[Congressional Record Volume 142, Number 17 (Wednesday, February 7, 1996)]
[Senate]
[Pages S1066-S1068]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        CAMPAIGN FINANCE REFORM

  Mr. SPECTER. Mr. President, I have sought recognition to comment 
about the increasing public concern about the unlimited amounts of 
money that individuals spend from their own private fortunes to gain 
public office in the United States, which I believe poses a real threat 
to democratic government in our society.
  I have spoken about this subject in the past and have, along with 
Senator Hollings, supported constitutional amendments, because that is 
what is necessary to deal with this campaign finance reform issue, 
because the Supreme Court of the United States decided a little more 
than 20 years ago, on January 30, 1976, in a case captioned Buckley 
versus Valeo, that an individual can spend as much of his or her money 
as he or she chose, notwithstanding spending limitations on everyone 
else.
  As I have said on this floor, that case had a substantial personal 
impact on me because I had declared my candidacy for the U.S. Senate in 
late 1975 when the campaign finance law had recently been enacted. In 
1974, specified on a population basis for the State, a State the size 
of Pennsylvania had a limit of $35,000, which is about what I had in 
the bank, having recently returned to private practice after having 
been district attorney of Philadelphia.
  That year I contested a man who later became a very distinguished 
U.S. Senator--he won the election in 1976--a very close personal friend 
of mine, Senator John Heinz, who was able to spend beyond the limits 
established under the statute because the Supreme Court of the United 
States declared the law unconstitutional, on first amendment grounds, 
limiting the amounts anybody else could spend. My brother, for example, 
could have contributed substantially but could only spend $1,000 by way 
of contribution.
  This has become a proliferating, expanding problem in our society, 
with many Senate seats having been, in effect, bought with enormous 
personal contributions. Now we are seeing the matter played out on the 
national level, obtaining a lot of national notoriety, with recent 
disclosures showing expenditures in excess of $15 million because 
people are not limited by the Federal laws if they choose to spend 
their own money. Those Federal laws on matching funds for the 
Presidency limit the amount that anybody can spend, if they take 
Federal funding, to 

[[Page S1067]]
about $600,000 in New Hampshire, about $1 million in Iowa. Those funds 
are not the limit for those who spend their own funds.
  I was fascinated to see on Friday in the New York Times, a column by 
Anthony Lewis, about this precise subject. I was surprised to see it 
because Mr. Lewis is well known for his defense of the Constitution and 
his defense of the first amendment. I think I have that same record, 
concern about the Constitution, concern about the first amendment.
  So, when Anthony Lewis wrote a column in effect calling for the 
overruling of Buckley versus Valeo, which was decided on first 
amendment grounds, I thought it a very important event. At the 
conclusion of my presentation I will ask this be printed in the Record. 
But I only want to cite one sentence from it at this time, referring to 
the current events, on the tremendous expenditures by an individual, 
that these events may pose. A ``real contribution should be to make us 
think of ways to overcome the Supreme Court's misguided 1976 decision 
that limiting how much political candidates can spend on themselves 
violates their freedom of speech.''
  I think it worth noting, when Anthony Lewis calls the Supreme Court 
decision ``misguided,'' he, in effect, joins Senator Hollings and 
myself and others in calling for a constitutional amendment. On Friday, 
February 2, the day this appeared, I called Mr. Lewis. Before I could 
tell him the purpose of the call, he said, ``I think I know what you 
are calling about.'' He was exactly right.
  On Sunday in the Philadelphia Inquirer there is an extensive article 
by Mr. Dick Polman, on the same subject, starting off, ``If money 
talks.'' Again, quoting only one small section, Mr. Polman noted, 
referring to Buckley versus Valeo:

       The justices ruled that candidates could spend their own 
     money as they wanted, as an exercise of their constitutional 
     right to freedom of expression. Publicly financed rivals, on 
     the other hand, must obey spending ceilings in each state--
     $600,000 per candidate in New Hampshire, $1 million in Iowa.

  Now, Mr. Polman quotes from a comment by Miss Ellen Miller, who 
directs the Center for Responsive Politics in Washington, ``That ruling 
made no sense 20 years ago, and it certainly makes less sense today.''
  As the Presidential campaign moves forward and we see the impact, I 
am surprised that money could have made as much a difference as it has 
in what has resulted so far as shown by the public opinion polls in New 
Hampshire and Iowa. It may really be possible to buy the White House if 
enough money is spent from an individual who reportedly has $400 
million. And if that individual chooses to spend, say $200 or $300 or 
$350 million--what is the difference if you have $50 million more left 
over? You probably have enough for any other contingency--the impact of 
that kind of spending has really potentially cataclysmic impact on the 
electoral process in the United States.
  I do not want to keep the Senate here too late. It is now 6:15. I 
know the leader wants to wrap up, but I did want to make these brief 
comments.
  At this time I ask unanimous consent the full text of these articles 
by Anthony Lewis in the New York Times of February 2, and the article 
by Dick Polman of the Philadelphia Inquirer of February 4 be printed in 
the Congressional Record.
  There being no objection, the articles were ordered to be printed in 
the Record, as follows:

             [From the Philadelphia Inquirer, Feb. 4, 1996]

              If Money Talks, What Does It Say of Forbes?

                            (By Dick Polman)

       Ask Charles Lewis about the Steve Forbes phenomenon and you 
     get a shake of the head and a sigh of exasperation.
       ``What's so disturbing,'' he says, ``is that here you have 
     a guy who's pumping his own millions into his presidential 
     campaign--and a substantial number of voters aren't bothered 
     by it. This gnaws away at me a bit.''
       Lewis is a Washington activist who wants to curb the power 
     of money in politics--witness his new book, The Buying of the 
     President--and that explains why he gets so hot about the new 
     darling of the Republican field.
       Lewis pursues his point, with a dollop of sarcasm: 
     ``Apparently the answer to our problem is, we should elect a 
     multimillionaire because we think he's not [beholden] to 
     special interests. Well, look at the people who are helping 
     him. Look at the world he lives in. . . . He has come 
     absolutely out of nowhere. At least Bob Dole is familiar to 
     us. But this guy? It's like The Twilight Zone.''
       In terms of money and moxie, there has never been a 
     presidential candidate like Steve Forbes. Yes, Ross Perot 
     spent $60 million in 1992, but he arrived late in the game 
     and ran as an independent; unlike Forbes, he didn't target 
     the primaries and try to blow out rivals with saturation 
     advertising. And, yes, John F. Kennedy spent his father's 
     money, but JFK was a career politician.
       Forbes, by contrast, is a career publisher of inherited 
     wealth and conservative bent, whose sole public job was a 
     stint as board chairman of Radio Free Europe. As the hottest 
     ticket in the Republican road show, he is pushing a flat 
     income tax that would put more money in his own pocket, 
     according to an independent analysis sponsored by Lewis's 
     public-interest group, the Center for Public integrity. 
     Despite repeated requests, he refuses to follow Dole's 
     example and release his income tax returns.
       Most important, his lavish private spending is wreaking 
     havoc among his chief revivals, all of whom are bound by the 
     strict federal spending limits that inhibit those who accept 
     campaign money from the public treasury. Forbes is free to 
     spend, but they are not--thanks to a landmark Supreme Court 
     ruling 20 years ago this week.
       In fact, the self-financed Forbes candidacy would not exist 
     without Buckley v. Valeo. The justices ruled that candidates 
     could spend their own money as they wanted, as an exercise of 
     their constitutional right to freedom of expression. Publicly 
     financed rivals, on the other hand, must obey spending 
     ceilings in each state--$600,000 per candidate in New 
     Hampshire, $1 million in Iowa.
       ``That ruling made no sense 20 years ago, and it certainly 
     makes less sense today,'' says Ellen Miller, who directs the 
     Center for Responsive Politics in Washington. ``What Forbes 
     shows is that the `free expression' of a non-wealthy 
     candidate, or a voter who can't afford to contribute money, 
     is drowned out by the free expression of a candidate who can 
     finance himself.''
       If Forbes' candidacy proves that money talks, the public 
     doesn't appear concerned. The latest survey puts him ahead of 
     Bob Dole by nine points in New Hampshire, which stages the 
     first primary, on Feb. 20; three weeks ago, the survey showed 
     Forbes trailing--by 16. As several New Hampshire voters 
     insisted in interviews last week, Forbes can ``afford'' to 
     be his own man.
       Some say this sentiment is naive. ``I've run 
     [congressional] campaigns against rich people,'' says an 
     adviser to a Forbes rival, ``and you have to pay attention to 
     the people they socialize with and do business with. In 
     Forbes' case, it's all his magazine advertisers, his vendors, 
     accountants, investors, lawyers--a whole culture.''
       It is not all Forbes' money. He has also staged fund-
     raisers--including a Philadelphia event Friday night--and has 
     drawn the corporate elite. Miller complains: ``He's selling 
     himself now. He's breaking the myth that he can't be 
     bought.'' As long as he doesn't seek public matching funds, 
     though, he remains free of restrictions.
       And the public seems not to mind. Gerry Chevinsky, the 
     pollster who conducted the latest New Hampshire survey, 
     explains the public's growing support: ``We asked people if 
     they thought it was appropriate for a candidate to use his 
     own personal money in a big ad campaign--and 61 percent said 
     yes. They are so turned off to Washington, and to politicians 
     in general, that they're looking for anyone who doesn't play 
     the political game. The support for Forbes is symbolic. He is 
     a sanitized Perot.''
       Forbes also gets a boost from Steve Salmore, who advises 
     Republican campaigns in Forbes' native New Jersey: ``People 
     see that . . . he's not just saying something in order to 
     pander to people. There's a feeling that if you're spending 
     your own money, that at least you believe in what you say.''
       Is it unfair that Forbes can outspend everyone else? Not 
     necessarily, argues Salmore: ``The court said, `Spending your 
     own money is a form of speech.' And rightly so. Look, is a 
     businessman who wants to influence [the public] supposed to 
     take time away from his work just to . . . lick stamps? The 
     career politicians already have the advantage.''
       He says that if campaign-finance reformers are unhappy, 
     they have only themselves to blame. After all, the court in 
     1976 was trying to clean up the reforms adopted in 1974. 
     Referring to good-government activists, Salmore scoffs: 
     ``This is the problem with the `goo-goos.' They put in 
     reforms, and you end up with a system that helps some and 
     hurts others. A classic case of unintended consequences.''
       Indeed, the system that has soured so many Americans--the 
     ties between politicians and special-interest political 
     action committees (PACs)--evolved as a consequence of the 
     1974 reforms.
       The congressional reformers, seeking to banish ``fat-cat'' 
     contributors, enacted a law requiring that presidential 
     candidates accept only small amounts--no more than $1,000 
     from an individual and $5,000 from a group--with the totals 
     then being matched by the federal treasury. This law also 
     decreed that no candidate could spend more than $50,000 of 
     his or her own money.
       The high court kept the first two provisions (the amounts 
     are the same today), but threw out the cap on personal funds. 
     And here are the results:
       It takes enormous effort to build a sizable war chest from 
     small contributions. Candidates can do it faster by relying 
     on special-

[[Page S1068]]
     interest PACs, which is one big reason that the PAC population has 
     exploded over the last two decades. By contrast, someone like 
     Forbes doesn't need to play even this game.
       And while Forbes can spend whatever he wants wherever he 
     wants, the others must obey the state-by-state ceilings. 
     These ceilings often inspire creative cheating.
       One veteran strategist says: ``To stay inside the 
     [spending] limit in Iowa, you rent all your cars in Kansas 
     and Nebraska, and charge the accounts there. . . . Charge 
     the cars in states where you know you won't be spending 
     much money. Then bring the cars over to Iowa. Problem is, 
     some poor schlepp has to drive all the cars back.''
       The big question is whether anything will be done. Salmore 
     likes the idea of allowing publicly financed candidates to 
     keep pace with the rich; if Forbes is spending big money, 
     then remove the ceilings and allow his rivals to raise and 
     spend the same amounts.
       But Bill Bradley, a Democrat who is retiring from the 
     Senate, is calling for a constitutional amendment that would 
     bypass the court and allow Congress to set spending limits on 
     rich candidates. In a speech last month, Bradley said: 
     ``Money is not speech. A rich man's wallet does not merit the 
     same protection as a poor man's soapbox.''
       Charles Lewis says: ``Buckley is the biggest roadblock to 
     reform, so we either need a constitutional amendment, or . . 
     . How do we do this in the fairest possible way?
       ``I have to say, I don't know the answer.''
                                                                    ____


                [From the New York Times, Feb. 2, 1996]

                              Less Is More

                           (By Anthony Lewis)

       Boston.--A rich man campaigns for President on a one-plank 
     platform: ``Vote for me to cut my taxes drastically and make 
     many of you pay more.'' The voters respond with enthusiasm.
       It sounds like fiction, a parody of the American political 
     process. But judging by what is happening in New Hampshire, 
     it is reality. Three weeks before the primary there polls 
     show Steve Forbes, the flat-tax candidate, in the lead.
       A survey just taken by The Boston Globe and WJZ-TV finds 31 
     percent of likely voters favoring Mr. Forbes. Senator Bob 
     Dole, who has dominated the figures for a year, is second 
     with 22 percent. Just three weeks ago the same pollsters gave 
     Senator Dole 33 percent, Mr. Forbes 17.
       Mr. Forbes has poured millions from his personal fortune 
     into television advertising in New Hampshire. In the new poll 
     85 percent of the respondents said they had seen his ads. 
     Most of them are negative, principally attacks on Senator 
     Dole. Just about the only affirmative argument he offers is 
     for the flat tax.
       The Forbes tax proposal would exclude the first $36,000 in 
     income for a family of four, then tax all earnings above that 
     amount at a rate of 17 percent. Income from investments would 
     not be taxed at all.
       A change of that kind would be a boon for Mr. Forbes and 
     other wealthy Americans, who now are taxed on investment 
     income and pay a marginal rate of 39.6 percent on income over 
     $256,500 a year. To produce the same revenue as the present 
     system, the flat tax would have to make the middle class pay 
     more.
       The Treasury Department analyzed a flat tax that would keep 
     government revenue steady, one with a rate of 20.8 percent 
     and excluding the first $31,400. A family of four earning 
     $50,000 a year would pay $1,604 more in taxes, one earning 
     $100,000 an additional $2,683. But a $200,000 family would 
     save $3,469.
       In fact, the Forbes formula as drafted would cut Federal 
     revenue by $186 billion a year. That would mean an 
     enormous increase in the deficit or severe cuts in Social 
     Security, Medicare and the defense budget. There is not 
     enough discretionary civilian spending to absorb more than 
     a small part of that amount.
       Why would New Hampshire voters want to inflict such misery 
     on themselves in order to give Steve Forbes and others in his 
     bracket big tax cuts? Many may simply not understand the 
     consequences.
       Detailed findings of the new poll suggest that the meaning 
     of the Forbes flat tax has not quite sunk in--but is 
     beginning to. Asked whether they supported the Forbes tax 
     plan, 37 percent said yes--down from 54 percent three weeks 
     ago.
       And of those who said they favored the flat tax, 45 percent 
     said they would not be for it if it exempted investment 
     income so the wealthy could live tax-free. Others in varying 
     numbers dropped out of the group favoring a flat tax if it 
     eliminated deductions for home mortgage interest or local 
     property taxes--as the Forbes plan would.
       The more attention 17 percent flat tax gets, the less 
     likely voters are to support it. But that need not be the end 
     of Steve Forbes. When New Hampshire supporters were asked why 
     they liked him, the largest category of responses (37 
     percent) was that he was not a Washington insider. In short, 
     angry Americans--and there are a lot of them--can work off 
     their feelings by voting for Mr. Forbes.
       The loser in all this is Bob Dole, and that is reason for 
     regret. Even those who disagree with him on this issue or 
     that must recognize that he is a responsible political leader 
     and a serious man.
       It is hard to take the other Republican candidates 
     seriously. The party has lurched far to the right, but I 
     doubt that it has become suicidal enough to nominate Phil 
     Gramm or Pat Buchanan.
       As for Steve Forbes, my guess is that he will look 
     increasingly flaky. He told a Boston Globe interviewer this 
     week that much of acid rain ``is created by nature, not by 
     smoke-stacks.'' Mr. Forbes's real contribution should be to 
     make us think of ways to overcome the Supreme Court's 
     misguided 1976 decision that limiting how much political 
     candidates can spend on themselves violates their freedom of 
     speech.

  Mr. SPECTER. Mr. President, I yield the floor and suggest the absence 
of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. DOLE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________