they limited the amounts of money you can give to candidates.
These laws vary, of course, in the various states regarding state and local races. Federal laws governing U.S. Senate, House and presidential elections limit personal contributions to candidates to $1,000. These contributions are sometimes called "hard money" because they are strictly limited and disclosed.
In North Carolina, if you contribute to candidates for city council or the legislature your contribution is limited to $4,000 per election. That means you can give your cousin whose running for mayor or the state House a $4,000 check in the primary and another $4,000 in the general election. Businesses and corporations cannot make such contributions directly, but their Political Action Committees (PACs) can.
But we all read about wealthy contributors and special interests that give tens of thousands of dollars to candidates. Presidential campaigns often have designations for these big donors such as the "$100,000 Club." In President Bill Clinton’s 1992 campaign, such donors received gold saxophone lapel pins.
There are other rewards such as easy access to the candidate or access to key members of the victor’s administration. Vice President Dick Cheney held a posh party at the Vice President1s Mansion earlier this year for these contributors.
How, then, can people legally give such large sums?
They use a loophole in the campaign finance laws. While the government carefully limited donations that go directly to candidates, it made no such limits on contributions to political parties. Like the road to Hell, the intent of this law was good‹it intended the money to pay for voter education, get-out-the-vote campaigns and other "party building" efforts.
Cynics contend the politicians who wrote the law knew what they were doing all along because in practice there is little distinction between money given to the party and that given to the candidate. In presidential races, for instance, the nominee is also the de facto leader of his or her political party. The nominee can direct the party to pay for campaign expenses such as campaign ads that are hardly distinguishable from advertising for the candidate.
The political parties have become adept at using soft money in other elections, too. If you want to give $1 million to one of the nominees in next year’s U.S. Senate race, you can give the money to the candidate1s national party with instructions that the money should be directed to that election here in North Carolina. You probably shouldn1t put your request in writing.
Similarly, the parties also can spend their "soft money" in certain targeted races. That is what happened in the North Carolina 2000 Election for governor when soft money from Washington flowed into the state to help Republican Richard Vinroot.
Even in the non-partisan election for Raleigh’s mayor this year, Republican solicitations for soft money became an issue. The practice is one used by both parties, and North Carolinians can expect to see millions of soft money dollars for both the Democratic and Republican nominees in the 2002 U. S. Senate campaign.
There is serious legislation in Congress to limit soft money contributions (this is the McCain-Feingold bill), but it has been stalled if not killed for this term. The nation’s attention is elsewhere now and rightly so. The democracy that our soldiers are defending overseas, however, increasingly is purchased by the candidates with the most money. In the 2000 state legislative races, the candidates who spent the most money in their respective elections won 87 percent of the time!
(Relatively small numbers of us can afford to or choose to contribute to political candidates. And very, very few people give large contributions. Less than one half of one percent of political contributors gave more than $1,000 in the 2000 federal elections for Congress and the presidency, according to a study by the non-profit Washington group, Public Campaign. The same study showed that 70 percent of the money came from people who gave more than $200.)
Soft money is a corruption of earlier campaign finance reforms. It is clear that until such money is better regulated, democracy in America will carry a "For Sale" sign.
J. Barlow Herget is a businessman and former member of the Raleigh City Council.
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