Beltway Bulletin: Campaign Finance Reform
Campaign-Spending Reforms Proposed
On Feb. 11, two key Democrats, Sen. Charles Schumer (NY) and House member Chris Van Hollen (MD), outlined a bill to reform spending on elections. The bill will seek to undo the worst effects of the U.S. Supreme Court decision of Jan 21 in the case of Citizens United v. the Federal Election Commission. That decision allows corporations, unions and interest groups to spend freely on political advertising, as freely as if they were individual citizens. For a view on the U.S. Constitution and First Amendment rights for corporations see: http://www.acslaw.org/node/15540.
While some have proposed that Congress seek to amend the Constitution to undo the Supreme Court decision, making changes to U.S. law will yield results more quickly. A constitutional amendment would take many years and is unlikely to succeed. On the other hand, the proposed legislation will likely withstand review by this Supreme Court, especially on issues related to disclosure of spending on elections.
There is a critical need to fix the problems created by the recent Supreme Court ruling. Reducing the influence of money on elections is key to restoring an effective democracy. It is difficult to reform the health care system or U.S. energy policy when many members of Congress are unduly influenced by corporations and wealthy campaign donors. Unrestricted corporate spending to influence elections would worsen an already bad situation.
The major provision of the proposed legislation would:
1. Prevent foreign influence in U.S. elections;
2. Prevent government contractors from spending money on elections;
3. Prevent corporate beneficiaries of TARP bailout funding from spending money on elections;
4. Require advertisements to identify sponsors;
5. Enhance requirements for disclosure of political expenditures;
6. Require corporations to notify shareholders of spending on political ads;
7. Require lobbyists to disclose their ad spending;
8. Provide for the lowest unit rates for ads run by candidates and parties; and
9. Prevent corporations from coordinating their activities with candidates and parties
For a four page summary of the proposed legislation see: http://vanhollen.house.gov/UploadedFiles/Legislative_Framework_021110.pdf.
The obstructionist tactics of Republicans may hinder passage of the Schumer/Van Hollen bill. In the Senate, it will require the vote of at least one Republican senator.
Sen. Richard Durbin (D-IL) has introduced a separate bill to give incentives to politicians who agree to campaign on less funds. Durbin’s bill would offer a federal four-to-one match to qualifying Congressional candidates who pledge to only accept donations of $100 or less and abide by spending limits and transparency rules.
Sen. Dodd Proposes Senate Financial Reform Bill
On March 15, as chair of the Senate Finance Committee, Sen. Christopher Dodd (D-CT) introduced a bill to reduce the chances of another financial meltdown. While the press has focused on the health care bill, improved regulation of Wall Street is more crucial to America’s economic future.
If the Senate passes the bill, it will have to be reconciled with the House’s version, which passed in December. Both bills seek to establish a broad and independent system to regulate financial companies, including those selling derivative products, such as default credit swaps. It was the sale of default credit swaps that required the massive federal bailout of insurance giant AIG. For more information on the Senate bill see http://www.nytimes.com/2010/03/16/business/16regulate.html?hp. With the current filibuster rules, finance reform will also require the vote of at least one Republican senator.
Rep. Barney Frank (D- MA), Chairman of the House Financial Services Committee, said he expects the House and Senate to eventually agree on a bill. “There are some differences between the House-passed bill and Senator Dodd’s version, but they are more alike than they are different,” Frank said.
Like health care and other pressing issues, the House version of financial reform was strongly opposed by conservative members. No House Republicans voted for the bill and several Democrats voted against it. For a summary of the House passed bill see: http://www.politico.com/news/stories/1209/30497.html.
For on-going analysis of the different approaches of the House and Senate bills, see the blog by Nobel laureate Paul Krugman at http://krugman.blogs.nytimes.com. There is a link on his blog page to his opinion columns in the NY Times. His March 1 column notes that passing a weak financial reform bill may be worse than no bill. While he supports a weak health care reform bill, Krugman states:
“A weak financial reform, by contrast, wouldn’t be tested until the next big crisis. All it would do is create a false sense of security and a fig leaf for politicians opposed to any serious action — then fail in the clinch. Better, then, to take a stand, and put the enemies of reform on the spot.”
For More Information
For up-to-date reports on many progressive issues, see the Center for American Progress at www.americanprogressaction.org/ and the Gristmill at http://www.grist.org/news/. For justice issues, see the American Civil Liberties Union (ACLU) at www.aclu.org/. For the issues of peace, national defense and the Iraq and Afghanistan wars, see the Friends Committee on National Legislation (FCNL) at www.fcnl.org/. For the issues of energy and global warming, see the Union of Concerned Scientists (UCS) at http://www.ucsusa.org/ and the Natural Resource Defense Council (NRDC) at www.nrdc.org. Φ
Phil Carver worked on energy and climate change issues for Oregon state government from 1980 until 2009. He earned a Ph.D. in natural resource and utility economics from the Johns Hopkins University in 1978. He is a former OPW Board Co-Chair who writes this column exclusively for The PeaceWorker.