Commentary: This `Poision Pill' Could Kill Campaign ReformRichard S. Dunham
In a move that should have surprised only the hopelessly naive, Senate Republicans dove into the campaign-finance debate on Sept. 29 with a proposal that could stop reform in its tracks. The idea, immediately assailed by Democrats as a "poison pill," would bar unions from spending dues on political causes unless members gave advance approval.
Majority Leader Trent Lott's plan is not only cheap politics, a transparent attempt to kill a bipartisan campaign-finance bill by making it unacceptable to the 45 Senate Democrats who now support it. It's also bad policy. If Lott were really serious about reform, he would extend the principle of his proposal--an end to the tyranny of donation without representation--to business. Corporations outspent labor in '96 by at least $60 million, say campaign-finance watchdog groups. Yet managers of corporate political action committees aren't accountable to shareholders. They distribute PAC dollars and unrestricted "soft money" to the party of their choice, most often the GOP. Like union bosses, they don't poll their shareholders to determine their preferences. And like union bosses, they operate under a "trust me" philosophy to do what's best for their enterprise.
FEAR OF A BACKLASH. Lott and other anti-reform Republicans should think twice before rushing down this path. In launching their attempt to bloody unions they may embolden shareholder groups to demand more accountability from the executive suite. Investors "have no say at all in determining the size or magnitude of these contributions," says retired leveraged buyout specialist Jerome Kohlberg Jr., a reform backer. "The overwhelming majority of shareholders are unaware of the large contributions which are being made."
Some corporations, fearful of a shareholder backlash, are already rethinking their participation in financing campaigns. A lobbyist for one major New York-based investment house that gave more than $500,000 in unregulated "soft" money during the '96 election--overwhelmingly to Republicans--says the company has quietly adopted a moratorium on such contributions, partly in response to complaints about its partisan donations. "We are sensitive to our shareholders and clients," the lobbyist says.
Republicans and their business allies are quick to point out a big difference between labor and corporate politicking. "Shareholders always have the right to sell their shares and buy something else," says Frank Coleman of the U.S. Chamber of Commerce. "Workers can't just walk away from their jobs."
True. In fairness, Republicans aren't the only partisans playing games with reform. Some Democratic liberals who favor the status quo insist on including spending limits, which the GOP sees as a violation of free speech. Meanwhile, President Clinton continues to raise millions at big-bucks fund-raisers, even as he calls for a halt to soft-money giving. "Both sides are being hypocritical," says one disgusted executive. "They are posing as white knights, when all they want to do is disarm the other side."
Republicans who complain about Democratic fund-raising abuses should instead direct their energies into real reform. There may be no real enthusiasm on the Hill for a major overhaul. But with a little goodwill from both parties, some modest changes could help restore public trust in the political process. Among them: curbs on soft money, tighter regulation of business and labor advocacy campaigns, and more public disclosure of sources of campaign cash. But none of this can happen as long as Republicans use the current debate to settle some old scores with the AFL-CIO.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.
- Uber Halts Autonomous Car Tests After Fatal Crash in Arizona
- Apple Is Secretly Developing Its Own Screens for the First Time
- Stocks Slump as Facebook Hits Tech; Bonds Recover: Markets Wrap
- From a $126 Million Bonus to Jail: The Fall of a Star Trader
- Facebook Plunges as Pressure Mounts on Zuckerberg Over Data