Reforming Reform; Unintended Consequences of Campaign Laws
Byline: Gary J. Andres, THE WASHINGTON TIMES
Congress may be in for some surprises if it tries to alter lobbying and ethics rules without considering how these changes affect campaign finance and elections. Bifurcating these issues may make sense as a tactic to ease the passage of legislation, but history suggests separating rules related to "petitioning the government" from elections is easier said than done.
That's because lobbying, ethics, and campaign reform share two real-world common denominators - unintended consequences and inter-relatedness. Like the water balloon of American politics, squeezing First Amendment practices doesn't make them disappear; they just pop out somewhere else.
Twenty-five years ago, labor unions pushed a provision in the Federal Election Campaign Act (FECA) of 1971 allowing them to use their own treasury funds to administer union political action committees. The union-drafted floor amendment stemmed from concern that labor might lose a pending Supreme Court case, Pipefitters Local Union No. 562 v. United States. The appeals court held the pipefitters PAC was "compulsory and union-financed" rather than "voluntary and member-financed." The "Pipefitters case had caused considerable alarm in labor circles," wrote Edwin Epstein, a University of California Business School professor, in a 1980 paper for an American Enterprise Institute-sponsored conference. Labor wanted insurance that it could still use its union funds for organizing purposes in case the Supreme Court upheld the appeals court, so a change in law was sought and the Democratic majority in Congress obliged.
In 1974, when Congress adopted the first changes to FECA, labor advocated another modification - the removal of a prohibition on federal contractors forming a PAC. Mr. Epstein notes that a number of labor unions were "government contractors" because they received federal manpower training and development grants.
While Democrats accommodated the unions in 1971 and 1974, the unintended beneficiaries were corporations, who used these new laws as a green light to form their own PACs. In the wake of the 1972 election and the Senate Watergate investigation, when several major U.S. companies were charged with making illegal corporate contributions, these two changes in law provided a new legal but unintended avenue for business participation. Corporate PACs grew almost ten-fold after these laws were passed - from less than 100 in the early 1970s to nearly 1,000 by the end of the decade - while the number of labor PACs remained flat, giving unions stout new competition in the campaign finance arena. …