Corporate financed campaigns ... Government by the rich, for the rich?

Corporate financed campaigns ... Government by the rich, for the rich?
John Jack
April 2000

Though Senator John McCain and others have made campaign finance reform an issue central to his failed candidacy, the corporate media has left the problem largely unexplored. The likely reason is that the corporate media receives its funding (through advertising) from many of the same companies making large campaign contributions. Some conservative pundits argue that the campaign finance problem has been exaggerated by cynics. Yet when these same pundits are the ones benefiting, through funding of their shows, by the same people they are defending, it's time to take a closer look.

Public Citizen studied the election cycles for 1998 and 1994, and discovered that in the 1998 elections, federal candidates and national parties raised $1.45 billion, 19% more than the $1.22 billion raised for the comparable 1994 mid-term election, and that of the $1.22 billion, the soft money contributions to the two major parties totaled $224.4 millionÑmore than twice the $101.7 million raised for the 1994 mid-term election. At the same time, mass-media has become the primary source of political information. The result is that candidates with little financing from corporations and/or wealthy individuals can not afford television, radio, and print ads, and so have little chance of being elected. Exacerbating the problem, financiers do not want to contribute to someone they think might not win, and because of our flawed election system where millions of voters can vote for someone and still have their demands ignored, voters think voting for someone who won't win is a waste of time. And they might be right.

"We didn't send you to Washington to make intelligent decisions. We sent you to represent us." This statement was made by Texas Baptist pastor Kent York, to Representative Bill Sarpalius, on his vote on the Clinton budget, and was included in the 1997 calendar of the 365 Stupidest Things Ever Said. Most people express their expectations of the candidates they contribute to with more subtlety.

The Telecommunications Bill, endorsed by Bill Clinton and passed in 1996, was not covered much by the media, except in sound bites about how it would "spur competition" and "lower rates." The reason the corporate media did not cover the bill in depth was that the corporate media was the bill's main beneficiary. The bill lifted provisions on how many stations one company could own. The result was an almost immediate drop in competition through merger-mania and a resulting increase in cable rates.

The bill also provided companies a piece of the "digital spectrum," which allows the creation of interactive TV, including commercials. In other words, it allowed for an extraordinary marketing opportunity--the FCC estimates the fair market value on this opportunity at around $70 billion. Common Cause reports that "$70 billion is enough to construct over 10,000 new elementary schools or to run and renovate each of our 368 national parks until the year 2018."

Broadcasters had contributed nearly $5 million in soft money contributions from 1991 to June, 1997. Media scholar Dean Anderson reports that from May 1995, when the bill was introduced, to February 1996, when it passed--nine months later--the three network news shows (NBC, ABC, CBS) aired a total of 19 minutes on the Telecommunications Act. Congress refused to auction the licenses, instead giving these licenses to the broadcasters for free. The head of the FCC at the time called the signing of the act "the biggest corporate giveaway this century."

McCain gives some indication of how this particular fleecing of America happened: "[Say] there's an issue before the Congress which affects their industry. [Lobbyists] call in the station managers from the Congressman's district or the Senator's state. They all come to Washington. They sit down in the room with the senator or representative. Now, there's never any threat made; there's never any statement that "if you don't do this, we're going to say bad things about you in our newscasts." But they are the messengers. They portray you and your work here in Washington to the people in your state or district." Effectively combining disincentives to investigate the issue and incentives to pretend to be ignorant of it, the telecommunications industry donated $12.6 million to federal elections in 1998 alone. In July 1998 Congress decided not to investigate the rate hikes.

The second biggest contributor to federal elections in 1998 was the oil industry, which contributed $10.8 million to federal elections but still didn't pay the $2 billion owed in royalties on oil taken from public land (reported in Project on Government Oversight). Mother Jones Magazine reports that "when the Interior Department tried to collect an additional $66 million by charging more for oil, Sen. Kay Bailey Hutchison (R-Texas) inserted an eleventh-hour provision blocking the change into a spending bill. The provision itself sailed through without a separate vote."

Mother Jones also reports that the alcohol, hotel, and restaurant industries contributed $9.8 million to federal election campaigns in 1998: ÒIn March 1998, the House considered lowering the legal maximum blood-alcohol content level for drivers from 0.1 percent to 0.08 percent. But the food and beverage industry feared that fewer drinks would mean less profit. . . . The proposal was secretly killed in a House committee without a recorded vote," although some states have enacted similar provisions on their own. The pharmaceutical industry contributed $7.4 million, and Congress promptly voted to allow drug manufacturers to promote their products for uses not approved by the Food and Drug Administration, ignoring critics' concerns about possible health risks. The credit card industry contributed $3 million, and in 1998 Congress passed a bill forcing bankrupt consumers to repay some of their debt--despite protests from the Consumer Federation of America arguing that the bill penalizes consumers but places no responsibility on credit card companies for extending credit indiscriminately.

Former Speaker of the House Newt Gingrich's fine for lying to Congress was paid through a loan from Senator Bob Dole, who had recently been appointed "special counsel" to the law firm Verner, Liipfert, Bernhard, McPherson & Hand, which "lobbies for numerous industries that had business before Gingrich's Congress." Verner, Liipfert was attorney for Philip Morris, RJR Nabisco, Brown & Williamson, U.S. Tobacco, and Loews Corp. Gingrich was fined for lying about the tobacco industry.

"The best Congress money can buy"--Supreme Court seeks equal representation. Judges are among elected officials in 39 states. Most of these judges get campaign funding from the lawyers that will later appear before them in court; and many get corporate backing as well.

Bob Gammage, a Texas Supreme Court Justice who served one term and chose not to run again because the system was just too corrupt notes, "people don't pour money into campaigns because they want fair and impartial treatment. They pour money into campaigns because they want things to go their way."

Bill Cook, President of the Pennsylvanians for Effective Government, appears to be one of those people: "There are issues which we want the legislature to pass, which we want the governor to sign into law, and we would certainly like to have Justices find those issues Constitutional when they come before them." Ginger Sawyer, of the Louisiana Association of Business and Industry (LABI), explains further: "We don't pick our opponents lightly when we make selections of people to target for replacement on the bench. The primary way to make a selection is tracking all the decisions the Supreme Court has made over the last 25 years. So we drew the 25-year history--fifty cases--and determined how each one of the judges had voted on the merits of those cases. Court Justice Pascal Calogero had a 3% voting record. Now that's totally unacceptable to the business community." The Justice Calogero that Ms. Sawyer is referring to is a Louisiana Supreme Court Justice with a reputation of finding for individuals and against companies. LABI found a candidate to run against him and backed that candidate with an extensive smear campaign against Calogero.

The Chemical Corridor lies along the Mississippi River between Baton Rouge and New Orleans and is home to seven major oil refineries and hundreds of other chemical and industrial sites. It is one of the most polluted places in the United States. Tulane Law professor Oliver Houck cites figures showing that there are plants discharging--directly into the Mississippi--more pollution than all industry in New Jersey combined. Three or four of the plants outpollute all of Ohio on their own; the contamination levels going into the Mississippi are astronomical, yet Louisiana, unlike other states, drinks that water. Locals refer to this particular stretch of the Mississippi as Cancer Alley.

Cancer Alley exists largely as a result of the efforts of Mike Foster, the Louisiana governor, who ran ads in the Wall Street Journal announcing tax breaks and limits of liability for companies that located there. Shintec, a subsidiary of a Japanese company, announced plans to build a $700 million polyvinyl chloride plant near Convent, Louisiana, in Cancer Alley. The governor was delighted; the Department of Environmental Quality quickly approved it.

Professor Houck, in response to this rampant pollution, founded the Environmental Law Clinic at Tulane University in New Orleans. Students at the clinic provide free legal services to those who couldn't otherwise afford it; the Louisiana Supreme Court allowed the student assistance for almost thirty years under a provision called Rule XX. Residents of Convent turned to the clinic to help them fight Shintec. The student lawyers argued that it was not environmentally just to put in yet another heavily polluting plant alongside six others that had already overloaded the environment with chemicals. The EPA ruled in favor of the Convent residents, deciding that Shintec did not meet the air pollution standards. The plant was never built.

Governor Foster came to New Orleans and told the Chamber of Commerce and the area alumni not to contribute any more to Tulane. He then threatened to introduce legislation to eliminate Tulane's tax exemptions, and began trying to convince the Supreme Court to change Rule XX. LABI, the organization that once loathed Justice Calogero, now asked Calogero to revise Rule XX to restrict Tulane students. Calogero was running for re-election, and changed the rule. Under the new rule, for the law clinic to provide free assistance to a group, 75% of its members must prove that they are indigent or living below the poverty line. (This figure was later changed to 51%.) The new rule greatly restricted the clinic's ability to help the working poor. Soon after Calogero's decision, 29 business leaders--including the lawyers who had represented Shintec--publicly endorsed him. Calogero raised over $1 million and won by a comfortable margin.

In an extensive poll, The Texas State Supreme Court and the Texas Bar Association discovered that 83% of the Texan public thinks judges are already unduly influenced by campaign contributions. Skeptics would be right in pointing out that public opinion is not a good measure of truth. Yet the same study also showed that 79% of lawyers think that contributions significantly influence decisions, as do almost 50% of the Justices.

The 1970s Texas Supreme Court was comprised mostly of former personal injury lawyers. The Texas Medical Association (TMA) organized its Clean Slate 88 to replace those Justices with people more sympathetic to their side. TEXPAC (the TMA's Political Action Committee) distributed tapes with litigation horror stories detailed on them to doctors throughout the state. One tape featured the story of Dr. Benjamin Bradley, who was appealing a $20 million suit to the Texas Supreme Court. Elections were upcoming.

The doctors began contributing money, taking out ads in local papers, and even trying to influence their patients choices on who to vote for. Apparently they were successful. In one year alone, five of the Justices were replaced by ones supported by TEXPAC. As Craig McDonald of Texans for Public Justice, notes: "We would never allow our umpires ... to be paid by the baseball players." Another media scholar asks, "if we don't allow companies Fifth Amendment protection--and for good reason--why should we allow them First Amendment rights?" Yet corporations routinely fund the campaigns of people who will later preside over their cases.

Kingsley and Comfort Agbor, a middle-class Texan couple, had a son who had the nerves in his arm separated from his shoulder during birth. At five months old, the boy went into surgery to have a nerve transplant. The operation failed. The Agbors sued the doctor for malpractice. She settled out of court. But during the suit, the Agbors discovered that the doctor did not have insurance and had already had several other suits filed against her for malpractice. They sued the hospital for negligence, stating that at the very least, the hospital should have known if its doctors had insurance. The court ruled that under the Medical Practice Act--an act originally intended to protect patients--the Agbors did not have the right to sue the hospital. The Appeals Court reversed the decision and the hospital appealed to the Supreme Court. The Supreme Court split 5-3, deciding that the Agbors could not sue the hospital unless they proved that the hospital administration had acted with malice and forethought--in other words, the Agbors would have to prove their case, and then some, before they could present it.

Animals' Agenda reports that "After extensive hearings in 1976, the Senate Select Committee on Human Needs and Nutrition, chaired by Sen. George McGovern" released a report entitled "Dietary Goals for the United States," in which McGovern "recommended that Americans 'eat less meat.'... Industry leaders and lobbyists brought out their biggest guns to pressure McGovern and other committee members. All the arm-twisting brought on a new round of hearings at which meat industry hacks padded the record with the red-meat party line. The revised report recommended, 'Eat less saturated fat.' Never since has a government publication used the word 'meat' in such a dietary report."

Checks and Balances
So what can be done about the corrupting power of money in politics--especially when Senators are bought or coerced (or both) and Justices, also frequently elected, are in the same position when it's time to review the results of existing laws? The most obvious solution is campaign finance reform. For that, several diverse groups are taking equally diverse approaches.

Grassroots movements across the country, inspired by the enactment of Clean Money Campaign Reform in Maine in 1996, are pushing for public financing for campaigns and equal access to media time for all candidates. Public financing initiatives have appeared on ballots here in Florida and also in Arizona, Maine, and Massachusetts. And a few cities like Oakland and Boulder are passing laws calling for public financing of municipal elections. The Nation reports that under C.M.C.R, "candidates for state office who agree to limit their spending and raise little or no private money can qualify for full public financing of their campaigns."

McCain is pushing a bill to decrease corporate power in elections. The McCain-Feingold bill (S.1593) would abolish soft money--the unlimited contributions made by corporations, wealthy individuals and unions-- to campaigns. Soft money is frequently used to air sham issue ads--thinly disguised campaign ads. If passed, the bill would prohibit corporations from raising soft money either directly or indirectly, through leadership PACs and other means. It would also limit individual donations to campaigns and prohibit corporate and union donations.

The Shays-Meehan bill that passed the house last September was originally intended to regulate issue ads by broadening the definition of express advocacy to include any communication aired within 60 days of an election in a paid radio or TV broadcast ad. Broadening the definition in that way would subject the ads to the contribution limitations and disclosure provisions of the Federal Election Campaign Act. (This part of the bill was weak already, as it excluded contributions of internet ads, which frequently exceed the $1,000 benchmark requiring full disclosure. The bill would also have required 24-hour Internet posting of required reports to the Federal Election Commission (FEC), allowed the FEC to conduct random audits of campaigns within 12 months of an election, made it easier for the FEC to initiate enforcement action, and increased penalties for knowing and willful violations of election law.

The Georgia State Conference of NAACP Branches has filed a lawsuit challenging the Constitutionality of campaign spending, stating that since advertising through mass media has become the primary means of political discourse, and that since all that advertising costs a tremendous amount of money, and that since candidates must spend on a par with their opponents to have a reasonable chance of election, the current system denies First Amendment rights to the poor. As John White, an African-American with 22 years of experience in the Georgia House, says, "It used to be you couldn't vote if you couldn't pay the poll tax. Now you can't be a senator if you can't raise $200,000." White should know--he ran in the Democratic primary for State Senate in 1996. His campaign budget was $16,000; his opponent's was $270,000. He lost. The NAACP suit also alleges that since representatives make candid admissions that "they tend to give ear only to those who contribute funds to their campaigns' (a bias euphemistically referred to as "access"), the current political system denies Fourth Amendment protection to the poor, as well.

Things are looking good for the NAACP--Associated Press reports that "on January 25, The Supreme Court, in a 6-3 decision Monday, reinstated Missouri's $1,075 cap on individual contributions to candidates for state office. It was the first time the high court had ruled on contribution limits since 1976. "The Supreme Court stated that "unlimited campaign contributions distort the political process."

As Sen. Mitch McConnel (R-Ky) whines to one reporter, "Take away 'soft money' and we wouldn't be in the majority in the House and the majority in the Senate, and couldn't win back the White House." Sounds like a good start.

The information in this article came in part from the videos Consuming Images, Leading Questions, Justice for Sale, and The High Cost of Free Speech, all available at The Civic Media Center. The CMC is located at 1021 W. Univ. Ave, (352) 373-0010.
Other information came from Mother Jones magazine ("Loan Officer for the Corporate Welfare State," "Tip Sheet: A guide to the biggest vices in Congress," "Coin-Operated Congress," and "Contribution Camouflage") and Time Magazine ("How the Little Guy Gets Crunched" and "How to Become a Top Banana").
You can read the NAACP's complaint at world.std.com/~nvri/MasseyResp.html and world.std.com/~nvri/MasseyComp.html
Public Citizen's address is www.publiccitizen.com. The Project on Government Oversight's address is www.pogo.org. For more information on campaign finance reform, visit Common Cause (www.commoncause.org) or Granny D's site (www.GrannyD.com)