STATEMENT OF U.S. SENATOR MITCH McCONNELL ON CAMPAIGN FINANCE REFORM

U.S. Senate ^ | March 20, 2002 | Senator McConnell, the Defender of the Constitution

[Smile-n-Win]

STATEMENT OF U.S. SENATOR MITCH McCONNELL
ON CAMPAIGN FINANCE REFORM
*The following statement was delivered today on the floor of the U.S. Senate*

Mr. President, I would like to begin by citing the ultimate campaign reform – the First Amendment to the Constitution:

“Congress shall make no law….abridging the freedom of speech, or of the press…”

I referred to the freedom of the press because it is the robust exercise of that freedom which has brought us here today to assault the freedom of speech.

Over the past 5 years, the New York Times and the Washington Post have joined forces to publish an editorial an average of every 5 ½ days on campaign finance reform. If you had to buy that editorial space in the Times or the Post it would cost about $36,000 and $8,000 respectively for each editorial. Multiply that amount by the number of editorials in each paper and it equals a total value of $8 million of unregulated soft money advertising that frequently mentions federal candidates. And, of course, that type of corporate, big media, soft money expenditure will not be regulated in this new law.

Why is the press -- the institution that has unlimited free speech -- so interested in restricting the speech of everyone else? Let’s take a closer look.

The unconstitutional issue ad restrictions in this bill purport to limit advertising within proximity to an election. However, it does not -- interestingly enough -- apply to newspaper ads. So, the already-powerful corporations that control the news -- and in many instances, the public policy -- in America will get more power and more money under this new law. One has to wonder why that blatant conflict of interest has not been more discussed in a debate about the appearance of conflict.

Outside groups such as Common Cause have devoted years and millions of dollars to lobbying this issue in the House and Senate. And why not, their fundraising will explode if this bill passes – they no longer have to compete with party committees for soft dollars. Shays-Meehan permits every member of the House and the Senate to raise soft money for these outside groups. And, I’m told that this unlimited, undisclosed, unregulated soft dollar fundraising has already begun.

Although the facts about the provisions of this bill are almost always misrepresented, the driving mantra behind the entire movement is that we are all corrupt or that we appear to be corrupt.

We have explored corruption and the appearance of corruption before in this chamber. You can’t have corruption unless someone is corrupt. At no time has any member of either body offered even the slightest hint of corruption.

As for the appearance of corruption, our friends in the media, who are part and parcel of the reform industry, continue to make broad and baseless accusations. It has been reported that the reform industry spent $73 million from 1997-1999 on this issue – this is all soft money. These all soft dollar expenditures are used to fuel negative perceptions of federal officeholders and candidates. Scandal or perceived scandal sells papers and gets viewers. In the non-stop competition to be the next Woodward and Bernstein, the reform industry relentlessly works to raise questions in their minds.

In short, I believe that the appearance of corruption is whatever the New York Times says it is. Add to that, cash-strapped, scandal-hungry newspapers and unlimited foundation donations for the reform industry – and you’re in full-scale corruption mode. The actual facts are rarely relevant.

Mr. President, I request that 2 articles be included in the record that document the hypocritical actions of the reform industry.

With no basis in fact or reality, the media consistently and repeatedly alleges our every decision can be traced back to money given to support a political party. I trust that every member of the chamber recognizes how absurd, completely false and insulting those charges are. In fact, we have been derelict in refuting these baseless allegations. I doubt we will ever see a headline that says “99% of Congress has never been under an ethics cloud.”

Each of us is elected to represent our constituents. We act in what we believe is the best interest of the country and our home states. Does representing the interests of our state and our constituents lead to corruption or the appearance of corruption? These allegations are not an attack on us, they are an attack on representative democracy.

What we are talking about here today is speech. The government telling people how, when and how much speech they are allowed. This wholesale regulation of every action of every American anytime there is a federal election is truly unprecedented.

The courts have consistently upheld the free speech rights of individuals and parties. Even in the most recent case of Colorado II, the court made clear that parties are not to be treated any worse than any other organization in the protection of constitutional rights. This legislation falls far short of that charge. The Shays-Meehan bill weaves a bizarre web of restrictions and prohibitions around parties and candidates while simultaneously strengthening the power of outside groups and corporations who own newspapers.

This legislation is remarkable in its scope. Indeed, this legislation seeks nothing less than a fundamental reworking of the American political system. Our Nation’s two party system has for centuries brought structure and order to our electoral process. This legislation seeks, quite literally, to eliminate any prominence for the role of political parties in American elections.

This legislation favors special interests over parties, favors some special interests over others, it treads on the associational rights of groups by compelling them to disclose their membership lists to a greater extent than ever before contemplated, it hampers the ability of national and state parties to support state and local candidates, and places new limits on political parties’ ability to make independent and coordinated expenditures supporting their candidates. Many of these provisions are directly contrary to existing Supreme Court precedent.

Equally remarkable is the patchwork manner in which this legislation achieves this virtual elimination of political parties from the electoral process. It seeks to achieve a pernicious goal via haphazard means. And the real loser under this legislation is the American voter, who no longer can rely on the support of a major political party as an indicia of what a candidate stands for.

Let me walk you through how this legislation will affect all of us.

1. Effect on National Parties

A. The Numbers

Shays-Meehan will eliminate nearly 50% of the fundraising receipts of the National Parties. National parties will be forced to conduct their wide array of federal and state party activities with only half the revenue.

Shays-Meehan will eliminate 90% of cash on hand of the National Parties.

• If Shays-Meehan were law in 2001 the total cash on hand for all 6 national parties would drop from $66M to $6M.
• 3 National Republican Parties - $56M down to $19M.
• 3 National Democrat Parties – $10M down to a debt of $13M

By eliminating so-called soft-money, or nonfederal money, national party support of state parties and state and local candidates will be dramatically reduced if not eliminated.

In the 2000 cycle:

• The National Republican Parties gave $130M to state parties and $13M to state and local candidates in soft money.
• National Democrat Parties gave $150M to state parties and $6M to state and local candidates in soft money.

Where will all the soft money go? To outside groups and we can raise it for them and to the newspapers who can sell advertising in proximity to an election.

B. Coordinated vs. Independent Expenditures.

Shays-Meehan significantly limits party support of federal candidates. Parties are prohibited from engaging in both independent and coordinated party expenditures after a candidate has been nominated. The bill treats all party committees – from state and local to the national party – as a single committee.

How this works: If the Atlantic City Republican Party does a $500 independent expenditure on behalf of a Senate candidate – the party is prohibited from making the permissible $900,000 coordinated party expenditure in New Jersey.

The impact is even more severe for Presidential candidates! – if a local party anywhere does a $300 independent expenditure, the nominee will loose the entire party coordinated – roughly $13.7M in 2000.

My colleagues on the other side of the aisle that have spent time in New Hampshire lately should pay very close attention to this provision.

C. Conventions.

Shays-Meehan will end National Party Conventions as we know them. The soft money ban covers host committees created to host these grand events.

In 2000, the federal convention grant was $14M per major party, just slightly more than was spent on convention security alone in 2000.

However, host committees raised and spent roughly $65M each. This is all soft money. Parties will be left with a choice: put on their conventions with 80% less funding or pay for them with all hard dollars - money that would otherwise be used for candidate support.

The big losers are not only the parties and presidential candidates, but also the host cities and the viewing public.

In case you think this can be done through state parties, Shays-Meehan closes that option – by allowing the use of soft money only for state, district or local political conventions.

Perhaps the outside groups will step in and fill the gap. We will be able to raise the money for them. Or maybe even the unrestricted media.

2. Effect on Federal Officeholders and Candidates

Shays-Meehan “federalizes” our every action and conversation. The big losers under this bill are state and local candidates and our state parties.

Under Shays-Meehan we can only raise money for state and local candidates within the hard dollar limits and restrictions – individual limit will be $2,000 per election.

• But 39 states allow statewide candidates to receive more than $2,000 per election or allow corporate contributions.
• For example, the individual contribution limit in Wisconsin for a governor’s race is $10,000 per election. Federal officeholders and candidates will only be able to raise $2,000 per election for the governor’s race.
• In Virginia, there are no contribution limits or restrictions for state and local candidates. Federal officeholders and candidates will only be able to raise $2,000 per election for statewide candidates.

Under Shays-Meehan we can only raise soft dollars for state parties within the hard dollar limits and restrictions - $10,000 from individuals.

• But 40 states allow state parties to receive more than $10,000 per year or allow corporate contributions.
• For example, in Arizona there is no limit on the amount an individual can contribute to a state party state account. Federal officeholders and candidates will only be able to raise $10,000 per year for the state account.
• In Illinois, there are no contribution limits or restrictions on contributions to a state party’s state account. Federal officeholders and candidates can only raise $10,000 per year for the state account.

But have no fear, my colleagues, the House has provided us with an alternative:

• We can raise unlimited soft money from any source for outside groups so long as their primary purpose is not voter registration, voter identification, get out the vote and generic campaign activity. So make sure the group’s primary purpose is issue advocacy and then raise as much as you can from anyone you can. And don’t worry, it will never be disclosed.
• If you fancy voter registration, voter identification, get out the vote and generic campaign activity, we can raise $20,000 per year from individuals for any outside group specifically for those activities.
• This money is all soft money.

3. Effect on State and Local Parties

• State and local party operations are impacted dramatically by Shays-Meehan. Shays-Meehan eliminates the National Parties as a source of non-federal support for their state activities but it also heavily restricts how they operate.
• Last year we addressed in a limited way the problem of federalizing generic voter registration and get out the vote drives. The Levin amendment was adopted by voice vote to incorporate that change.
• However, the House has placed such extensive restrictions on fundraising and spending by state parties for voter activities that the provision is now virtually meaningless. State parties will be forced to use all hard money to benefit state and local candidates.
• Shays-Meehan prohibits party transfers, joint fundraising, fundraising by us for the state account and also prohibits state parties from broadcasting generic “vote Republican” or “register Democrat” messages.
• Not only are we the big losers under the House scheme, but state and local candidates who run in federal election years suffer as well.
• The big winners yet again are the outside groups and news media.
• As for hard dollar contributions to state parties, Shays-Meehan actually lowers the total hard dollars that an individual can contribute during an election cycle to state parties.
• Shays-Meehan creates a per-cycle annual aggregate sub-limit that individuals can contribute to all state parties of $37,500.
• Currently an individual can give their entire $25,000 per year limit to state parties - $50,000 per cycle.
• We are actually going backwards! And this at a time when state parties are forced to do much more with much less.

4. Effect on State and Local Candidates

• National parties will be extremely limited in their ability not only to make contributions to state and local candidates, but also in promoting issues of state and local importance and conducting voter drives.
• Members of Congress are similarly restricted in what assistance we can provide to state and local candidates.
• Shays-Meehan even regulates the conduct of state and local candidates – from fundraising to advertising.
• State and local candidates will be forced to burn campaign funds to retain lawyers to guide them through the myriad of state, and now federal regulations on their state and local campaigns.

5. Effect on Outside Groups

A. Outside Groups vs. The National Parties.

Soft money will exist and thrive under Shays-Meehan – everywhere but at the party committees. Here are a few short examples:

• Corporations, labor unions and outside groups will continue to use all soft money to run issue ads. We have no idea how much they spend because corporations and labor unions do not disclose. National parties will be forced to use all hard money.
• Corporations, labor unions and outside groups will continue use all soft money to raise all hard money for their PACs. National Parties will be forced to use all hard money to raise hard money.
• Corporations, labor unions and outside groups will continue to use all soft money for voter registration and get out the vote activities. According to news reports, the AFL-CIO plans to raise dues 60% to fund their $35M effort this year. Again we have no idea how much they spend because they do not disclose. National Parties will have to use all hard dollars for those activities.
• Stand-alone PACs like Emily’s List will continue to raise and spend a mix of hard and soft money. National parties will be allowed to raise and spend only hard money.
• Members will still be allowed to maintain leadership PACs – and even have soft dollar accounts for those PACs. National parties will raise and spend only hard dollars.

The bottom line is that this bill does not take money out of politics, it takes the parties out of politics.

B. Issue Ad Restrictions

• The Shays-Meehan issue ad provision muzzle political speech based solely upon timing of the speech. A person or group must report to the government whenever they mention the name of a candidate in any broadcast, cable or satellite communication with 30 days of a primary or 60 days of a general election. Corporations and labor unions are totally censored during that period. This censorship extends to non-profit corporations like the Sierra Club and NAACP on the left and the National Right to Life Committee and NRA on the right.
• Let me use a recent example of how this provision will work. Just this past week, within 30 days of the primary, the ALCU ran two issue advertisements in Illinois. One was a broadcast radio advertisement and the other was a newspaper ad. [Senator – read script and hold up newspaper ad]
• If this legislation is passed today, the radio advertisement falls within the issue ad prohibitions and restrictions. However, the newspaper advertisement is not effected.
• The arbitrary and capricious stifling of political speech is the essence of the issue ad restrictions in this bill.
• Both advertisements are issue speech, both advertisements ran at the same time – however only one advertisement invokes the jurisdiction of the newly created speech police.
• Reformers are apparently not concerned by the fact that this provision flies in the face of more than a quarter of a century of court decisions striking down such attempts to restrict issue speech.
• The FEC will be the speech police to track these ads – something that will prove nearly impossible to enforce in a presidential election year when there will be only a couple months without censorship somewhere.
• For those who dare speak within the 30/60 day window, they will have to report to the FEC. However, unlike every political committee registered with the FEC, the regulated speakers only report receipts of $1,000 or more - not $200 or more. Very few donations will end up being disclosed.
• Conveniently for the Washington Post and New York Times, the restriction and disclosure provisions only apply to broadcast ads – not print.
• By focusing only on broadcast media, this restriction allows unions to continue their massive ground war with unregulated and undisclosed soft money.
• The breadth of this provision may also restrict communications via the internet and other high-tech modes of communication which are satellite based.

C. Loopholes for Outside Groups

UNIONS

• Reformers claim this bill will increase disclosure and shine the light on the big money in politics – this is not true. Unions will continue funnel hundreds of millions of dollars of hardworking union member dues into the political process without ever disclosing a cent. Last spring during the Senate debate – a moment of rank hypocrisy, the Senate voted to reject a provision that simply required corporations and unions to disclose all of their political activities.
• The AFL-CIO just voted to increase by 60 percent the mandatory contributions collected by the unions from their members. These are mandatory contributions – not voluntary. In fact, in increasing the mandatory contributions, the union eliminated all voluntary contributions.
• In the 2000 cycle alone, unions contributed $83M to political campaigns. We will never know how many hundreds of millions of dollars the unions spend on their ground war because it is never reported. This bill does nothing to address these problems.
• Mr. President, I submit two articles for the record: One entitled “The organized labor loophole” and the other entitled “AFL-CIO to boost mandatory donations.”

  MEDIA

• One of the largest loopholes in this bill is reserved for the media. I ask that the full text of George Will’s February 25th column from Newsweek and his March 10th column from the Washington Post be included in the record.
• Shays-Meehan restricts the free speech rights of individuals, parties and groups – but not the media.
• The issue ad restrictions are so onerous, that many individuals and groups will choose not to speak. But, of course, the media will still be free to speak their mind.
• Mr. President, I ask that an article by Pete Du Pont, the former governor of Delaware entitled: “Just a Gag? Congress prepares to repeal freedom of speech” be included in the record.
• Many of the Shays-Meehan restrictions on political discussion by outside groups only apply to discussions in the broadcast media, not in the print media. And if you happen to own or be a newspaper then none of those restrictions apply. It is no mystery why the New York Times and Washington Post have joined forces to run an editorial in favor of campaign finance reform once every 5 ½ days for the last five years.

  Fundraising for Outside Groups

• The largest loophole for outside groups is that we can raise soft money for them. This huge loophole was literally added at the eleventh hour by the House in order to secure enough support for this bill so that it would pass the House of Representatives.
• This bill shuts off money to the political parties, but turns the spigot wide-open on contributions to outside special interests.
• What the reformers don’t tell you is that soft money to the parties was fully disclosed. But for some reason, the reformers believe a system of raising undisclosed soft money for outside groups is better.
• The parties will be replaced by an underground network of outside groups for whom we can raise unlimited, undisclosed sums of soft money.
• Let me be clear: who are the soft money organizations from this point forward that members can raise unlimited, undisclosed, corporate and union soft money for? Let me give you some names: groups like Common Cause, the Sierra Club, NAACP, NARAL, NOW. This is indeed a very good day for them.

There are other loopholes in Shays-Meehan for specific outside groups.

INDIAN TRIBES

• In the 2000 cycle, Indian tribes contributed almost $3M to political campaigns. They use their general treasury for contributions, independent expenditures and to run issue ads. This bill does not cover any of their activities.
• A recent article from Fox News concluded that Indian Tribes could soon contribute more money than any other interest group in America. I ask consent that the full text of that article appear in the record.

  TRIAL LAWYERS

• Shays-Meehan does not cover trial lawyers that organize as partnerships rather than corporations. Lawyers gave more than $112 million in the 2000 election cycle alone. They are free to run issue ads at any time without restriction.
• Mr. President, I ask that a copy of an editorial by James Wooten on this subject be included in the record.

D. Coordination

Petitioning the Government to Redress Grievances

• In addition to protecting the American people’s right to free speech and association, the First Amendment protects the right of Americans to petition their government for redress of grievances. This right is essential to our representative democracy.
• We meet with constituents and citizens groups– who in this debate are simply referred to as “special interests”–to help determine how best to effectuate the wishes of the American people. Our meetings with fellow Americans is thus one of the most important things that occurs in our democratic process.

  The Danger Posed by an Overbroad Coordination Standard

• By subjecting candidates, officeholders, and citizens groups to civil and criminal liability for innocuous–and indeed, necessary-contacts the “coordination” provisions in Shays-Meehan do great damage to the constitutionally protected right of Americans to petition their government to redress their grievances.
• The Shays-Meehan coordination provisions repeal existing FEC regulations on coordination and direct the agency to promulgate new ones. In doing so the bill ties the FEC’s hands by specifically prohibiting the FEC from passing regulations that require “agreement” or “formal collaboration” before subjecting a candidate, officeholder, or citizens group to civil or criminal liability for a coordinated communication. In other words, Congress is prohibiting the FEC from drafting coordination regulations that meet the constitutional requirement of being neither vague nor overly broad.
• Citizen groups and candidates will be subject to prosecution if the government deems an otherwise lawful issue communications to be a prohibited corporate contribution, simply because groups have met with candidates or officeholders about public policy issues and then run ads about those issues.
• For example, if a Member meets with a group about legislation that the Member and the group support and the group then runs ads promoting that legislation or those policies-someone-anyone-can then file a complaint charging that the Member and the group “coordinated” the communication.
• Because Shays-Meehan bars the FEC from requiring agreement or formal collaboration to establish that the ad was coordinated, a group and a candidate can be liable for receiving and making, respectively, prohibited contributions. It will not matter that the Member disagrees with the ad or even that he doesn’t know anything about it.
• Instead of requiring an actual agreement or formal collaboration before liability can be established, Shays-Meehan allows the government to use simple presumptions to show coordination when, in fact, it may not exist.

  Broad Opposition

• Citizen groups, both on the left and on the right, oppose Shays-Meehan’s coordination provisions. These groups recognize that they will face intrusive and costly investigations, prosecution, civil fines and penalties, and even criminal liability simply because they meet with Members and candidates about issues and then promote their policy agenda.
• I submit for the record letters from the National Right to Life Committee, the National Rifle Association, the American Civil Liberties Union, and the National Association for the Advancement of Colored People, opposing the coordination provisions in Shays-Meehan.
• I urge these groups and others who are concerned about their ability to continue to promote issues to join me in challenging the overbroad coordination provisions in this bill.

  Colloquy/Clarification

• The proponents of this legislation urge that the result I have described to you is not what they have intended. They have inserted in the record a clarification of how they envision their coordination provisions to operate.
• · However, neither a colloquy nor legislative history can change clear statutory language. If the drafters did not intend the troubling result I have described, then they should have used different language or accepted my offer to modify the provision. Instead, they insisted on directing the FEC to find “coordination” when there is no agreement to coordinate.

6. Closing

Mr. President, I submit for the record additional documents written by individuals and groups across the political spectrum which highlight the fundamental problems with this legislation. Although this legislation will pass today, I am confident the Supreme Court will step-in to defend the constitution.

I want to commend the proponents of this bill for acknowledging the serious constitutional questions that are wrapped up in this legislation and for providing an expedited route to the Supreme Court for an answer to these questions. I am consoled by the obvious fact that the courts do not defer to the Congress on matters of the Constitution.
Today is a sad day for our Constitution, for our democracy, and for our political parties. We are all now complicit in a dramatic transfer of power from challenger-friendly, citizen-action groups known as political parties to outside special interest groups, wealthy individuals and corporations that own newspapers.

After a decade of making my constitutional arguments to this body, I am eager to become the lead plaintiff in this case and take my arguments to the branch of government charged with the critical task of interpreting our constitution.

Today is not a moment of great courage for the legislative branch. We have allowed a few powerful editorial pages to prod us into infringing the First Amendment rights of everyone but them. Fortunately, this is the very moment for which our Bill of Rights was enacted. The Constitution is most powerful when our courage is most lacking.

[Salvation]

The courts have consistently upheld the free speech rights of individuals and parties.

McConnell bump!

[Smile-n-Win]

If you want to see something hilarious see The liberal analysis.

What a cruel twist of fate: campaign finance reform that benefits Republicans and big money.

Oh, those poor little-money Democrats! They'll be absolutely unable to campaign now that they've passed this bill. They will need to be financed from taxpayers money! </sarcasm>