Watchdog Blog

Time to Put an End to the Paper Chase

Though presumably most senators (or their campaign staff) now use computers, they continue to file their campaign contribution forms on paper -- preventing us from learning quickly and easily how their campaign coffers are being filled and by whom.  The Senate Campaign Disclosure Parity Act (S. 482) would require Senate candidates to submit their campaign finance forms electronically, as House candidates already do. 

The bill could finally be up for a vote this week or next.  But, in spite of strong public support for the measure, Sen. Pat Roberts (R-Kan.) has taken up the mantle from (recently embarrassed) Sen. Ensign (R-Nev.) to try and kill it by attaching an irrelevant and unconstitutional amendment.  Unbelievably, the Ensign/Roberts amendment would force nonprofit organizations to expose their donors when they file ethics complaints against senators.  We can't imagine which senators would vote for that one, but I suppose it could be interesting to find out. 

Please call your senators today and let them know the Roberts amendment is unconscionable and it's time to pass S. 482.  If you have another minute, you also may want to call Sen. Majority Leader Reid's office and ask that he bring this bill to the floor for a vote:  202-224-3542.

from Angela Canterbury and Glenn Simpson

Insider Trading: How Congress Can Make Big Bucks at Our Expense

It has been a difficult start for the financial services sector thus far in 2009 - yet it may be even more difficult to excuse the multitude of bad decisions made by Wall Street already (refusing to release information about bailout spending, Bank of America's $10 million super bowl ads, obscenely large bonuses for AIG executives...the list goes on).  Thankfully, it looks like Congress and the federal government are finally getting more serious about oversight of Wall Street and the financial sector.

Now also would be a good time to put an end to secret spending and insider trading immunity for government officials. 

A recent piece of legislation proposes to do just that.  Introduced by Reps. Brian Baird (D-Wash.), Louise McIntosh Slaughter (D-NY) and Tim Walz (D-Minn.), the “Stop Trading on Congressional Knowledge Act” (H.R. 682) would ensure that those with access to privileged "non-public information" gathered through oversight proceedings would not be able to use that information for personal benefit in securities and commodities trading.

Specifically, H.R. 682 would negate a little-known loophole in the law which could allow members of Congress as well as executive staffers and government officials to practice insider trading in order to enrich themselves as well as their associates.  Of course,  this type of insider trading would be wholly illegal for citizens like you and me.

The act would also be effective in combating corrupt lobbying practices, since lobbyists and stock traders ("political intelligence consultants") who haunt the halls of Congress precisely in order to glean insider tips from staff would also be banned from insider trading.

The legislation would require members of Congress and their staff to disclose stock transactions of $1,000 or more within 90 days, and require “political intelligence consultants” to register under the Lobbying Disclosure Act and disclose their financial activities.

The time to pass this legislation is now, before our tax dollars pay for any more lucrative insider investments.

Posted by Craig Holman

Editorials, Conn.'s Experience Suggest Pro-Public Funding Sentiment

Barack Obama's $150 million haul in September so dramatically exceeded the $84 million grant he would have received had he opted in to the presidential public funding system that many pundits have declared the system moribund.

But a recent spate of newspaper editorials, the successful implementation of a public funding system in Connecticut and general disgust with the current regime among politicians suggest that sentiment in favor of public funding lives on, and may be increasing.

McCain-Feingold Reality Clashes With WSJ Narrative

The Wall Street Journal's editorial board on Wednesday leveled an oft-repeated but misleading attack on the law commonly known as McCain-Feingold. The Journal, an opponent of campaign finance reform, took a measure of satisfaction in arguing that John McCain's fundraising deficit is due to the very legislation he sponsored: 

The ultimate irony – perversity, if you're a Republican – is that the great champion for today's system is none other than John McCain. Having pushed for the government to limit money in politics, he is being outspent – and, should the polls hold, beaten – thanks in part to the laws he worked tirelessly to put on the books.

What the Journal and other drive-by critics of campaign finance reform miss is that McCain-Feingold was not really intended to limit money in politics and certainly was not intended to limit campaign contributions to candidates. The law actually doubled the maximum amount an individual could contribute to candidates, from $1,000 to $2,000 per election (a figure since adjusted for inflation to $2,300). 

What McCain-Feingold did was stop the political parties from accepting corporate or union contributions, which candidates were already prohibited from doing. An honest attack on McCain-Feingold would have to start with a claim that the country was better off with the political parties trading favors in exchange for corporate and union contributions of hundreds of thousands – and sometimes millions – of dollars (in 2002, for example, Fannie Mae and Freddie Mac lavished $4.2 million in soft money on the two major parties). 

If the Journal wants to make that argument, we would welcome the debate.

Voters Still in Line Behind Wall Street

Back in early July, we sent a request with a few of our partners in reform to every candidate running for Congress this fall urging them to sign the Voters First Pledge, a simple statement of support for legislation for a new system of pubic funding for congressional campaigns.  So far, nearly 220 candidates have made the pledge - but there are still many others who have yet to tell us where they stand.

So, we've sent yet another letter to candidates who haven't responded and have asked our members and activists to make sure the candidates in their districts know this is an issue they shouldn't ignore.  It's frankly hard to understand why a candidate wouldn't want to commit to change business as usual in Washington today.  The urgent need for reform is summed up neatly in the letter:

As the nation faces its worst financial crisis since the Great Depression, now is the time for bold reforms to both the financial and political systems. Wall Street and powerful financial interests should not be funding campaigns for Congress if we want a political system that truly works for the American people. Public confidence in Congress is at an all-time low, and voters assume that both incumbents and challengers are under the undue influence of special interests.

Seeking big donations does not end with the campaign season - from their first day in office members of Congress must continue to dial for dollars.  The result?  Policies that favor Wall Street and not Main Street.  Public funding of campaigns would allow our elected officials to get off the fundraising treadmill and truly represent the interests of ordinary citizens.

Obama’s Mistake on Public Financing (and how McCain is skirting the law, too)

Originally by Andy Wilson at TexasVox.org

Today’s New York Times reported that life is not all peaches and cream for the Obama campaign after they opted out of the presidential public financing system.  (See Article “Straining to Reach Goal, Obama Presses Donors“)

Pushing a fund-raiser later this month, a finance staff member sent a sharply worded note last week to Illinois members of its national finance committee, calling their recent efforts “extremely anemic.”

The signs of concern have become evident in recent weeks as early fund-raising totals have suggested that Mr. Obama’s decision to bypass public financing may not necessarily afford him the commanding financing advantage over Senator John McCain that many had originally predicted.

But the campaign is struggling to meet ambitious fund-raising goals it set for the campaign and the party. It collected in June and July far less from Senator Hillary Rodham Clinton’s donors than originally projected. Moreover, Mr. McCain, unlike Mr. Obama, will have the luxury of concentrating almost entirely on campaigning instead of raising money, as Mr. Obama must do.

It is not yet clear whether the Obama campaign will be able to ratchet up its fund-raising enough in the final two months of the campaign to make up the difference.

Public financing is a boon to any politician who accepts it, as it allows her or him to run free from the strings attached to big-dollar-donations and to focus the campaign’s time on where it should be spent: connecting with voters.  This is why when I explained Public Financing to Congressman Nick Lampson, currently running in the most competitive House race in the country, he was exuberant to think of a time when he would no longer have to dial for dollars. Considering the other two competitive House races in Texas, in CD 7 and 10, think of the race it would be if the campaigns were on equal footing moneywise and ideas, not dollars, affected the outcome of the race.

Lobbyists Trying to Hide in Plain Sight at the DNC

by Eric Encarnacion

Over the last month, we've talked about the pervasive corporate presence at the national conventions and the ways that big-money special interests will try to influence politicians through their stomachs and their general taste for the good life. Now, with the Democratic National Convention in Denver this week, the evidence is in: Corporations and their lobbyists are throwing lavish parties for lawmakers. They're hard to miss, as the mainstream media has started covering them.

Crashing the Convention Parties

The Democratic Party Convention is now in full swing. As you might imagine, it's quite the jet-set party scene, with well-heeled lobbyists and corporate CEOs schmoozing with our members of Congress and other luminaries.

Like you, we're sick of special interests coming before voters - just look at the mess we're in thanks to this pay-to-play system. Big Oil, Big Pharma and other corporate titans have had their way with our government for too long.

That's why we're crashing their parties!

Lobbyists gone wild!

By Joe Newman, originally posted on Citizen Vox.

How much would you need to throw a great party for several thousand friends? Imagine what you could do with $1 miilion. The possibilities boggle the mind.

I’m thinking little meatballs served with 14-carat gold toothpicks. Now, imagine if you had $112 million at your disposal. That’s how much money corporate sponsors and lobbyists are contributing to this year’s Democratic and Republican conventions, events that have become less about the American political process and more about seeing who can throw the most lavish soirees.

A report released today by Public Citizen shows how corporations and lobbyists are exploiting loopholes in election law and congressional ethics rules to turn the conventions into a place where they can wine and dine lawmakers and lobby them away from Capitol Hill.

Some of these parties appear to cross the line and put lawmakers who attend in violation of their ethics rules, the report says. You can learn more and read the Public Citizen report at www.SayNoToLobbyists.org.

Big Corporate Influence is in the Bag

When the welcome bags for the 2008 DNC national party convention were revealed earlier this month, bloggers took notice. Why? Because the bags are covered in corporate logos.

As blogger and New York Times Bestselling author Glenn Greenwald points out, the national party is making little effort to conceal which companies are financing the convention, instead placing their logos unabashedly on the bag that every delegate and member of the media will receive when they arrive at the conventions [Salon.com, July 20, 2008].

But the benefits of corporate sponsorship go well beyond prominent advertising on welcome bags. A quick look at the sponsorship packets that the host committees give to possible sponsors betrays the true purpose of corporate sponsorship - a guarantee that big-money contributors will have special access to elected officials attending the conventions. The fact that corporate donors have been so reluctant to disclose the exact amount of their contributions further suggests that their interest in sponsorship is far from benevolent.

The Denver host committee packet promises donors who give more than $500,000, "Platinum" and "Presidential" sponsors, access to premier Denver venues for corporate hospitality events and receptions. The Campaign Finance Institute (CFI) has reported that the original Minneapolis St. Paul host committee packet offered top sponsors a golfing outing with Republican leadership, in addition to a reception with local party officials and US Senator Norm Coleman.   

Though these perks were removed from the packet following a number of critical articles in local and national media, the fact remains that the primary benefit that host committees offer to corporate sponsors is exclusive access to decision makers. To ensure that ordinary voters have a voice at the conventions, Congress must act to close the conventions soft-money loophole.

Learn more about corporate sponsorship of the conventions and take action today!

Big Money Influence at the Conventions

Written by Zoe Bridges-Curry and Angela Canterbury.

"I look forward to the day, by 2008, when Americans can turn on their TVs and watch the Nokia Democratic Convention, or the AT&T Republican National Convention."

                                                        - Bradley Smith, former Republican member of the FEC

What happened to putting voters first?  Well, yesterday, our own Craig Holman threw down the gauntlet and told CQ [$] that campaign finance and ethics watchdogs will be out in force, keeping tabs on the events and making noise over rules violations.

Campaign finance laws like the Fair Elections Campaign Act (FECA) were created in part to end the undo influence of corporate donors.  Contradicting the spirit of these laws, political parties continue to use the national party conventions to secure millions of dollars in corporate contributions, funneling contributions through the supposedly nonpartisan host committees.  The Federal Elections Commission (FEC) has even approved this maneuver, thereby allowing wealthy corporations privileged access to elected officials at the conventions.

For the political parties, the conventions are the perfect opportunity to circumvent existing restrictions on soft-money donations, because donors can make lavish contributions to the conventions’ host committees. A report recently released by the Campaign Finance Institute (CFI), estimated that approximately 80% of the estimated $112 million needed to hold the conventions will come from private donors, primarily large corporations.

As both the report and a quick visit to the DNC convention website make clear, in return for sizeable donations, host committees for both parties offer corporations and other big donors exclusive access to elected officials at the conventions.  The greater the donation, the greater the access to advertising opportunities and influential convention attendees. In his talking points for meeting with potential corporate donors, Republican Governor Tim Pawlenty from Minnesota offered corporations the chance to “connect with influential government officials (Cabinet, President, next President)” [New York Times, June 7, 2008]. An added bonus for donors: corporate donations to the host committee are tax deductible, meaning that, ultimately, it is taxpayers who subsidize corporate privilege at the conventions.

The CFI report documents that “Presidential” donors who give $1 million to the DNC Convention receive VIP access to the Pepsi Center convention hall and all Host Committee-sponsored events, numerous advertising opportunities, and the opportunity to attend private events with Colorado Governor Bill Ritter, U.S. Senator Ken Salazar, and other party officials. As advertised in brochures given to potential donors, corporate donors to the GOP Convention receive similar perks for a $5 million donation.

To ensure that voters’ voices are not drowned out by big-money interests, it is crucial that Congress act to prevent unlimited soft-money donations to convention host committees and to ensure public financing for elections.

Take Action! Tell your members of Congress to comply with existing ethics laws at the conventions.

Campaign Finance Reformers Open the Floodgates

By David Arkush and Craig Holman. Originally published in Roll Call ($).

The presumptive presidential nominees, Sens. John McCain (R-Ariz.) and Barack Obama (D-Ill.), are exploiting a major loophole in the campaign finance law. Both Senators are setting up joint fundraising committees that allow the wealthy to donate $70,000 or more on behalf of their campaigns.

You might wonder how this squares with the $2,300 limit on contributions from individuals - contribution limits that the Bipartisan Campaign Reform Act of 2002 sought to protect by banning large soft-money contributions.

Heres how McCain Victory 2008, one of the candidates new joint fundraising committees, is accepting $70,100 from donors: The first $2,300 is treated as a contribution to the McCain campaign. Then, $2,300 goes to McCains compliance fund. The next $28,500 is earmarked for the Republican National Committee. And the remainder - up to $37,000 - is split between the Colorado, Minnesota, New Mexico and Wisconsin Republican parties.

McCain set up at least six joint fundraising committees. Obama announced on April 25 that he, too, will set up a joint fundraising committee with the Democratic National Committee.

Double Standards and Fair Elections

From Joe Newman over at Citizenvox.org:

There’s an interesting breakdown on the FAIR (Fairness & Accuracy in Reporting) site of how the herd mentality of the media seems to have a double standard when it comes to the presidential candidates and their views on public financing of the general election. While Public Citizen is non-partisan, we do feel strongly about public financing of elections as one of the best ways to reduce the influence of special interests in politics. Sens. Richard Durbin (D-Ill.) and Arlen Specter (R-Pa.) have introduced the bipartisan Fair Elections Now Act, which would create a voluntary system to publicly fund congressional elections. You can help this effort by signing on to be a “citizen co-sponor” of this legislation.

Who's got more money?

Money, money, money.  It seems that's all we hear in the news about the upcoming election.  It should be about ideas and leadership, not dollars.  Fortunately, there's a solution: public funding of elections.

Now is a vital time to act. Rep. John Larson (D-Conn.) will soon introduce a House version of the bill Senators Dick Durbin (D-Ill.) and Arlen Specter (R-Pa.) introduced in the Senate: the Fair Elections Now Act.  Under Fair Elections, candidates would no longer need to worry about chasing money from wealthy special interests.  They can focus on the voters and the critical challenges facing our nation today. 

It is important that we get many representatives to sign on to support this reform.

During Fair Elections Action Week, April 14-18, 2008, let's call on Congress to end the corrupting influence of money in politics. Actions and events will take place all across the country and you can be a part of the movement.

Fair Elections Gets Stump Time

Our friends over at Common Cause highlight the recent Democratic debate in Nevada where public funding of elections got some air play.  Senator Obama explained: 

Ultimately, what I would like to see is a system of public financing of campaigns and I am a co-sponsor of the proposal that is in the Senate right now.  That's what we have to fight for.

Watch it.

In fact, all of the Democratic candidates have expressed their support for a congressional public funding system modeled on those in Arizona and Maine.  Senator Clinton announced her support back in April.

The publicity is great.  However, in the meantime, nearly all of the candidates could be doing a lot more to disclose where their private money is coming from.  Yesterday, we sent letters to candidates asking them (again) to make the information on how much money their bundlers are raising for their campaigns public. 

A keystone benefit of public funding is that special interest money can no longer buy influence with candidates.  Until we fix the presidential public financing system, the voters at the very least have the right to know who is bankrolling the candidates.

Fair Elections Action Week

The Fair Elections Action Week is coming up in just a few weeks!  People are taking action now so that we can show Congress that Americans want an end to pay-to-play politics by instituting a system of public financing.

We are closer than ever to cleaning up Washington.  The Fair Elections Now Act is gaining support in the Senate and we anticipate the introduction of the companion bill in the House to happen very soon!  A voluntary system of public funding for congressional elections would allow members of Congress to serve without taking huge sums of special interest money.  Elections should be about voters, not campaign cash.

Join us for the Fair Elections Action Week on November 12-16 when we will send a strong message to Congress that it's time for public funding of elections!  Actions and events will take place all over the country – some sponsored by Public Citizen and our coalition partners, others happening in the living rooms and kitchens of people ready for a change.

It’s easy to help make it a success by showing your support and spreading the word now!

Workin' Too Hard For His Money

On Thursday, John Edwards announced that his campaign will accept public financing for his presidential campaign. Edwards told reporters that the decision was about taking “a principled stand” in favor of public financing and challenged his top opponents, Sens. Hillary Clinton and Barack Obama, to do the same.

The public funding system was designed to help candidates like Edwards, whose polling in states like Iowa clearly demonstrates his ability to appeal to voters, just not the ones with the deepest pockets. That system hasn’t kept up with the times, however. Both Clinton and Obama will probably raise $100 million by the end of this year, money they’ll be able to spend freely. Edwards, meanwhile, will have his spending in most areas restricted to less than half of that. The frenetic pace set by this season’s primary schedules unfortunately tilts the playing field toward the most heavily-funded candidates. Restoring the public financing system would put some much needed balance back into the contest, giving all voters a better voice.

Laura MacCleery on WVOX

Last week, Laura MacCleery, director of Public Citizen's Congress Watch division, spoke to New Yorkers about the recently passed Lobbying and Ethics bill, the role of lobbyists in campaign fundraising, Fair Elections, and presidential bundlers.

Listen to her interview on WVOX.

Hearing on Fair Elections

Ordinary voters are being drowned out by corporate and wealthy special interests that co-opt our elected officials and raid the treasury for earmarks and tax breaks.  The result is policy for Big Pharma, Big Oil and Wall Street.  We can change all that with the Fair Elections Now Act.

The Senate Rules Committee is holding the first congressional hearing in more than a decade on publicly funded elections.

Watch it live on June 20, 10:00 a.m. EST!

Take a minute to become a Citizen Co-Sponsor of the bill and tell your Senators to break free from corporate and wealthy special interests.

Why do you think publicly funded elections are so important?

UPDATE: You can still watch the hearing at the link above.

Joan Claybrook at The New School

Check out a video of Public Citizen President Joan Claybrook's recent panel discussion at The New School.  The panel was well-attended – focusing on "How to Return Democracy to the People."  Joined by former lawmakers and political scientists, the vibrant discussion dealt with the burden on politicians to drum up campaign cash and  showed how full public funding for congressional elections would do a lot to end the money chase.  Joan was joined by former Senators Bob Kerrey and Warren Rudman, John Rauh of Americans for Campaign Reform, Costas Panagopoulos, PhD., and Brennan Center Executive Director Michael Waldman.

(If you have trouble viewing this video, try here.)

Clinton Is Ready to Break Free

This just in from the Associated Press . . .

(AP) A day after her campaign announced a record breaking fundraising haul, Democrat Hillary Rodham Clinton said Monday she would support public funding of campaigns if elected president next year.

At an event where she picked up the endorsement of New Jersey Gov. Jon Corzine, the New York senator said she would continue the fundraising pace that helped bring in $26 million for her presidential bid between January 1 and March 31. But, Clinton said, she hoped a different system could one day be enacted.

"I believe we have to move, eventually in our country, toward a system of public financing that really works for candidates running for federal office. I will support that as president," she said. (more)

Now, will the other presidential candidates pledge to support a system of public funding of elections like Fair Elections?

Breaking Free

We just released a step-by-step plan to transform our democracy: Breaking Free with Fair Elections: A New Declaration of Independence for Congress.  Public Citizen and our coalition partners offer this manifesto to those who wonder: How can we make lawmakers more accountable to ordinary citizens?

The answer is a "Fair Elections" system – also called voluntary public funding – for congressional elections.  As we mentioned last week, Senator Arlen Specter (R.-Pa.) and Assistant Majority Leader Dick Durbin (D.-Ill.) introduced landmark legislation to create a Fair Elections system for the Senate.  Our report tells the story of public funding and explains the architecture of the Fair Elections system, drawing on successes in the states.

People are taking notice of the new bill and important allies like the AFL-CIO, MoveOn.org, NAACP, National Council of Churches, and the League of Women Voters are joining the movement. Want to come along?

The Solution to the Money Problem Introduced

Today Public Citizen joined with congressional leaders from both sides of the aisle and a broad coalition of civic groups to uproot the problem of money in politics. Senators Richard Durbin (D-Ill.) and Arlen Specter (R-Pa.) announced the introduction of the Fair Elections Now Act [listen] to establish public funds for senatorial elections.  This bold and important bill would transform federal elections for the U.S. Senate from a business enterprise into a contest of ideas focused on our nation's challenges. 

It’s plain that the cost of campaigns for Senate (and all other offices) is out-of-sight.  Over the last past three election cycles, the average cost of the 10 most expensive Senate races has more than doubled, from $16.9 million in 2002 to $34.9 million in 2006.  This escalation in costs continues today, and candidates will have to spend more and more time trying to raise enough money to compete.  Enough is enough.  We cannot allow our government to keep spiraling out of the hands of ordinary Americans.

The Fair Elections Now Act would create a voluntary system through which participating candidates - those who establish their credibility by collecting enough qualifying contributions and who then pledge not to accept private contributions - would receive public funds for the primary and general elections.  Participants would also be eligible for free media vouchers and discounted commercial advertising rates.  The bill is patterned on successful efforts to reduce the impact of money on the election process in Arizona, Maine, and elsewhere.

Public funding of congressional elections is a huge break for the American taxpayer. It would cost just a fraction of one percent of the annual federal budget. But it would produce lawmakers who would not feel obligated to repay donors with costly tax loopholes, special earmarks and other boondoggles that drain billions of taxpayer dollars from the Treasury.

Last year, we fought to clean up the corruption in Washington. The public took notice, and then took action, culminating on November 7, when voters chose to put an end to the culture of corruption.  The new Congress is responding to the call for change by debating a variety of worthwhile ethics and lobbying reforms. 

Some of these first-line improvements are expected to pass in the coming weeks - but none of these will lower our gas prices, the cost of prescription drugs or student loans  - all inflated by tax-breaks and special corporate giveaways served up by lobbyists and well-heeled contributors. 

The only lasting antidote to the corrupting influence that comes with privately funded elections is to publicly fund them with a system of fair and clean elections.  Thanks to Senators Durbin and Specter, we are on our way to a brighter future.

It's the public financing, stupid!

In a surprising development, The Hill reported yesterday that Republican Sen. George Voinovich (Ohio) has been discussing public financing of congressional elections with Democratic Sens. Richard Durbin (Ill.) and Christopher Dodd (Conn.), and might join them in co-sponsoring  a public financing bill. Said the prescient GOPer: “Maybe it is the answer. Too much of our time is spent raising money, time spent campaigning, time buying TV ads. Everyone’s out there trying to raise money… until we deal with this issue, you’re going to continue to have problems.”

Give that man a cigar! We couldn’t have said it better ourselves.

While any public financing plan will face an awfully tough slog in a Congress so controlled and corrupted by special interest money, the support of a vocal Republican senator promises to change the dynamic considerably. A related problem that will need to be tackled is the strange disconnect, reviewed here by Kevin Drum, between the popularity of public financing for state elections and the perception here in Washington that the public hates the idea. Hmmmm. Could members of Congress perhaps be getting their information from corporate lobbyists?

Back to Voinovich for a final thought: it’s worth noting that in addition to considering public financing, he is also talking up lack of enforcement of current lobbying rules.

“How are we enforcing our laws? Things are filed, and, in some cases, nothing’s done about it,” Voinovich lamented, calling the notion of exempting lobbyist-sponsored fundraisers from the congressional gift ban “ridiculous.”

Once again, we couldn’t agree more. The irony here, though, is that the chair of the Senate Select Committee on Ethics is none other than… yes, you guessed it… Sen. George Voinovich! So what IS up with that whole enforcement thing, George?

-Gordon Clark