Doing Well by Pretending to Do Good

By threatening reform, Congress is reaping unparalleled booty from lobbyists.

A year ago, Bill Clinton brought an ambitious agenda for change to Washington. He wanted to revamp the health-care system, pass the North American Free Trade Agreement, push through a budget that could begin controlling the nation's deficit, and pass campaign-finance reform.

But did he start with the most important issue? During the presidential primaries, former California Governor Jerry Brown's main issue was campaign-finance reform. Brown repeatedly warned that until special-interest money is removed from the campaign system, all other efforts to reform government will be futile.

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Brown was right. Clinton should have started his presidency by insisting that Congress pass genuine campaign-finance reform, effective immediately upon passage, forbidding Congress one final squeeze of the special-interest grapes. Then, without their ears plugged by money from industry lobbyists and political action committees, Congress could have given the president's other initiatives a fair and objective hearing.

Unfortunately, campaign-finance reform was not among Clinton's early battles. The reason, say sources on Capitol Hill, is that the House Democratic leadership, in particular Speaker Thomas Foley, D-Washington, waved the White House off the issue.

"Foley warned the president not to make the same mistake Jimmy Carter made in attacking Congress," a house staffer told us. "And Foley made it pretty clear that attacking the current campaign-financing system, which benefits incumbents, would be viewed as attacking Congress."

Clinton blinked--and in doing so followed in Jimmy Carter's footsteps anyway. Carter had also stalled on campaign-finance reform, and by the time he acted, the American Medical Association's PAC had shoveled enough money to members of Congress (an average of $8,100 each) to defeat his major health-care initiative, the Hospital Cost Containment Act of 1977. Now, seventeen years later, Bill Clinton's extensive health-care reforms have opened the floodgates of special-interest money again. Members of the health-care industry have already dumped more than $14 million into congressional coffers, with most of the spoils going to Democrats. Few of these contributors agree with the president's plans for their industry--a fact that comes stapled to the checks.

By delaying a full-court press on campaign finance, Bill Clinton blew his best chance to begin a cycle of genuine government reform. At this point, with special-interest money pouring in, trying to convince Congress to do the best thing is likely to prove impossible.

"Right now, there's this atmosphere of getting away with whatever they can," said Ellen Miller of the Center for Responsive Politics, a nonpartisan public-interest group that tracks campaign spending. "Members of Congress have become so inured to business as usual that they don't even see the conflict of interest any longer."

REFORM--NOT!

In May, five months after taking office, President Clinton finally sent his campaign-finance reform plan to the Hill. Clinton's plan to limit campaign spending (like others before it) had to skirt the legal limitations imposed in 1976 by Buckley v.. Valeo, in which the Supreme Court ruled that placing mandatory spending limits on a political candidate violated that candidate's First Amendment free-speech rights. It was a bad decision, critics say, that the Court should revisit. Others say it simply underscores the core issue--money talks.

In order to comply with the law, the Clinton plan called for voluntary limits on campaign spending ($1.2 million to $5.5 million in the Senate, depending on the size of the state, and $600,000 in the House) and PAC contributions (20 percent of campaign spending in Senate races, and 33 percent, up to $200,000, in House races). Candidates who complied would be rewarded with federal subsidies such as discounted TV and radio spots, printing, and postage for campaign mailings.

Congress, too, promised reform. But Congress has made such promises before--in 1971, in 1974 after Watergate, in 1976, and again in 1979. Each time they pledged to fix the system, and each time they lied and got away with it. This is a game Congress knows how to play a lot better than Bill Clinton does.

Predictably, neither party embraced the president's proposals. Republicans filibustered, pledging to block any attempt to use public money to finance campaigns or impose spending limits, voluntary or otherwise.

Democrats weren't much help either. Senator Jim Exon, D-Nebraska, did manage to broker a backroom deal with Republicans. But given Exon's dependence on PACs (he spent $2.5 million in his 1990 race, 55 percent of which came from PACs and 20 percent from other large contributors), it's not too surprising that the resulting legislation was hardly reform.

The Senate bill set voluntary ceilings on spending, offered vouchers for discounted broadcast time, and set new limits on soft money. And, in a startling move, the Senate eliminated all PAC contributions, or, if that were deemed unconstitutional, limited them to $1,000 per candidate, per campaign, down from the current $5,000 limit. If a candidate exceeded the "voluntary" spending limits, the excess would be taxed at 34 percent and that money given to his or her challenger.

It looked like a bold stab at reform. But just beneath that veneer lay the ugly truth: the bill could never work, was in fact designed not to work. Senators had included a clause voiding the bill if any part of it was deemed unconstitutional by the courts. And, of course, the bill's tax on excess spending probably violated the law on two levels: by establishing a punitive tax on candidate spending and by imposing a tax on "speech."

The House didn't get to the campaign issue before the summer recess. When representatives returned last fall, Clinton bombarded them with new initiatives, spearheaded by individuals whom even self-important members of Congress could not ignore:

Eli Segal, Clinton's longtime friend, confidant, and campaign chief of staff, was heading the president's National Service Corps initiative;

Vice President Al Gore was put in charge of "reinventing government";

First Lady Hillary Clinton was appointed head-wonk for health-care reform; and

Michael Waldman was made point man for the administration's campaign-finance reform efforts.

Michael who?

"THAT NADER GUY"

Mike Waldman came to the administration from Ralph Nader's public-interest lobby, Public Citizen, where he worked on campaign- and banking-reform issues. Waldman is bright, and he brings important expertise to the issue. But his appointment as point man on campaign-finance reform--when measured against those chosen to push the president's other pet projects--sent a weak message to Congress.

For instance, Waldman's image as a former public-interest "do-gooder" is an obvious liability. If this wasn't clear at first, it became so early in the administration, when a powerful Democratic House leader lashed out at Waldman: "Whose idea was it to bring this Nader guy in here with all this public-financing crap, anyway?"

Waldman and his White House reforms also got a chilly reception from the Congressional Black Caucus, which nearly doubled its size in the 1992 elections. The thirty-eight members of the CBC, who were just beginning to appreciate the charms of the existing campaign-financing system, decided they wanted no part of limitations on free-and-easy PAC money. (For example, the CBC's poker-faced chairman, Kweisi Mfume, D-Maryland, got 52 percent of his money from PACs, and member William Clay, D-Missouri, got 75 percent of his money from PACs.) Caucus members claimed that if PAC contributions were limited, they would not be able to finance their elections because many of them represented poor districts where it was hard to raise money. Among those who have given to the CBC is former junk-bond king Michael Milken, who recently laid $50,000 on the Caucus and gave them a seminar on how to attract still more money.

The Black Caucus handed the House leadership the perfect "liberal" cover to oppose PAC limits. House Democrats, themselves dripping with PAC contributions, could appear virtuous by professing their deep concern over the harm PAC limits would do to women and minority candidates.

In September, Speaker Foley, who got 72 percent of his campaign funding through PACs (and less than 1 percent from individual small contributors), told reporters that if campaign-finance reform were to find support in the House, the White House would virtually have to scrap the PAC limits. Foley suggested that the White House raise the cap from 33 percent to 45 percent--or higher.

"The Democratic leadership in the House has become absolutely convinced that if they can't get unlimited PAC money, they will lose control of the House," a White House source who asked to remain confidential told us. "We've tried and tried to convince them that they're just plain wrong. Even the president has personally told them that voters today are paying attention and voting the issues, that the PAC money is not as important. But they're not buying it."

BLOCKING THE TANKS

After my meetings on the Hill, I phoned Mike Waldman, who sounded downright upbeat. "Campaign-finance reform, yep, that's my baby," he said. "Come on over and we'll talk."

At nine o'clock the next morning, I sat in Waldman's empty office at the Old Executive Office Building, watching visitors come and go from the Oval Office a few hundred feet away. On the wall hung a large framed photo of the lone Chinese student blocking a column of tanks during the Tienanmen Square pro-democracy revolt. I couldn't avoid the notion that the photo was an apt metaphor for the role the White House had given Waldman.

An hour later, Waldman hadn't appeared, so I set off looking for him. I finally found him behind a row of shut office doors, each marked with a hastily scrawled sign reading "NAFTA War Room." But, appointment or not, he was not to be lured out. Even an attempt to do so by identifying myself as "Senor Pizzo" proved fruitless.

So here we were: it was mid-October, the Senate had already passed a phony campaign-finance reform measure, the House leadership was trying to gut the White House plan, and the administration's point man on campaign-finance reform had been sucked into the NAFTA vortex.

Meanwhile, as Waldman was furiously bailing out the administration's floundering pro-NAFTA efforts, organized-labor PACs were subverting his efforts by pouring money into the pockets of anti-NAFTA Democrats in Congress.

WHERE WERE THE PEOPLE'S PACS?

So who's working on campaign reform? "My sense is that no one at the White House is really working on it now," said Pam Gilbert of Public Citizen's Congress Watch. Gilbert used to work with Waldman at Public Citizen, where he opposed NAFTA. His switch to the other side caused some former colleagues to attack Waldman as a turncoat. Gilbert, who still considers herself a friend, struggles with Waldman's new realities.

"Does Mike believe in campaign-finance reform and public financing? Yes, absolutely. Does he believe in NAFTA? Well, I think he believes that this is a better country with Bill Clinton in the White House than George Bush, Jack Kemp, or Bob Dole. And if the president decides NAFTA should pass, I think Mike believes it's his job to make sure the president doesn't fail."

But even the public-interest groups, which constitute the only organized constituency for campaign reform, have all but dealt themselves out of the game. The three main public-interest organizations--Public Citizen, Common Cause, and the Center for Responsive Politics--have gone separate ways.

The Center for Responsive Politics, a nonpartisan group that tracks campaign contributions, maintains that to accept anything less than a 100 percent publicly financed campaign system is a cop-out. Common Cause and Public Citizen take a more moderate position. They were generally supportive of the president's plan, seeing it as a beginning, at least.

But the three groups fell out badly last spring when Common Cause swung its support behind the reform proposed in the Senate bill. The failure of public-interest lobbies to speak with a single voice sent a mixed message to Capitol Hill--and on the Hill, a mixed message is no message at all.

Representative Tim Penny, D-Minnesota, a six-term member who won his last race with more than 74 percent of the vote, announced after the summer recess that he would not seek reelection. Part of the reason, he told Mother Jones, was that the House leadership fixes the game.

"Take campaign-finance reform, for example," he said. "What kind of people does the leadership put in charge of formulating these reforms? People like Sam Gejdenson [D-Connecticut]. He had to spend nearly a million dollars to get reelected in 1992, and even then he got just 51 percent of the vote. But he professes to be for PAC and spending limits that, had they been in place during his last campaign, would have caused him to lose. You really have to wonder how much of this is just lip service."

A MISSED OPPORTUNITY

The president could have chosen to frame campaign-finance reform in the same way he did the military's gay ban, the family-leave policy, the gag rule, and the right to universal health care--as a moral, not a political, matter. Had the president told Americans in January 1993--fresh from his own campaign--that America's campaign-financing system has become little more than a system of legalized bribery that has made a mockery of the "one person, one vote" cornerstone of our democracy, he could have demanded that Congress move immediately to cleanse the system once and for all. He could have pointed to the "Keating Five" as just one example of how special-interest money makes fundamentally good people do bad things.

He could have, but he didn't. And that failure will haunt the rest of his presidency.

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