MONEY in politics, passed by gloves both iron and velvet,
surrounds a Congress that, as Barry Goldwater puts it, is
"paralyzed with the fear of alienating" interest groups.
Paralysis benefits the status quo and rockets the deficit. This
should be our top domestic issue.
It isn't, of course, because campaign finance is Washington's
hottest growth industry. Congressional races in 1992 cost $678
million, a 52 percent increase over 1990. Everyone is related to or
friends with someone who milks the cash-based lobbying machine, or
aspires to do so. It permeates the society scene, and even the
Fourth Estate, with its own conglomerates' political action
committees (PACs) and media seers who pick up speaker fees from
Most important, it offers incumbents an incredible advantage. In
1990 the General Electric PAC gave money to 19 United States House
candidates who faced no opponents, and to 70 more who had won past
elections by margins of more than 3-to-1. Incumbents are reluctant
to tamper with such a system.
From 1982 to 1985 AT&T enjoyed tax loopholes that garnered a
huge rebate instead of having to pay taxes on $25 billion in
profits. Its million or so in PAC contributions fell far short of
the point of diminishing returns. The late Phil Stern, campaign
reform champion and author of "Still the Best Congress Money Can
Buy," analyzed congressional votes and showed a stunning
correlation between increasing levels of PAC money given and the
percentage of recipients who "vote right." The cash arms race
escalates because the potential gain is astounding.
Consider President Clinton's task in revamping an $800
billion-a-year health industry. Its 200 political action committees
gave $60 million in PAC contributions to congressional candidates,
plus individual contributions, during the 1980s.
In the mid-'80s, the American Medical Association's PAC dumped
hundreds of thousands of dollars of "independent expenditures" (a
clever sidestep around contribution limits) to attack a couple of
popular congressmen who sought ceilings on Medicare fees. The
failed attempt to dump them was viewed as a victory because, as the
PAC chairman said, it sent "a message to everyone in Congress who
won by 51 percent."
"When these political action committees give money, they expect
something in return other than good government," Senate Minority
Leader Bob Dole once wryly observed. Senator Dole, whose
thrift-and-fortitude lectures are Sunday morning TV fixtures, gave
Mr. Stern his favorite illustrations of money calling the tune. For
example, in 1982 Dole chided Democrats like Rep. Dan Rostenkowski
(D) of Illinois for assisting 333 wealthy Chicago commodity traders
over questionable use of a tax loophole. He even complained to the
Internal Revenue Service. Traders bumped up largess to Dole by a
factor of six. Dole abruptly reversed, approving a proposal that
took traders off the IRS hook, worth an average of $866,000 to each
Not just cynics wonder how often lawmakers make noise about
what's right just to get contributions flowing so they can afford
to do what's wrong. "We're looking closely at this," is often
code for "It's on the block, open your wallets." When markers are
called in they can be as subtle as a pass not caught or a ball
fumbled. Don't count on a toothless Federal Election Commission,
crouched under the thumb of those it watches, to follow the play.
ACS and trade associations are dominated by members who are most
active because they seek the most. When the economic marketplace
doesn't pan out, they gild their pitch in a political bazaar
focused on the short term. It's a poor formula for rational
decisions, and often tilts toward losers. Cases made on money, not
merit, breed inefficient and unfair results.
It isn't just PACs. The top 1 percent of income earners provide
the vast bulk of campaign cash, giving more to candidates than do
PACs - huge amounts in "soft money" to national and state
parties, and toward charities associated with legislators. …