Executive Memorandum #329
May 5, 1992
I For further details on the contents of the House and Senate versions of campaign fmance reform, see Steve Schwalm, "Back to the Congress: Campaign Finance Reform in 1992," Heritage Foundation Backgrounder No. 88 5, February 28, 1992. 2 Steve Schwalm, ibid., pp. 34. 3 Cm?Wdgn Finance Reform - A Report to the Majority and Minority Leader, United States Senate, Campaign Finance Reform Panel, March 6,1990. p.3.later,-declared improper, that decision, and any penal ty, would come long after the campaign. Further, S.3 re- d even r a quires o@ly random auditing, so there is a good chance that illegal activity will not be detecte afte campaign ends. Beyond campaigns, S.3 would add restrictive new regulations on state p o litical parties and on independent political activity. The aim appears to be to make it dOicult for anyone other than incumbents to participate in the electoral process. Taxpayer Funding, Government Control. Taxpayers have indicated time and again that th e y do not wish to pay taxes for government campaign financing. Even the voluntary Presidential Campaign Fund is expected to go broke by the next election. S.3 includes numerous government funding provisions, yet there are no pro- visions to pay for the sub s idies. S.3 represents a lurking campaign tax, as proponents hope to pass the bill now and stick someone else with the tab later. Beyond the direct subsidies, S.3 would require private broadcasters and the Postal Service to subsidize campaigns without reim b ursement, costs which will ultimately be borne by consumers. Another objectionable element of the public financing is the indiscriminate way in which funds will be dis- tributed. Candidates who meet the mathematical thresholds for receiving government ben e fits will receive them, even the David Dukes or Al Sharptons. This already happens in Presidential primary races. The problem will only be exacerbated by opening for funding 535 more races with lower qualifying standards. While S.3 opens the public coffer s to candidates, it fails to eliminate the special interest advantage incum- bents claim to oppose. Political Action Committees (PACs) are the greatest source of special interest funding in elections. PAC contributions favored incumbents over challengers i n House races by more than thirteen to one in 1990. The PACs' power is due largely to the fact that PACs are allowed to contribute more than individ- uals in elections. Yet S.3 continues a contribution limit that is two and one-half times (for the Senate) t o five times (for the Hduse) greater than the $1,000 limit for individual contributors. Perpetuating Incumbent Advantages. S.3 does little to offset the huge electoral advantages incumbents enjoy by virtue of their office. Incumbents have access to tax mo n ey for activities and resources that support their re-election, such as full-time paid staff, district and state offices, the ability to do constituent service on behalf of district voters, virtually unlimited travel, and use of House and Senate broadcast studios. The biggest of these re-election perks, is the fi-ee mailing privilege, or frank. Congress sends out hundreds of millions of pieces per year, only ten percent of which is in response to constituent mail. Senators have agreed to a ban on election- y ear franked mass mailings largely because that leaves five years in which they can flood their states with taxpayer-funded mail. A staff error initially included an election year ban for the House as well. But, in an unusual procedure, the House quickly r e moved the election-year limit: with terms of only two years, the free mail was simply too valuable for House members to give up. Rules for the House and Senate also differ in regard to contribution sources, government funding, and other subsidies. These d i fferences reveal that S.3's real aim is not so much to clean up campaigns as to appear to do so while protecting favored-and differing-fundraising sources and campaign techniques for House and Senate in- cumbents. S.3 would do virtually nothing to address the real problems in campaign finance: unfair incumbent advan- tages and a cumbersome regulatory system. Instead, S.3 would add even more bureaucratic restrictions on po- litical activity and would enhance incumbent advantages with spending limits and pub lic financing. The need for true campaign finance demands that the President veto S.3 as promised.
Steve Schwalm Congressional Analyst U.S. Congress Assessment Project}}