Campaign Reform Bill Passes Congress; Bush Says He’ll Sign

The Senate approved a landmark change in federal campaign law on Wednesday, sending President Bush a bill to check the rising flow of huge donations into U.S. politics.

In a statement released after the vote, Bush said he will sign the bill, although he considers it “flawed in some areas.”

With Bush’s signature, the bill would curtail a source of funding that pumped roughly half a billion dollars into national politics in the last presidential campaign. Party professionals already are retooling to search aggressively for smaller donations to make up for that loss--meaning American voters can expect more aggressive requests for their money from politicians.

Wednesday’s developments culminated a seven-year quest by reform advocates in Congress to put some distance between politicians and big-money donors. The bill’s advocates say this is needed to boost public confidence in government. Vanquished opponents said the measure will only weaken political parties and trample on constitutionally protected free speech.

The Senate’s 60-40 vote for the bill followed its passage last month in the House. The measure will produce the biggest shake-up in political fund-raising since the post-Watergate reforms of the 1970s.

Most significant, it would prohibit the national political parties from raising or spending the unlimited, loosely regulated donations known as soft money.

These donations, a fund-raising innovation of the late 1980s that grew strikingly in the 1990s, often amount to $100,000 or more. The givers are corporations, labor unions and wealthy individuals, many with business before government. The money often helps the parties promote or attack candidates in television ads.

The bill is expected to force politicians to rely less on this narrow band of donors and instead cultivate a broader base of contributions from people able to give up to $2,000 at a time.

“We all recognized one very simple truth--that campaign contributions from a single source that run to the hundreds of thousands or millions of dollars are not healthy for democracy,” said Sen. John McCain (R-Ariz.), the bill’s best-known sponsor. “Is that not self-evident? It is to the American people.”

For the average American, the consequence of cracking down on big donations will be that middle- to high-income voters should expect far more mail or telephone calls seeking political donations. And parties will encourage their wealthiest donors to ask peers to contribute.

McCain, who first teamed with Sen. Russell D. Feingold (D-Wis.) to push for campaign finance reform in 1995, generated momentum for the effort in his 2000 presidential campaign.

Now the bill’s fate rests with the man who defeated McCain that year in the GOP primaries.

Bush, in his statement, said: “The reforms passed today, while flawed in some areas, still improve the current system overall, and I will sign them into law.”

He did not specify his objections to the measure, but, echoing criticism by its foes, he said: “It does present some legitimate constitutional questions.”

Expecting Some Provisions to Die

One reason the president plans to sign the bill is that he anticipates some of its provisions will be found unconstitutional, said a Republican who has spoken to Bush about the issue.

Bush praised parts of the measure, such as its increase in the maximum amount of individual contributions to candidates. The limits on these donations have not been raised since 1974.

But the measure differs in several ways from the reform principles Bush detailed as a candidate. Bush, for instance, favors banning soft money donations by unions and corporations, but not by individuals.

The bill also omits his proposal to require labor unions to obtain permission from members before spending their dues on politics.

Wednesday’s Senate debate reprised arguments aired with more gusto and tension last year when the Senate spent a rollicking two weeks on the issue. Back then, opponents fought with everything they had. This time, they readily conceded that they lacked the votes to amend the bill or sustain a filibuster to block it.

Instead, the opponents concentrated on sharpening their arguments for the legal challenges expected to begin as soon as the bill becomes law.

Sen. Mitch McConnell (R-Ky.), who intends to become the lead plaintiff in the case, cited in his criticism “the ultimate campaign reform--the 1st Amendment to the Constitution.”

He said the bill would muzzle political parties, shifting power from them to special interests. For instance, he said the bill would still allow unions, corporations and interest groups--such as the Sierra Club or the National Rifle Assn.--to spend soft money at will during much of the year on political ads.

He also charged that some of these ads would be sponsored by “front groups” that would be hard to trace back to their original source.

The bill takes some steps to limit the political activities of unions, corporations and interest groups. For instance, they would be prohibited from using their money to pay for television or radio advertising that targets a federal candidate one month before a primary election and two months before a general election.

McConnell also said that much of the push for the bill came not from the public but from major newspapers.

“Today is not a moment of great courage for the legislative branch,” McConnell said. “We have allowed a few powerful editorial pages to prod us into infringing the 1st Amendment rights of everyone but them.”

Sen. Phil Gramm (R-Texas), another fervent opponent, waved a pocket copy of the Constitution as he declared: “This bill is a movement back to the smoke-filled room. This concentrates power in fewer and fewer and fewer hands. This is profoundly anti-democratic.”

Proponents countered that Congress was rescuing public officials from a never-ending stream of questions about how big donors seek access and favors in Washington. Their latest example: the now-bankrupt Enron Corp.

The energy company and its executives gave $3.5 million in soft money over the last decade.

In all, Republicans and Democrats collected $495 million in soft money during the 1999-2000 election cycle--more than five times the $86 million collected in 1991-92.

And in 2001, soft money accounted for nearly half the donations collected by the two parties.

“It doesn’t look good,” said Sen. Fred Thompson (R-Tenn.), a proponent. “The average Joe on the street believes that with that much money being paid by that few people, that they’re expecting something for it.”

The backers acknowledged that the bill represented just a fraction of what many reformers have long demanded. It proposes no new limits on what political campaigns can spend, no limits on what television stations can charge for political advertising and no public financing of campaigns. And the bill takes several steps to ease the limits on donations.

“No one should have any illusion that if we pass this legislation we get the big money out of politics,” said Sen. Paul D. Wellstone (D-Minn.), a backer of the bill. “This legislation is the first step, not the last.”

A basic compromise lies at the heart of the bill: While taking soft money donations away from the national parties, effective after this year’s congressional elections, it would raise the limits on the contributions known as hard money.

Since 1974, hard money contributions from individual donors have been limited to $1,000 per candidate per election and a total of $50,000 over two years.

The bill would raise those limits to $2,000 and $95,000, respectively, and allow those amounts to increase over time with inflation.

As a result, while soft money to national parties would be banned, a politically active married couple could still give $190,000 in an election cycle to parties and candidates.

Many analysts say provisions of the bill that affect soft and hard money appear likely to withstand legal challenges because the Supreme Court has repeatedly upheld the constitutionality of campaign contribution limits. Also, direct contributions to federal candidates by corporations and unions have long been illegal.

More vulnerable are the provisions imposing the regulations on political advertising by corporations, labor unions and interest groups. The bill’s proponents say these “issue ads” amount to another soft money loophole that should be regulated.

But many of the affected groups say they are simply exercising free speech protected under the Constitution. The issue-ad restrictions in the bill have been roundly criticized by groups spanning the ideological spectrum, from the American Civil Liberties Union to the American Conservative Union. A letter conservative activists sent to Bush on Wednesday urged the president to “do everyone a favor by vetoing” the bill.

Others hailed the congressional action. “Americans have won an historic victory to help bring our government back to the people,” said Scott Harshbarger, president of Common Cause, a group that has long backed the campaign finance legislation.

The House approved the bill, 240 to 189, on Feb. 14. It passed with support from a solid bloc of Democrats and a maverick group of Republicans. In Wednesday’s Senate vote, 11 Republican senators joined 48 Democrats and one independent to approve the bill. Only two Democrats opposed the bill: Sens. John B. Breaux of Louisiana and Ben Nelson of Nebraska.

Earlier Wednesday, in a critical vote to force final action, the bill’s proponents logged an even bigger victory margin. By 68 to 32, the Senate swatted down any lingering threat of a filibuster.

Times staff writer Ronald Brownstein contributed to this story.

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What the Bill Does

The main elements of the campaign finance bill passed by Congress on Wednesday:

Soft Money

The bill prohibits national political parties from raising or spending soft money, which refers to unlimited political contributions from unions, corporations or individuals. It also bans state and local parties from spending soft money on federal elections, with one exception: allowing parties to collect up to $10,000 per donor annually in states that allow soft money. That money could be used only for voter registration and turnout efforts.

Hard Money

The measure doubles to $2,000 per election what individuals can give to candidates for president and Congress. It also increases how much an individual can donate to parties and candidates from $50,000 to $95,000 every two years. These limits would be indexed for inflation. The bill also would ease contribution limits even further under certain circumstances for federal candidates who face wealthy, self-financed opponents.

Advertisements

The bill bars special-interest groups from using their general funds to pay for television or radio advertising that targets a federal candidate one month before a primary election and two months before a general election.

Court Review

The bill would allow some of its provisions to remain in effect even if others are struck down by the courts.

Effective Date

Nov. 6, 2002, for most of the bill. The hard-money limits would take effect Jan. 1, 2003.

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Reported by Times Staff Writer Nick Anderson