[PEN-L:28210] protection rents

["Ian Murray" <seamus2001@xxxxxxxxx>]

[have Wash. Post writers been reading Frederic Lane and Charles
Tilly? :-)]

Big Business's Soft Money Followed No Party Line


By Terry M. Neal
washingtonpost.com Staff Writer
Friday, July 19, 2002; 12:00 AM

Someone has finally added up the numbers, and it's not a pretty
sight.

Big business funneled about $1.1 billion in soft money contributions
to both major political parties over the last decade. About
one-third of that came in a two-year election cycle ending with the
last presidential election. Six companies tainted recently by
scandal - Arthur Andersen, Enron, Qwest, WorldCom, Adelphia
Communications and Global Crossing - gave $13 million alone over
that time period.

As you might expect, the Republicans won the race for cash - but not
for a valiant lack of effort from the Democrats.

The fact is, big money has poured into the coffers of both parties,
with Republicans taking in $636 million to the Democrats' $449
million, according to figures compiled for Democracy 21 by the
Center for Responsive Politics, both non-partisan, Washington-based
watchdog groups. The six scandal-tainted companies contributed $7.8
million to Republicans compared to $5.2 million for Democrats.

The dollar figures raise serious questions about whether the
Democrats can gain a real advantage over Republicans on the
corporate corruption issue in the November midterm election. What
will the party's campaign slogan be? Vote for us: We were less
successful than the GOP at sucking up to corporate America!

For the uninitiated, soft money is the term for unregulated,
unlimited contributions that businesses, unions and wealthy
individuals make for general party-building activities. Big business
gave 87 percent of the total over the last decade.

These contributions have long been the target of reform-minded
groups such as Democracy 21 and the Center for Responsive Politics,
as well as politicians such as Sens. John McCain (R-Ariz.) and Russ
Feingold (D-Wis.). Earlier this year, Congress passed and President
Bush signed the Bipartisan Campaign Reform Act of 2002 in an effort
to do away with the corrupting influence of soft money in federal
politics. The law goes into effect after the November election.

Protection Money?

Democracy 21's report demonstrates just how beholden both parties
have become to corporate America. The report also helps explain why
neither party made a major effort to impose meaningful regulations
to counter corporate excess until a string of high-profile
scandals - starting with the Enron/Arthur Andersen debacle - turned
into a political issue this summer.

"It bought protection," Democracy 21 President Fred Wertheimer said
of the corporate generosity. "I'm not arguing it's the only factor,
but it's a huge factor."

The way Wertheimer sees it, corporate money is still buying
protection.

This phenomenon is in full effect now in Congress, underscored by
the tug of war between House Republicans who want to join Democrats
in passing major new reforms, and their GOP colleagues who merely
want to strengthen existing laws. House leadership has been carrying
corporate water, seeking to reject the broader business reforms
passed recently in the Senate. But the effectiveness of that
protection money may be fading. In just the last 24 hours or so, the
reformers appears to be gaining momentum, no doubt bolstered by a
rash of new public and private polls showing that the corporate
scandal issue is strongly resonating with voters. The poll data do
not make it apparent, however, that voters prefer passage of new
laws over enforcement of existing ones.

According to McCain, big business's influence can also be seen at
the Federal Elections Commission. The FEC is locked in a war of
words with the senator and his campaign finance reform co-sponsors,
who have accused the bipartisan commission of purposefully diluting
the impact of the law when it approved new regulations to enforce
the soft money ban a few weeks ago. The disagreements rest on
legalistic interpretations of words, but the impact could be
significant: As written, the regulations allow, among other things,
federal candidates to continue helping state parties raise money
that can be used on "the same old candidate attack ads," according
to a news release from McCain's office.

"We're about to see seven years of work get emasculated by four
people who were not elected, including one whose term expired 16
months ago," McCain said of the commission in an interview earlier
this week. "It's remarkable."

FEC Commissioner Michael Toner, a former Republican National
Committee member who worked on Bush's 2000 presidential campaign,
strongly disagrees, saying the commission followed the spirit and
letter of the law to a T. And he said he welcomes a court challenge
to settle the issue.

Nonetheless, Wertheimer and McCain say both parties - but
particularly the Democrats - risk being seen this fall by voters as
hypocrites if they don't stand up to the FEC. McCain, Feingold and
the other bill co-sponsors have vowed that they won't let the FEC's
new regulations stand without a challenge. And McCain has angered
both parties by putting a hold on all nominations until a
pro-campaign finance reform commissioner, Ellen Weintrab, is
appointed. Will Democratic leadership in Congress step up to the
plate with them?

"Democrats are going to lose a lot of credibility in their corporate
responsibility theme if it appears that they are playing Washington
games by passing strong reform legislation while standing by while
the agency that is supposed to enforce it instead sets out to
undermine and compromise the law by adopting irresponsible
regulations," Wertheimer said.

Democrats don't seem to be worried that voters will make that
connection. And they're probably right. It seems too
inside-the-Beltway.

"You write out a list of concerns, and campaign finance reform never
ranks higher than fifth," said Dane Strother, a Democratic media
strategist advising more than dozen House and Senate candidates this
year. "In fact, if campaign finance reform used to be fifth on the
list, it's ninth now."

Corporate scandal appears for now to be a better issue for
Democrats.

Strother said he's moving ahead with plans to attack Republicans
full-bore on corporate scandal. He said a few days ago, he wrote the
following line into the speech of a state attorney candidate he's
advising: "I don't care if you steal with a pistol or a pencil, you
ought to go to jail." The line got wild applause and will soon make
it into the stump speeches of his congressional candidates.

Meanwhile, the Democratic Congressional Campaign Committee is busy
blast-faxing and e-mailing reporters press releases with headlines
like: "Corporate Special Interests Win; Investors and Victims of
Security Fraud Lose" and "House Republicans Reject Strong Senate
Reforms for the Second Time".

Republican Counterattack

There is a sense among some Republicans in Washington that the
party's response to Democratic attacks has been too tepid.

"I feel like we've been holding back," one administration official
said yesterday, suggesting that Democratic National Committee
Chairman Terry McAuliffe, whose suspiciously profitable Global
Crossing stock dealings have come under media scrutiny, should
already be under full attack. There's also a lot of buzz on the
right about a recent National Review article that delves into the
details of the Department of Labor's investigation in the late 1990s
of some of McAuliffe's other business deals and suggests that he
should be the last person to "preach about business accountability."

The feeling that Republicans need to step up their aggressiveness is
even stronger among some on Capitol Hill. The president's 70 percent
approval ratings are dandy, but he's not the one facing voters in
the fall. And it's not at all clear that his popularity will
translate to Republican candidates this year. Poll after poll
recently has shown more people suggesting they'll vote for Democrats
than Republicans this fall. A new Washington Post-ABC News poll has
Democrats leading Republicans 47 to 45 percent.

Elections analyst Stuart Rothenberg said in a column in Roll Call
Thursday that risks for Republicans are real because "some voters,
even if they don't hold the president primarily responsible for
their stock losses or for corporate fraud and mismanagement, will
grow angry, frustrated or merely impatient with the negative news.
If they do, they might decide to send a message of change to the
president by voting against his party's candidates in November. Even
if GOP voters remain loyal to the president, all of the bad news
could depress Republican turnout. And that could be enough to turn a
neutral political election into a good Democratic year."

Many Democrats reject Republican complaints that Democrats are
trying to exploit the corporate scandal issue for political gain.
Democratic National Committee spokeswoman Jennifer Palmieri said the
party's response has exposed the intrinsic difference between
Republicans and Democrats. In response to a question about a lawsuit
filed against Vice President Cheney and his former company
Halliburton by Judicial Watch's Larry Klayman, who made a name for
himself by repeatedly suing the Clinton White House, Palmieri said:
"You will not see Democrats jumping on [Klayman's] bandwagon the way
the Republicans did against Clinton. It's just not in our nature,
for better or worse, to go for the jugular." Had this scandal broken
during the Clinton presidency, Palmieri said the Republicans would
have demanded an independent counsel, issued subpoenas and called
for congressional hearings while conservative columnists and talk
radio hosts fanned the flames with non-stop, overheated rhetoric.

Palmieri spoke on Monday. By Wednesday, Senate Democrats were
hinting strongly that they may call soon call for congressional
hearings to get to the bottom of Cheney's knowledge about alleged
accounting practices at Halliburton that may have defrauded
investors out of millions of dollars. "Full disclosure is on the
way," Sen. Joseph I. Lieberman (D-Conn.) was quoted as saying.

In response, Cheney adviser Mary Matalin bemoaned the "return of the
politics of personal destruction."

Perhaps, these two parties have more in common than they'd like to
admit.