From the Office of Senator Kerry

Wednesday, March 20, 2002

MR. KERRY. Mr. President, today we take an important first step toward reforming our campaign finance system. After an election in which $3 billion was spent in an effort to elect or defeat candidates, we are finally taking action to attempt to make our campaign finance laws meaningful. However, there are predictable consequences from this legislation that will not be positive and will require further attention to the issue of campaign finance reform. The money spent on the 2000 election should come as a surprise to no one. Soft money, an important target of this bill, has increased at a remarkable pace. Year after year, there has been a steady and dramatic increase in the amount of money raised and spent on elections. For example, in 1992, Democrats raised $30 million in soft money. In 1996, the Democrats more than tripled that amount and raised $107 million in soft money. In the 2000 Democrats raised $243 million in soft money. The Republican party has consistently proven itself to have even more fund-raising prowess than the Democrats, but the trends are exactly the same, with substantial increases year after year. In 1992, the Republican party raised $45 million in soft money. In 1996, they raised $120 million in soft money. And in 2000, the Republican party raised $244 million in soft money. The American people have become almost numb to these kinds of staggering figures, and they have come to expect fund-raising records to be broken with each election cycle. And, what is far worse for our Democracy is that the public also believes that this money buys access and influence that average citizens don’t have. In addition to the overwhelming amounts of soft money that were raised and spent in 2000, hundreds of millions of dollars were also spent on so-called issue ads. Now, I’m not talking about television ads that truly discuss the issues of the day. I’m talking about ads that air just before an election that show candidates, surrounded by their families, American flags waving in the background, that tell of the candidates’ service to the nation, or heroic actions during a war. Anyone who sees an ad like this believes it is a campaign ad. But, because of a quirk in the law, even these most blatant of campaign ads are called issue ads. As such, the contributions that pay for them are unlimited and relatively undisclosed. Yet, in many cases, these ads shape the debate in a race, and they most certainly are intended to shape the outcome. Those ubiquitous television ads are purchased by all kinds of organized special interests to persuade the American people to vote for or against a candidate. These ads – usually negative, often inaccurate – are driving the political process today. Do they violate the spirit of the campaign finance laws in this country? They certainly do. But, don’t take my word for it. Listen to the Executive Director of the National Rifle Association’s Institute for Legislative Action, who said, “It is foolish to believe there is a difference between issue advocacy and advocacy of a political candidate. What separates issue advocacy and political advocacy is a line in the sand drawn on a windy day.” The bill that we are sending to the President takes a step toward reform. It is important to know that it is also firmly rooted in prior laws. Federal law has prohibited corporations from contributing to federal candidates since 1907. Labor unions likewise have been barred from contributing to candidates since 1943. In addition, the post-Watergate campaign finance law caps individual contributions at $25,000 per calendar year, and permits individuals to give no more than $20,000 to a national party, $5,000 to a political action committee, and $2,000 to a candidate. These limits were put in place after the country learned a hard lessen about the corrupting influence of money in politics. Nowhere in these laws are there any provisions for soft money. That aberration came into play in 1978 when the Federal Election Commission gave the Kansas Republican State Committee permission to use corporate and union funds to pay for a voter drive benefitting federal as well as state candidates. The costs of the drive were to be split between hard money raised under federal law and soft money raised under Kansas law. The FEC’s decision in the Kansas case gives parties the option to spend soft money any time a federal election coincides with a state or local race. A creation not of Congress, but of a weak, politically motivated federal agency, soft money is a loophole to our system that is long overdue for eradication. Mr. President, despite what the foes of this bill claim, banning soft money contributions does not violate the Constitution. The Supreme Court in Buckley v. Valeo held that limits on individual campaign contributions do not violate the First Amendment. If a limit of $1000 on contributions by individuals was upheld as constitutional, then a ban on contributions of $10,000, $100,000 or $1 million is also going to be upheld. Buckley, too, said that the risk of corruption or the appearance of corruption warranted limits on individual campaign contributions. Soft money contributions to political parties can be limited for the same reason. Like soft money, issue advocacy has a history that defies the intent of campaign finance laws. In what remains the seminal case on campaign finance, Buckley, the Supreme Court held that campaign finance limitations applied only to “communications that in express terms advocate the election or defeat of a clearly identified candidate for federal office.” A footnote to the opinion says that the limits apply when communications include terms “such as ‘vote for,’ ‘elect,’ ‘support,’ ‘cast your ballot for,’ ‘Smith for Congress,’ ‘vote against,’ ‘defeat,’ ‘reject.’” The phrases in the footnote have become known as the "magic words" without which a communication, no matter what its purpose or impact, is often classified as issue advocacy, thus falling outside the reach of the campaign finance laws. Until the 1992 election cycle, most for-profit, not-for-profit, and labor organizations did not attempt to get into electoral politics via issue advocacy. That year, one advocacy group pushed the envelope and aired what was, for all intents and purposes, a negative campaign ad attacking Bill Clinton. Because the ad never used Buckley’s “magic words,” the Court of Appeals decided that the ad was a discussion of issues related rather than an exhortation to vote against Clinton in the upcoming presidential election. That ad and others like it opened the flood gates to more so-called issue advocacy in 1996, when countless special interests started overwhelming the airwaves with millions of dollars in ads that looked like campaign ads, but, because they avoided those magic words, were deemed issue-ads. Opponents of this proposal will also argue that any effort to control or limit sham issue ads would violate the First Amendment. They argue that as long as you don’t use the so-called “magic words” in Buckley – such as “vote for” or “vote against,”– you can say just about anything you want in an advertisement. But that is simply not what the Supreme Court said in Buckley. It said that one way to identify campaign speech that can be regulated is by looking at whether it uses words of express advocacy. But the Court never said that Congress was precluded from adopting another test so long as it was clear, precise and narrow. A final argument opponents of reform like to make is that we spend less on campaigns than we do on potato chips or laundry detergent. But I would ask the proponents of this argument whether what we are seeking in our democracy is electioneering that has no more depth or substance than a snack food commercial. Despite the ever-increasing sums spent on campaigns, we have not seen an improvement in campaign discourse, issue discussion or voter education. More money does not mean more ideas, more substance or more depth. Instead, it means more of what voters complain about most. More thirty-second spots, more negativity and an increasingly longer campaign period. Less money might actually improve the quality of discourse, requiring candidates to more cautiously spend their resources. It might encourage more debates – as was the case in my own race against Bill Weld in 1996 – and it would certainly focus the candidates’ voter education efforts during the period shortly before the election, when most voters are tuned in, instead of starting the campaign 18 months before election day. Shays/Meehan takes an important step that begins to tackle the problems of soft money and issue advocacy. I support this legislation that has been championed by two very able colleagues, but I would note one serious shortcoming of the bill. It won’t curb the rampant spending that drives the quest for money. Unfortunately, we all recognize that creating spending limits is not a simple proposition. In the 1976 Buckley case, the Supreme Court struck spending limits as an unconstitutional restriction of political speech. An important caveat to its decision is that spending limits could be imposed in exchange for a public benefit. I wish we had at our disposal a number of bargaining chips – public benefits that we could trade in exchange for spending limits. However, unless the Supreme Court reverses itself – something I am certainly not expecting in the near future – we must accept that if we want to limit the amounts spent on campaigns, we must provide candidates with some sort of public grant. I realize that a lot of my colleagues aren’t ready to embrace public funding as a way to finance our campaigns. But it is, in my opinion, the best constitutional means to the important end of limiting campaign spending and the contributions that go with it. Ultimately, I would support a system that provides full public funding for political candidates. I will continue to support Clean Money as the ultimate way to truly and completely purge our system of the negative influence of corporate money. I would also support a partial public funding system as a way to wean candidates from their reliance on hard money and get them used to campaigning under generous spending limits. I offered an amendment to McCain/Fiengold that would have provided sweeping reform in the form of a partial public funding system, but I recognize that we are a long way away from enacting such a program. Nevertheless I will continue to support and work for that type of reform as a way to end the cycle of unlimited money being raised and spent on our elections. Mr. President, this bill is a way to break free from the status quo. However, as with any reform measure, there are always going to be possibilities for abuse. The fact that some people will try to skirt the law is not a reason for us to fail to take this incremental movement towards repairing the system. But, it does mean we must ensure that this the first, rather than the last, step for fundamental reform. I have supported campaign finance reform for eighteen years and I believe that even legislation that takes only a small step forward is necessary to begin to restore the dwindling faith the average American has in our political system. We can’t go on leaving our citizens with the impression that the only kind of influence left in American politics is the kind you wield with a checkbook. I believe this bill reduces the power of the checkbook and I will therefore support it.