Watergate Return Inevitable as Cash Floods Elections: Albert Hunt

A prediction: The U.S. is due for a huge scandal involving big money, bribery and politicians. Not the small fry that dominates the ethics fights in Washington; really big stuff; think Watergate.

It is axiomatic in politics that without accountability there is abuse. This year, there is a massive infusion of special-interest money into U.S. politics that is secret, not reported. Corporations and other interests will spend more than $250 million of undisclosed funds to affect the outcome of the Nov. 2 national elections.

One of the villains is Citizens United, a sweeping Supreme Court decision last January that gave the green light for the use of corporate and union funds to try to sway elections.

Chief Justice John Roberts’ five-member Supreme Court majority argued that massive amounts of special-interest cash don’t create an appearance of corruption; none of these five jurists ever faced a voter.

A former justice who did, Sandra Day O’Connor, was dumbstruck by the Citizens United case, cracking, “I step away for a couple years and there’s no telling what’s going to happen.”

One of the few good elements in the case was that the Court came down on the side of disclosure of this campaign money. It’s the Federal Election Commission -- which for most of its 35-year history has been more interested in protecting politicians than the public interest -- that has done nothing to prevent groups from hiding the source of these contributions.

‘Voters Know Less’

“As a result, we have more money flowing into this campaign than ever before,” says Anthony Corrado, a professor at Colby College in Waterville, Maine, who specializes in campaign finance. “But voters know less about the source of that funding.”

The Obama administration didn’t help when it clumsily suggested these secret funds might include illegal foreign contributions, charging, without proof, that the U.S. Chamber of Commerce used money from overseas for some of its $75 million, pro-Republican campaign.

Corrado, noting the Chamber’s political sophistication, doubts that. It really misses the point. It would be perfectly legal, for example, for the Chamber to receive secret money from a U.S. subsidiary of London-based BP Plc, or Houston-based Citgo Petroleum Corp., the U.S. subsidiary of the Venezuelan oil company, or health-insurance companies, or big oil companies, or smut peddlers. The issue is that the public doesn’t know the source.

Rove Group

The Chamber, of course, knows who gave and what they want for it. So do the architects of what may be the biggest secretly funded initiative this year, run by Karl Rove and Ed Gillespie, former Bush White House aides. Rove and Gillespie, with their American Crossroads and its subsidiary Crossroads GPS, already have brought in $56 million -- they make little secret that this is possible under the protection of anonymity afforded all donors to GPS -- and are attacking Democratic candidates around the country.

When criticized, they say they’re just a part of a conservative citizens’ revolt. In reality, their brainchild surely relies on a lot of the special interests and wealthy contributors that flourished during the Bush years.

They are shrewd at deflecting attention from their clandestine operations. Gillespie says the Democrats always operate the same way; in an e-mail he cites a news report that labor unions and their political-action committees spent almost $450 million to help the Democratic nominee, Barack Obama, in the 2008 presidential contest.

Donor Identity

Gillespie, a former Republican Party chairman, intimately familiar with the rules, knows political-action committees have to disclose contributors; and unlike in the case of Crossroads GPS, voters know the identity and general purpose of money spent by a labor union.

Rove, donning his civil-libertarian cap, expresses outrage at government or politicians threatening to reveal the identity of secret, wealthy campaign contributors.

“There’s a case for a need to protect an anonymous, obscure pamphleteer,” says Walter Dellinger, who served as solicitor general in the Clinton administration and is one of the foremost scholars of the U.S. Constitution. “That hardly justifies allowing major multinational corporations to operate in American politics behind the veil of secrecy. This is the mother of all other issues for democratic governance.”

‘Lobbyist for Liberal Causes’

On the Fox News network, Rove said the criticism is partisan sniping, taking particular aim at the longtime campaign-finance reformer Fred Wertheimer, president of Democracy 21. When Democratic groups spent huge sums in the 2004 presidential campaign, “we never heard one whisper from this lobbyist for liberal causes, Mr. Wertheimer,” Rove said.

Rove, who directed President George W. Bush’s 2004 re- election campaign, must realize that this is the same Wertheimer who filed a Federal Election Commission complaint against two Democratic outside groups that year. In the 1990s, Wertheimer called for a Justice Department investigation of the Clinton White House fundraising tactics; in the 1980s, he triggered the probe of the so-called Keating Five, four Democratic senators and one Republican.

The influence of money in politics is always controversial. The U.S. spends far more to elect politicians than most countries; this year’s congressional elections may cost as much as $4 billion.

McCain-Feingold Law

Ever since Watergate, politicians have debated rules on the size and scope of campaign contributions. The 2002 McCain- Feingold measure, which cracked down on contributions and was signed by Bush, a Republican, was the culmination of years of intense struggle. In subsequent years, the courts, dominated by conservatives, have chipped away at the law, Citizens United representing the latest and most sweeping decision.

All campaign funds aren’t the same. Even the purest campaign-finance overhaul advocates have trouble faulting small grassroots contributions: most of the $750 million that Obama raised in the 2008 presidential campaign or the $14 million that Sharron Angle, a Tea Party-supported Republican candidate for a Nevada U.S. Senate seat, raised over the past three months.

Large contributions from corporations, unions, trade associations or wealthy individuals are another matter; these donors often expect something in return. Few of those making sizeable and secret gifts to the Rove-Gillespie effort are engaged in selfless acts of good governance.

There is no legitimate case against transparency. “Sunlight,” the late Supreme Court Justice Louis Brandeis famously noted, is “the best of disinfectants.”

(Albert R. Hunt is the executive editor for Washington at Bloomberg News. The opinions expressed are his own.)

To contact the writer of this column: Albert R. Hunt in Washington at ahunt1@bloomberg.net

To contact the editor responsible for this column: Max Berley at mberley@bloomberg.net.

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