Senate Endorses Higher Election Donation Caps

The Senate voted overwhelmingly Wednesday to raise federal campaign contribution limits for the first time in more than 25 years, a key bipartisan accord that significantly improves the prospects for a sweeping overhaul of the political finance system.

Under an amendment to the reform bill sponsored by Sens. John McCain (R-Ariz.) and Russell D. Feingold (D-Wis.), the limit on individual donations to federal candidates would be doubled to $2,000 per election from $1,000.

Also, individuals would be able to give as much as $37,500 total to candidates and parties each year--a 50% increase from the current limit of $25,000.

Both limits have been unchanged since 1974.

The amendment, approved on an 84-16 vote, was a compromise worked out between Sens. Dianne Feinstein (D-Calif.) and Fred Thompson (R-Tenn.), authors of competing proposals.

With the amendment, the essential trade-off in the McCain-Feingold bill clearly emerged. The measure’s core proposal would ban the unlimited donations to political parties, known as soft money, that have skyrocketed in recent years. But it would ease the limits on individual donations to presidential and congressional candidates, known as hard money. Some of the hard-money donations also flow to candidates through the parties.

Proponents say such an overhaul would make the political system more accountable and reduce the appearance of a corrupting influence by big donors.

After more than a week of unpredictable debate on campaign finance, some Senate Republicans who have opposed the McCain-Feingold bill now concede it is likely to win Senate approval.

“I’d probably bet it’s going to pass by a very close margin,” said Sen. Craig Thomas (R-Wyo.).

Added Sen. Kay Bailey Hutchison (R-Texas), a member of the GOP leadership: “I think the bill’s going to pass.”

Asked whether President Bush would sign the final product if a bill clears Congress, she said: “Every indication I get is yes.”

Bush, who has staked out positions on campaign reform that vary in important ways from the bill’s approach, waved off a question on the issue Wednesday at the White House. “There will be ample time to talk about bills in progress,” he said.

But the president is on record as favoring an increase in the hard-money contribution limits, so Wednesday’s action could give him incentive to support the bill.

A final Senate vote on the measure could come as soon as today or Friday. It then would go to the House, where similar legislation passed in recent years only to be blocked in the Senate.

Key threats to the bill still loom. Among them is a proposal by opponents that would ensure the entire legislation is nullified if courts find parts of it unconstitutional.

Constitutional Issues Loom

This proposal, known as “nonseverability,” is crucial because some provisions that have been added to the bill are considered vulnerable to challenge under the 1st Amendment’s guarantee of freedom of speech.

These measures seek to regulate political activity by special interest groups, such as the Sierra Club or the National Rifle Assn.

As the vote on the overall bill nears, the key political question appears to be whether some Democrats who have professed support for reform will stray from the bill to jeopardize its passage.

The reform coalition until now has relied on virtually unanimous support from Democrats and the backing of some centrist Republicans.

Wednesday’s vote to raise hard-money contribution limits drew criticism from some Democrats, who complained that the amendment would merely reroute, rather than restrict, the flood of money into the political system.

“Putting more big money into politics is not reform,” said Sen. Paul Wellstone (D-Minn.). “It’s deform.”

All 16 senators who voted against the amendment are Democrats. These opponents included Sen. Barbara Boxer of California.

But several leading Democrats agreed to the amendment after the negotiations between Thompson, who wanted larger increases in the hard-money limits, Feinstein and others. Democrats have been reluctant to raise the limits because Republicans have held a substantial edge in hard-money contributions. That was a major reason why all of the Senate’s 50 Republicans voted for the amendment.

Its key Democratic supporters included Minority Leader Tom Daschle of South Dakota. He said that, with the agreement on the amendment, the reform coalition had passed a critical test, “and we are now within reach of a bill that can pass the Senate.”

Feinstein and Thompson bargained in private for several hours with other prominent senators before reaching their accord.

A key issue was the limit on total annual donations--an issue affecting a rarefied circle of donors. According to the Center for Responsive Politics, 792 donors gave the legal maximum of $25,000 in hard money in 2000, with their largess split nearly evenly between Democrats and Republicans.

As Wednesday’s talks progressed, senators seemed eager to seize a rare chance to reshape the system.

“It is likely we won’t address this issue for another 20 or 30 or 40 years,” Feinstein told the Senate. “Therefore this is a bill that has to stand the test of time.”

At the heart of the campaign reform debate that has consumed the Senate for more than a week are questions about the rules for, and the roles of, hard and soft money.

While the distinction between the two forms of political currency may be lost on the public, it is vital in U.S. politics.

Under federal law, only hard money--subject to limits--may be spent to advocate the election or defeat of a candidate. Soft money--unlimited--is supposed to be spent on general party activities such as voter registration and turnout. But increasingly, soft money has been used to promote issues that favor or attack candidates. Critics say the line between these “issue” advertisements and other campaign ads is becoming increasingly blurred.

The two major parties raised nearly $500 million in 1999 and 2000 in soft money, much of it in six-figure sums that would be unlawful if given directly to candidates. If recent trends hold, the next presidential election could draw as much as $1 billion in soft-money donations.

Many advocates of reform--but not all--say that a principal cause of the abuse of soft money is the failure of hard-money limits to keep pace with inflation and the rising costs of modern campaigns.

‘A Step in the Right Direction’

Opponents of a soft-money ban also favor increasing the hard-money limits.

Sen. Mitch McConnell (R-Ky.) has complained repeatedly during the debate that when the 1974 limits were established a Ford Mustang could be bought for $2,700. McConnell, the leading critic of McCain-Feingold, called the amendment “at least a step in the right direction.”

Under the Thompson-Feinstein compromise, candidates would be allowed to collect $2,000 per individual donor for each primary election and another $2,000 for each general election.

National parties would be allowed to collect $25,000 per year in hard money from individual donors, up from the current $20,000. And the total limit on individual donations to candidates and parties would be raised to $37,500 per year--or $75,000 for a two-year cycle.

Limits on contributions that parties can make to Senate candidates would also be doubled--to $35,000 per election.

These new limits would be tied to the rate of inflation--a step meant to reduce the chances of a future imbalance in the system.