[Congressional Record Volume 146, Number 79 (Wednesday, June 21, 2000)]
[Senate]
[Pages S5481-S5482]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       SECTION 527 ORGANIZATIONS

  Mr. TORRICELLI. Mr. President, last week the Senate voted to tighten 
regulations on 527 organizations--organizations created to influence 
political campaigns in the United States; that section of the Tax Code 
allows them to operate without disclosure of their contributors or 
without limitations on their expenditures, and, indeed, on a tax-
deductible basis.
  The vote last week was genuinely historic in the Senate. It was the 
first time since 1993 that a campaign finance reform measure passed the 
Senate.
  I congratulate Senator Lieberman on his leadership in bringing the 
Senate to this important moment of judgment.
  These ``527 organizations,'' as they have come to be known, are the 
latest threat to the integrity of our Nation's electoral process, with 
unlimited funds unaccountable from unknown sources.
  If this legislation does not become law, they threaten to change the 
entire electoral process of the country. Every reform instituted not 
only since Watergate but, indeed, in this century could be undone.
  There is no assurance that even those limited protections--from the 
progressive movement in the times of Theodore Roosevelt and Woodrow 
Wilson that barred unlimited and undisclosed corporate contributions--
and reforms could remain in place if these 527 organizations are 
allowed to operate and, indeed, to proliferate.
  The Senate's vote last week sent a very strong message that for 
whatever we are unable to do on campaign finance reform we can at least 
agree that complete and full disclosure is required and that we will 
not allow the Tax Code to be misused for the raising of unknown 
political funds.

  It is, however, important that the public not accept this limited 
achievement as the sum total of all the Congress can do on campaign 
finance reform. It is only a beginning. Indeed, it is a modest 
beginning.
  It is also true that our efforts on soft money in McCain-Feingold 
have been frustrated. For a variety of reasons, it is now very clear 
McCain-Feingold and limitations on soft money contributions are not 
going to be enacted in this Congress. Some of the barriers are 
political. Some are legislative. Indeed, as my friend, Mitch McConnell, 
has pointed out, some are very real and constitutional. There are real 
problems to enacting a complete soft money ban. Federal courts have 
spoken on the subject. There are many who believe their

[[Page S5482]]

individuals rights might be limited. That debate will continue for 
years on the merits.
  Now the Congress is left with a partial achievement on 527 
organizations, a frustration on soft money prohibitions. The question 
is whether anything else can be done. Indeed, a great deal more could 
be done that is both easier to achieve and in some respects more 
important.
  There is primarily a single reason that campaign fundraising is 
rising exponentially in the Nation. It is very simple. Campaign 
expenditures are rising exponentially in the Nation. It is becoming 
more and more expensive to communicate with the American people through 
more and more news outlets. It is the heart of the problem.
  A recent study has indicated that records are being broken across the 
Nation in the cost of political advertising. The study, led by the 
Alliance for Better Campaigns, cited the Senate primary in my own State 
of New Jersey as evidence of how broken the campaign finance system has 
now become and that the same broadcasters in the news media who are 
leading national efforts for campaign finance reform are a central part 
of the problem.
  Television stations in New York and Philadelphia during the recent 
New Jersey Democratic primary took in a record $21 million in 
advertising. The chart shows the stations in New York and Philadelphia, 
the four rated stations, the amount of time they actually devoted to 
hard news. We have these stations in New York and Philadelphia bringing 
in $21 million in revenue from political advertising. Yet in actual 
news coverage of the campaigns per evening--two stations in 
Philadelphia--one is giving 19 seconds of coverage per evening; 
another, 1 second; in New York, the two top stations, WNBC and WCBS, 23 
seconds and 10 seconds, respectively.
  Advertising rates soar. News coverage collapses. Candidates are left 
with no choice. There being no other means to communicate with people 
who live in our States, they must buy more advertising time at ever-
higher and higher rates. Indeed, in the final 2 weeks of the New Jersey 
primary, voters in Philadelphia and New York markets were 10 times more 
likely while watching a news program to see a campaign advertisement 
than a news story--10 times more likely to see an advertisement than a 
legitimate news story on an issue in the campaign.
  That, my colleagues, is the heart of the problem. However, it is not 
only a senatorial problem or not only a problem in my own region of the 
country. During the month before the March 7, Super Tuesday primary, 
the national networks aired a nightly average of only 36 seconds 
discussing an issue of importance to the national voters. The situation 
that Democrats and Republicans face in the New Jersey primary is 
identical to what Al Gore and George W. Bush face in the national 
elections--no news coverage, rising rates, higher expenditures. It is, 
of course, part and parcel of this problem that is driven by the 
individual rates for specific advertising time.

  An example of this would be, in New York City, a 30-second 
advertisement can now cost as much as $50,000. In Chicago, the same 
advertisement could cost $20,000. Television stations in the Nation's 
top 75 media markets took in a record of $114 million in the first 4 
months of this year in political advertising.
  There is no other nation in the world where the public airwaves are 
licensed to a private corporation which will then set commercial rates 
as the cost of discussing public policy issues with the Nation's 
voters. This wouldn't happen in Britain, Canada, Italy or France. These 
airwaves belong to the American people. The issues, be they Democrat, 
Republican, or Independent, be they from some other group or political 
party, are issues of importance to the American people. Yet the 
broadcasting networks are using them as a revenue source while they 
incredibly claim to be campaigning for campaign finance reform.
  There is no mistaking that the power to change the campaign finance 
system belongs in the Congress. We could lead to a solution. For a 
variety of political reasons, legislative reasons, and constitutional 
reasons, that is not going to happen. The question now is whether the 
television networks will spend the remainder of this electoral season 
complaining about this political problem of reaching a solution or be 
part of the answer. I believe they should lead by example.
  Only a year ago, Mr. Kennard, the Chairman of the Federal 
Communications Commission, raised the prospect of, by regulation, 
lowering the cost of television advertising. Rather than $50,000 in New 
York or $20,000 in Chicago, the FCC could mandate, if the networks are 
unwilling to do it voluntarily, a lower cost. Since television accounts 
for 80 or 90 percent of the cost of the Senate or Presidential 
campaign, lowering the cost of that advertising would dramatically 
remove pressure on fundraising. The problem could begin to solve 
itself. The FCC chose not to do so under pressure from Members of 
Congress.
  The question remains, Why do the networks not do so themselves? I 
understand the networks looking to the Congress for an answer. They 
should. They are entitled to look to us, and they are entitled to 
expect an answer. But I also look back to them. Rather than 20 seconds 
a night for candidates to discuss the future of our Nation, rather than 
using the national airwaves to discuss every latest crime trend or 
weather pattern or cultural abnormality, the national airwaves could be 
used to actually discuss the Nation's future--not 10 seconds a night or 
20 seconds a night but 10 minutes a night or 15 minutes a night so 
candidates believe there is an alternative to communicating with the 
American people other than buying the public airwaves to do so.
  Second, the networks, most obviously, could enhance this national 
debate and reduce the cost of this fundraising, remove the pressure on 
fundraising by dramatically reducing these costs. Political advertising 
is now the third largest source of revenue for the television networks. 
We have become an industry supporting the networks themselves, only 
behind retail sellers of merchandise in the Nation, spending hundreds 
of millions of dollars in this Presidential and congressional campaign. 
A reduction of those rates to allow challengers to compete with 
incumbents and lesser-financed candidates to compete with 
multimillionaires would enhance the American political system and start 
setting an example of how the Nation can begin to change the dominance 
of money in the American political system.
  I hope at some point the networks, as good corporate citizens and as 
Americans, no less as people who claim to be for campaign finance 
reform, would hear this message and join this movement.
  I yield the floor.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  The PRESIDING OFFICER. In my capacity as a Senator from Rhode Island, 
I ask unanimous consent that the order for the quorum call be 
rescinded.
  Without objection, it is so ordered.

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