    [House Hearing, 107 Congress]
    [From the U.S. Government Publishing Office]

    H.R. 577, TO REQUIRE ANY ORGANIZATION THAT IS ESTABLISHED FOR THE
     PURPOSE OF RAISING FUNDS FOR THE CREATION OF A PRESIDENTIAL ARCHIVAL
     DEPOSITORY TO DISCLOSE THE SOURCES AND AMOUNTS OF ANY FUNDS RAISED

    =======================================================================

                                    HEARING

                                   before the

                     SUBCOMMITTEE ON GOVERNMENT EFFICIENCY,
                            FINANCIAL MANAGEMENT AND
                          INTERGOVERNMENTAL RELATIONS

                                     of the

                         COMMITTEE ON GOVERNMENT REFORM
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED SEVENTH CONGRESS

                                 FIRST SESSION

                                       ON

                                    H.R. 577

      TO REQUIRE ANY ORGANIZATION THAT IS ESTABLISHED FOR THE PURPOSE OF
    RAISING FUNDS FOR THE CREATION OF A PRESIDENTIAL ARCHIVAL DEPOSITORY TO
              DISCLOSE THE SOURCES AND AMOUNTS OF ANY FUNDS RAISED

                                   __________

                                 APRIL 5, 2001
                                   __________

                               Serial No. 107-67
                                   __________

           Printed for the use of the Committee on Government Reform

      Available via the World Wide Web: http://www.gpo.gov/congress/house
                          http://www.house.gov/reform

                         U.S. GOVERNMENT PRINTING OFFICE
    79-867                       WASHINGTON : 2002
    ________________________________________________________________________
    For Sale by the Superintendent of Documents, U.S. Government Printing Office
    Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800; (202) 512-1800
    Fax: (202) 512-2250 Mail: Stop SSOP, Washington, DC 20402-0001

                         COMMITTEE ON GOVERNMENT REFORM

                         DAN BURTON, Indiana, Chairman
    BENJAMIN A. GILMAN, New York         HENRY A. WAXMAN, California
    CONSTANCE A. MORELLA, Maryland       TOM LANTOS, California
    CHRISTOPHER SHAYS, Connecticut       MAJOR R. OWENS, New York
    ILEANA ROS-LEHTINEN, Florida         EDOLPHUS TOWNS, New York
    JOHN M. McHUGH, New York             PAUL E. KANJORSKI, Pennsylvania
    STEPHEN HORN, California             PATSY T. MINK, Hawaii
    JOHN L. MICA, Florida                CAROLYN B. MALONEY, New York
    THOMAS M. DAVIS, Virginia            ELEANOR HOLMES NORTON, Washington,
    MARK E. SOUDER, Indiana                  DC
    JOE SCARBOROUGH, Florida             ELIJAH E. CUMMINGS, Maryland
    STEVEN C. LaTOURETTE, Ohio           DENNIS J. KUCINICH, Ohio
    BOB BARR, Georgia                    ROD R. BLAGOJEVICH, Illinois
    DAN MILLER, Florida                  DANNY K. DAVIS, Illinois
    DOUG OSE, California                 JOHN F. TIERNEY, Massachusetts
    RON LEWIS, Kentucky                  JIM TURNER, Texas
    JO ANN DAVIS, Virginia               THOMAS H. ALLEN, Maine
    TODD RUSSELL PLATTS, Pennsylvania    JANICE D. SCHAKOWSKY, Illinois
    DAVE WELDON, Florida                 WM. LACY CLAY, Missouri
    CHRIS CANNON, Utah                   ------ ------
    ADAM H. PUTNAM, Florida              ------ ------
    C.L. ``BUTCH'' OTTER, Idaho                      ------
    EDWARD L. SCHROCK, Virginia          BERNARD SANDERS, Vermont
    ------ ------                            (Independent)

                          Kevin Binger, Staff Director
                     Daniel R. Moll, Deputy Staff Director
                         James C. Wilson, Chief Counsel
                         Robert A. Briggs, Chief Clerk
                     Phil Schiliro, Minority Staff Director

        Subcommittee on Government Efficiency, Financial Management and
                          Intergovernmental Relations

                       STEPHEN HORN, California, Chairman
    RON LEWIS, Kentucky                  JANICE D. SCHAKOWSKY, Illinois
    DAN MILLER, Florida                  MAJOR R. OWENS, New York
    DOUG OSE, California                 PAUL E. KANJORSKI, Pennsylvania
    ADAM H. PUTNAM, Florida              CAROLYN B. MALONEY, New York

                                   Ex Officio

    DAN BURTON, Indiana                  HENRY A. WAXMAN, California
              J. Russell George, Staff Director and Chief Counsel
                   Robert Alloway, Professional Staff Member
                             Scott R. Fagan, Clerk
              Mark Stephenson, Minority Professional Staff Member

                                C O N T E N T S

                                  ----------
                                                                       Page
    Hearing held on April 5, 2001....................................     1
    Text of H.R. 577.................................................     4
    Statement of:
        Bellardo, Lewis J., Deputy Archivist, National Archives and
          Records Administration; Scott Harshbarger, president,
          Common Cause; Larry Noble, executive director and general
          counsel, Center for Responsive Politics; and Kenneth A.
          Gross, partner, Skadden, Arps, Slate, Meagher & Flom LLP...    13
        Duncan, Hon. John J., Jr., a Representative in Congress from
          the State of Tennessee.....................................     8
        Light, Paul C., Director, Center for Public Service,
          Brookings Institution......................................    53
    Letters, statements, etc., submitted for the record by:
        Bellardo, Lewis J., Deputy Archivist, National Archives and
          Records Administration, prepared statement of..............    16
        Duncan, Hon. John J., Jr., a Representative in Congress from
          the State of Tennessee, prepared statement of..............    10
        Gross, Kenneth A., partner, Skadden, Arps, Slate, Meagher &
          Flom LLP, prepared statement of............................    48
        Harshbarger, Scott, president, Common Cause, prepared
          statement of...............................................    28
        Horn, Hon. Stephen, a Representative in Congress from the
          State of California, prepared statement of.................     3
        Light, Paul C., Director, Center for Public Service,
          Brookings Institution, prepared statement of...............    55
        Noble, Larry, executive director and general counsel, Center
          for Responsive Politics, prepared statement of.............    41
        Schakowsky, Hon. Janice D., a Representative in Congress from
          the State of Illinois, prepared statement of...............     7

     H.R. 577, A BILL TO REQUIRE ANY ORGANIZATION THAT IS ESTABLISHED FOR
        THE PURPOSE OF RAISING FUNDS FOR THE CREATION OF A PRESIDENTIAL
     ARCHIVAL DEPOSITORY TO DISCLOSE THE SOURCES AND AMOUNTS OF ANY FUNDS
                                     RAISED

                                  ----------

                            THURSDAY, APRIL 5, 2001

                      House of Representatives,
      Subcommittee on Government Efficiency, Financial
            Management and Intergovernmental Relations,
                                Committee on Government Reform,
                                                        Washington, DC.
        The subcommittee met, pursuant to notice, at 10:15 a.m., in
    room 2154, Rayburn House Office Building, Hon. Stephen Horn
    (chairman of the subcommittee) presiding.
        Present: Representatives Horn and Putnam.
        Staff present: J. Russell George, staff director and chief
    counsel; Randy Kaplan, full committee professional staff
    member; Bonnie Heald, director of communications; Earl Pierce,
    professional staff member; Matthew Ebert, policy advisor; Grant
    Newman, assistant to the subcommittee; Brian Hom, intern;
    Michelle Ash and David McMillen, minority professional staff
    members; and Jean Gosa, minority clerk.
        Mr. Horn. I apologize for being late. This is a first.
        We are delighted to have my colleague and very
    distinguished chairman in his own sense, Mr. Duncan. A quorum
    being present, we are glad to have you here.
        The subject of today's hearing is both timely and
    important. H.R. 577, introduced by Mr. Duncan from Tennessee,
    is a bill that would require organizations established to raise
    funds to create Presidential libraries disclose the names of
    their contributors and the amounts of their donations.
        This bill is similar to H.R. 3239, which was introduced by
    Representative Duncan in the 106th Congress. It is designed to
    ensure that fundraising for Presidential libraries is public
    information and is free from conflicts of interest or the
    appearance of impropriety.
        In 1939, President Franklin D. Roosevelt developed the
    concept of a Presidential library to house his Presidential
    papers and other historical materials. The National Archives
    and Records administers Presidential libraries for every
    President since Herbert Hoover, with the exception of former
    President Nixon, whose library is privately administered and
    funded.
        Today these libraries maintain over 400 million pages of
    text, nearly 10 million photographs, over 15 million feet of
    motion picture film, and approximately 500,000 Presidential
    objects.
        In order to establish a Presidential library, a President's
    family or political associates generally create a nonprofit
    foundation or organization to receive contributions and
    donations. Because of the private nature of these organizations
    and because the President does not play an official role in the
    organization, these fundraising activities are not subject to
    public scrutiny. Under current law, Presidential library
    foundations can raise unlimited amounts of money from
    undisclosed sources. H.R. 577 would require that the names of
    these donors and the amounts of their contributions be publicly
    disclosed.
        [The prepared statement of Hon. Stephen Horn and the text
    of H.R. 577 follow:]
    [GRAPHIC] [TIFF OMITTED] T9867.001

    [GRAPHIC] [TIFF OMITTED] T9867.002

    [GRAPHIC] [TIFF OMITTED] T9867.003

        Mr. Horn. We have today a number of witnesses who will
    discuss this legislation, and we will elaborate, perhaps, on
    this bill one way or another. We welcome all of our witnesses
    and look forward to their testimony.
        [The prepared statement of Hon. Janice D. Schakowsky
    follows:]
    [GRAPHIC] [TIFF OMITTED] T9867.004

        Mr. Horn. The first panel is Representative John Duncan,
    Member of Congress from Tennessee, and author of the
    legislation.

      STATEMENT OF HON. JOHN J. DUNCAN, JR., A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF TENNESSEE

        Mr. Duncan. Thank you very much for inviting me here this
    morning, and thank you for holding this hearing and for
    offering to move this legislation. I want to say good morning
    also to my colleague, Mr. Putnam.
        I want to say, Chairman Horn, that this is my second time
    appearing before this subcommittee. You held a hearing a few
    years ago on some legislation that we worked on together to
    help small businesses compete, be able to compete more fairly
    with government agencies, the Freedom From Government
    Competition, and that legislation, at least major portions of
    it, were enacted into law. So I appreciate that.
        Today I am here before you concerning a bill that I
    introduced back in the 106th Congress concerning Presidential
    libraries. In fact, I introduced this bill in November 1999,
    approximately a year and a half ago, and long before the
    controversies of recent months, because I felt that the public
    should be made aware of possible conflicts of interest that
    sitting Presidents can have while raising funds for their
    libraries. In most cases, we do not know who these donors are
    or what interests they may have on any pending policy decisions
    that are to be made.
        The bill I have introduced in this Congress, H.R. 577, is a
    simple public disclosure bill. In fact, I don't suppose you
    will ever hold a hearing on a shorter, simpler bill. It does
    not prohibit any type of contribution, nor does it limit the
    amount of any contribution. Any person can still contribute $1
    million or even several million dollars to a Presidential
    library.
        One problem that exists today is that a person who is very
    limited in what they can contribute to a Presidential campaign
    could potentially contribute millions to their library and
    perhaps receive favors in return.
        H.R. 577 would require these donors and donations to be
    made public so that the citizens of this country can decide for
    themselves if they believe there is some type of quid pro quo
    at work here.
        I don't believe, Mr. Chairman, that anybody would have a
    problem with this bill, unless they want to keep this process
    secret.
        Quite some time ago Fred Wertheimer, president of Democracy
    21, said, ``Any President of the United States should not be
    raising secret money, period.'' He said, ``If you are President
    of the United States and you are raising money, particularly to
    things that inure to your benefit and interest, you have the
    responsibility to the American people to tell them where that
    money is coming from.''
        The National Journal had an article earlier this year, in
    fact, just last--I started to say last month, but we are in
    April now, this was February 24th, and they say in this
    article, ``No sitting president, even the two-termers, should
    be headlining intimate little dinners at private mansions in an
    effort to raise unlimited amounts of cash from undisclosed
    sources, foreign and domestic, so that their accumulated papers
    and the record of their White House achievements can be safely
    stored for all eternity.
        The Knoxville News Sentinel, shortly before I introduced
    this legislation, ran an editorial concerning, at the time,
    former President Clinton, and they said, ``Maybe the President
    is hitting up donors now while he still has the clout to do
    it.'' This editorial said, ``Clinton is still a sitting
    President and is in a position to do favors for donors. His
    raising more money for his library behind closed doors may be
    legal, but it smells all the same.''
        This legislation, of course, is not aimed at former
    President Clinton or anybody else, it is just, I think, good
    public policy to require that these donations be disclosed. As
    I said a few moments ago, I think anyone who would oppose this
    could only do so because they had some motive to keep some of
    these things secret. I don't think that should be done.
        So that concludes my testimony. I appreciate your giving me
    the courtesy to be here with you this morning.
        [The prepared statement of Hon. John J. Duncan, Jr.,
    follows:]
    [GRAPHIC] [TIFF OMITTED] T9867.005

    [GRAPHIC] [TIFF OMITTED] T9867.006

        Mr. Horn. Well, I hope you can join us on the panel up
    here. I would like to call on my colleague from Florida, Mr.
    Putnam, for an opening statement. He has some other things to
    do also. If you want to come on up, we will have Mr. Putnam
    give his opening statement.
        Mr. Putnam. Thank you, Mr. Chairman, and I thank Mr. Duncan
    for this timely issue. My first foray into this congressional
    business was a full-blown hearing on the pardon of Marc Rich.
    We were informed that his ex-wife had contributed a large sum
    of money to help fund the Clinton Library, and the committee
    tried to find out how much, and we didn't have a very easy time
    of that. We asked her and she took the fifth, and we subpoenaed
    the library and finally discovered she had given $450,000.
        It shouldn't take scandals and subpoenas to know who is
    contributing to Presidential libraries. It ought to be publicly
    disclosed. Through the Government Reform Committee's work, I
    have come to two conclusions.
        First, it is clear that the government and the public have
    a substantial interest in these facilities. The libraries are
    built through private contributions, but after they are built,
    they are deeded over to the Federal Government and run by the
    National Archives. Since these facilities end up being run by
    the government, we should know what money is used in their
    construction. It is also logical for the public to know how
    much was raised and from whom and how it came about.
        Second, it is clear that the vast majority of individuals
    who contribute to Presidential libraries, not surprisingly, are
    political supporters of the President, any President. It
    applies to all Presidential libraries. These individuals make
    contributions to libraries just like they make contributions to
    parties or other charities of their interest.
        We have laws requiring public disclosure of political
    contributions, and I support that. We believe that public
    scrutiny will let us know when people are buying access or
    influence, or that there is the appearance thereof. For the
    same reasons, contributions to Presidential libraries should be
    disclosed.
        Currently the foundations are private and their activities
    are not open to public scrutiny. They can raise unlimited
    amounts of money from undisclosed sources. This invites abuse
    and accusations of undo influence. Mr. Duncan's bill, which was
    first introduced last Congress, long before the current
    scandal, changes that.
        The concept of public disclosure of contributions to
    libraries should not be terribly controversial. It should be
    bipartisan in its support. I look forward to hearing further
    details about the legislation. For example, should there be a
    threshold under which contributions need not be disclosed, how
    should the libraries go about making their disclosure, how
    frequently. These are issues that are at the margin, the core
    being that Mr. Duncan has seized upon an important issue, an
    important issue for public disclosure, and one that I hope this
    Congress will receive very warmly.
        Thank you, Mr. Chairman, for holding this hearing.
        Mr. Horn. I thank the gentleman for his opening statement.
    By unanimous consent, I would like to note that Mr. Duncan will
    be a member of this panel.
        Hearing no objection, it is unanimously approved that he be
    a part of the panel.
        So, at this point let's go to panel two. That is Dr. Lewis
    J. Bellardo, Deputy Archivist, National Archives and Records
    Administration; Mr. Scott Harshbarger, president, Common Cause;
    Mr. Larry Noble, executive director and general counsel, Center
    for Responsive Politics; Mr. Kenneth A. Gross, partner,
    Skadden, Arps, Slate, Meagher & Flom LLP; Mr. Paul Light will
    be here shortly, director, Center for Public Service, Brookings
    Institution.
        Gentleman, as you know, this is an investigating committee,
    and we do swear in anybody but our colleagues. So if you will
    raise your right hands.
        [Witnesses sworn.]
        Mr. Horn. The clerk will note that all four members of
    panel two are sworn. We will start with Dr. Bellardo.

      STATEMENTS OF LEWIS J. BELLARDO, DEPUTY ARCHIVIST, NATIONAL
        ARCHIVES AND RECORDS ADMINISTRATION; SCOTT HARSHBARGER,
     PRESIDENT, COMMON CAUSE; LARRY NOBLE, EXECUTIVE DIRECTOR AND
    GENERAL COUNSEL, CENTER FOR RESPONSIVE POLITICS; AND KENNETH A.
        GROSS, PARTNER, SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP

        Mr. Bellardo. Congressman Horn, Chairman Horn----
        Mr. Horn. We are going to have to get that--this is a crazy
    room.
        Mr. Bellardo. Can you hear me now?
        Mr. Horn. We can.
        Mr. Bellardo. Chairman Horn, Congressmen Duncan and Putnam,
    thank you for the opportunity to speak with you today. I want
    to thank you for holding this hearing on H.R. 577. I am
    delighted to join you this morning to offer some background on
    the Presidential library system and its multiple benefits to
    scholarship, public policy, education, and a more complete
    understanding of our history.
        This has been a very successful public/private partnership,
    and we greatly appreciate the opportunity to explain why it has
    flourished for the past 60 years and 11 Presidential
    administrations.
        Sixty years ago, Franklin D. Roosevelt proposed creating a
    Presidential library that would be a part of an institution
    whose growth he had shepherded, namely, the National Archives.
    Roosevelt suggested an innovative approach. He would donate the
    land and build the library with private funding, and then he
    would give the library and his papers to the National Archives.
        On June 30, 1941, Roosevelt dedicated his library at Hyde
    Park. His words of dedication remain important today, ``to
    bring together the records of the past and to house them in
    buildings where they will be preserved for the use of men and
    women in the future, a nation must believe in three things: It
    must believe in the past, it must believe in the future, and it
    must, above all, believe in the capacity of its own people so
    to learn from the past that they can gain judgment in creating
    their own future.''
        In the services that it provided for its researchers, its
    extensive collection of materials and the incorporation of a
    museum experience for hundreds of thousands of visitors a year,
    the Roosevelt Library became the model of the Presidential
    library system, which soon began to grow. The library system
    was codified during the Eisenhower administration with the
    Presidential Libraries Act of 1955. This act not only provided
    a continuing legal authority for the government to accept the
    gifts of the library, but authorized the government to enter
    into agreements with State and local governments, with
    universities, with institutes and foundations, for the purposes
    of using land, buildings and equipment for a Presidential
    archival depository. This means three and even four-way
    partnerships, sometimes as foundations, universities, local
    communities, come together to build a Presidential center.
        In 1986, Congress passed various amendments to the previous
    act as a cost reduction and control mechanism to reduce costs
    of operating the libraries and also to ensure that their
    designs met archival standards.
        44 U.S.C. 2112 requires an endowment equal to 20 percent of
    the cost of the building be transferred to the government at
    dedication to contribute to the operating expenses of the
    library. The act also required the archivist to promulgate
    architectural and design standards for the preservation of the
    materials and the inclusion of adequate research facilities. So
    on the day that the George Bush Library was dedicated, the Bush
    Foundation presented a check for $4 million to the National
    Archives Trust Fund.
        I should mention that these funds do not fully provide all
    of the funds necessary to operate the facility, but they are a
    contribution, and an important contribution.
        I trust that the chairman will agree with me that the
    materials in Presidential libraries are among the Nation's most
    important documents. Presidential records are often open for
    research long before the records of other departments and
    agencies of government are even transferred to the National
    Archives. Political scientists study the processes used by
    Presidents to govern. Economists study the impact of
    Presidential decisions on economic indicators and project what
    will happen in the future.
        Hundreds of thousands of children visit libraries each year
    to learn about how Presidents make decisions, how laws are
    passed, how wars were fought, and how our civil rights have
    been ensured. And over 1 million visitors each year view the
    human drama of the Presidency through the power of objects and
    documents displayed in the libraries.
        Whatever their larger vision has been, former Presidents
    and their families have agreed that a lively exciting
    institution that draws a large visitorship, an institution that
    provides an informative program of exhibits, public and
    educational events, must have an active and generous
    foundation. The government cannot be expected to provide
    appropriated funds to each Presidential library for these
    value-added purposes, and the library foundations have evolved
    to meet these needs.
        The contributions of these support organizations to the
    library spell the difference between static repositories and
    lively vital centers of scholarship and service to the public.
        So to kind of recapitulate what the foundations or
    institutes do as it relates to the libraries and NARA, they
    obtain the land, this is often in conjunction with the
    university or with local community groups or local governments
    and so forth; they obtain the land, they build the building,
    they provide the keys to us after having created the building
    to our design specifications, they hand us an endowment for the
    partial maintenance of the building.
        Fortunately for us, they usually transfer only the
    footprint of the building to us, which means that they have to
    maintain the parking and the grounds. That is another plus from
    our standpoint.
        They provide funds to do exhibits, to support historical
    conferences, public policy symposia, educational materials and
    public events such as the World War II events at the
    commemorations at the Eisenhower Library, and even have, in
    recent years, made contributions to major building renovations.
        So, on the other hand, directly appropriated funds pay for
    activities mandated by the law as part of NARA's mission. These
    include the appraisal of documents, the accessioning, the
    processing and preserving of these materials, as well as
    providing reference services. NARA also provides security,
    facility maintenance of the building itself, and environmental
    and safety controls.
        So, in conclusion, Mr. Chairman, this is a system that has
    worked economically, a system that has served the purposes
    envisaged by Presidents Roosevelt, Truman and Eisenhower, a
    system that has won the accolades of scholars and students from
    around the country for 60 years. The National Archives is proud
    of what we have achieved with this partnership and look forward
    to the next 60 years of growth and improvement.
        Mr. Chairman, that concludes my prepared remarks. I would
    be happy to answer any questions at an appropriate time.
        Mr. Horn. Thank you for your statement. We will wait until
    we can go through all the witnesses, and then we will have the
    questions and answers.
        [The prepared statement of Mr. Bellardo follows:]
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        Mr. Horn. Our next presenter is Mr. Scott Harshbarger,
    president of Common Cause.
        Mr. Harshbarger. Mr. Chairman, thank you very much, and
    members, for this opportunity for Common Cause to testify on
    this important issue, and for my first opportunity in this role
    to appear before you and to see you all again.
        Common Cause totally supports both the noble principles and
    the reality of what has occurred with the various Presidential
    foundations and, as so eloquently described by the speaker
    before me, we also believe very much in an engaged, educated
    citizenry and the role they play. Common Cause also cares about
    open, honest and accountable government.
        We are here because there have been a number of issues
    raised, not only recently, with the Presidential pardon issues,
    but others, and so I thought we could focus on what the issues
    are that bring us here, and particularly, thanks to Congressman
    Duncan, have the issue presented in the House, and Senator
    Specter in the Senate.
        We are here because Presidential library foundations now
    raise millions of dollars in private contributions and have
    become more and more ambitious. The FDR Library, the first of
    the 10 Presidential libraries now in the Federal system, cost
    under $400,000 to build. Former President Clinton's library
    complex is expected to cost well over $100 million.
        Any time elected officials or their supporters are raising
    millions of dollars in private donations, there is a cause for
    concern; who are these donors and are their large gifts their
    way of gaining access and influence at the White House or in
    any other way in terms of the performance of public officials
    and public responsibilities?
        The Clinton pardon scandal brought home problems with the
    Presidential library system. The Rich donation of $450,000 that
    Congressman Putnam referenced and Beth Dozoretz's pledge of $1
    million to the library and their successful lobbying for the
    pardon of Marc Rich, raised the problem very directly.
        When Congress wanted to investigate these media reports and
    learn the names of the donors to the library foundation, the
    library's director tried to stonewall and didn't comply with
    the congressional subpoena. It took the threat of contempt to
    bring limited disclosure of contributors.
        Common Cause wrote to Skip Rutherford asking that the
    Clinton library donors be disclosed. Then when a few key
    members of the House Government Reform Committee got access to
    the names of the top donors, we stated publicly that this
    accommodation wasn't adequate.
        Let's be clear about this: Our view is that Presidents
    should not be in the business of raising private funds for
    their libraries, but we recognize the political difficulties in
    translating this view into the legislation that will be
    enacted.
        Again, we mentioned H.R. 577, sponsored by Representative
    Duncan, is an important step in addressing these issues posed
    by these libraries. Senate 645, sponsored by Arlen Specter of
    Pennsylvania, would require a sitting President to disclose all
    contributions to a library foundation of more than $5,000, and
    that is a step in the right direction in reforming the process.
        But there are two other problems we must find a way to
    address. First is the problem that the gifts are unlimited.
    Clinton and Reagan both solicited a contribution for their
    library while still in office. These gifts can give any donor
    with an agenda before the Federal Government a powerful tool to
    gain access and influence at the highest levels of the
    executive branch.
        What President would not be grateful for a $1 million or a
    $5 million or $10 million gift to his or her library? Second is
    the problem that these gifts can come from foreign sources,
    which are prohibited from almost any other type of campaign and
    other contributions.
        While President Bush did not raise contributions for his
    library, Kuwait and Saudi Arabia both are among his $1 million
    donors. Now they ask the father of a sitting President. Is
    there a potential for a conflict of interest or potential
    conflict?
        Common Cause recommends that library contributions not be
    permitted from foreign nationals or foreign governments and
    that there be limits on the sizes of donations to Presidential
    library foundations.
        As we consider disclosure and contributions for
    Presidential libraries, we should take note of the fact that we
    may want to apply these requirements not only to sitting
    Presidents. Our history shows that former Presidents also wield
    influence in their parties, with many Members of Congress, and
    often take active roles as heads of commissions, diplomatic
    emissaries, and even in brokering negotiations between the
    United States and leaders of other countries, as Jimmy Carter
    did in Haiti.
        These restrictions are really a way to ensure that our
    Presidents, past and present, are not beholden to wealthy
    special interests, and that our Presidential libraries remain
    free to serve the American public, not so much as monuments to
    individual politicians, but as repositories of important public
    documents about a particular Presidential administration.
        As Presidential library scholar Curt Smith has observed,
    ``It's not only their history, it's our history.''
        We have submitted a prepared statement in addition, and we
    thank you for this opportunity to speak to this committee.
        Mr. Horn. Thank you very much. That is very helpful.
        [The prepared statement of Mr. Harshbarger follows:]
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        Mr. Horn. Mr. Larry Noble is executive director and general
    counsel for the Center for Responsive Politics. Mr. Noble.
        Mr. Noble. Mr. Chairman and members of the committee, thank
    you for the opportunity to testify on the important question of
    the disclosure of financial contributions to Presidential
    libraries. I would also note that, like Mr. Harshbarger, this
    is my first opportunity to appear in my present capacity before
    the committee, and I am pleased to do so.
        The Center for Responsive Politics is a nonpartisan,
    nonprofit research organization that monitors and analyzes
    contributions in Federal elections. The Center is not an
    advocacy group. The reason for our existence is simple: To
    inform citizens about who is paying for Federal elections and
    who is in the position to exercise influence over the elected
    officials who represent the public in our Nation's Capital. We
    can do this because the financing of your campaigns are open to
    public scrutiny.
        Starting with the Federal Election Commission's data, the
    center compiles and publishes full campaign finance profiles
    for all Members of Congress, all candidates for Congress, and
    for most of the Presidential contenders. For example, we
    compile and make public a summary of how much you took in
    during the last election cycle, how much you spent, how much
    money you had left in your campaign, how much of your campaign
    contributions came from PACs versus individuals, and how much
    you contribute to your own campaigns. We also break down these
    contributions geographically.
        The public can also get a breakdown of contributions by
    industry and interest group. We show a candidate's leading
    contributors standardized and grouped by organizations. We even
    display how well he or she did in fully identifying the
    occupation and employees of their donors.
        This is public disclosure. Without it, the public would not
    have the faintest idea of who is financing our elections, how
    much they gave and what they might be expecting in return. The
    law has recognized for almost 100 years that our democracy is
    significantly strengthened when the public knows who is giving
    the money. The public, however, is still in the dark with
    regard to several back-door ways of buying influence in
    Washington. One of these is the funding of Presidential
    libraries.
        As we all know, Presidents begin fundraising for their
    libraries well before they leave office. President Clinton was
    not the first, and I suspect he will not be the last. When you
    have a sitting President whose fundraising machine is raising
    millions of dollars in unlimited contributions for a project on
    his behalf, legitimate concerns must be raised by the identity
    of the donors.
        As you are all aware, the perception is that money, at the
    very least, opens doors for the donors, and there is a
    perception and reality that the large contributor is looking
    for something in return. We all know too well about President
    Clinton's pardon of Marc Rich and how six-figure contributions
    to a Presidential library fund, along with other political
    donations, has left the indelible impression, accurate or not,
    that a Presidential pardon was bought.
        Few reasonable people any longer doubt that one of the most
    critical checks against the real and apparent corruption in
    politics is disclosure. As Justice Brandeis wrote in 1933,
    ``Sunlight is said to be the best of disinfectants; electric
    light the most efficient policeman.''
        Doesn't the public deserve to have the sunlight shine on
    the Presidential library contributors? If you answer yes, then
    you need a law that does more than expresses a worthwhile
    sentiment and requirement for disclosure.
        As always, when discussing any law, the devil is in the
    details. Important questions must be answered before disclosure
    of Presidential library contributions will become a reality.
    For example, what information must be disclosed; who must
    disclose it; how often and for how long will disclosure be
    required; in what form must they disclose it; who will
    administer and enforce the disclosure?
        As history has shown us, a law unenforced may be as bad as
    no law at all, as it leaves you with a false comfort that you
    have done something, even as the problem rages on.
        Mr. Chairman, members, as you address these issues,
    remember that this is about more than politics or philanthropic
    desires of the well-to-do. It is about the public interest in
    holding elected officials accountable for their actions and
    decisions, and the public's confidence that what belongs to the
    public, an office holder's free and untainted judgment, is not
    being sold.
        Thank you for this opportunity to testify. I will be happy
    to answer any questions you have.
        [The prepared statement of Mr. Noble follows:]
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        Mr. Horn. Thank you very much. All of you come at this in
    various ways, and we are going to get a lot of knowledge out of
    it.
        Mr. Gross is the partner at Skadden, Arps, Slate, Heagher &
    Flom. We are delighted to have you. Please proceed.
        Mr. Gross. Thank you, Mr. Chairman. I am not here
    representing any group, but I was immediately drawn to this
    bill because it is short and sweet. It is shorter than most
    footnotes, and I liked that right off.
        Mr. Horn. It might start a terrible trend around here.
        Mr. Gross. I will try and keep my comments to be the same.
    I just had a few specific comments as I looked at it.
        I guess there is always a question about what a library is.
    Most of the libraries that I have seen setup in recent years--
    there is a defined term there, and you could limit the scope of
    the disclosure by just limiting the contributions just to the
    library. So I think it needs to be drafted in a way to include
    the surrounding and related facilities in and around the
    library, since the definition of what the library is, as I read
    it, is kind of a narrow definition, and, of course, the
    complexes have become more elaborate in recent years.
        I do believe that there should be disclosure of
    contributions after the President leaves office. This bill does
    not address that. I think the Specter bill limits it to while
    the President is in office.
        It certainly should continue after the President leaves
    office. I don't know whether it should be in perpetuity. If it
    is a one-term President, he or she could run again. You could
    have a Grover Cleveland situation. Certainly there should be a
    meaningful period of post-service disclosure.
        As far as thresholds go, I think I would recommend the
    $5,000 threshold for disclosure. It is the disclosure threshold
    right now for filing 990's, which is the tax return for
    501(c)3. I should say disclosure only to the IRS. It is not
    public disclosure, and that is what would be made public with
    this bill, presumably, and it seems like a good number to me.
        There is always the threat, and we got into this at my
    years at the Federal Election Commission, of contributions made
    in the name of another. You give money to some third person,
    who then donates it, and that thwarts the disclosure. I think
    there needs to be a specific provision to prevent conduit
    contributions, contributions in the name of another, as well as
    probably some additional information, occupation, employer,
    some of the information we see now currently on the Federal
    Elections Commission reports.
        As far as its administration goes, I am reluctantly moving
    toward the IRS. The reason I say ``reluctantly'' is that the
    527 legislation, the soft PAC legislation that passed last
    year, is being administered by the IRS. It puts the IRS in the
    business of being a disclosure agency.
        The culture of the IRS, the whole legal construct of the
    IRS, is to maintain secrecy of taxpayer information. They were
    thrust into a disclosure role there, which I think was an
    uncomfortable one for them and probably should have been at the
    Federal Election Commission, which does a good job with
    disclosure. Here this is basically just tax information. So I
    sort of reluctantly come to the IRS as the appropriate
    disclosure agency.
        Perhaps maybe disclosure could be made to the Archives,
    but, as Mr. Noble noted, you need some enforcement mechanism,
    and I think that would also probably be placed at the IRS for
    late filing of returns and that type of thing.
        So those are my thoughts on the administration side of the
    bill. Again, any questions, I would be happy to address.
        [The prepared statement of Kenneth Gross follows:]
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        Mr. Horn. Thank you. Dr. Light, is he here yet?
        OK, we will take his testimony later. Let us start with
    some questions then, if we might. I wonder if the author of
    this legislation would like to ask a few questions?
        Mr. Duncan. Thank you very much, Mr. Chairman. I want to
    thank each member of the panel for being here to testify. I
    think that each of you has made very helpful comments and many
    good suggestions, and I can tell you that I don't have any
    objections to revising this legislation in some of the ways
    that you have suggested.
        We tried to keep the bill as short and simple as possible
    because we want to remove as many objections as possible so
    that we can get something through. If you start putting too
    many limits or details on some of this, we potentially run into
    objections from the White House or other places.
        Dr. Bellardo, do you see any problems about the Archives
    administering these disclosure requirements? Would you rather
    it be placed, as Mr. Gross suggested, in some agency such as
    IRS?
        Mr. Bellardo. I think Mr. Gross indicated probably some
    other agency would be more appropriate, since most of the funds
    ultimately end up coming to us for the support of the library
    and the library programs. I think that would further complicate
    our situation. It would probably be better administered by
    another agency.
        Mr. Horn. Could you speak up just a little?
        Mr. Bellardo. Oh, sure. Were you able to hear me?
        Mr. Horn. Keep going. You are getting there.
        Mr. Bellardo. That would be all I would have to say at this
    point.
        Mr. Duncan. Mr. Harshbarger, I appreciate the letter that
    Common Cause sent to the Clinton Library last February 27th,
    and I think it is a well-written letter and it makes a lot of
    good points that pertain to this legislation. I don't remember,
    did you say that you thought these contributions should be
    limited? I notice you requested contributions over $5,000 be
    disclosed, as is in Senator Specter's legislation. Do you think
    there should be a top limit on the contributions?
        Mr. Harshbarger. We did think they should not be unlimited.
        Mr. Duncan. But you haven't suggested an amount?
        Mr. Harshbarger. $5,000, we would prefer limits. I mean, I
    guess, you can start to talk about the amount and number. I am
    very sympathetic to your point, Congressman, that you are
    trying to get something through here, and if we--I am sure the
    two gentlemen here to my right can speak even more to this
    issue, about how you deal with the details of disclosure, and
    those of us that have been enforcers also understand those
    problems.
        On the other hand, if the reason you are trying to get the
    disclosure is for the purposes of public disclosure, we all
    know that if you don't have a method that starts to lay it out
    in some detail, it will be driven by other factors that will
    start to weigh, and at least we have experience in other areas
    to try to figure out how to do it.
        I am concerned with--you know, this is a great opportunity
    for me to raise questions to my two knowledgeable colleagues
    here--why you would think that the IRS--I mean, because I think
    part of the problem here, if you are doing a sitting President,
    for example, you are interested in knowing in a somewhat timely
    manner who gave the contribution, specifically the reason to
    get a sitting President's information is because you are
    concerned about the reasons that this money is being given now,
    and you want to know what is pending.
        So having an agency, while we all know some of the issues
    with the FEC, I think the other question is they are at least
    used to making disclosures available quickly so people can take
    advantage of that. I would think at least as to the sitting
    President, you would want to treat these much more as any kind
    of donation that comes in the nature, if not campaign
    contributions, at least disclosure. If you are giving gifts, it
    would have to be disclosed. So I think that is where I would be
    concerned.
        I tend to wholly agree with your concept. Everything here
    ought to be disclosed. I understand that people may not want to
    do that, but most of the major institutions in this country
    proudly display who their contributors are at all levels. I
    mean, the more platinum you can get, the better, at most
    universities, and smaller donations as well.
        So I don't think that the privacy issue is important. If
    your goal is to get this, not for puritan interests, but
    because you are trying to figure out what the reasons are
    somebody might have given this money, I think you have to treat
    it more in the nature of a disclosure that is ongoing.
        Mr. Duncan. I had the thought that if you could run into
    the argument that some of these libraries would make, that
    especially after a President leaves office, that if they can
    get a contribution from some corporation or foundation, they
    serve educational purposes. I can see them making some pretty
    good arguments against limiting these contributions to any
    great extent. But I don't personally have any real objections
    to it.
        Mr. Noble, do you have any comments you wish to make as to
    what Mr. Harshbarger said?
        Mr. Noble. Yes. I think the FEC is the best place to put
    this, and I am personally aware the FEC is not without its
    controversy. But the FEC, as Mr. Gross said, does an excellent
    job in disclosure. It right now has systems setup for doing
    this type of thing. It is setup to take electronic disclosure,
    electronic filing. It has an excellent Web site where it puts
    the information out there for the public. And it also has right
    now what is a temporary administrative fines program, that is
    apparently working very well and they are going to ask for an
    extension of that program, and that is the type of program that
    would serve as a good enforcement mechanism for any type of
    reporting system where you have a late report and you want to
    just have administrative fines for it.
        So I think the FEC is the one that is setup right now to do
    it quickly and it could get it online pretty quickly. So that
    is where I think it would belong.
        Mr. Duncan. Mr. Gross.
        Mr. Gross. First of all, I would oppose limits. I don't
    think there should be limits on these contributions. These are
    approved charities by the Internal Revenue Service under
    501(c)3. They are considered to be in the public interest.
    Anybody who has visited one of these Presidential libraries I
    am sure has been impressed with them. They provide a great
    public service, and I would not want to interfere with the
    fundraising, as long as we have proper disclosure.
        I don't think we need to get into trying to disclose a
    pledge, because I don't think you can administer a pledge. A
    Federal Election Campaign Act used to have a written pledge
    disclosure requirement, and it was taken out. I think if we get
    the disclosure at some point, even after the President serves,
    we will be well served.
        I personally wouldn't mind seeing this at the Federal
    Election Commission, because they are used to administering,
    putting information out. The problem I have--and that is where
    I wish, as I mentioned, the 527 legislation had placed
    disclosure--is, this is a tax entity. This is a 501(c)3, it is
    not a political entity, and just because it is going to a fund
    that happens to be connected with a President or a former
    President, I don't think shifts it into the enforcement
    mechanism of the FEC and the disclosure mechanism of the FEC.
        The other problem with limits, by the way, is you get into
    a whole disclosure mechanism, saying were the contributions
    from affiliated entities, and were they aggregated, and you
    don't want to get into all those types of issues.
        I think it should be strictly disclosure, and now the IRS
    seems to be able to handle disclosure because of it having
    gotten the 527 legislation. I reluctantly feel that is probably
    the most comfortable fit for this type of information.
        Mr. Duncan. Thank you very much. I know it was Dr. Light,
    the witness from the Brookings Institution, that suggested the
    $50,000----
        Mr. Horn. Here he is coming right through the door, the
    Scarlet Pimperel of American political science. He is here, he
    is there, he is everywhere.
        Mr. Duncan. Thank you very much for your supportive
    comments and suggestions.
        Mr. Chairman, thank you.
        Mr. Horn. Let me just say, we are delighted to have Dr.
    Light here. He always lends a little humor to anything he
    testifies about.
        What would you like to say, since you don't know what your
    colleagues have said?
        Mr. Light. I agree 100 percent with their wise thoughts.
        Mr. Horn. I have to swear you in. You have been sworn in
    numerous times here but let's do it again.
        [Witness sworn.]
        Mr. Horn. The clerk will note that Dr. Light has taken the
    oath.

        STATEMENT OF PAUL C. LIGHT, DIRECTOR, CENTER FOR PUBLIC
                     SERVICE, BROOKINGS INSTITUTION

        Mr. Light. I apologize for being late. We have been working
    for the last few years on the Presidential appointments process
    reform and the Senate Governmental Affairs Committee held a
    hearing yesterday afternoon--a hearing this morning. They are
    constantly voting. Actually, they are not constantly voting so
    when they do vote it is a big event so we had a little bit of
    trouble getting that hearing underway.
        I really don't have a deep statement here. I support the
    general notion here of requiring disclosure of contributions to
    Presidential libraries. What I bring to the table here this
    morning is my own experience back in 1988, as the Senate
    Governmental Affairs Committee drafted the Presidential
    Transitions Effectiveness Act in 1988 where we decided that it
    was a wise--or the Senate and the House decided that it was a
    wise move to regulate, require the disclosure and limitation of
    funds given to private foundations that had been created to
    support a Presidential transition. I think that provides the
    precedent perhaps for Representative Duncan's legislation. I
    mean, we have done this before. We have made the decision
    before that private foundations can be regulated, and that
    there are places where such regulation makes sense.
        The decision to regulate the contributions to the
    Presidential transition funds was based on a concern about
    conflicts of interest, appearance of conflicts rather than any
    reality that we could find. We just knew that there was a lot
    of money going into transitions; that the 1981 Reagan
    transition had involved a lot of money but nobody knew how
    much, in what levels, what contributions, and it created the
    appearance of conflicts of interest that we thought was
    troublesome for democratic confidence.
        Having said that, and having looked briefly at the
    legislation and not being an expert on the regulation of
    501(c)3 tax exempt organizations, although I am in one right
    now, I would say that my notion was that, No. 1, require full
    disclosure; No. 2, link the requirement for disclosure to the
    acceptance of Federal services rendered by the National
    Archives and Records Administration. That strengthens, I
    believe, the disclosure requirement. Include pledges, and I do
    believe that you ought to limit the amount of contributions
    that are made.
        Now I am talking to a committee--a subcommittee chaired by
    a man who has raised capital dollars in an educational setting.
    There is nothing more difficult than raising money for
    buildings. You know that. We all know that. I don't think we
    could put a cap of $5,000 on contributions. Otherwise, we
    wouldn't get these Presidential libraries built until, what,
    200 or 300 years after the President elect--or the President is
    gone. Now that might not be a bad thing. You never know.
        Mr. Horn. That's right.
        Mr. Light. You never know. But I think if you are going to
    put a limit on the amount of contributions, it has got to be
    higher than the kind of limit that was imposed under the 1988
    Transitions Act of just $5,000. That's a limit that, as you
    know, President-elect Bush and Vice President-elect Cheney
    agreed to well before they were given access to the Federal
    services and dollars last December that would have required
    them to disclose.
        Basically, I am joining my colleague who was testifying
    yesterday from Common Cause, I believe on disclosure. I think
    there is an antiseptic, disinfecting effect of disclosure, and
    I think we ought to do this here and do it in such a way that
    the American public is reassured that there is no pro quo, I
    think, for the quid, or so to speak.
        [The prepared statement of Mr. Light follows:]
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        Mr. Horn. Let's throw in another type, and that's in-kind
    contributions. Should they be included? And if so, who is
    putting the valuation on it?
        Mr. Noble. I would say, yes, they should be included and it
    is something you deal with with the Federal Election Campaign
    Finance laws right now. You have to value in-kind contributions
    by fair market value. Sometimes it is difficult but usually it
    is not that difficult to do, and I think they present the same
    problem as cash contributions.
        Mr. Gross. I have no question that in-kind contributions
    should be included. It is sometimes a disclosure challenge
    depending on whether it is a third--payment to a third party on
    behalf of the library or something of value that's given that
    has to be valued. But either way, that clearly should be part
    of the legislation.
        Mr. Horn. Does the gentleman from Tennessee have some more
    questions?
        Mr. Duncan. No more questions.
        Mr. Horn. Does anybody on the panel, after you have
    listened to your colleagues, do you agree with them or do you
    not agree with them? If so, we just want to get it all out on
    the record. Dr. Bellardo.
        Mr. Bellardo. I would just like to make one observation,
    and I guess it is apropos to the item that Dr. Light mentioned
    in terms of the limits that might be set, without taking a
    position itself on whether limits are good or bad. What I would
    like to do is just call attention to the fact that these
    libraries go through cycles, and the older libraries, such as
    Hoover or Roosevelt or the--or Truman, reach a point where
    major fundraising efforts become necessary in order to either,
    in the case of Roosevelt, build a building, a visitors' center;
    in the case of Truman, for example, to do a major total
    renovation inside.
        So at 50 years after the President is no longer living,
    there is not that same kind of issue, I think. But the major
    concern is that there would be sufficient opportunity to raise
    the funds at that time and sometimes those amounts are very
    large. That would be all.
        Mr. Horn. Really, as an ex-university president, I do know
    something about what happens to your donations and why you need
    them, and that is, frankly, that the capital structure is a
    very small percentage. What really gets you is the operations.
    And then the question is, after the President, any President,
    ex--President, gets the money for a Taj Mahal of one kind or
    another, I think of that when I go into the Johnson library,
    who beat them all to work and you felt that he always had whips
    down there and said, keep going, John Kennedy's Presidential
    library is not yet up, and there he got it. It is beautiful.
    But the operational money, is the Archives willing to put up
    some of the operational money? Some of these 50 years from now
    just might not be able to get the operational money. What do we
    do then?
        Mr. Bellardo. Well, we are continuing to fund operations
    for those buildings. The entire cost of the Presidential
    library system, including the two projects that we have, the
    Nixon project, which is out at Archives II, and the Clinton
    project, total approximately $40 million a year. So as of this
    point, funds are available to continue those operations.
        I can't say, you know, 100 years from now what that would
    look like as you get additional Presidential libraries coming
    on board.
        Mr. Horn. Well, I think the McKinley area down in Ohio that
    Mr. Regula has correctly protected, and the Hayes home, which
    is a marvelous home, and it isn't so much the workings of the
    library or scholarly research on manuscripts but you have
    sometimes things go on with it. In the case of the Nixon
    Library, which I must say I have fond affection for it because
    it is down to human size, and I have the same about President
    Carter. Again, it is down to human size as opposed to the Taj
    Mahal approach.
        So I would think maybe there might be people 50 years from
    now that care about history, although the way history has been
    taught in colleges recently and in high school it is a wonder
    anybody even remembers George Washington.
        So any other questions that you want to work out here?
    Because this is very well done, tight language that Mr. Duncan
    has put in there, but we can always put a little more tight
    language or we can throw something in a footnote. Since the
    Supreme Court doesn't like us putting report language in, we
    have to put everything in if that it is going to stand the
    test. I think the disclosure we are all agreed on; the in-kind
    is all agreed on.
        I guess the $5,000 one I am wondering about. To me, $1,000
    bucks still looks pretty good. I know we have tried to raise it
    on the candidates, and I have been for keeping it at $1,000. I
    don't know where that point comes. Do all the relatives put in
    $5,000? We know how that's been used in many of the campaign
    situations where little kids had been, you know, writing their
    own checkbook down for somebody they never met but the
    millionaires had a lot of kids and that's where they got the
    money.
        So I would welcome any thoughts here as to why is $5,000
    the cutoff?
        Mr. Harshbarger. Let me just, since we sort of have
    suggested that, I mean it has some parallels. There are some
    other parallels. There obviously are ways, as Mr. Noble rightly
    said and as anybody who comes from a prosecutorial background
    knows and you face, is if we don't have an enforcement
    mechanism we can write all the laws we want and it doesn't
    serve any purposes, or people will get around it.
        So I think there is a certain both--genius to the
    simplicity of this. You don't want to really--because you
    either turn it into 1 page or it is a 500-pager if you are not
    careful, I think. But the limiting principle, I would think, is
    when you are around or in the nexus in relationship of a
    sitting President or a President who is still in a position to
    be active and, of course, we have all quoted down exceptions
    beyond the time, but I think that the reason--what you are
    trying to do, I think, with this is, is this really a
    charitable solicitation? Is this a President going out and
    soliciting for a worthy cause that's a 501(c)3 entity that has
    nothing to do with him or her, or is it in their own self-
    interest and you are trying to make--not give people--if we are
    suspicious--we don't want to give people other avenues to gain
    the access or the appearance of influence, or frankly to put
    the President in a position of having to face that dilemma. So
    that the closer you are to serving in office, the more
    rationale there is for limitation. The further you are away
    from it, to go to Mr. Gross' or others' point is, and to what
    was just stated is, that's much more in the nature of
    preserving history. That starts to become more of the
    educational and other purposes.
        So I think that it is not--it sounds like you can't build a
    library with $5,000 contributions. On the other hand, I mean
    who--the problem we have today is that it appeared that when
    somebody was soliciting, one of the ways once they had given
    all the hard money they could, all the soft money they could,
    all the other things that they could do, then there was one
    other avenue here, and the legal defense fund was taken care
    of, now we will go on to one more thing, and that seemed to be
    the rationale.
        Now they could all have been totally good-hearted,
    tremendously supportive, loyal people. That is not to pick on
    President Clinton, but that's why to some extent, you know, we
    are here. So in terms of contemporary--if you sort of take it
    in terms of the time relating to sitting Presidents, there is
    an argument for limits that maybe does not exist as far down
    the line in perpetuity; but I think there is some reason to
    think about a limit when you are talking about a sitting
    President's capacity to get money or people's reasons to
    contribute, as opposed to later on a corporate foundation or an
    educational body where people are otherwise making tax
    deductible donations and they are choosing that one. But that's
    our rationale, at least for keeping that in people's minds at
    this point.
        Mr. Horn. What about foreign donations?
        Mr. Harshbarger. Well, I mean I think if we know, I think
    that in the--if you were to--I guess I would say this: I would
    take the principle that the foreign donations ought to be
    prohibited. That's what we have said here. Now I think that we
    are also talking--I mean I guess my operating principle here
    was when you are contemporaneous in time to a sitting President
    or shortly thereafter, or where there is some reason to
    believe--theoretically you could reactivate limits. It is not
    impossible. We do that with former officials who were under a
    conflict of interest law when they served in a prior
    administration. They go out; they remove from them, but when
    they return limits begin to apply again.
        So it is not impossible to have some timeframe, but if
    foreign nationals and others are not supposed to contribute in
    our political process, and what we are treating this as--at
    least from our perspective, we are treating this as in the
    nature of or some way of gaining or seeking some kind of
    access, I think that's a problem with a foreign national or
    other kinds of contributions.
        I know that one other answer somebody could give this,
    well, nobody stops the parties from doing these infomercial
    receptions at conventions but at least you are using the party
    mechanism there and not the individual. That would be my
    theory. This is solicitation by a President for something that
    directly relates to him or her, and that's the reason for the
    limitation.
        Mr. Horn. Yes, Mr. Noble.
        Mr. Noble. While we don't take a position on the merits of
    a bill and don't lobby bills, I do agree with Mr. Harshbarger
    to this extent: That a lot of the same concerns that are behind
    the contribution limits in Federal elections, and the
    prohibitions on foreign nationals excepting, would be behind
    this type of activity, especially when the President is in
    office or shortly after or for some period after the President
    is in office.
        So I think you do have a situation where you have to look
    at a lot of the same interests.
        I also wanted to comment briefly on the simplicity of the
    bill. And I do think that there is--I agree with Mr. Gross that
    there is a tremendous amount to be said for simplicity, though
    it does tend to cut into his business.
        As a former enforcer, I have to say that it presents
    tremendous problems in administering the law. It looks nice
    having simple laws but it leaves so many questions unanswered,
    and either an agency, whether it be the IRS or the FEC or some
    other agency, is going to have to answer it, or else the law is
    not going to be enforceable.
        I think it is always better if Congress makes those
    decisions and gives the agency the direction to go in and makes
    the decisions about whether you want--obviously, you have to
    make the decision whether you want limits but how often
    disclosure should be, where disclosure should be, what kind of
    enforcement mechanism you want for it. Because without that, I
    think you are just going to end up with a lot of internal
    debates within an agency and a system that is not very
    effective. The agency really needs to look to Congress to make
    these decisions, at least in the first instance. Obviously
    there will be a lot of details the agency will have to fill in
    in terms of regulations, but at least in terms of the basic
    outlines of the law and what is required. I think Congress
    really should do that.
        Mr. Horn. Yes, Dr. Light.
        Mr. Light. I always thought that the simpler the
    legislation, the more business it generates because you have to
    interpret it.
        Mr. Gross. Particularly after the regulators get through
    with it.
        Mr. Light. I mean, I think that one of the points that I
    was making, I am sure is shared by others, is that money is
    like mercury in this business.
        We have got a bill now moving over from the Senate that
    closes off soft money, and I am not saying that you are going
    to get a $248 billion library fund but some huge amount of
    money is going to be looking for a new place to land, and
    that's why this bill is particularly attractive. I mean, money
    and politics looks for options, and I look forward to the
    hearing with you some time in the distant future where we
    figure out where the money is going to go from here.
        I suspect we are going to have one heck of a great
    inaugural event in 2004 and 2008 that we eventually will have
    to regulate the inaugural committees. It is just the way of the
    world. And so disclosure--I do believe in limits.
        I do worry that if you put a $5,000 cap that may be just
    too little for what has to be done here in terms of the cap on
    campaigns involved. I have been in a situation in past lives
    where I have gone out seeking soliciting funds for two former
    Vice Presidents from Minnesota, Hubert Humphrey and Walter
    Mondale. I will tell you it is about the hardest call to make
    after they leave office. Walter who? Hubert who? It is just
    hard fundraising, and if you limit that after office it may be
    what Scott is telling us is that Common Cause might be OK with
    a limitation of $5,000 or $1,000 up to the end of the
    administration and then afterwards you could raise the limit.
    Maybe that's a possible alternative here to keep the whole
    process clean.
        I don't want to put words in his mouth but maybe that's one
    option here.
        Mr. Gross. Well, one of the most impressive things about
    this bill is that it was introduced a year ago, and I
    compliment the foresight of Congressman Duncan in doing so, and
    that it isn't--we don't have to be feeling like we are
    necessarily trying to make recommendations on a bill in the
    context of the brouhaha of the Clinton Library contributions.
    And I really do have some objections or concerns about putting
    severe limits on these donations. We are deciding that this is
    a good cause; this is a 501(c)3. I understand the influence
    issue, but you are going to create a whole regulatory scheme to
    see how--who is exceeding limits, whether affiliated groups are
    exceeding limits, and I think we are doing just fine with the
    disclosure of the money that's now being disclosed to the IRS
    under 527 legislation and that we shouldn't adorn it with a lot
    of these provisions.
        I perhaps could live with a limitation while the President
    is in office. I mean, maybe you could draw a line there, but I
    understand that there are ways around that without--but I think
    if we start getting into pledges we are--it is a hopeless thing
    to enforce what a pledge is. We all know what a promise for a
    political contribution is worth; very little until you see the
    money. So I wouldn't go down that road as well.
        So I am on the column of no limits for this.
        Mr. Horn. Mr. Harshbarger, any comments?
        Mr. Harshbarger. I have had an opportunity here to comment
    now sort of arguing and negotiating against myself and I am
    sure Celia Wechsler sitting back here is beginning to worry
    deeply about what position I am going to take on behalf of
    Common Cause. I think this is a very important discussion. I
    mean, I really do. I think there is--the points that are being
    made here, I think that this is the time to--this is the time
    to focus on it because I think that each of the points that--
    all of the reasons that you are having this, and the folks here
    are giving you arguments, this thing is going to get worse, not
    better.
        This isn't going to stop happening because of a particular
    circumstance. It is an avenue. And I think that--I guess one
    vantage point once in awhile you think about is what does the
    average person think about this, not what those of us who, you
    know, who maybe understand the need to raise huge amounts of
    money, but what would the average person say in terms of do
    they expect somebody got influence or not influence from making
    the contribution to the President's favorite charity or the
    President's favorite institution, and if you could give a huge
    chunk of money you are likely to have more access, the bigger
    megaphone, than somebody who is sending in their $5 check. I
    think that's one of the ways to look at this around the
    appearances aspect, and I think that is what you are trying to
    do here.
        I think later once these become--I look back on this. You
    mentioned about the history piece. I mean, today 5 years ago is
    history. I mean, so we could set shorter limits of time because
    people don't remember.
        I think Dr. Light's position is well taken. Having been in
    this world, it was amazing the number of people who supported
    me or appeared to support me until the day after I lost. It was
    sort of funny how those calls just don't get returned. You
    know, can cry a lot, you beg a lot and talk about deficits but
    it is a whole lot harder to do a deficit fundraiser the day
    after you are out of office than the day after you--or the
    period of time in which you are still in office.
        So I think that's part of the--there is no question in my
    mind that it has some influence on the way we ought to think
    about this, but thank you for letting me just ramble on with my
    thoughts about that one.
        Mr. Horn. Well, we have had some very good suggestions.
        I wonder, anything else you want this expertise on?
        Mr. Duncan. Well, Mr. Chairman, when Dr. Light said,
    ``Walter who,'' I thought back when my father told me many
    years ago. He said, you know how long it takes them to forget
    you once you leave office? He said, about as long as it takes
    the ripples to disappear when you throw a rock in the water;
    and there is some truth in that.
        I can tell you that I was a lawyer and circuit court judge
    in Tennessee for many years; and, Mr. Gross, I don't have any
    objection to stirring up business for lawyers.
        Mr. Light. Thank you.
        Mr. Duncan. But you have made many good suggestions here
    today.
        Mr. Chairman, I have told the counsel that I am certainly
    willing to work with you and with the staff to make some
    changes. I don't have--as I said earlier, I don't have any
    objection to limits. I don't really think that they are
    particularly a good idea in this context. And if we did, I
    think that was a good suggestion to say that perhaps they
    should be limited only while in office, because the further a
    President gets away from office I suppose the harder it would
    become to raise money.
        At any rate, this hearing was designed to start the ball
    rolling about this legislation, and I appreciate Chairman Horn
    expressing interest in it, and also I understand that Chairman
    Burton and he has cosponsored my bill, and so I really am
    appreciative of that and I thank you very much for holding this
    hearing.
        Mr. Horn. Well, we thank you. I just note for the record
    that the committee staff has contacted the heads of the various
    Presidential libraries, and the heads of the libraries
    discussed the legislation with our staff but generally
    expressed a preference not to testify at the hearing. I don't
    know if they felt maybe we won't be getting the money we need
    or something. But anyhow, that's just for the record on that.
        I think what you have given us is sufficient for any
    revisions in the bill is the way I feel about it. So I want to
    thank each of you. It is very important, and you gave some
    really first class evidence on this, especially when we get
    into tax laws. Thank you very much.
        This is the statement of the ranking Democratic that will
    be put in the record at the beginning, after myself and Mr.
    Putnam.
        The staff that has helped do this is J. Russell George, our
    staff director and chief counsel, who is over there in the
    corner; Randy Kaplan, full committee professional staff; Bonnie
    Heald, director of communications; Earl Pierce, professional
    staff; Matthew Ebert, who is on my left and a very useful
    policy adviser; Grant Newman, assistant to the committee; and
    Brian Hom is intern on the staff. And with the minority staff,
    we have got Michelle Ash, professional staff; David McMillen,
    professional staff; Jean Gosa, minority clerk. And we have two
    court reporters today, Bob Cochran and Mindi Colchico. Thank
    you very much.
        With that, we are adjourned.
        [Whereupon, at 11:25 a.m., the subcommittee was adjourned.]

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