Finance Reform Down to the Wire

A resurgent coalition of Democrats and renegade Republicans, energized by the Enron scandal, is making a final push this week for House passage of the broadest overhaul of the nation’s campaign laws in a quarter century. House Republican leaders are mounting a furious defense of the status quo.

Coalition members hope public outrage over Enron’s enormous political contributions will put an end to what they call the corrosive influence of big money on politics. Opponents argue that the reform agenda is an unconstitutional violation of free speech--and that it would benefit Democratic candidates.

At issue is the House version of a bill the Senate approved last April. If the House passes a similar bill and the Senate votes to accept the House changes, the measure would go to President Bush for his signature.

The White House has said publicly that congressional Republicans cannot count on Bush for a veto, even though the House bill, which is scheduled for debate Tuesday and Wednesday, violates some of his principles for campaign finance reform.

Bush has said that a ban on unlimited giving should apply to corporations and unions but not individuals (the House bill includes all three) and that unions should have to get the consent of their members before making political contributions (the House bill has no such feature).

Stripped to its essence, the question before the House is whether to eliminate unlimited contributions and impose a $95,000 ceiling on what any person may give in any two-year national election cycle.

When Congress capped individual campaign giving in 1974 after the Watergate scandal, big political donors found a loophole: The law didn’t limit contributions to the political parties for so-called party-building activities. These contributions, which have seeped into recent campaigns through the proliferation of party-sponsored TV advertising, have become known as soft money.

In the last election cycle, the two major parties hauled in nearly $500 million in unlimited, loosely regulated soft money. The scandal-ridden Enron Corp. gave $1.7 million of it--and now some of its recipients are ducking for the political cover of campaign finance reform.

No one knows what the political landscape would look like without soft money. Would reform favor one party over the other? Hard to say. Would it be easier for challengers to unseat incumbents? Also unclear. Would it reduce the influence of big donors? Probably, to a degree.

“It wouldn’t solve all the problems,” said Paul S. Herrnson, a campaign finance expert at the University of Maryland. “It wouldn’t get rid of money in politics. But these reforms, if passed, will prohibit groups from giving the largest sums in concentrated form.”

House Minority Leader Richard A. Gephardt (D-Mo.), a leading reform advocate, said many incumbents simply fear tinkering with rules that helped elect them to Congress.

“They know this system; they don’t know what would be the new system,” Gephardt told reporters. “And I think the fear of change of a new system scares a lot of people.”

Legislation to ban soft money, impose an updated system of contribution limits and regulate certain forms of political advertising passed the Senate in April in a 59-41 vote. That vote was in part a coda to the 2000 presidential campaign of pro-reform Sen. John McCain (R-Ariz.). It was a major breakthrough after years in which Senate filibusters prevented action.

Heading into this week’s House showdown, the bill’s advocates hold a critical edge that they lacked before the Senate debate: They are defending a proven bipartisan majority. In 1999, the House voted 252 to 177 to ban soft money. Of those on the winning side, 226 are still in the House, eight more than a majority.

Key to the outcome this time are 43 Republicans from that group. Many, such as Rep. Stephen Horn of Long Beach, have reaffirmed that stance. Horn was the only California Republican to sign a rank-and-file petition that has forced the House GOP leaders to hold a vote.

But some Republicans are having second thoughts as party leaders, led by Speaker J. Dennis Hastert (R-Ill.), warn that campaign finance reform could cost them control of the House. Republicans are defending a narrow 222-211 majority in this year’s elections.

“No member of Congress on either side of the aisle likes to turn his or her back on the leadership when they say it’s vital,” said Rep. John M. McHugh (R-N.Y.), one swing vote.

Two Californians on the fence are Reps. Doug Ose (R-Sacramento) and Elton Gallegly (R-Simi Valley). Both voted in 1999 for a soft money ban, and both were co-sponsors last year of the version of McCain’s bill that was introduced in the House by Reps. Christopher Shays (R-Conn.) and Martin T. Meehan (D-Mass.).

Gallegly spokesman Tom Pfeifer said late last week that the congressman could not say how he would vote until he saw the final bill. Ose said the bill already had changed so much that “if it were just straight up or down right now, I’m not sure I could support it.”

Any member of Congress who switches position on campaign finance reform during an election year could be on treacherous ground. Public scrutiny of the donations made by Enron, major accounting firms and other groups could prove harmful to the political health of the recipients.

Mindful of the perils, Ose said: “I agree that soft money is distorting this process. The question is how to go about getting it out of the system.”

Republicans are not the only potential swing votes. There are 182 Democrats and one independent who voted in 1999 for the soft money ban, but some could stray this time for various reasons. In addition, 49 House newcomers have never voted on the matter.

While the top two Democrats are working to pass the legislation, Rep. Martin Frost of Texas, the No. 3 House Democrat, is undecided.

A splinter group of as many as seven members of the Congressional Black Caucus, most of whom voted for a soft money ban previously, could join with Republicans in an effort to help kill the legislation. Those black lawmakers say they are worried that wiping out a key funding source could hamper voter turnout programs.

In the debate starting Tuesday, lawmakers will be able to vote on up to 20 amendments and as many as three different bills, including two offered by Republican leaders opposed to the soft money ban.

Shays and Meehan will seek to ward off amendments that would jeopardize final passage, in a vote scheduled for Wednesday, or force the legislation into a House-Senate conference, where it could be killed.

Battles could erupt over whether to postpone the bill’s effective date until after the 2002 elections (the Senate-approved ban would go into effect 30 days after enactment), whether to force courts to consider the bill as a whole or piecemeal in any legal challenge (the bill allows piecemeal review) and whether to clamp down on the high cost of television broadcasting (the bill proposes TV cost regulations).

On Sunday, in a preview of the debate, Meehan predicted that the Enron hearings would reinforce the anti-soft money message. On NBC’s “Meet the Press,” Meehan denounced Enron executives for having “basically bought all kinds of unfettered influence on every level of government.”

But Rep. Roy Blunt (R-Mo.), a Republican leader, attacked Meehan’s legislation as a sham reform that would only allow media companies “to decide what they thought was important about a campaign.” The vote, Blunt said, “is going to be very tight. . . . It’s reality-check time for members of Congress who believe in party-building activities.”

Blunt suggested the Republican strategy might be to force the bill into a potentially fatal visit to a House-Senate conference committee, possibly by making it even tougher than the Senate bill. “The president can be involved more in a conference bill than he can with bills on the floor,” Blunt said.

Reform advocates are hoping the Senate-approved bill will survive the House with revisions so minor that the Senate would vote on them directly, avoiding a conference committee.

By now, most lawmakers have heard all the arguments. Some fervently believe it would be an unconstitutional infringement on free speech and political participation. Others argue with equal conviction that the chase for big-money donations taints the whole federal government, whether the controversy is last year’s presidential pardons or this year’s Enron hearings.

Interest groups are nonetheless drumming up pressure on both sides. For the reforms, groups such as Common Cause, the League of Women Voters and AARP argue that soft money prevents congressional action on such issues as giving senior citizens affordable prescription drug coverage.

Against them are the National Rifle Assn., the National Right to Life Committee and the U.S. Chamber of Commerce, which say the reforms--especially proposed regulations on political advertising in preelection periods--are an attempt by incumbents to squelch legitimate expression by outsiders. They warn that even if legislation gets through Congress, it would be subject to challenge as an unconstitutional infringement of free speech.

“Should this bill pass the House and be signed by the president,” said Bill Miller, a Chamber of Commerce vice president, “our lawyers would be sprinting down Pennsylvania Avenue toward the courthouse.”

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Campaign Finance Reform

The campaign finance reform legislation proposed by Reps. Christopher Shays (R-Conn.) and Martin T. Meehan (D-Mass.) would:

* Ban “soft money”--unlimited contributions to the national political parties.

* Limit individual donors to overall contributions of $95,000 to national political parties and candidates for president and Congress during a two-year election cycle. No more than $57,500 of that could be given to party organizations, and $37,500 to candidates.

* Raise the amount that individuals can give to any one candidate from $1,000 to $2,000 in presidential and Senate races. Today’s $1,000 limit for House candidates would remain in place. The caps would be indexed to inflation.

* Leave intact separate contribution limits for political action committees run by unions, corporations and interest groups.

* Ban the use of corporate and union treasury money for broadcast advertisements that refer to a federal candidate and target the candidate’s electorate within 60 days of a general election or 30 days of a primary. Certain other groups that fund such advertising also would be subject to new regulations.

* Within 60 days of a general election and 45 days of a primary, require broadcast television, cable and satellite providers to charge candidates and national parties the lowest amount they have charged any other advertiser during the preceding 180 days.