Money Talks

Both major parties are disingenuous about campaign finance reform.

Wed Nov. 19, 2003 3:00 AM EST

 George Soros's announcement last week that he was donating $15 million to various political groups aligned with the Democrats went down well, naturally enough, with liberals. But coming as it did days after Howard Dean announced was opting out of federal campaign funding in order to be competitive with Bush, it added to the impression that Democrats, however much they might whine about the broken campaign finance system, are prepared to take a pragmatic, if-you-can't-beat-'em-join-'em approach to fundraising --  much to the delight of Republicans, who, understandably, are crying hypocrisy.

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The electoral calculus confronting Democrats is stark: the Democratic presidential nominee, whoever he is, will go up against the best money-raiser in the business, George Bush, and the president is likely to have hustled a record-busting $200 million by election time. Under the current system, money talks: and unless the Dean or Clark or Kerry can rake in the contributions in comparable amounts, Bush's money edge, other things being equal, will be decisive.

Soros, previously a generous backer of groups working for campaign finance reform, thinks America under Bush is a "danger to the world," and he calls the 2004 presidential race “a matter of life and death.” He said he is committed to contributing more money if necessary: "I’m willing to put my money where my mouth is.” Soros even half-jokingly said he was willing to spend his entire wealth, estimated at $7 billion, if someone could guarantee Bush's defeat.  Meanwhile, his friend Peter Lewis, the chairman of the Progressive Corp., has also pledged to give $10 million to the America Coming Together (ACT), a new group dedicated to driving Bush out of the White House.

All of which has Terry McAuliffe & Co. rubbing their hands.  But Soros' and Lewis' donations are not exactly a cause for celebration. The GOP, rightly, criticizes the Soros contribution as complicating efforts for real campaign finance reform, and point out that the gift contradicts Soros's own stated position on campaign finance.

Here's the AP on the Republicans' reaction:

"Republican Party Chairman Ed Gillespie on Monday challenged campaign finance watchdog groups to speak out about billionaire George Soros and other independent efforts to defeat President Bush and urged the organizations to disclose how much the moneyed donors have given them.

…The chairman called on groups such as Common Cause, Democracy 21, the Alliance for Better Campaigns and Public Campaign to criticize the unregulated, third-party efforts by Soros, who said he is committed to spending $15 million, and Peter Lewis, who has earmarked $12 million, to defeat Bush. Gillespie sent a letter to the four groups asking them how much Soros has donated to their organizations in his support of campaign finance reform.The GOP chairman argued that Democrats plan to direct big donors to the groups to avoid campaign finance laws and use millions in unregulated soft money against Bush.'Where are the referees? They swallowed their whistles,' Gillespie said. 'They passed laws to prevent this kind of thing.'"

Fred Wertheimer of Democracy 21, one of the watchdog groups that Gillespie attacked, acknowledged that “there’s some irony, given the supporting role [Soros] played in helping to end the soft money system." He added: "We are concerned about George Soros's large contributions to affect the 2004 campaign, as we are also concerned about President Bush's decision to swamp the country with $200 million in spending for his uncontested presidential primary race."

Republicans see an opportunity here. The Washington D.C. newspaper, The Hill, says Republicans are scared that left-leaning advocacy groups will raise substantial amounts in unregulated contributions:

"While Republican National Committee Chairman Ed Gillespie questioned the legality of pledges from wealthy donors like George Soros and Peter Lewis who advocate the defeat of President Bush, Republican groups will use those high numbers to galvanize their own soft money base."

Republicans are not the only ones guilty of bad faith here. Democrats are currently focusing their fire on House Majority Leader Tom DeLay, whom they accuse of side-stepping campaign finance laws by funneling charitable contributions to the Republican Party. Democrats are also making noise about the practice of 'bundling' - which is splitting up (illegal) large contributions into (legal) individual contributions of $2,000.

While both parties have valuable points to make, it seems they are more interested in exposing the other sides' loopholes than in enacting a genuine reform of the way American politics is financed.

Democrats are facing a real political and moral predicament. Traditionally, they have been (at least rhetorically) opposed to money's influence on politics. Now, Howard Dean became the first Democrat to decline taxpayer financing, followed by Senator John Kerry. In choosing to do so, they are abandoning almost $19 million in matching funds offered by the program, as well as its $45 million spending limit. True, in order to implement true reform, a Democrat needs to get elected -- and in order to get elected, it looks like Democrats need to play by the current rules.

The American Prospect thinks that Dean's decision to raise his own funds is a step in the right direction:

"For three decades, ever since Richard Nixon's 1972 campaign raised bushels of corporate money and overwhelmed George McGovern, liberal activists and candidates have had two opposite fantasies about how to level the financial playing field. The first was to get big money out of politics. The second was to mobilize small money in a big way.

…Now […] for the first time, a major candidate has realized the second fantasy -- of small money beating big money. More precisely, Howard Dean became the leading Democratic candidate by using the Internet to mobilize thousands of enthusiasts who in turn become small donors (average third-quarter Dean donation: $73.69).

…Public financing […] had two rationales. First, it was intended to release candidates from dependence on self-interested, large contributors and, second, to enable underdogs to win or lose on the merits of their message, not on the thickness of their wallets. A candidate underwritten by legions of small donors is even better able to compete than one funded by public money, because a citizen mobilized to write a small check is, first, a citizen mobilized to be an activist."

Others take a more bleak view and see Dean's move as a way of exposing the failures of the current system.

Cybercast News Service thinks it's a good thing that Dean is '"off the dole":

Predictably, the flinty doctor blamed President Bush for his decision. 'The unabashed actions of [Bush] to thwart our democratic process with a flood of special interest money have forced us to abandon a broken system,' Dean huffed. ...

It's good news that Dean, like Bush, is opting out. By proving beyond doubt that the campaign financing system is broken, he may force Congress to admit its reform efforts are a failure."