In Speech at Holland Lecture Series, Democracy 21 President Fred Wertheimer Calls for Small Donor Revolution to Counter Corrupt Campaign Finance System
In Speech at Holland Lecture Series, Democracy 21 President Fred Wertheimer Calls for Small Donor Revolution to Counter Corrupt Campaign Finance System
In a speech given last week at the Holland Lecture Series in Omaha, Nebraska, Democracy 21 President Fred Wertheimer said we are at “a crossroads for our democracy” as a result of the misguided Supreme Court decision in the Citizens United case.
Wertheimer said, “The Supreme Court changed the landscape of American politics and has created a campaign finance system that is wreaking havoc on our political system.”
Wertheimer called for “a small donor revolution in American politics,” saying, “We need the symbol of future elections to be ordinary Americans, not Sheldon Adelson.”
Wertheimer noted that “as a result of the Citizens United decision massive amounts of unlimited contributions, secret money and corporate funds have returned to our national elections in 2012 for the first time since the Watergate era.”
Wertheimer said, “These are the very kind of funds that were at the heart of the Watergate corruption scandals and the return of these funds has raised basic questions about the state of our democracy.”
The speech entitled, “A Disaster for Democracy: The Campaign Finance Scandals of 2012,” examined the destructive impact of the Citizens United decision on the 2012 national elections; reviewed the history of campaign finance scandals and major campaign finance reforms that followed; illustrated the public’s overwhelming rejection of the new role being played by outside spending groups in national elections; and proposed a reform agenda to dramatically increase the role and importance of small contributions in federal elections and address the fundamental problems resulting from our corrupt campaign finance system.
According to the Wertheimer speech:
Every national election we have turns out to be the most expensive in the country’s history. Unlike the stock market, the cost of elections never goes down, it only goes up.
The 2012 election, however, will be the most costly election in our history by far.
Spending on the presidential and congressional elections combined is expected to reach $6 billion. President Obama and Mitt Romney, and the outside groups supporting them, are expected to spend at least $1 billion each in the election.
Spending by Super PACs and nonprofit groups is expected to reach $750 million and could reach $1 billion. The money for these expenditures is coming in the form of unlimited contributions and secret donations from wealthy individuals and corporations, along with labor unions and other special interest groups.
According to the speech:
The [Citizens United] decision and later lower court decisions based on Citizens United have brought us the following:
• Corporations are free to spend, or contribute to outside groups to spend, as much of their trillions of dollars of resources as they wish to use to influence federal elections;
• Hundreds of millions of dollars in secret, unlimited contributions are being laundered into federal elections through groups claiming tax-exempt status without leaving any public fingerprints of who these donors are;
• Candidate-specific Super PACs that receive unlimited contributions and support only one candidate are serving as vehicles to eviscerate the limits on contributions to these candidates;
• Other Super PACs are using huge amounts of unlimited contributions to exercise disproportionate influence on elections, to bombard the races with negative attack ads and to provide opportunities for influence-buying and political corruption.
History tells us that unlimited contributions and secret money in American politics are a formula for corruption and scandal.
The speech noted the following facts:
There are 308 million residents in the United States according to the latest census.
Two-thirds of the money contributed by individuals to Super PACs came from just 100 individuals at an average contribution of $2.3 million per donor, according to the Center for Responsive Politics.
Forty billionaires have given contributions ranging as high as $10 million per donor to the Super PAC supporting just Mitt Romney.
The Super PAC supporting just President Obama hasn’t done nearly as well with billionaires. But President Obama has his own form of big money supporters: 179 individuals have gotten credit for raising, or bundling, at least $500,000 each for the Obama campaign. Raising $500,000 for a candidate is no different than contributing $500,000 to the candidate when it comes to the potential for influence-buying.
Last week, The Washington Post reported ane-mail invitation that went to an exclusive list of recipients to become co-chairs of a fundraising event for the Super PAC supporting Mitt Romney. All you had to do to become a co-chair was raise or bring “a check for 1 Million/couple.”
According to the speech:
The most famous Super PAC donor in 2012 is Sheldon Adelson.
Mr. Adelson is a multibillionaire who owns a gambling empire based in Las Vegas and Macao, a region of China. He reportedly plans to contribute as much as $100 million to outside spending groups to be spent to defeat President Obama.
When asked recently why he is giving this money, Mr. Adelson said his top reason is “self-defense.”
Mr. Adelson’s gambling empire, but not Mr. Adelson, has reportedly been the subject of ongoing criminal investigations by the Justice Department and the U.S. Attorney in Los Angeles and a civil investigation by the Securities Exchange Commission.
So perhaps what Mr. Adelson means when he talks about “self-defense” is if President Obama goes away the investigations of his gambling empire will also go away under a grateful President Romney.
This is not, however, the way in which government decisions should be made about potential criminal prosecutions or anything else for that matter.
Ironically, the Washington Post reported today that Mr. Adelson has said he finds the way U.S. elections are financed abhorrent putting too much power in the hands of the wealthy few. He’s got that right.
According to the speech:
Perhaps the best explanation of why the Citizen United decision makes no sense and is just plain wrong has come from Judge Richard Posner of the Seventh Circuit Court of Appeals.
Judge Posner is a conservative federal judge seen by many as the most influential judge outside of the Supreme Court Justices. Judge Posner has said this about Citizens United:
Our political system is pervasively corrupt due to our Supreme Court taking away campaign-contribution restrictions on the basis of the First Amendment.
Judge Posner explained:
The Supreme Court allows donations to political campaigns to be regulated (and limited) because of fear that donations unlimited in amount corrupt the political process because the candidate recipient knows that a donor of a large amount of money expects something in return, usually favorable consideration of a policy that would benefit the donor, and hence a large donation is likely to be a tacit bribe.
Judge Posner stated:
[I]t is difficult to see what practical difference there is between super PAC donations and direct campaign donations, from a corruption standpoint.”
According to Judge Posner, the donors to a Super PAC are known and:
[I]t is unclear why they should expect less quid pro quo from their favored candidate if he’s successful than a direct donor to the candidate’s campaign would be.
According to the speech:
Money in politics is a cyclical issue.
We have campaign finance scandals, like the Watergate scandals in the 1970s and the political party “soft money” scandals in the 1990s.
They are followed by new reform laws like the Federal Election Campaign Act of 1974 and the Bipartisan Campaign Reform Act of 2002.
The reforms work for varying periods of time – the presidential public financing system, for example, worked for seven presidential elections.
At some point candidates, parties and political operatives start pushing the envelope, loopholes are opened and the laws begin to break down. The absence of effective enforcement speeds up this process.
This is followed by a new period of excess and scandal and then, once again, new opportunities for reform occur.
The speech continued:
This cyclical nature of the money in politics issue tells us several of things.
First, we can never entirely and permanently eliminate influence-buying and political corruption. But, we can contain these problems and limit them to manageably low levels. Reforms can and have worked.
Second, this is an area that requires constant vigilance on the part of the American people. Fortunately, citizens in our country have never accepted influence-buying and political corruption as a way of life and we cannot accept it today.
Third, we are again at the point in the cycle when new reforms are needed and the voices of citizens need to be heard.
We are again at a crossroads for our democracy.
According to the speech:
Money in politics is a fundamentally important issue for a couple of reasons.
If political money from a relatively few wealthy individuals and from well-financed, influence-seeking interests has disproportionate influence on the outcome of our elections, the basic principle of one person, one vote is undermined.
Also, government decisions on taxes, spending, regulation, health care policy and countless other issues affect all of us.
If decisions are made in Washington based on the undue influence of political money, the decisions that favor a few generally come at the expense of most Americans.
According to the speech:
The American people do not like what is going on.
National polls this year show that citizens overwhelming reject the campaign finance system created by the Supreme Court.
According to a Washington Post/ABC News poll, “Nearly seven in 10 registered voters would like super PACs to be illegal.”
A Survey USA poll found that more than 75 percent of voters “view corporate election spending as an attempt to bribe politicians rather than as free speech protected by the First Amendment.”
According to an Associated Press poll, “More than 8 in 10 Americans support limits on the amount of money given to groups that are trying to influence U.S. elections.”
And a Gallup Poll found that Americans view reducing government corruption as the second-highest priority for the next president, behind only job creation.
The challenge that lies ahead is to galvanize the widespread concern of the American people into citizen action for fundamental change.
According to the speech:
[W]e need a small donor revolution in American politics.
We need the symbol of future elections to be ordinary Americans, not Sheldon Adelson.
In August, our organization joined with the Brennan Center for Justice to issue a report entitled “Empowering Small Donors in Federal Elections.”
The report included a new proposal to empower citizens to play a central role in financing presidential and congressional elections by matching their small contributions with multiple public funds and greatly increasing the importance and value of the small contributions.
For anyone who may be interested, you can find our report on our website at www.democracy21.org.
Our proposal has been described in a New York Times editorial (August 22, 2012) as “a plan that could restore a voice to ordinary citizens.”
The speech continued:
By engaging and empowering small donors, and making their contributions far more important in financing elections, we can counter and dilute the role and importance of influence-seeking money and reduce the opportunities for government corruption.
We can also provide candidates with an alternative way to finance their campaigns without having to sell their souls to their funders.
Last month, many of the recommendations in our proposal were incorporated into the Empowering Citizens Act, legislation introduced in the House of Representatives by Representatives David Price (D-NC) and Chris Van Hollen (D-MD).
….
An editorial in The Philadelphia Inquirer said about the Act, “The Empowering Citizens Act could change the game by putting control of the money flow in the people’s hands.” Theeditorial described the Act as a bill “that could provide an alternative to politicians’ dependency on the huge amounts of campaign cash that come with strings attached.
According to the speech:
In addition to advocating the Empowering Citizens Act, our organization is pursuing another very important way to increase the role of small donors in financing our elections.
The Democracy 21 Internet Project is based on the idea that the Internet and social media have revolutionized our society and can also revolutionize the way our campaigns are financed.
The Project is aimed at developing new ways to make use of the Internet and new media to engage and empower tens of millions of citizens to make small contributions to candidates.
In order to do this, the technological innovators and digital age platform companies that have transformed our society need to be enlisted to help create a user-friendly system for online giving available to all potential donors and all candidates.
The leading new media companies with their enormous ability to reach tens of millions of citizens need to be persuaded to help the nation solve a fundamental problem for our democracy.
The speech continued:
We also need to do one more thing: we need to put an end to unlimited, secret contributions being laundered into our elections.
….
For more than three decades Republican and Democratic officeholders alike had a consensus view that citizens have a basic right to know who is giving and spending money to influence their votes. This bipartisan consensus ended following the Citizens Uniteddecision.
In 2000, for example, when Congress passed the 527 Organization Disclosure Act, 48 Republican Senators and 44 Democratic Senators voted for this disclosure legislation. Ten years later in 2010, no Republican Senators voted for the disclosure legislation that is necessary following the Citizens United decision.
In 2012, the DISCLOSE Act received 53 votes in the Senate but was again short of the 60 votes needed to break a filibuster. Again, no Republican Senator voted for the legislation.
The effort to enact the DISCLOSE Act will continue in the next Congress with an emphasis on rebuilding bipartisan support for disclosure legislation.
The speech noted:
Unlike in Congress, however, there is no partisan divide in the country over disclosure.
A poll taken this year by the Clarus Research Group found that 88 percent of respondents believe that all political campaign contributions and expenditures should be publicly disclosed. Other national polls have similarly found overwhelming public support for disclosure.
The Supreme Court also has consistently supported and upheld campaign finance disclosure laws for more than three decades.
The speech concluded:
The country is faced today with a corrupt campaign finance system that is doing serious damage to our democracy. This will only get worse in the years ahead until we address the problem.
There are discussions in the media about which political party and which candidates are benefiting most from the outside spending groups. That is not the issue for the country.
The issue for the nation is: what is the massive spending of massive amounts of unlimited contributions doing to our political system and to the interests of the American people?
….
We are the world’s oldest existing democracy.
We have an obligation to our Founders, to others in the world who look to us as a model for democracy, and most importantly to ourselves to clean up our own house.
A small donor revolution in American politics will help to restore the integrity of our democracy and the health of our representative system of government.
It will also restore citizens to their rightful preeminent place in our democracy.
Democracy 21, along with others, will undertake an all-out-effort beginning in 2013 to build support from citizens, citizens groups, other organizations, business leaders, opinion makers, editorial writers and officeholders for the enactment of the Empowering Citizens Act and the DISCLOSE Act.
We have won these battles before.
We can and will win them again.
I hope you will find a way to join in this effort.
To read the full speech: visit our website at www.democracy21.org.
