TOPICS > Politics

Background: A New Look at Campaign Finance Reform

November 28, 1996 at 12:00 AM EDT


MARGARET WARNER: In the wake of controversy over fund-raising practices during the recent presidential race, campaign finance reform has become, once again, a top legislative priority to some on Capitol Hill. We’ll look at three proposed solutions but first, Kwame Holman.

KWAME HOLMAN: A year ago in New Hampshire, President Clinton and House Speaker Newt Gingrich pledged to support a commission to do what politicians, themselves, have been unable to do — reform the system of financing political campaigns.

PRESIDENT CLINTON: I would love to have a bipartisan commission on this. It’s our only chance to get anything done. I accept.

REP. NEWT GINGRICH, Speaker of the House: Mr. President, let’s shake hands on that.

KWAME HOLMAN: The two leaders made their promise knowing that substantial numbers of lawmakers oppose various approaches to reforming a system of campaign funding that traditionally has favored incumbents. And in Congress this year, they successfully blocked any new legislation.

SPOKESMAN: Ladies and gentlemen, the President and Vice President of the United States.

KWAME HOLMAN: Meanwhile the amount of money spent on political campaigns has continued to grow. Final totals are not in yet but by mid-October in the presidential race, the Clinton campaign had spent at least $37 million, the Dole campaign $49 million, and Ross Perot $16 million, according to the Federal Election Commission, which monitors campaign spending.

As he did four years ago, Ross Perot used the campaign reform issue to try to energize voters in the final days of the campaign.

ROSS PEROT: I never thought I would live to see a major drug dealer give 20,000 bucks in Florida and then be invited to a big Democratic reception by the Vice President of the United States, Al Gore, and then be invited to the White House for a reception.

Now keep in mind you can’t get into the White House unless the Secret Service clears you. This guy had been convicted, arrested twice in the ’80s. It’s in the computer. Forrest Gump on the Secret Service — and they don’t have one–would have picked that up, right? But every now and then, the White House just overrules them and says let ’em in anyhow. I promise you that if I am ever your President, drug dealers will not be invited to the White House. (applause)

And I am personally offended that the President is now selling the Lincoln Bedroom to any $100,000-a-night contributor.

KWAME HOLMAN: Fund-raising records also were set in House and Senate races. According to the latest filing, weeks before the election, congressional candidates had raised a total of l.6 billion campaign dollars– the most ever.

Leading the way in spending among Senate candidates was Democrat John Kerry, who won re-election in Massachusetts. This summer, Kerry and his opponent, Republican Governor William Weld, agreed to limit campaign spending on advertising to $5 million each.

But in October — with the race in a dead-heat — Senator Kerry’s campaign announced it was breaking the cap. Both candidates eventually ended up over the limit, with Governor Weld spending $6.6 million and Senator Kerry spending nearly $9 million to keep his Senate Seat.

REP. DICK GEPHARDT (D-MO): Our new Speaker, the gentleman from Georgia, Newt Gingrich.

KWAME HOLMAN: Among House Races the two top spenders were the two top House office holders. Democratic Minority Leader Richard Gephardt spent $2.6 million winning re-election from his district in St. Louis. And Speaker Gingrich won the most expensive House race this year. The Republican from Georgia spent $4.5 million and his opponent, cookie manufacturer Michael Coles, spent $2.3 million.

Part of the current system of federal campaign finance law was shaped by Supreme Court rulings that prohibit any limits on campaign spending as an unconstitutional restriction on free speech. But currently presidential candidates who accept public funding can be made to abide by some spending limits.

And while though there are no spending limits on congressional campaigns, Congress did place restrictions on the amount of money individuals and groups may contribute to a candidate’s campaign. Individual contributions are limited to $1000 per candidate in each election. And Political Action Committees may contribute $5000 per candidate.

But there are ways around the limit.

AD SPOKESMAN: When Bruce Products abandoned their plant site, they left behind vats of toxic chemicals.

KWAME HOLMAN: The Supreme Court has ruled that so-called “independent expenditures,” money spent by interest groups like labor unions and business organizations, cannot be limited by Congress as long as the money goes toward general election activities, like issue education and voter registration, and is not coordinated with a specific campaign.

This year, the nation’s largest labor organization, the AFL-CIO, waged a much publicized TV and radio ad campaign against two dozen House Republicans.

REP. NEWT GINGRICH: (ad) But we believe it’s going to wither on the vine.

AD SPOKESMAN: Last year, Congressman Steve Stockman voted with Newt Gingrich…

KWAME HOLMAN: The ads never mentioned Democratic challengers but the $35 million effort was designed to aid them. Tennessee freshman Representative Van Hilleary was re-elected, despite being one of the AFL-CIO’s targets.

REP. VAN HILLEARY, (R) Tennessee: It’s just low ball politics and there’s really no place for it, and I don’t care who’s doing it.

KWAME HOLMAN: Jim Neally is the head of the AFL-CIO in Tennessee.

JIM NEALLY, AFL-CIO: If they vote against working families, we’re going to explain their positions to the workers in this state.

KWAME HOLMAN: Another major source of campaign money is subject to no regulation. It’s so-called “soft money”–money donated by individuals and Political Action Committees to the political parties. The parties are supposed to use it for general party building activities but, in practice, they frequently direct money to benefit certain candidates.

Soft money fund-raising practices became an issue in the presidential campaign after it was reported former Democratic fund-raiser John Huang may have solicited $five million in contributions from foreign donors. It is illegal for non-residents to contribute to U.S. campaigns. After its own inquiry, the Democratic Party returned more than a million dollars that were traced to foreign sources.

PRESIDENT CLINTON: Let me begin by once again thanking the American people for the honor they have bestowed upon me.

KWAME HOLMAN: But the push for campaign finance reform will begin again with the new Congress, and his first press conference after the election, President Clinton again pledged his support for campaign finance reform.

PRESIDENT CLINTON: Our campaigns cost too much, they take too much time, they raise too many questions, and now’s the time for bipartisan campaign finance reform legislation.

KWAME HOLMAN: But even before the first day of the new Congress, members who oppose various forms of campaign finance reform have indicated next year may be no different from this one.