Mar. 4, 2002
Campaign Finance Reform: What Will It Do?
By J. Barlow Herget
RALEIGH – The other day I watched a video of North Carolina businessman Miles Wright speaking at a recent press conference here. He was talking about his experience with the state legislature following Hurricane Floyd. Wright owns a printing business and he was concerned about small businesses in eastern North Carolina and the government's response to their plight.
"Folks were interested, but we could get no real access. There were no return phone calls, our ideas and proposals seemed to go nowhere," he recalled. "I could have written some big checks, but most of the folks in eastern North Carolina could not. I also found it ethically distasteful to write big checks. I didn’t want to buy my access."
Wright’s rub with political reality is one reason why he and a great many others favor the new campaign finance legislation moving through Congress and consider it "a start."
What will the new reforms actually do?
First, I should tell you that the legislation is not yet law. The House last month adopted the Shays-Meehan bill, which is very similar to the McCain-Feingold bill that was approved earlier in the Senate.
Pending final Senate approval, the bill then goes to President Bush for his signature, and he campaigned against it. Many of his more conservative supporters are encouraging him to veto any bill, but Bush reputedly has had a change of heart in the wake of the Enron Scandal and his desire to distance himself from former Enron Chairman Kenneth "Kenny Boy" Lay.
So, to quote the New York Yankee political philosopher Yogi Berra, "It ain’t over ‘til it’s over." If and when it is over, the law will affect campaign financing in a big way.
The primary reform is to prohibit the collection and spending of "soft money" by national political parties in federal campaigns for Congress and the presidency. Again, you ask, what is "soft money?"
It is a contribution that goes to your candidate’s political party with softly worded instructions that the money be spent on the candidate’s campaign. (The money is supposed to be spent on "party building" activities.) When you write a check directly to your favorite U.S. Senate candidate, it is considered "hard money." You are limited to $1,000 in "hard money" contributions or money that is given directly to the candidate in each election.
As campaigns have grown more expensive, individuals and special interest groups have used the "soft money" to pour millions of dollars into politics. Enron’s Lay, for example, gave hundreds of thousands of dollars to Bush’s campaign as well as others--Republican and Democrat alike this way. The new law plugs this loophole.
To balance the loss of this source of funds, the law raises the limit on hard money contributions to $2,000 per election, e.g. primary, general and runoff. The amounts will rise with the inflation index. These amounts still are small fortunes for most of us, but they are big constraints on the "Kenny Boys" of politics.
The law also opens up the secrecy surrounding contributions of sham "issue advocate" groups that come and go with elections -- that is, they are more concerned with candidates than they are with issues.
Remember that Texas outfit in the 2000 Election called Republicans for Clean Air? It turned out to be two wealthy Texas brothers, Sam and Charles Wyly, who supported then Governor Bush against his primary opponent, Sen. John McCain. The Wylys spent about $2.5 million in the New York, Ohio and California primaries on television ads attacking McCain’s environmental record. North Carolina has had similar groups, such as Farmers for Fairness, that targeted and defeated state legislator Rep. Cindy Watson, R-Duplin, in 1998.
These front organizations will have to disclose contributions and expenditures just as candidates do. They and other special interests will be prohibited from broadcasting campaign ads that mention candidates by name within 60 days of the general election and 30 days of a primary.
North Carolina’s own Rep. David Price attached his "Stand By Your Ad" provision to the legislation.
It requires a candidate to appear in an attack ad and tell people he’s the culprit who paid for it. (North Carolina already has its own version of this legislation and some argue it had an impact in the tone and impact of attacks ads in the 2000 gubernatorial election.)
There are other changes. The law permits limits "soft money" contributions to $10,000 per year to state parties. The money can be spent on voter registration and get-out-the-vote activities that do not mention any federal candidate.
There are many objections to the law. It is unconstitutional, some argue, because it limits free speech. It diminishes the already diminished role of political parties in elections, others warn, while transferring more political clout to issue advocate groups.
But Miles Wright speaks for many Americans when he responds, "The price of running for office is escalating every day. How bad does it have to get? We must put democracy back in the hands of citizens. We must change the rules."
Barlow Herget is a writer, businessman and former member of the Raleigh City Council.
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