U.S. Senator Russ Feingold on Campaign Finance ReformFrom the Senate Floor
October 18, 1999 Mr. FEINGOLD. Madam President, in a few minutes, the Senate, for the first time--let me reiterate that--for the first time, the Senate will go on record on the central issue in this debate: Should the Senate ban soft money? It is a simple question that has a simple answer. And soon, finally, we will see where each Senator stands. The fact that our current campaign finance system has created an appearance of corruption justifies Congress acting to ban soft money. In fact, if we don't act, we create the appearance that we don't care about corruption. Creating a legislative record of the appearance of corruption is critical because the Supreme Court has held that not just actual corruption but an appearance of corruption is adequate reason for the restrictions on the speech represented by campaign contribution limits. Madam President, this is the central misunderstanding or flaw in the opposition's position. They have premised everything in this debate on the idea that you have to show individual Senators who are guilty of corruption. Well, of course, that isn't the standard at all. That isn't the law. Let me quote from the Supreme Court's opinion in Buckley v. Valeo because this is a crucial concept that opponents of reform often seek to ignore. The Court said:
Let me give some examples of news stories in just the last three weeks that drive this point home. All of them make it perfectly clear to me, and I think to almost any American, that political donations are generally a way of attempting to buy influence and access. All of them add to the record that there is an appearance of corruption out there that justifies the Congress taking action to ban soft money. Madam President, if this applies to hard money contributions, it surely must apply far more easily and obviously to soft money contributions. Exhibit A is a story from the National Journal of October 2, 1999. I ask unanimous consent that this article be printed in the RECORD. There being no objection, the article was ordered to be printed in the RECORD, as follows: [From the National Journal, Oct. 2, 1999] (By Peter H. Stone) Since he joined Akin, Gump in January, after sifting through a score of job offers, Paxon, the former chairman of the National Republican Congressional Committee, has worked diligently to boost the firm's standing in GOP circles. Moreover, Paxon's arrival at Akin, Gump reflects the determination of K Street firms loaded with Democratic ties to adjust to the GOP's control of Congress. It was no secret that Akin, Gump needed a GOP star. After the 1996 presidential elections, the firm courted Bob Dole, the GOP nominee and a former Senate Majority Leader. But instead he joined another heavily Democratic firm, Verner, Liipfert, Bernhard, McPherson and Hand. Two years later, Akin, Gump recruited Paxon aggressively and nabbed him as a ``senior advisor'' for an annual salary of about $750,000. Paxon gets an office next to Strauss, to boot. Paxon, who was instrumental in the GOP's 1994 takeover of the Congress, enhances Akin, Gump's credibility among Republicans. After all, he has raised big bucks for House GOP leaders, the party committees, and the leading presidential contender George W. Bush, the Texas Governor. He has already attracted roughly a dozen new clients to the firm, including Americans for Affordable Electricity--a coalition of energy producers, led by Enron Corp., and large users, such as the chemical industry--which backs quick utility deregulation. Paxon also earns his keep by advising several long-standing Akin, Gump clients on lobbying strategy. Paxon conceded that Akin, Gump had a lot of fence-mending to do with the GOP. ``The firm had a reputation as a Democratic firm, unfairly so,'' he said. Despite the presence of such GOP stalwarts as Donald C. Alexander, Smith W. Davis, and Barney J. Skladany, the firm's superstars are former Democratic National Committee Chairman Strauss and President Clinton's golfing buddy Jordan. Joel Jankowsky, who heads the firm's lobbying team, is also a Democrat. ``We have needed to ratchet up our Republican profile to another level,'' Paxon added. Paxon, 45 and a nonlawyer, is certainly trying. Since coming on board, Paxon has helped host 20 fund-raisers for House Speaker J. Dennis Hastert of Illinois, House Majority Whip Tom DeLay of Texas, Senator Majority Whip Don Nickles of Oklahoma, and others in the GOP. What's more, Paxon and his colleagues raised more than $250,000 for an NRCC dinner earlier this year and another $150,000 for a GOP Senate-House dinner. In late August, Paxon helped Hastert during the Speaker's successful fund-raising trip to Las Vegas. Not surprisingly, NRCC Chairman Tom Davis of Virginia is a huge Paxon fan. ``Bill is still a very integral part of the culture over here,'' said Davis, who talks to Paxon a couple of times a week. ``He's been helpful in building bridges to groups. I consider him a right arm up here.'' Paxon is also one of a small number of K Streeters who meet regularly with Hastert to discuss party strategy and to swap information. He does the same with Chief Deputy Majority Whip Roy Blunt, R-Mo., who holds weekly meetings with lobbyists. During a recent session, Paxon maintained that the GOP should not worry too much about its record on Capitol Hill this year, because the party's generic poll numbers remain high as a result of the public's ``fatigue'' with the Clinton Administration and other factors. Nationally, Paxon has proved to be a key fund-raiser and strategist for Gov. Bush. Paxon has raised more than $100,000 for Bush, with a major slice of the money coming from New York state. On Oct. 4, Paxon will co-host events in Buffalo and Rochester that are expected to pull in close to $500,000 for the Bush campaign. Campaign sources say that Paxon is likely to be named a member of Bush's national finance committee when the panel is expanded later this year. Paxon has helped to secure congressional endorsements for Bush, whom he has visited three times in Austin. Paxon was instrumental in lining up Blunt as the point man for the Bush campaign in the House. In addition, he has advised the campaign on tapping various House members for fund-raising and other help. Paxon's fund-raising skills, plus the experience he gained during five terms in Congress, have seemingly proved magnets for new business. Although he is barred by ethics rules from lobbying on Capitol Hill until next year, Paxon said he offers clients a cornucopia of other services. ``I help clients understand what kind of lobbying, grass-roots, and PAC (political action committee) programs they need to be effective in Washington.'' As for clients, Paxon is doing well. Americans for Affordable Electricity, for example, is paying the firm approximately $500,000 a year for Paxon's services, according to coalition sources. Paxon is the group's national chairman. What does Paxon do to merit such fees? For the AAE, Paxon has offered advice about how to approach members and what arguments sell well on Capitol Hill. He has also helped organize fund-raisers that the coalition has held for key members of the House Commerce Energy and Power Subcommittee, including its chairman, Joe Barton, R-Texas. Paxon is a former member of the panel. In late September, Paxon and Marc D. Yacker, a member of the coalition's steering committee and a lobbyist for the Electricity Consumers Resource Council, attended a luncheon with aides to roughly a dozen Governors to discuss utility deregulation. Paxon has helped at the coalition's press conferences and been a guest on several radio talk shows. Paxon's name is also featured in the coalition's advertising campaign. Several coalition leaders give Paxon high marks. ``The very fact that his name is on all the ads and that he's associated with the issue and the cause is a major boost to the coalition's legislative efforts,'' Yacker said. But another coalition source complained that Paxon has failed to raise enough money to enable the coalition to compete with the utility industry's lobbying and advertising efforts. Paxon, a Buffalo native, has corralled new clients in areas ranging from financial services to construction. Not surprisingly, some of that business comes from the Empire State. For instance, Paxon brought in the New York State Health Facilities Association, which is seeking additional Medicare reimbursement money. Moreover, Paxon is permitted to lobby lawmakers outside Washington, and he has already done some work in Albany, N.Y., for PG&E Generating Co., a unit of Pacific Gas & Electric Co. Paxon also devotes a fair chunk of his time to helping the firm's longtime clients, such as AT&T Corp. In late September, Paxon participated in a morning press briefing hosted by the Competitive Broadband Coalition--of which AT&T is a key member--to introduce a multimillion-dollar television ad drive that will run in about 23 states and inside the Beltway. The coalition's ad message is aimed at countering lobbying by some Baby Bells, which want to revise the 1996 Telecommunications Act to allow them to provide high-speed data services in the long-distance market. Paxon will also advise the coalition on legislative strategy. The lobbying battle has a personal dimension for Paxon. His wife, former Rep. Susan Molinari, R-N.Y., represents iAdvance, a coalition that includes several Baby Bells. ``Every now and then, we square off,'' quips Paxon. ``It's not exactly (James) Carville and (Mary) Matalin.'' According to Paxon, his move from Capitol Hill has proved to be relatively smooth. ``In the leadership, we spent a lot of time strategizing on legislative issues, working on the public angles, and trying to keep an eye on the big picture,'' he added. ``It's the same downtown.'' Of course, Paxon's transformation from congressional leader to thriving lobbyist, a success greased by plenty of campaign cash, has provoked some indignation from longtime critics of the money game. ``Bill Paxon may have changed jobs, but he doesn't appear to have changed his role as a big-time player in the Washington influence-money game,'' said Fred Wertheimer, the president of Democracy 21, a group that advocates campaign finance reform. But at Akin, Gump, legendary lobbyist bob Strauss is bursting with pride about the success of the firm's Republican hire. ``He fit in from day one,'' crows Strauss. ``He's a franchise player. He'll continue to make contributions, not just to the business of the firm, but the character and the culture of the firm.'' Akin, Gump is banking on that.
Apparently, Akin Gump, a firm known for its Democratic Party ties, hired Mr. Paxon to ``mend fences'' with the Republican Party. And how does Mr. Paxon do that? According to this article, the main thing he does is raise money for Republican Members of Congress and the Republican Party. The National Journal reports that Paxon has helped host 20 fundraisers for the Speaker of the House, the House majority whip, the assistant majority leader in the Senate, and other Republican office holders. He has also raised more than $250,000 for an NRCC dinner, and another $150,000 for a Republican House-Senate dinner this year. He has raised over $100,000 for Presidential candidate George W. Bush. Let me quote from the article:
The article continues:
Mr. DAVIS calls him an integral part of the culture over here. Just what kind of culture is this? Certainly not the kind of culture I would be proud to tell my children and grandchildren about. Certainly not a culture that we should nourish and preserve for the future of our democracy. He is a right arm for the congressional leadership? The public might be excused for asking: Just who is the right arm for whom in this relationship? Exhibit B. On October 5, the day before the House considered the Patients' Bill of Rights, according to press reports, officials for Cigna, Blue Cross-Blue Shield, and Aetna held a $1,000 per plate breakfast fundraiser for the Speaker of the House. Press reports the next day said that 15 or 17 health insurance industry lobbyists attended the event. Atlanta Constitution columnist Tom Baxter wrote the following: The condition of the political ground could be judged by the keen attention of all the television networks to a breakfast fund-raiser this week at which insurance lobbyists arrived with checks for Hastert and others. Not that such scenes aren't common these days, but the timing made this a photo-op for campaign finance reform. Indeed. I remember seeing reports on the national TV news about this event. And I thought to myself: ``what can the average American watching on TV think about this scene?'' ``How can anyone not think this is wrong?'' Actual corruption? We will never know. The appearance of corruption? Without a doubt. The headline of this AP news story tells it all: ``Insurers Give Speaker Thousands on Eve of Vote.'' I ask unanimous consent, Mr. President, that this article from the Bergen County Record on this fundraiser be printed in the RECORD at this point. There being no objection, the article was ordered to be printed in the RECORD, as follows: [From the Bergen County (NJ) Record, Oct. 6, 1999] (By David Espo) ``I'd like to ask them about sitting down with America's families instead,'' President Clinton chided from the White House as he sought to build support for legislation granting patients the right to sue their health insurance companies. Hastert, who opposes the bill, defended his previously scheduled meeting and sought to turn the tables on the White House. ``Mr. President, I hope you will say no to helping trial lawyers, and say yes to helping the 44 million Americans who want health-care coverage,'' the Illinois Republican said in a written statement. The exchange underscored the deep philosophical and political gulf between the two parties on health care at a time when government statistics show the number of uninsured continues to increase. The White House, most Democrats, and some Republicans are supporting legislation to strengthen patients hands in dealing with their managed care companies. Among prerogatives would be the ability to sue for damages when prescribed care was denied. Republicans counter that such provisions will merely raise the cost of insurance and prompt some employers who now offer insurance to their workers to drop it. Facing a likely setback on that measure, the GOP leadership is proposing a companion bill that provides numerous tax breaks to make health insurance more affordable. Their ``access'' bill also includes a provision opposed by many Democrats to expand a current small program allowing medical savings accounts. Another would give small businesses the option to buy health insurance under federal rather than state regulation. That would exempt them from state mandates that bigger self-insured companies avoid. ``It's not the severe poor who don't have health care,'' Hastert told reporters. ``There are government programs that reach out. It's working people today, who are working for small business or who run their own shop or they go from job to job, who need the ability to get health care.'' Hastert pledged a ``fair and open debate of the health-care issue'' today when the legislation reaches the House floor. The debate will come against a backdrop of a fresh government report that estimates 44.3 million Americans, one in six, had no health insurance coverage in 1998. The Census Bureau survey found the number without coverage grew by nearly a million, but overall population growth kept the rate about steady, 16.3 percent in 1998, compared with 16.1 percent in 1997. In 1996, 15.6 percent lacked coverage. Public opinion polls show the issue is high on the public's list of priorities, and GOP leaders have struggled for months in a narrowly divided House to keep control of it. Hastert held the fund-raising breakfast for his political action committee a few blocks from the Capitol. Aides said it was scheduled several weeks ago. There was no word on whether there was consideration of rescheduling the event given the close proximity to the House's debate. ``I've listened to everybody in the health-care business for a long time,'' the Speaker told reporters in the Capitol. ``The die is cast already on what the health legislation is going to be. So there's no influence there whatsoever.'' An invitation to the event was issued in the name of officials of Cigna, Blue Cross-Blue Shield, and Aetna. Mr. FEINGOLD. Madam President, an article that appeared in the Capitol Hill newspaper The Hill on September 29. Here's another great headline: ``Why 30 top Democratic lobbyists attended GOP chairman's bash.'' This article reports however, that 30 top Democratic lobbyists attended a fundraising dinner for a Republican committee chairman at the home of Democratic super-lobbyist Tommy Boggs. I bring this article to the attention of the Senate not to cast aspersions on any Senator. My interest in this article is in the views of lobbyists on fundraising, and the appearance it creates for the public that reads about it. Let me quote from the article: ``Indeed, it would be tantamount to political suicide for Democratic lobbyists--or Republican lobbyists for that matter--who specialize in the [the issues] that are the focus of [the chairman's] committee and the lifeblood of their corporate clients, if they desert him in his hour of need.'' Here are a few quotes in this article from lobbyists who were questioned on the irony of Democratic lobbyists making contributions to a powerful Republican chairman of a Senate committee. One said: ``In situations like this, I tend to be a strong fan of incumbency.'' Another said, ``Most lobbyists know which side their bread is buttered on.'' And this is what a staffer on the House side had to say: ``Any time you have a chairman of [a committee] running for reelection, and you're lobbying ..... issues before the committee, you risk having your issue blown out of the water if you don't contribute to his campaign. The game in this town is to support the incumbent. Mr. President, I don't suggest that these lobbyists bearing gifts have swayed or will sway a chairman on substantive issues, but they sure are trying. And I have avoided using the Senator's name because I don't think he has been swayed. But we all have to admit that these kind of comments create a perception, an appearance, that campaign contributions are given because of the effect they will have on policy. Madam President, let me anticipate a question by the Senator from Kentucky. Most of the fundraising in these articles is hard money fundraising, isn't it? It is all legal under our system. Thousand-dollar checks to candidates are permitted under the Federal election laws, aren't they? The answer, of course, is yes. But what strikes me is the obvious appearance of corruption that is present when a lobbyist specializes in throwing fundraisers for candidates or when members of Congress solicit even these relatively small donations from people with an interest in legislation, especially on the eve of a crucial vote. Madam President, can there be any doubt that an outrageous appearance of corruption arises when the same Members of Congress are involved in raising hundreds of thousands of dollars of soft money in a single phone call for the political parties? As Justice Souter said just a few weeks ago at the oral argument in the Missouri case--``Most people assume, and I do certainly, that someone making an extraordinarily large contribution gets something extraordinary in return.'' That brings me to another exhibit in our legislative record of the appearance of corruption--a story that appeared yesterday in the Washington Post about the effort that the Democratic party--my party--is making to raise soft money in order to retake the Congress. According to the article, the Democrat Congressional Campaign Committee increased its soft money fundraising from $5.1 million in 1994 to $16.6 million in the '98 cycle. It is now going after the really big givers with an innovation called Team 2000. The Post story describes Team 2000 as ``[A] new club for $100,000 and over donors who would be feted by the party at exclusive events, including a weekend of clambakes and sightseeing.'' The article describes the wooing of Steven Wynn, owner of Mirage Resorts in Las Vegas, who gave a $250,000 contribution to the DCCC in May of this year. The article indicates that Wynn is angry about the impeachment of the President and with the Republican failure to stop the antigaming crusade of a Member of the House. Incidentally, this information is not included in this particular article, but I have learned that the Mirage Resorts gave an identical $250,000 amount to the National Republican Senatorial Campaign Committee in July of this year. So I guess Mr. Wynn got over his anger and realized that he had better play both sides of the fence, as many big soft money donors do. Madam President, I ask unanimous consent this Washington Post story be printed in the RECORD. There being no objection, the article was ordered to be printed in the RECORD, as follows: [From the Washington Post, Oct. 17, 1999] (By Susan B. Glasser) Wynn took the call, and soon Jones was flying out to breakfast at his golf course mansion along with Rep. Charles B. Rangel. The gravelly voiced New Yorker became the Democratic point man, reciprocating Wynn's hospitality with a tour of his Harlem district. By last February, when Jones and Rangel met with Wynn in his Las Vegas office, they didn't even have to make their pitch. Wynn had told friends he was angry at ``mean-spirited'' House Republicans for impeaching President Clinton. Besides, he complained, they had neglected him, and hadn't stopped Rep. Frank R. Wolf's (R-Va.) anti-gaming crusade. He was ready, Wynn said, to help the Democrats regain control of the House. How much, Wynn asked, do you need me to help raise out of Nevada for the 2000 election? Jones knew that during the entire 1998 election, the House Democrats' campaign arm had only collected about $110,000 from Vegas, so his answer was an audacious one: $1 million to $1.5 million. Done, Wynn replied. The first installment--a $250,000 corporate check from Mirage Resorts--was Wynn's downpayment on a bet that Democrats will take back the House next year. It also suggests one reason why they might succeed. With the Democratic Congressional Campaign Committee as their vehicle, they are raising record amounts of money for next year's races, trading on their new electoral competitiveness to raise funds earlier and in larger amounts than ever before. ``Soft money''--the term of art for the unlimited contributions that corporations, unions and wealthy individuals can give for so-called ``party building''--has fueled an explosive growth in fund-raising for both parties since the 1996 elections, when campaign operatives figured out a way to legally spend it on TV ads that focused on individual candidates. But this year it is the House Democrats who have been most aggressive in increasing the amount of soft money they raise, even as they lead the campaign in Congress to eliminate it. Driven by Gephardt and Rep. Patrick J. Kennedy (D-R.I.), the chairman hand-picked by Gephardt, the DCCC is out to reverse its traditional status ``at the bottom of the fund-raising food chain,'' as former Rep. Vic Fazio (D-Calif.) put it. In just the first six months of this year, the DCCC raised $17 million total--$9 million of that in soft money. That marks a stunning 373 percent increase in soft money compared with the first six months of 1997--the highest rate of growth for any party committee. The fund-raising escalation foreshadows an election season next year when both parties will pour a million dollars or more into more than 30 House races whose outcome will determine control of Congress. Some of the money is from businesses like Wynn's Mirage Resorts; some is from well-heeled individuals giving $100,000 each, such as Slimfast founder S. Daniel Abraham, National Enquirer heiress Lois Pope and Florida Marlins owner John W. Henry. As of June 30, Democrats had attracted 21 six-figure soft-money givers compared with 14 for Republicans, according to data compiled by the Campaign Study Group. Those checks came from groups or individuals who had never before made such a financial commitment so early. Since individual members can't raise soft money for their own campaigns, the DCCC and the National Republican Congressional Committee do it for them. This embrace of soft money--legally meant to go only for ``nonfederal'' purposes--is particularly ironic since the two campaign committees exist for the sole purpose of electing federal candidates. In recent years, the soft money powerhouse on Capitol Hill has been the NRCC. Since the beginning of 1997, a new Common Cause study found, the House Republican committee has raised more of it than any other congressional committee: a total of $37.8 million. So far this year, the NRCC has outraised the DCCC overall $27 million to $17 million. And in House Majority Whip Tom DeLay (R-Tex.), the subject of a story Monday, the Republicans have the single most effective fund-raiser in Congress. But slightly less than a year before the congressional elections, the House Democrats have significantly cut into the GOP's fund-raising advantage. The DCCC is running essentially even with the NRCC in soft money raised this year, and Democrats are ahead for the first time ever in cash on hand: $10.7 million to the NRCC's $10.1 million. ``Republicans have experienced growth,'' said David Plouffe, the Gephardt strategist who is now executive director of the DCCC. ``We've experienced much greater growth.'' By design, the Democratic growth strategy has focused on soft money, seeking contributions from a new club--``Team 2000''--for $100,000 givers, and on what several sources said was an organized effort to get labor unions to ``frontload'' their contributions by giving as much as possible early in the election cycle. Republicans have hardly ignored big givers. After the Democrats upped the ante, NRCC Chairman Tom Davis (Va.) imitated them with his own $100,000 program--the ``Business Leadership Trust,'' a name reflective of the GOP's financial base. The GOP is also starting a new national finance committee to recognize corporate CEOs and top lobbyists. And when it comes to big checks, the NRCC lays claim to the biggest single donation of the year: $300,000 from Chiquita banana king Carl Lindner. ``Soft money follows power,'' said Davis, recognizing that the Republicans' takeover of Congress in 1994 has immeasurably boosted their fund-raising capacity. But he argued that Democrats have benefited most, leveraging the power of the presidency for their financial gain. ERODING THE GOP EDGE For decades, Democrats have gone into campaigns knowing they would be outspent. Taking over the DCCC in 1981, when Republicans had a fund-raising lead of 13 to one, Rep. Tony Coelho (D-Cal.) cut into that edge by convincing businesses they should invest in what was then the congressional majority. Coelho, now Vice President Gore's campaign chairman, also professionalized the DCCC, insisting for example that a campaign hire pollsters before it could receive a dime from the committee. But the game then was hard money--strictly limited contributions of no more than $20,000 a year to party committees. At the time, before a succession of court rulings and Federal Election Commission cases, soft money was an add-on, used to finance building projects and television studios but never contemplated as a thinly veiled way around the contribution limits to specific races. And so the dollar amounts were low, amazingly so compared with the current checks. ``In retrospect, we were pikers,'' said one former Coelho adviser. ``We thought we were pushing the envelope when we were asking people for $5,000.'' And yet Coelho was a transformative figure, his close ties to S&L power brokers and aggressive style memorialized in a book, ``Honest Graft,'' by journalist Brooks Jackson that showed members how the DCCC and the NRCC could become fund-raising powerhouses and use that money to wield more influence over campaigns. New York Republican Bill Paxon, who took over an NRCC deeply mired in debt in 1993, said flatly, ``Coelho was my model'' as he reinvented the committee in time for House Republicans to win the majority for the first time in 40 years. In 1994, the last election before soft money's rise, the NRCC raised $7.4 million in soft money, compared to $5.1 million by the DCCC. When Texas Rep. Martin Frost became chairman of the DCCC in 1995, he knew the Democrats were going to have to raise money differently. In the minority after four decades of power, they no longer had the legislative club that Coelho had taught them to wield with the K Street lobbyists who controlled business giving. ``Once we went into the minority, we had to reach beyond the PAC community in Washington,'' said Frost, who led the DCCC in the 1996 and 1998 elections and is now the Democratic Caucus chairman. ``We really had to work the rest of the country aggressively.'' Clinton and his advisers supplied the blueprint, using the Democratic National Committee to fund an unprecedented $35 million ad campaign to boost his reelection and paying for the ads with mix of hard and soft money. On Capitol Hill, members quickly grasped the implications: soft money could now be used to launch candidate-specific TV ads that were legal as long as they avoided the magic words ``vote for'' or ``vote against.'' Frost was planning to raise more soft money--but only to fund more traditional activities, like election-day turnout and overhead expenses. To start, he had to confront a party committee without much of a national donor base. ``We weren't really thinking about soft money,'' said Matt Angle, Frost's top aide. ``We were thinking about new money. When they arrived at the DCCC, Angle said, they found that only 100 or so individuals had ever given more than $1,000 to the DCCC. Democratic House members, still stunned by their party's defeat, were reluctant to hit up their own big donors for the committee. And most donors had never heard of the DCCC, assuming it was an affiliate of the DNC. ``We had one guy who was a $100,000 giver,'' Frost said, New Jersey businessman Grover Connell, a rice broker who figured in the Koreagate scandal of the late 1970s and as long ago as the Coelho days was already giving $50,000 a year to the DCCC.'' ``He was the only one we ever had,'' Frost said. ``I said, `Well, if Grover will give that much, we should start asking other people for larger figures.' '' Meanwhile, the predicted switch in business giving was coming to pass--Republicans, led by Speaker Newt Gingrich (R-Ga.) and DeLay, made an aggressive push to shut down Democratic money on K Street. By the 1998 election, about 65 percent of business funds were going to the House GOP. Overall, the DCCC raised $16.6 million in soft money to the NRCC's $27.8 million for last year's election--225 percent more for the Democrats and 274 percent more for the Republicans since 1994. Gephardt was already a top fund-raiser, a master of ``the big ask,'' and yet, said Frost, ``we didn't have 100 percent of his attention.'' But last fall's election, when Democrats shocked even themselves by whittling the House GOP's majority to just six seats, galvanized Gephardt, a believer in the power of political soft money since his 1988 presidential campaign sputtered to a finish on Super Tuesday, several million dollars in debt. GEPHARDT AIMS FOR SPEAKER Two days after last year's election, Gephardt convened his top advisers and started planning for the 2000 campaign. His goal, it was clear, was to become speaker--not to run for president. While he didn't announce that decision until February, Gephardt quickly began planning his DCCC strategy, deciding to transfer virtually all his political operation to the committee. As chairman, Kennedy would be Gephardt's ``director of sales and marketing,'' in the words of banking lobbyist Tom Quinn, a longtime Kennedy family backer. Unabashed about trading on his family name, Kennedy was seen by Gephardt's team as a financial asset. ``Patrick being chairman means an additional $10 million to $20 million for the DCCC,'' argued a leading party fund-raiser. Jones, Gephardt's top money man, was put on contract at the DCCC. So was Richard J. Sullivan, the young lawyer who had served as the DNC's finance director in the 1996 election and was the lead-off witness in hearings held by Sen. Fred D. Thompson (R-Tenn.) about the influx of foreign money to the DNC in 1996. The idea was to personalize the committee, selling donors on the future speaker. Kennedy said he often tells would-be contributors: `` `This is the Dick Gephardt for Speaker committee.' They get that. It personalizes it.'' Gephardt himself calls big donors, not just to ask but also to thank. ``He's the kind of guy who understands that in order to get dessert, you have to eat your vegetables,'' said Erik Smith, a Gephardt aide who is now the DCCC's communications director. Determined to take advantage of the political momentum generated by the November election gains--and to play off the outrage felt by Democratic donors about the GOP House's impeachmnent of Clinton--the DCCC decided to focus its efforts on soft money and to push earlier than ever for major checks. But Kennedy himself proposed the most audacious innovation, according to his aides. Until then, the biggest dollar program at the DCCC had been the Speaker's Club, price of entry: $15,000 in hard money. Kennedy created ``Team 2000,'' a new club for $100,000 and over donors who would be feted by the party at exclusive events, including a weekend of clambakes and sightseeing at the Kennedy family compound in Hyannisport last month. Big donations began to roll in: $250,000 from the Communications Workers of America, whose political director considers herself Kennedy's ``fairy godmother'' in the labor movement; $210,000 from AFSCME; $102,000 from AT&T; $100,000 from Texas trial lawyer Walter Umphrey's firm, Price Club founder Sol Price and others. The Democrats are eagerly keeping score: according to the sheet handed out at each week's Democratic Caucus meeting, Gephardt has already collected $6.8 million for the DCCC and House candidates this year, followed by Kennedy at $6.2 million, aspiring Ways and Means Chairman Rangel at $1.9 million and Frost at $670,000. Contributors who have dramatically increased their help to the House Democrats this year cite everything from personal loyalty to Gephardt to disaffection with the Republicans to a sense that the Democrats may lose the White House and therefore need to go all-out to retake control of at least one branch of government. Richard Medley, a Wall Street analyst and former congressional aide, mentioned all three. ``I've been a friend of Gephardt's for probably ten years,'' said Medley, who hosted a July dinner in New York with former treasury secretary Robert E. Rubin that raised $300,000. But he also referred to pessimism about Vice President Gore's chances to win next November: With GOP front-runner ``George W. Bush doing so well, it's important to take out an insurance policy hoping to have at least one branch controlled by Democrats.'' Personal service from Gephardt and Kennedy also helps land donors. That certainly was the case with the $100,000 check from David Alameel, a wealthy Dallas dental clinic owner. Alameel was already on the radar of Frost and his team, but they had no idea he would become a six-figure contributor. Frost duly set up the meeting with Kennedy and, in the end, he said, ``Patrick was the one who convinced him.'' The $100,000 check came in on June 21. Indeed, Kennedy has produced a number of eye-popping checks from unexpected sources, like the $100,000 from Lois Pope, the Palm Beach heiress to the National Enquirer fortune. The wooing of Pope included Kennedy flying to Florida to present her with an award for her charity work. ``One of the great joys of my job is meeting people who inspire me,'' Kennedy gushed as he presented her with a ``distinguished service award'' from Citibank Private Bank of Florida. ``I feel the energy that they feel for this country. Those of you who know Lois know that energy comes through.'' That was on April 7. On May 28, the DCCC received Pope's $100,000 check. An even larger amount came as the result of his friendship with John J. McConnell Jr., a trial lawyers for Ness Motley Loadholt Richardson & Poole, a South Carolina-based firm that has earned millions of dollars from representing states in the tobacco settlement. Operating out of the firm's Rhode Island office, McConnell worked hard to introduce Kennedy to colleagues, flying him on the corporate jet so he could spend time with senior partner Ronald L. Motley and hosting a dinner on Capitol Hill for Kennedy, Gephardt and other trial lawyers with deep pockets. On June 30, the courtship paid off--with a check for $250,000. ``No question about it,'' McConnell said, ``that was a personal contribution to Patrick.'' SPENDING IN NEW WAYS That check--and all the others--will go into a new pot of soft money that the DCCC will be able to spend next year in ways not envisioned by the 1974 election law, which restricts the parties to direct and coordinated gifts to their House candidates of only about $100,000 each. The idea behind the law was ``to take fund-raising out of the hands of the party committees and give control of it to candidates themselves,'' as GOP pollster Brian Tringali put it. Instead, with soft money issue ads and sophisticated voter identification programs, the parties are planning to spend upwards of $500,000 or $1 million each in next year's key districts. That gives the parties more say over how campaigns are run, what they are saying and who they are saying it to. ``Practically speaking,'' said a top Democratic fund-raiser, ``you can take a race that is a $1 million House race and turn it into a $3.5 million race with soft money. In a day and age when parties themselves are not as strong, individual party committees are stronger than ever.'' For Kennedy and his staff, the new emphasis on soft money is simple political pragmatism. ``You can really draw a direct correlation between the amount of money in a campaign committee and the impact it has in terms of getting members elected,'' he argued. To win, Kennedy said, ``we need to raise an even greater amount of money. In practical terms, that means we need to raise it in bigger chunks.''
The Senator from Kentucky said on the floor last week, ``Well, they have a right to be duplicitous.'' Actually, Madam President, they are not being duplicitous. We all know they are giving to both sides. They are just playing by the rules as we have set them up. They are not doing anything that is dishonest. They are simply trying to cover their bases. Surely, the Senator from Kentucky doesn't think when AT&T gives a big contribution to the National Republican Senatorial Campaign Committee that it won't give money to the Senator from New Jersey's Democratic Senatorial Campaign Committee as well. We all know why they do it, too--because in the candid words of a lobbyist, ``They know which side their bread is buttered on.'' Both sides--the bread is buttered on both sides. They play both sides of the fence so they can get their calls returned and their positions heard. That, my friends, is on its face an appearance of corruption. And if we are so caught up in this fundraising game that we can't see it, the disenchantment the public feels in its elected officials is well warranted. Last week, the Senator from Kentucky suggested that press reports
about the connection between campaign donations and legislative actions
arise from the desire of newspapers to I am reminded of what the great Senator, Robert La Follette, from my home State of Wisconsin, said in response to those who argued that the press of his day--the early 1900s--was somehow spreading hysteria about the power of the railroads over Congress. La Follette said: It does not lie in the power of any or all of the magazines of the country or of the press, great as it is, to destroy, without justification, the confidence of the people in the American Congress....... It rests solely with the United States Senate to fix and maintain its own reputation for fidelity to public trust. It will be judged by the record. It can not repose in security upon its exalted position and the glorious heritage of its traditions. It is worse than folly to feel, or to profess to feel, indifferent with respect to public judgment. If public confidence is wanting in Congress, it is not of hasty growth, it is not the product of ``jaundiced journalism.'' It is the result of years of disappointment and defeat.
There is no other way to put it. There is an appearance of corruption. There is an appearance of cravenness. There is an appearance of a smug confidence that the American people will not laugh out loud in disgust at the assertion that there is no corruption near. There is an appearance of something terribly, terribly wrong that we refuse to fix. If that offends people in this Chamber, so be it. We had better get rid of this system so they won't be offended anymore because I am not going to stop talking about it until we do. Madam President, how much time do I have remaining? The PRESIDING OFFICER. The Senator has 6 minutes 19 seconds. Mr. FEINGOLD. Madam President, the Senator from North Carolina asked if I will yield. Mr. EDWARDS. Will the Senator yield for a question? Mr. FEINGOLD. I yield. Mr. EDWARDS. I know the Senator has spent a great deal of time moving across his home State of Wisconsin. How many counties are in Wisconsin? Mr. FEINGOLD. Seventy-two counties. Mr. EDWARDS. Seventy-two counties, and the Senator has been in every one. Mr. FEINGOLD. I go to listening sessions in every one every year. Mr. EDWARDS. I wonder what the Senator would think what someone in rural Wisconsin, a farmer in rural Wisconsin, would believe in terms of their influence, vis-a-vis someone who gave $100,000 in soft money to, in our case as fellow Democrats to the Democratic Party, or to the DNCC, whether that rural farmer in Wisconsin would believe that they have the same voice in the Senate that a $100,000 soft money contributor has. Mr. FEINGOLD. I thank the Senator from North Carolina for his question. The example of the farmer is a wonderful example, because of what has happened in Wisconsin in the last 18 years. We have lost something like 18,000 dairy farmers, so farmers in my State are in no position to be giving even $10 or $25 contributions. When they hear, as the Senator is suggesting, that a person can give even $1,000, the possibility of doing that is pretty much off the charts. When they hear that somebody can actually for the first time in this century give $100,000, it is absolutely disappointing. And it must make them even more despondent. They have enough problems already. But to think they can't have their vote count for what it used to count--we always had in Wisconsin the notion that the farm vote kind of shifted the balance, it is the swing vote traditionally in Wisconsin. But in this kind of system where soft money ads can make a farce out of an election, they feel--I know from firsthand conversations--quite left out of the process and quite dispirited. Mr. EDWARDS. How does the Senator think that farmer would feel in his gut about whether this representative democracy is working the way it ought to work in a situation where he or she has at best one vote, and that position vis-a-vis another individual who has given $100,000, when he is working on his farm on a day-to-day basis? Does the Senator think that farmer believes he has the same equal voice that he is supposed to have in his representative democracy as somebody who wrote a $100,000 check. Mr. FEINGOLD. I don't think there is any possibility that he feels his voice is as strong as it used to be. A typical farmer in Wisconsin with a certain amount of cows and a certain amount of acreage and a family, those are things that he had. He knew he had those things, and he had his vote counting the same as everybody else's. That is where the whole progressive movement in Wisconsin and the efforts of Robert La Follette came from--a lot of these farmers who were able to put their votes together to elect people who would really represent them. Mr. EDWARDS. If I could ask a followup question, there has been a lot of debate on the floor and a lot of private conversations about whether there is any usefulness associated with simply banning soft money. Let me ask the question again, using the example of this dairy farmer from Wisconsin. Does the Senator think it is important for the Senate to send a message to that farmer in rural Wisconsin that we are trying to do something real and meaningful to clean up campaign finance in this country? Mr. FEINGOLD. We absolutely have to. I don't know how we convinced ourselves in the end of the 20th century of something that was the opposite conclusion at the end of the 19th century, early 20th century; and that is that unlimited contributions corrupt the process and make the individual farmer or individual homemaker or any other person almost a nonfactor in the political process. We have to send this message and we have to do even better. We have to actually pass a ban on soft money as a first signal to that farmer that we will do the rest of the job and actually return the notion of one person-one vote to that farmer. Mr. EDWARDS. Will the Senator agree that even if we are not able in this Congress in this session to pass across-the-board comprehensive reform that it is critically important that we send a message to Americans all over this country that this Senate and this Congress is willing to take a strong and courageous step to do something real and meaningful in terms of cleaning up campaign finance and that one of those steps would be the banning of soft money? Mr. FEINGOLD. There is nothing more important than passing a ban on soft money in this Congress. In a few minutes we will have the first vote, I say to the Senator from North Carolina, the first vote ever on the question of whether we are going to allow party soft money or not. This is not one of these votes that you have every once in a while, a bed check vote on a Monday night. This is the real thing. I thank the Senator from North Carolina for distilling it down to the perspective of one farmer in Rice Lake, WI, who might be watching and saying: Are these guys going to clean this place up or not? Mr. EDWARDS. Let me ask the Senator one last question. I agree. One last question: In the Senator's mind, is this a party issue? Is this a Democratic or Republican issue? Mr. FEINGOLD. Clearly not. In fact, the only thing that can defeat us on this is partisanship. That is why I worked for 5 years, not only with Senator MCCAIN but I have gotten to know a number of my colleagues on the other side of the aisle--people such as Senator THOMPSON of Tennessee and Senator COLLINS of Maine. These are Republicans who I have grown to know and enjoy working with who together have worked to try to do something to ban soft money. So this is an example of how this institution can work well in terms of our cooperation and bipartisanship. Let's make sure that partisanship doesn't defeat our efforts. Mr. EDWARDS. I thank the Senator from Wisconsin and Senator MCCAIN for their courageous leadership on this critical issue. Mr. FEINGOLD. I certainly thank the Senator from North Carolina who in the few months he has been here has become a strong voice in the campaign finance reform debate. I yield the floor.
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