Home

Search

Browse

About IPO

Staff

Links

MONEY TALKS

Soft money. Bundling. Directed donations.
Reformers sift through a lexicon of villains to
diminish the role of dollars in politics.

by Gayle Worland

When then-Springfield Congressman Richard Durbin decided to run for Paul Simon's seat in the U.S. Senate, the first two people he hired for his campaign staff were not political strategists, press handlers or media consultants. They were fund-raisers.

"You have to start financing the day you declare your candidacy," says Michelle Ishmael, the downstate finance director for the Durbin for Senate Campaign. Nancy Kohn handled fund raising for Chicago and the collar counties; Ishmael raised Durbin's dollars in the 96 counties downstate. By the time the first voter stepped into a polling booth November 5, the campaign had raised more than $4 million.

Having defeated Republican opponent Al Salvi, whose campaign had spent close to $3.2 million by mid-October, Durbin won't have to run for office again for another six years. But less than a month after Inauguration Day, his former colleagues in the House still need to keep their reelection machines rolling in anticipation of 1998.

Under the current federal campaign finance system, reformers say, politicians are akin to hamsters on a never-ending wheel of fund raising. President Bill Clinton has likened the escalating costs of campaigns to an "arms race." The frantic process also

Soft money fund raising has tripled since the 1991-92 election cycle. 1991-92 election cycle Source: Common Cause

1995-96 election cycle

favors incumbents, disrupts the law-making process, has the potential to put legislators in the pockets of their wealthiest contributors — and has pushed everyone in the business close to exhaustion.

"It's a tough business," says Melanie Delianides, who runs a fund-raising consulting firm in Chicago for Democrats in statewide and federal races. Fund-raisers, she says, are expected to be a political campaign's "miracle workers."

Their magic is essential. The average campaign for the U.S. House last fall cost half a million dollars; Senate races averaged around $4 million. The total price tag for House and Senate campaigns came to more than $800 million. With campaign bills for the Clinton-Dole presidential contest totalling more than $797 million, the grand total for the 1996 election is estimated at nearly $2 billion. The reason, says researcher Ryan McPherson of the

32 / February 1997 Illinois Issues

Center for Responsive Politics, a Washington, D.C., watchdog group, "is a huge increase in soft money."

Written in reaction to the Watergate scandal, which included the discovery of multimillion-dollar campaign contributions by corporations, campaign laws enacted in 1974 limit federal campaign giving to $1,000 per individual and $5,000 per political action committee, or PAC. But those restrictions have become meaningless with the contrivance of "soft money," checks that are written not to specific campaigns, but to their parties. Soft money can be spent on "party-building activities," which have come to include everything from staff salaries and rent to huge TV advertising campaigns that can bolster a candidate's image without directly asking for a vote. Soft money also frees up more "hard" cash to be used in straight campaigning.

Soft money fund raising for the 1996 election reached a record $207 million through October 16 (the latest date for which figures are available) — three times more than the parties raised during the same period of the 1992 presidential campaign, according to the advocacy group Common Cause. Republican Party committees raised some $111.6 million; Democratic Party committees took in $95.4 million. A 1991 lawsuit by Common Cause forced the disclosure of soft money receipts. Disclosures for the period of July 1- October 16, 1996, included some generous gifts from Illinois, including $127,940 from United Airlines of Chicago and $125,000 from Personal Health Care of Schaumburg to the Democratic National Committee. The Republican National Committee received $103,100 from Chicago's J. Ira Harris and Lazard Freres.

Two other tricks of the trade include "bundling," money raised en masse from employees of a particular company or in an orchestrated effort by ideological interest groups, and "directed donations," yet a newer loophole that recently benefited some Democratic campaigns for state office in Illinois. The Democratic National Committee does not accept these "directed donations" per se, but channels them to a state political organization that shares its goals.

"We're seeing amounts of money that we'd never dreamed about before," says Wisconsin Sen. Russell D. Feingold, one-half of an improbable team of senators sponsoring the McCain-Feingold campaign finance reform proposal on Capitol Hill. The liberal Democrat Feingold and hawkish Republican Sen. John McCain of Arizona saw their bipartisan bill filibustered to death in the 104th Congress. But now in the 105th, they're back with what is considered the most viable proposal on the table — plus the avowed support of the White House and a Senate with 15 new members.

The legislation would ban soft money contributions, restrict bundling and set voluntary spending limits based on a state's voting-age population, ranging from, say, $950,000 for candidates in smaller states like Wyoming to $5.5 million in large states like California. Candidates who agree to the limits would qualify for free TV time as well as discounts on broadcast media and postage rates. If wealthy candidates refuse to limit their personal spending, the cap on individual donations to their opponents would rise from $1,000 to $2,000. The Federal Election Commission, charged with regulating the campaign system, would notify complying candidates when it became clear they were being targeted by outside organizations. A spending cap, reformers say, would stop the insanity of the campaign money binge, and also give challengers a better chance against incumbents. Ninety-five percent of incumbents running for office in the 1996 congressional elections won reelection. House incumbents had nearly $282 million in campaign resources, a nearly 4-to-l financial advantage over their challengers, according to

Reformers say a spending cap would stop the insanity of the campaign money binge and level the field for challengers.

Illinois Issues February 1997 / 33

Common Cause. Senate incumbents raised more than twice the funds of their challengers — $96 million to $43 million — and received nearly five times the PAC contributions.

Consistently, it is the wealthiest campaign that wins. In 1994, winners in the House spent an average of $516,125 on their campaign, to the loser's $238,715. In the Senate, victors spent an average $4,569,940, compared to $3,426,509 spent by their opponents.

Federal candidates often conduct two campaigns at election time — one with district voters, and another "phantom" campaign with their "cash constituents," whose big-money donations often come with a very specific political agenda in mind, says Larry Makinson of the Center for Responsive Politics. In the 1994 election cycle, 69 percent of PAC contributions came from business interests, 22 percent from labor and 9 percent from single issue or ideological groups, according to the consumer group Public Citizen.

The McCain-Feingold bill would ban special-interest PACs or — if that is ruled unconstitutional—would limit PAC contributions to 20 percent of a candidate's spending and lower the PAC ceiling from $5,000 to $1,000 pel election.

But overhauling the campaign finance system is inherently problematic, a bit like asking the fox to put a lock on the henhouse. A May 1996 report by Public Citizen, for example, discovered the 12 members of the House committee with jurisdiction

Selected candidates
Illinois election cycle, 1995 and 1996
U.S. Senate candidates	Spent	PACs
Richard Durbin (D)	$4, 003, 384	$1, 037, 905
Al Salvi (R)	$3, 183, 304	$435, 876
U.S. House candidates	Spent	PACs
Rod R. Blagojevich (D)	$1, 190, 140	$279.713
Jerry F. Costello (D)	$427, 220	$144, 680
Philip M. Crane (R)	$415, 781	$433, 652
Danny K. Davis (D)	$369, 660	$130, 050
Lane A. Evans (D)	$451, 594	$310, 459
Thomas W. Ewing (R)	$536.787	$305, 905
Harris W. Fawell (R)	$301, 261	$167, 298
Luis V. Gutierrez (D)	$231, 065	$145, 950
J. Dennis Hastert (R)	$754, 013	$489, 146
Henry J. Hyde (R)	$313, 915	$285, 057
Jesse L. Jackson Jr. (D)	$655, 841	$200, 650
Ray H. LaHood (R)	$603, 230	$255, 568
William O. Lipinski (D)	$286, 356	$236, 878
Donald A. Manzullo (R)	$573, 656	$160, 695
John E. Porter (R)	$625, 429	$231, 101
Glenn Poshard (D)	$148, 697	$0
Bobby L. Rush (D)	$139, 975	$132, 562
John M. Shimkus (R)	$419, 537	$112, 451
Gerald C. "Jerry" Weller (R)	$789, 585	$383, 301
Sidney R. Yates (D)	$127, 700	$13, 700
Source: Center for Responsive Politics

over campaign finance legislation had received more than $318,724 from PACs associated with the National Association of Business Political Action Committees, one of the fiercest opponents of proposed reforms.

Yet, polls show that 75 percent to 80 percent of the American people think politicians care more about special interests than about average voters. Revelations of foreign dollars in the campaign system and generous donors treated to a night in the Lincoln Bedroom at the White House have done little to bolster voters' faith in the political system. Nasty campaign ads on TV have added to public cynicism, too — but they're not about to go away.

Since the first "I Like Ike" commercials on television some 40 years ago, TV has been a major player in the election process. According to the Campaign Study Group, a national media consulting firm that tracks campaign expenditures, at least 25 percent of congressional campaign expenditures go to radio and TV advertising — equal to the amount spent on staff salaries, rent, office supplies and all other basic overhead costs combined. Another 16 percent is dedicated to simply raising more money.

The need to drum up big dollars for essential TV exposure creates a "fractured attention" among lawmakers up for re-election, Feingold explained in a January address. A lawmaker's day is split between serving constituents and "dialing for dollars" from contributors — a process that in Washington frequently takes place in the afternoon, at the same time that some of the most important legislative business is taking place on the House or Senate floors. The pressure to raise huge sums of money contributed to "one of the biggest brain drains in the history of the U.S. Congress" in 1996, says Feingold, who points to Illinois' former senator, Paul Simon, as an example. "They didn't want to go through this again."

Many candidates would rather talk about issues with their constituents, says Ishmael, who also headed fund-raising efforts for Dawn dark Netsch's unsuccessful race for governor against Jim Edgar. The fundraiser's job is to keep the candidate on

34 / February 1997 Illinois Issues

Source: Common Cause analysis based on reports of major party general election candidates

track — in other words, to consider fund raising more important than kissing babies or talking government. "The most effective way is the candidate on the phone or the candidate at an event," she explains. "People want to be asked."

Washington is airing other proposals for campaign finance reform — such as a change in the Constitution that would allow Congress to set mandatory spending limits; public financing of campaigns; or a bipartisan commission to further study the issue. Opponents of McCain-Feingold say that a ban on PACs and bundling would prevent the "little guy" from exercising more clout by combining his dollars with like-minded interest groups. But "little guys" are fairly rare on the campaign scene: According to Common Cause, 99.97 percent of Americans don't make political contributions of more than $200.

The system clearly needs to be changed, says Kent Redfield, a political science professor at the University of Illinois at Springfield and author of Cash Clout: Political Money in Illinois Legislative Elections. "But there are limits to what you can do within the scope of the law," he says. Challengers need a more level playing field, and citizens need to demand a higher ethical standard. "The nature of our politics shapes our campaign finance system," he says, "more than the other way around."

Gay Ie Worland, a Rockford native, is a free-lance writer living in Washington, D.C. Her work has appeared in such publications as Illinois Times and the Washington Post.

COMING SOON Campaign finance reform efforts in Illinois Doug Dobmeyer believes the pressure's on this year for campaign finance reform in Illinois. As the interim head of the state chapter of Common Cause, he'll need to hang on to that optimism. Efforts to stem — or even regulate — the flow of campaign cash have foundered often in this state. Illinois sets no limits on contributions from individuals, corporations or political action committees (PACs). Candidates must report their contributions, but the information required of them is bare bones at best. And procedures for inspecting those reports have been cumbersome. (Finance records are now on the Web, See Illinois Issues, December 1996, page 11.) Still, as Dobmeyer notes, suggestions for change are coming from a number of fronts this year. Evanston Democrat Jan Schakowsky has introduced measures to prohibit political contributions from regulated industries and to provide public financing for candidates who refuse contributions from special interests. The Illinois Campaign Finance Project, co-chaired by former Gov. William Stratton and former U.S. Sen. Paul Simon, also will have a set of recommendations. (That project, sponsored by Illinois Issues, was supported by a grant from the Joyce Foundation and was conducted in collaboration with the Institute for Public Affairs at the University of Illinois at Springfield.) Meanwhile, Common Cause has a few suggestions of its own. The group would adopt limits on individual and corporate contributions; restrict contributions from state contractors; limit or prohibit contributions from regulated industries; and limit candidates to contributions from a single PAC. In another issue, we plan to examine in greater detail these and other suggestions for change. Peggy Boyer Long

Illinois Issues February 1997/ 35