Supreme Court Reviews Campaign Spending Limits

HIGHLIGHTS

n Cunningham sentenced for taking bribes

n Katherine Harris linked to Duke’s conspirators

n NC scandals prompt reform calls

n Initiatives under attack in FL

n Court examines TX redistricting

n Redistricting reform in CA, FL, IN, OH

nNE stops reform rollback

n Back page cartoon: Kickback Mountaint


 

For the first time in thirty years, the Supreme Court of the United States considered the constitutionality of campaign spending limits as part of its review of a Vermont campaign finance law on February 28, 2006. The Justices did not come across as big fans of reforms that would curb the influence of big money in politics.

Vermont passed a comprehensive reform law in 1997 that included mandatory spending limits set near the levels that Vermont candidates typically spend and contribution limits of $200 per two-year cycle for legislative races and $400 per cycle for statewide races.

Derek Cressman of TheRestofUs.org speaks to the
media after the Vermont Supreme Court case.

The district court had upheld the contribution limits based on a 10 day trial and ruled that the state of Vermont had “proved that real concerns exist, and that Vermont’s expenditure limits address them,” but that it was inappropriate for him to revisit Buckley v. Valeo as a trial court. The Second Circuit Court of Appeals also upheld the contribution limits and ruled that the spending limits could indeed be constitutional.

Both the plaintiffs and the state of Vermont appealed to the Supreme Court for clarity following the 2nd Circuit ruling.

TheRestofUs.org filed a friend of the court brief in support of campaign spending limits that was joined by USPIRG, Common Cause, the League of Women Voters, AARP, Public Campaign, CREW, and others. We argued that Vermont has a right, indeed a duty, under the U.S. Constitution to preserve a republican form of government. This requires that elections produce legislators who accurately represent their constituents and that massive political spending can distort representative democracy.

Vermont PIRG served as an intervenor in the case, represented by the National Voting Rights Institute. Brenda Wright, senior attorney for NVRI, argued the case before the Court along with Vermont Attorney General William Sorrell. A recent poll commissioned by NVRI found that 87% of voters support caps on campaign spending.

During oral arguments, the Justices spent surprisingly little time discussing spending limits and focused instead on Vermont’s contribution limits. In 2001, the Court had upheld contribution limits that ranged from $275-$1075 in Missouri and issued strong language that states could set whatever contribution limits they deemed necessary

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EDITORIAL

Derek Cressman

Pioneering Corruption

In his State of the Union address, George W. Bush somehow managed to avoid talking about the two biggest scandals rocking the union: Enron’s fraud and Jack Abramoff’s greed. Both came to a crescendo the same week as his speech, and both involve men who have been important to George W. Bush the politician.

Right before the President’s address, Enron CEO Ken Lay went to court in what many are calling the “corporate trial of the century.” Also, House Republicans chose a new majority leader to replace Tom DeLay who was forced from his leadership post due to his indictment for violating Texas campaign finance laws and his association with lobbyist Jack Abramoff.

Could the president’s omission of the word “corruption” from his address have anything to do with his special relationship to Ken Lay and Jack Abramoff? Both helped propel George W. Bush to the White House by raising extremely large sums of money for him.

Many forget that Bush became the first major party nominee to reject the voluntary spending limits of the presidential public financing system and rely upon private donors to fund his campaign during the primaries. Bush took campaign fundraising to a whole new level by creating the Pioneers—fundraisers who were each responsible for bundling at least $100,000 in amounts of $1,000 or less.

While most of these Pioneers are no doubt ethical people, a disturbing number of them are proving otherwise.

According to federal prosecutors, Ken Lay told outright lies about Enron’s financial health to his employees and investors. Yet this pillar of integrity was invited to join Vice President Cheney’s secret energy task force, where he promoted Enron’s interests. Meanwhile, his company was manipulating California’s energy markets, artificially engineering a power shortage to drive up prices and thus drum up political support for Cheney’s agenda of more oil and coal extraction in places like the Arctic National Wildlife Refuge.

Jack Abramoff, the black-hatted Pioneer most frequently in the news lately, has pleaded guilty to, among other things, bribing a member of Congress. The White House is now scrambling to prevent photos of Abramoff and Bush from being circulated, while the president is claiming he can’t recall meeting the man. The administration is also stonewalling inquiries about whether Abramoff met with Karl Rove in the White House.

Thomas Noe, a rare-coin dealer from Ohio, is under federal indictment on charges that, as part of his successful effort to reach Pioneer status, he illegally reimbursed people for making contributions to Bush’s campaign. Ohio Gov. Bob Taft pleaded no contest last spring to failing to report gifts from Noe. Taft entrusted Noe with some $50 million in investments for the Ohio Bureau of Workers’ Compensation, from which some $12 million is now missing.

Brent Wilkes, a defense contractor from southern California, has been named by ex-congressman Duke Cunningham as one of the men who bribed him to the tune of at least $700,000. Wilkes, not only a Pioneer, but also a southern California chair of Bush’s fundraising committee, has a history of bundling contributions from his employees, family and associates. This suggests that he, too, may have been involved in making contributions to Bush in the name of other people, circumventing federal campaign finance law. Mitch Wade, who also bribed Cunningham, pleaded guilty to making illegal campaign contributions in late February.

The president’s Northeast Chairman for his 2004 campaign, also a Pioneer, was James Tobin. Tobin was recently convicted of illegally tampering with the Democratic Party’s phone lines on Election Day to prevent them from contacting potential voters.

President Bush has failed to sufficiently denounce these supporters or distance himself from their activities. While Bush’s re-election campaign has given away the contributions it received directly from Jack Abramoff, it has not dispersed money that Abramoff bundled as a Pioneer. Bush is still holding on to the money he took from Wilkes and the money raised by Noe. The Bush campaign has also steadfastly refused to reveal which contributions were made by which Pioneers, making it difficult to investigate whether any Pioneers besides Noe were engaged in illegal money laundering.

If the president truly wants to give the nation hope, he shouldn’t dodge the bad news about the corrupt state of our union. Rather, it is his responsibility to go beyond earmark reform and mount an effort to both root out corruption and tighten the rules on lobbying and campaign contributions—with the aim of preventing future scandals.
State Updates
 
ALABAMA
The Constitution, Campaign Finance, Ethics and Election Committee voted unanimously to propose a Constitutional Convention to the entire Senate on February 21. A similar effort had been defeated earlier in the House, where one member’s concern over the financing of delegate campaigns had left the bill short of the necessary votes. That member, Rep. Joseph Mitchell, has proposed a system of partial public financing for delegate campaigns in order to give average citizens a shot at delegate.

If the Legislature adopts the bill, the Alabama public would vote on it this November. If it passes, delegates would then be chosen on the Spring 2007 ballot and the convention would meet in July 2007 to draft a new constitution. Alabama voters would then vote on the proposed changes in 2008.
ARIZONA

Clean Money Violator Booted From Office
The Arizona Supreme Court removed Representative David Burnell Smith from office on January 29 for violations of Arizona’s Clean Elections law, making him the first state official in the country to be removed from office for violating a public financing law. As a candidate, Burnell Smith agreed to a campaign spending limit and to certain reporting requirements when he signed up for the voluntary program. He overspent the limit by some 20% and also under-reported his spending.

Those violations set in motion a process which eventually resulted in the Supreme Court’s action. Prior to that, Burnell Smith had received multiple hearings in front of the state’s Citizens Clean Elections Commission and judicial review of all the findings. He has raised the possibility of appealing the state supreme court’s decision to the U.S. Supreme Court, but has taken no affirmative steps to do so.

District 7 committee members of the Republican Party, of which Burnell Smith is a member, will now select three nominees to be considered by the Maricopa County Board of Supervisors to replace Burnell Smith. Burnell Smith says he will vie for one of the three spots.

Clean Money Repeal?
Opponents of Arizona’s Clean Money program introduced HCR 2046 to repeal the program. The bill was stalled in the House Judiciary Committee when the deadline passed for bills to get out of their house of origin. That being said, supporters of the repeal effort may still “strike,” or gut and amend, another House Concurrent Resolution and substitute HCR 2046’s language into that HCR, in effect giving clean money opponents another bite at the apple. Clean Elections Institute Exec. Director Barbara Lubin says they are keeping a close eye on legislative activity for signs that clean money opponents are pursuing the “striker” strategy.

 
CALIFORNIA

Redistricting
In the aftermath of the defeat of redistricting initiative Proposition 77 last year, legislative leaders have promised to put their own redistricting reform on the ballot this year. Using Senator Lowenthal’s SCA 3 as a starting point, legislators and reform groups have been working towards consensus on a number of issues, including the number of members on the proposed independent commission, the constituencies represented by the members of the commission, and the standards to be used for drawing California’s legislative and congressional districts.

In order to keep the legislature honest in its drafting, TheRestofUs.org and a coalition of reform groups including the People’s Advocate and the Mexican American Political Alliance have filed a separate independent redistricting initiative with the Attorney General.

Campaign Finance Reform – Statewide
For the first time in California history, a clean money bill passed a house of the legislature. AB 583, sponsored by Assemblymember Loni Hancock of Berkeley, passed the Assembly in January. Prior to arriving on the Assembly floor, the bill had to pass the Assembly Elections Committee, to which Speaker Nuñez added another member to ensure the bill’s passage.

Despite the understandable swell of good feeling around the bill’s passage, many legislators said at the time that they voted for the bill only because they knew it would be re-examined in conference committee. The bill is now in the Senate Rules Committee.

The California Nurses Association, the group that gained widespread attention protesting outside Governor Schwarzenegger’s fundraisers last year, filed with the Attorney General a ballot initiative that would institute a clean money system for state office, sharply limit all contributions from outside a candidate’s district, prohibit corporate contributions to state candidates and to ballot committees, and would place limits on contributions to candidate-controlled ballot committees.

Given the historical reluctance of officeholders to reform the system by which they were elected, the CNA initiative may play an important role in ensuring that lawmakers reform California’s broken system of financing campaigns. TheRestofUs.org offered input and drafting expertise on these issues to the CNA, as did Loyola Law Professor Rick Hasen.

San Francisco CFR
The San Francisco Board of Supervisors voted to extend the city’s program of partial public financing for Supervisor races to mayoral elections. Mayoral candidates who qualify for public financing will receive $50,000 in public funds for the first $25,000 in contributions under $100, $400,000 for the next $100,000 in private contributions, and $400,000 for the next $400,000. Private contributions raised beyond the initial $25,000 are subject to the city’s normal $500 contribution limit for city candidates. In sum, candidates will receive $850,000 in public funds for raising $525,000 in contributions. Candidates must also agree to a spending cap of $1,375,000 and to at least one public debate.


CONNECTICUT

Last year’s landmark campaign finance legislation came under attack early this year. The Green Party threatened to seek a 72-hour injunction against the law’s provisions related to the qualifying thresholds for third party candidates. Attorneys who work for citizen groups that worked on the bill say that such an injunction would likely scuttle almost the entire bill. Also, an association of lobbyists announced that they plan to file a lawsuit against the bill’s provisions prohibiting campaign contributions from lobbyists.

Lawmakers and reform groups were aware of some flaws at the time of the bill’s passage, but the bill’s supporters felt that the state legislature could and would correct any major flaws. That belief will likely be put to the test.
FLORIDA

Harris tied to Cunningham Bribers
Rep. Katherine Harris (FL-13) came under increasing scrutiny for her ties to Mitchell Wade, who pleaded guilty in February to bribing Duke Cunningham and making illegal campaign contributions to both Harris and Virginia Representative Virgil Goode.

MZM Inc., Wade’s defense contracting company, was the largest source of campaign contributions to Harris in 2003-4, giving her $50,000. Wade admitted reimbursing employees and their spouses for $32,000 of that total, an illegal evasion of campaign contribution limits known as “straw donations”. Harris’s claim that she didn’t know she had received $32,000 in illegal contributions was undermined when it was revealed she had also received similarly illegally funneled contributions during her 1994 state Senate campaign. In that case, Riscorp Insurance executives were convicted of illegally funneling contributions to several Florida candidates. Harris received more than $20,000 from employees of the company, the second highest total aside from the state insurance commissioner. In court documents filed in that case, a Riscorp memo said that Harris’ former campaign manager asked that the contributions be made under separate addresses so that the checks could not be easily be traced back to the company.

In addition to denying any knowledge that she had received illegal campaign contributions, Harris didn’t reveal that she had requested funding on behalf of MZM. After a dinner with Wade in early 2005 at which Wade offered to throw a fundraiser for Harris’s Senate campaign and asked Harris to help obtain federal funds for an MZM counterintelligence project and MZM facility in Florida, Harris submitted a request for $10 million for the MZM projects.

Redistricting
The Committee for Fair Elections turned in more than 900,000 signatures for an initiative that would change the process by which Florida draws its legislative and congressional districts. State elections officials certified that the signatures met geographical distribution requirements. The initiative, led by Common Cause, would create an “independent” redistricting commission composed of 15 members selected by the state legislature and the Florida Supreme Court. Lawmakers have challenged the initiative as violating Florida’s single-subject rule and the signature-gathering process as misleading.

Initiative Process
Even as Governor Jeb Bush declared his support for extending the state’s initiative process to statutory initiatives, state lawmakers continued their efforts to weaken the state’s initiative process. The Senate Ethics and Elections Committee passed SJR 26, a bill that would limit ballot initiatives to issues that: deal with a “fundamental right,” amend an existing section of the constitution, or change the basic structure of state government. Another legislative proposal, SJR 1244, would place severe restrictions on campaigns that used paid signature-gatherers, making it extremely difficult for citizens groups to put initiatives on the ballot. The last proposal, SJR 1436, would require a two-thirds majority for any initiative that required spending.

Last year, Governor Bush supported efforts to weaken the initiative process in the state, including HJR 1723, which increased the requirement for initiative passage from 50% to 60% of the vote and will be on the ballot in 2006. While supporting efforts to undermine the initiative process, Bush opposed efforts to reform the state’s broken redistricting process. These positions were in direct conflict with Bush helping California Governor Arnold Schwarzenegger raise money in Florida for a ballot initiatives in California that would have reformed California’s redistricting process.

 
INDIANA

State Rep. Gerald Torr introduced HB 1009, a bill that would turn over the job of drawing the state’s legislative and congressional districts to a five-member commission. Four members of the commission would be selected by the legislative leaders of the two major parties; the fifth member would be the chief justice of the state supreme court. Currently, the Senate Committee on Elections and the House Committee on Elections and Reapportionment have jurisdiction over drawing the state’s districts.

The proposed commission would have to draw compact districts and refrain from using political data, such as incumbent addresses and voter registration information, in drawing the districts. The bill’s authors put some teeth into the prohibition on political data, making it a Class D felony for Commission members to use such information. The proposed bill drew a mixed response from legislators.
LOUISIANA

Brett Pfeffer, former aide to Louisiana Congressman William Jefferson, pleaded guilty in January to bribing his former boss in exchange for Jefferson’s help obtaining telecommunications contracts in Africa for two companies. In his plea, Pfeffer describes Jefferson’s demand for a 5-7% share of the companies and employment of members of his family as payment for his assistance. In furthering his end of the bargain, Jefferson eventually wrote letters to African officials, met with officials at the Import-Export bank, and even flew to Ghana to encourage Ghanian officials to use the two telecom companies. In August 2005, federal officials raided Jefferson’s home in Louisiana, where they discovered $90,000 in cold hard cash . . . that is, cash hidden in Jefferson’s freezer. Federal officials have not commented on the fruits of their ongoing investigation into Jefferson.

 
NEBRASKA

The Nebraska unicameral legislature defeated efforts to end Nebraska’s system of voluntary spending limits in February, when it rejected an amendment repealing the system (AM2262) in favor of an amendment making some modifications (AM2270). The relevant bill is LB 188. Those modifications include an increase in the spending limits for candidates who accept public funds, an expedited reporting schedule to ensure qualifying candidates receive funds if their opponent crosses the spending threshold, a cap of public funds available at three times the spending limit, and improved enforcement.

State Senator Brashear led the move to repeal the campaign spending limits in the aftermath of an investigation into Board of Regents candidate Dave Hergert’s violation of the limits. Hergert had under-reported his campaign spending in his 2004 race, depriving his opponent of matching funds due to him under the public financing program.

Hergert eventually admitted to exceeding the limit for personal loans to his campaign and to failing to report his spending, but refused to step down from the seat he cheated to win, even in the face of the Nebraska Senate’s call on him to step down. As Senators began discussing the possibility of impeachment, a grand jury was scheduled to be convened in January to examine the matter. However, a judge vacated the order seating a grand jury, so now it appears Hergert can be held accountable only by action taken by the state legislature, rather than a jury of his peers.

 
NEW JERSEY

The Clean Elections Commission, the agency responsible for overseeing the state’s pilot program for public financing of elections, described the 2005 program a success. The trial program, run in two districts, offered public funds to those candidates who collected $20,000 in small contributions - $1,000 checks of $5 each and 500 checks of $30 each. The commission also found that improvements could be made by lowering the qualifying amounts, making the amount of qualifying checks uniform, and expanding the program to more districts and to primary elections. The Commission’s official report is due in May.

 
NEW MEXICO

In the wake of State Treasurer Robert Vigil’s resignation due to federal extortion charges against him, Governor Bill Richardson made a series of reform proposals at the beginning of the year. Richardson’s proposals focus primarily on the office of Treasurer, but also would limit contributions by state contractors to the relevant elected officials, require more information from campaign contributors under the state’s Campaign Disclosure Act, and increase penalties for corrupt officeholders.

 
NORTH CAROLINA

House Speaker Jim Black proposed a series of reforms to be considered by the recently-formed House Ethics and Governmental Reform Committee. Some of the reforms include: lowering the threshold for reporting donor information from $100 to $50, ban lobbyists from employment on legislative or executive political campaigns, and banning lobbyists from making political contributions or hosting political fundraisers. North Carolina PIRG is calling for the creation of an independent ethics commission, a ban on gifts from lobbyists, and restrictions on candidates accepting funds from donors outside of their own districts.

Black has been under scrutiny for accepting from a trade association’s members checks which left the payee blank. Black would then select the payees he thought best for the trade association’s purposes, fill in the payee, and distribute the check. Some of the checks ended up in the personal account of one of Black’s allies.

 
OHIO

Admissions by a former aide to Governor Bob Taft strengthened the case against coin dealer and major political donor Tom Noe for illegally funneling campaign contributions to the 2004 Bush presidential campaign. Former Taft aide H. Douglas Talbott told federal prosecutors that Noe had reimbursed both him and another former Taft aide, Doug Moorman, for contributions they made to the Bush presidential campaign. In February, Moorman and Talbott each pleaded guilty to failing to disclose loans they received from Noe.

Legislative leaders have begun serious discussions about redistricting reform with Reform Ohio Now, a coalition that unsuccessfully pushed for a redistricting ballot initiative last November. A legislative proposal may emerge from the talks.

 
OREGON

In January, opponents of the city Portland’s Voter Owned Elections law (public funds for the campaigns of qualifying candidates) turned in more than 40,000 signatures for an initiative repealing the law. On February 28, Portland elections officials announced that the group submitted only 25,855 valid signatures, 836 short of the required 26,691.

Also, state elections officials investigated whether signature-gathers claimed that the city’s Voter Owned Elections law would take funds directly from schools. The Portland City Council does not pay for education, possibly rendering such statements by signatures-gatherers misleading, if not fraudulent.

Portland’s city council passed the public financing law last May. Under the law, candidates have to collect a threshold number of signatures and small donations in order to obtain public funds for their candidacies. City council candidates, for example, have to collect $5 contributions from 1,000 denizens of the City of Roses. Candidates who enroll in the voluntary program also must agree not to take additional funds from private donors and agree to a spending limit for the campaign.

 
SOUTH CAROLINA
The state began to put campaign finance reports online. Campaign filings for contributions, expenditures, loans, and final disposition of property beginning in the 4th quarter of 2005 for 2006 candidates for the constitutional offices are currently available online.

 
TENNESSEE

Tennessee Waltz, an FBI sting operation into government corruption, continues to reverberate through Tennessee government. The sting operation involved offering state lawmakers at various levels bribes in exchange for helping a fictional company named E-Cycle with its business efforts in Tennessee. Last year, five members of the state legislature were indicted on corruption charges, two of whom resigned. Some county–level elected officials were also indicted.

In February, Hamilton County Commissioner William Cotton was found guilty of corruption. Audio tapes played at his trial suggest that those state lawmakers who have pleaded their innocence may face an uphill battle in defending themselves in court.

 
TEXAS

On March 1, the U.S. Supreme Court heard a case challenging the redistricting plan engineered by former House Majority Leader Tom DeLay and forced through the Texas Legislature in 2003. The Court will consider a number of questions, including:

1) whether any constitutional limits exist to check the partisan motivation, design, or effect of a redistricting plan;

2) whether a mid-decade redistricting is ever constitutionally permissible; and

3) whether the 2003 plan violated the Voting Rights Act by diluting minority voting strength in any districts.

The Texas Legislature is responsible for drawing the state’s legislative and congressional districts. In 2001, the Democratic-controlled House and the Republican-controlled Senate were unable to reach a compromise on a redistricting plan, leaving it up to a court to decide the districts. A three-judge panel of federal judges did just that, making slight modifications to the 1990’s plan in order to account for the increased population in the Lone Star state.

DeLay rightly realized that if Republicans could take control of the Texas House, they could redraw the congressional districts to their own benefit, strengthening their majority in Congress and DeLay’s position as Majority Leader. In order to make that happen, DeLay played an incredibly involved role in the 2002 state legislative races, including directing $190,000 of corporate money from his Texans for a Republican Majority PAC to candidates in the period immediately before the 2002 elections.

The Republican effort to take over the Texas House was successful. In 2003, the Texas Legislature passed a new redistricting plan, which helped shift the Texas congressional delegation from a Democratic advantage of 17-15 to a Republican advantage of 21-11. DeLay’s role in the 2002 elections may turn out to be his downfall however. Corporate contributions are illegal in Texas state races, and DeLay has since been indicted for his role in funneling corporate money into state elections. Despite a last-ditch effort to change House rules to accommodate DeLay, that indictment forced DeLay to step down from his position in the House leadership, costing him the very Majority Leader position which the Texas gerrymander helped solidify.
VERMONT

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so long as they did not drive a candidate’s voice “below the level of notice.”

Lower courts had consistently found that Vermont’s contribution limits did not drive candidate voices below the level of notice, but Justice Breyer seemed to be rethinking his past support for them, telling the Vermont Attorney General “I’d like to know why the limits are not far too low.”

Breyer expressed concern that lower contribution limits would make it too difficult for challengers to mount effective campaigns. However, research has shown that challengers perform better in states with lower contribution limits. Indeed, every $1,000 a contribution limit is lowered leads to challengers doing 3 percentage points better against incumbents. After being hostile to campaign finance reform in the 1970s and 1980s, the Supreme Court was surprisingly supportive of serious reform efforts in the past five years. In addition to upholding Missouri’s low contribution limits in 2001, the Court solidly upheld the Bipartisan Campaign Reform Act in 2003.

However, since then, two new justices have arrived at the court – Chief Justice Roberts and Justice Alito. Although he professed a strong belief in states rights and judicial modesty during his confirmation hearings, Roberts seemed more than willing to substitute his own view that Vermont was not corrupt for the view of Vermont legislators who are clearly concerned about the corrupting role of money in politics. Justice Alito did not show his cards much in this hearing, asking only two questions.

Some observers have speculated that Breyer and other justices may be shifting away from their past positions on campaign finance reform in order to accommodate new ideologically conservative justices and try to work out compromises on other issues.

The Court should issue an opinion in this case by the end of June. Should the Justices close the door on campaign spending limits, momentum may build in Congress for a constitutional amendment to clearly authorize both spending and contribution limits. Senator Fritz Hollings championed such an amendment for years while in the U.S. Senate along with Senator Arlen Specter.

 
VIRGINIA

In his guilty plea to corruption and campaign finance charges, Duke Cunningham briber and co-conspirator Mitchell Wade admitted to illegally contributing $46,000 to Virginia Congressman Virgil Goode. Wade, who owned defense contractor MZM Inc., reimbursed employees for contributions to both Goode and Florida Rep. Katherine Harris, often with cash.

Goode was not charged, and has said he had no idea he was receiving illegal campaign contributions from Wade. Goode helped MZM obtain a $3.6 million earmark for an MZM facility in Martinsville, Virginia. Wade and his MZM employees gave a total of some $90,000 to Goode.
WEST VIRGINIA

In February, the state Senate Judiciary Committee voted 7-5 to approve SB124, a bill providing public financing for qualifying legislative candidates. The state’s varying-sized multi-membered districts make things a bit confusing, but here goes. To qualify for public funds under the bill, candidates for single-member districts in the House must raise 100 contributions of $5; candidates for multi-member House districts must raise from 125-250 contributions, depending on the number of members in the district. Candidates for senate must raise 250. Qualifying single-member House district candidates with an opponent would receive $7,500 in public funding for the primary and $7,500 for the general; qualifying Senate candidates with an opponent would receive $20,000 for each.Funding for single-member House district candidates would be available in 2010; for other candidates in 2012.If the bill makes it through, West Virginia would become the second state legislature after Connecticut to pass a system of voluntary full public financing of elections for itself. Arizona and Maine have passed public financing by ballot measure.

 
AT THE FEDERAL LEVEL

Duke Cunningham Sentenced
On March 3, federal district court judge Larry Burns sentenced former congressman Randy “Duke” Cunningham to eight years, four months for tax evasion and conspiracy charges stemming from Cunningham’s acceptance of some $2.4 million in bribes in exchange for assisting defense contractors Mitchell Wade and Brent Wilkes obtain contracts.

In the prosecutors’ sentencing memorandum, they revealed a “bribery menu”, a scale of government contracts available for escalating bribes to Cunningham, scribbled by Cunningham on what appears to be his official congressional stationery. For a boat worth $140,000, a contractor could pick up $16 million in government contracts. For another $50,000, he could get another $1 million in government contracts, and so forth.

In sentencing Cunningham, Judge Burns made note of Cunningham’s bullying and browbeating Defense Department officials in order to make sure his bribers got their contracts. The judge ordered Cunningham to pay $3.6 million in back taxes and to disgorge illegally obtained assets. The U.S. Board of Prisons will now decide where Cunningham will serve his sentence.

While one of Cunningham’s bribers, Mitchell Wade, has already pleaded guilty to the scheme (see Virginia), three alleged co-conspirators remain unindicted. The most involved and likely corrupt of these men is Brent Wilkes, a defense contractor based in Poway, California, a San Diego suburb. Like Wade, Wilkes’ efforts to buy access and government contracts for campaign cash did not end with Cunningham. Wilkes and his associates contributed more than $100,000 to Rep. John Doolittle (CA-4), who rewarded them with some $37 million in earmarked federal funds for Wilkes company PerfectWave Technologies.

While much of the Cunningham story has rightly focused on the outright bribery in which he and his conspirators engaged, Wilkes and Wade both initiated their relationship with Cunningham through campaign contributions. Both Wade and Wilkes also doled out hundreds of thousands of dollars in campaign contributions to other members of Congress in their efforts to obtain government funds. It may be easy to ignore the problems of our current system of campaign finance in the face of splashy bribery stories, but the broken system of funding candidates plays a much more widespread role in the undermining of our democratic institutions than does the occasional bribe.

Abramoff Pleads Guilty
Former lobbyist Jack Abramoff pleaded guilty to fraud, bribery, conspiracy and tax evasion in two separate appearances in federal court. Abramoff has become the posterchild for influence-peddling in Washington D.C.

Abramoff’s most notorious scheme went like this: Abramoff pitched the p.r. work of his confederate Mike Scanlon to Indian tribes, receiving a 50% kickback of the fees Scanlon collected from the tribes – around $70 million. To get the gravy train rolling, Scanlon ran the council campaigns of tribal members friendly to his and Abramoff’s cause, ensuring that tribal councils were disposed to give them millions of dollars in contracts to influence federal Indian gaming policy. Scanlon went so far as to write campaign speeches for some tribal council candidates. With the right tribal council in place to steer them millions of dollars in p.r. contracts, Abramoff would pitch Scanlon’s p.r. work to the tribes.

While Scanlon was doing his thing, Abramoff was busy behind the scenes in Washington, using campaign cash and lucrative employment offers to generate connections with members and their staffs and with Administration officials in charge of tribal gaming. One former White House aide, David Safavian, has been charged with lying about his efforts to help Abramoff. An Interior Department official, Steven Griles, is under investigation for using his position to benefit Abramoff’s tribal clients.

Ohio Rep. Bob Ney was the one member of Congress explicitly referenced in Abramoff’s plea agreement as someone who Abramoff bribed in exchange for official actions. Ney entered remarks into the Congressional Record praising Abramoff’s partner in a gambling venture.

Lobbying reform
Congressional efforts to reform the way business gets done in Washington D.C. in the wake of the Abramoff scandal were little more than a hodge-podge of half-steps taken by various Senate and House committees with little coordination and not much reform. In the Senate, the Rules Committee passed a proposal which would: require all privately funded travel to be approved in advance by the Senate Ethics Committee; prevent former senators-turned-lobbyists from going onto the Senate floor; require full disclosure of all travel on corporate jets, including everyone who is on the trip; ban non-meal gifts from lobbyists to senators; and require disclosure of lobbyist campaign contributions. This proposal was rejected by most reform organizations as far too weak. The Rules Committee rejected a proposal to prohibit lobbyists from being in charge of a senator’s leadership PAC.

Also in the Senate, the Homeland Security and Government Affairs Committee was scheduled to vote on other reform legislation proposed by Senators John McCain and Sen. Joe Lieberman. That measure would make it easier to strike earmarks from bills, increase disclosure requirements for lobbyists and ban all gifts over $20.

While most lobbying reform stalled in the House soon after the election of Rep. John Boehner (OH-8) as Majority Leader, a one-year temporary ban on privately-funded travel was being discussed.

Public Financing at the Federal Level?
While most of the post-Abramoff discussion focused on lobbying reform, some members recognized the larger problem in Washington for what it is: big money still buys elections outcomes, access, and influence. Acting on this precept, Reps. David Obey (WI-7) and Barney Frank (MA-4) introduced a bill that would institute public financing for federal elections, paying for the program in part with a tax on corporate profits in excess of $10 million of one-tenth of one percent.

Senator George Voinovich (OH), a Republican, has expressed some support for the idea of publicly financed federal elections, and has held discussions with Senators Chris Dodd (CT) and Dick Durbin (IL) about a Senate version of the bill.

Electoral College Plan
The Campaign for the National Popular Vote kicked off its effort to abolish the Electoral College. The campaign has an innovative state-based approach to the problem: instead of pursuing a constitutional amendment, the campaign plans to pursue a compact between the states in which states agree to allocate their Electoral Votes to the candidate who wins the national popular vote. Each state would agree to the law internally, but once enough states have signed on and the compact kicks in, the effect would be to make the winner of the popular vote in U.S. presidential elections the President of the United States. Because the compact would not take effect until a sufficient number of states to reach a majority in the Electoral College had ratified the compact, the possibility (and argument) that a state would be disadvantaged by making the change is null and void.

FEC Punts on “Solicit”
The Federal Election Commission failed to define “solicit” and “direct” for purposes of federal election law, splitting along party lines in support of two competing proposals.

In the wake of the 2002 Bipartisan Campaign Reform Act, the FEC was required to pass certain regulations to implement the Act, including definitions of certain terms. These definitions play a crucial role in determining what activity is included in certain provisions of the Act, which can either reinforce and strengthen the Act’s purposes or utterly confound them. In their first post-BCRA rulemaking, the FEC defined “solicit” as to “ask”, a “wink and a nod” approach that parallels the oft-used distinction between “express advocacy” and “issue advocacy” and potentially severely undermined the BCRA’s purposes.

Last year, a federal judge told the FEC that most of its post-BCRA regulations and definitions were a sham and ordered the FEC to rewrite them. In the judge’s order, she made clear that the FEC’s regulations should encompass implicit requests, not just explicit solicitations. The FEC went back to the drawing board, culminating in the recent February vote on adopting a new definition of “solicit” and “direct.”

The three Republican Commissioners addressed the judge’s concerns by proposing that “solicit” mean not just to “ask”, but to “ask or request.” If your dictionary is anything like ours, it makes virtually no distinction between “ask” and “request,” making this proposal seem utterly specious. The three Democratic Commissioners proposed that “solicit” mean “ask, suggest, or recommend”, an approach advocated by the Campaign Legal Center’s Paul Ryan.

The Commission was scheduled to revisit the definitions at its March 9 public meeting. 

McCain Walks the Line
Senator John McCain, one of the principal authors of the BCRA, announced his intention to attend a fundraising event for California Governor Arnold Schwarzenegger to take place on March 20 at the Beverly Hills Hilton. McCain’s attendance and involvement with the fundraiser highlights the importance of the definition of “solicit,” discussed above.

The BCRA prohibits federal officeholders and candidates from soliciting contributions above the federal limits in connection with any non-federal elections. This means McCain can’t solicit contributions greater than $5,000 for a PAC and $2,100 for a state candidate like Schwarzenegger. BCRA allows federal officeholders, however, to appear and even be featured at events where funds above and beyond the federal limits are being raised.

One such event is the March 20 Schwarzenegger fundraiser, where sponsorships run as high as $100,000; $44,600 for Arnold’s re-election campaign and the rest for the California Republican Party. The invitations state explicitly that McCain is not soliciting funds for Arnold or the California GOP above the federal limits, but McCain’s presence at the fundraiser highlights the difficulty in determining where mere “appearance” stops, and the “soliciting” begins.

The California Democratic Party has filed an FEC complaint against McCain and Schwarzenegger, which appears to be specious without further evidence that McCain is actively “soliciting” contributions above the federal level for Arnold and/or the California GOP. That being said, the Senator will have to walk a fine line come March 20 in terms of his words and acts at the dinner.

Perhaps more importantly, McCain should explain whether he thinks it is acceptable for California candidates to raise soft money at events such as Schwarzenegger’s, or if he feels that California law should be changed to outlaw the size of donations that will be given at the event he is appearing at.
 
 
 

 

There are some things in life campaign cash can’t buy,
for everything else, there’s bribery.
 

$9 million congressional earmark: $90,000

n Representative Virgil Goode (VA-5) received more than $90,000 in campaign contributions from MZM, Inc. and its employees. Goode outspent his opponent by $272,046 in 2004.

n MZM is a defense contracting firm owned by Mitchell Wade, who pleaded guilty in February to bribing former congressman Duke Cunningham and to illegally funneling $46,000 in campaign contributions to Mr. Goode.

n Goode obtained $3.6 million in defense funds for an MZM project, and worked with state officials on a tax incentive package for an MZM facility in Martinsville. Then-governor Mark Warner helped obtain the state funds for the MZM project.

n Goode earmarked an additional $9 million of defense funds for MZM.

$10 million congressional earmark: $50,000

n Representative Katherine Harris (FL-13) received $50,000 in campaign contributions from MZM, Inc. and its employees in 2004, $32,000 of which were illegally made. Harris outspent her opponent by $2,916,186 in 2004.

n Wade had dinner with Harris in early 2005 in Washington D.C., at which he offered to host a fundraiser for Harris (who is running for U.S. Senate) and asked her for federal funds for a counterintelligence program involving MZM and for an MZM facility in her district. Wade eventually bought a building in Tampa with the help of a $400,000 in tax incentives from the state and local agencies.

n In April 2005, Harris requested $10 million for the counterintelligence program.

$37 million congressional earmark: $113,000

n Representative John Doolittle (CA-4) received at least $113,000 from Brent Wilkes and his business associates. Wilkes and his wife Gina also hosted a “Dinner and a Movie” with Doolittle. Doolittle outspent his opponent by $861,228 in 2004.

n In his plea agreement, Duke Cunningham identified Wilkes, who owns a broad array of companies including a defense contracting firm, as one of the men who bribed him.

n Rep. Doolittle guided $37 million in earmarked federal funds to PerfectWave Technologies, a company owned by Wilkes.


Publicly financing federal
campaigns so that honest
candidates can compete against those who hand out tax dollars to special interests:

$6 per citizen

 

 

Sentence for accepting $2.4 million of bribes in exchange for defense contracts to companies owned by Mitch Wade and Brent Wilkes:

8 years 4 months.
Knowing that your government isn’t sold to the highest bidder:

Priceless

  
 
The Back Page:




 

Loving the Lobbyists

Lobbyist Jack Abramoff’s influence in Washington was made possible in large part by his close relationship with former House Majority Leader Tom DeLay. DeLay, in turn, used money from Abramoff and his clients to tighten his grip on power.

Abramoff was a frequent contributor to DeLay’s candidate committee and PACs, personally contributing more than $20,000 to DeLay, in addition to directing his clients to contribute to DeLay’s committees. DeLay played a major role in torpedoing efforts to reform the labor conditions in the textile and garment factories in the Northern Marianas Islands, an Abramoff client.

Abramoff worked closely with the Alexander Strategies Group (ASG), a lobbying firm started and staffed by former DeLay aides. In his plea agreement, Abramoff stated that Tony Rudy, an ASG associate and former DeLay aide, took official actions for an Abramoff client in exchange for $50,000 directed to his wife’s political consulting firm. ASG also employed Christine DeLay, Tom’s wife, for four years.

Abramoff’s devotion to the man known as the Hammer was evident in his gushing introduction of DeLay to a conference of young conservatives -- “Tom DeLay is who all of us want to be when we grow up.”

 

graphic by Corey Anderson, AmericanIdle.net