The Gaggers and Gag-making: Hypocrisy among the campaign-finance reformers.

It's a common scene in Washington. Lobbyists representing powerful, well-financed special interests sit behind closed doors with members of Congress drafting legislation. Outside Washington, their dollars finance TV ad campaigns in the districts of wavering House members, hoping to pressure them into supporting the bill. Highly technical and complex legislation is then unveiled in the middle of the night, and most members of Congress have no time to read it before debate begins the next morning. Efforts by grassroots groups to amend the bill to protect their members are rebuffed, and though the bill contains provisions that even its sponsors admit are probably unconstitutional, such objections are shunted aside.

You may think this is a description of a special interest trying to benefit from some arcane budget bill, but in fact it is a description of the Shays-Meehan campaign-finance-regulation bill that passed the House in the wee hours of February 14. The passage of Shays-Meehan shows that those who think campaign-finance reform will reduce the influence of money in politics are mistaken.

Supporters of campaign-finance regulation like to portray themselves as an underfunded, scrappy grassroots coalition. However, a study conducted last year for the American Conservative Union by election-law attorney Cleta Mitchell found that groups dedicated to promoting campaign-finance reform spent over $73 million over the three-year period from 1997 through 1999. By comparison, the Center for Responsive Politics (CRP), one of the most prominent campaign-finance-reform organizations, lists total political spending by the "mortgage banking" industry at under $12 million, and by "Health Services and HMOs" at under $14 million, for the four-year period from 1997 through 2000. Even the dreaded drug manufacturers contributed just $28 million over that four-year period, or 40 percent of that spent in just three years by groups promoting campaign-finance regulation. Yet the campaign- finance regulators always portray these industries as colossally and harmfully big spenders.

Actually, Cleta Mitchell's study understates the spending by campaign- finance-reform groups. It does not include spending by many of the groups' affiliated 501(c)(4) committees, and misses some significant groups completely. To give just one example, it does not include spending by the National Voting Rights Institute (NVRI), which describes itself as "a prominent legal and public education center in the campaign finance reform field." NVRI, which argues that private campaign contributions violate the Constitution, is frequently quoted in the New York Times and other major papers. Meanwhile, the CRP overstates industry giving, as it includes in its figures individual contributions by any person employed by a company in the industry, and in certain cases even contributions by the employee's spouse. Thus, if the non-working spouse of an Enron employee earning $45,000 a year gave $200 to the campaign of George W. Bush, the CRP reports that as both an "Enron" contribution and a contribution from the "energy/natural resources" industry.

Arguably, money is the only thing that has kept the issue of campaign- finance regulation alive. With public-opinion polls consistently showing that campaign-finance reform is of little interest to the public, most of the groups advocating reform rely on six- and even seven-figure grants from giant foundations such as Ford, Carnegie, and Joyce for funds. With the notable exception of Common Cause (which has a budget of about $10 million a year), these groups usually have few individual supporters. Such individual support as they do have comes almost entirely in the form of large gifts from a handful of politically liberal multi-millionaires, such as George Soros and Silicon Valley entrepreneur Steven Kirsch.

These groups respond that their money does not represent "special interests." But their scorekeeping belies this claim. Surely if a $200 contribution by the wife of a mid-level Enron employee is "special interest" money, so are the six-figure expenditures made to promote campaign-finance reform by investment banker Jerome Kohlberg. Similarly, the Pew Charitable Trusts, to take just one example, have given considerably more in grants to advocate campaign-finance regulation than Enron gave in soft money to advocate energy deregulation. And these foundations and groups have other interests that are advanced by silencing their opposition. Pew, for example, also advocates environmental regulation and funds Planned Parenthood. If it can quiet political opposition from business and National Right to Life, it benefits. While one might describe foundations such as Pew, or organizations such as CRP, as disinterested entities concerned with the public welfare, one might just as accurately describe them as unaccountable organizations with lots of money and no members. Even Common Cause, the one reform group with a membership base, is small fry compared with other groups. With some 200,000 members, it describes itself as a "citizen's lobbying organization." But it describes the National Rifle Association, which has over 4.2 million members, as a "special interest." Indeed, many corporations represent hundreds of thousands or even millions of individual shareholders and employees. Why aren't they "citizen's lobbies"?

Pro-reform organizations have used their massive war chests to run one of the most cynical campaigns in the history of cynical Washington. Even though corporations and unions are prohibited from making contributions directly to candidates, a casual observer looking at CRP's website without reading the fine print would conclude that the largest direct contributors to every member of Congress are corporations and unions. This is because of the center's practice of attributing contributions by individuals to their employers. Another trick, in an apparent effort to inflate the perception of corporate influence, is to lump together contributions made over many years. Thus, organizations such as Common Cause and the CRP routinely issue press releases and studies showing huge corporate contributions, significant portions of which occurred as much as a decade ago. In some cases, more than half the Congress has turned over in the intervening years. Yet another misleading tactic is to lump together all contributions by "industries." So a 1997 Common Cause report on the influence of the "broadcast industry" listed total contributions from the "industry" over a ten-year period. No allowance was made for the fact that many of the contributions went to individuals no longer -- or perhaps never -- in Congress, or for the fact that the "broadcast industry" is hardly monolithic: Affiliates often quarrel with networks, networks with one another, radio with television, and so on. The reform organizations also frustrate any sense of perspective. In the current frenzy over Enron, for example, it is not mentioned that Enron's total soft-money contributions constitute a minuscule fraction of 1 percent of total soft money raised over the period cited.

Meanwhile, virtually every legislative action can be and is portrayed as a sellout or payback to some "special interest." So if Enron got a favorable regulatory ruling over opposition from the Chicago Board of Trade, it was a payback to Enron. But since the Board of Trade is also a powerful interest, any ruling the other way would not have been portrayed as a victory for principle or a defeat for Enron, but as a payback to the Board of Trade. All roads lead to corruption. That politicians might actually be acting on convictions or keeping campaign promises is given no credence. Few have worked harder to convince the American people that their representatives are corrupt, and their votes and participation meaningless, than the campaign-finance reformers. That they have done so on the flimsiest of evidence only adds to the shame.

The Enron scandal, which pushed Shays-Meehan over the top, is a perfect example. Reformers gleefully argued that the Enron bankruptcy proved that Shays-Meehan was necessary, with no evidence that Shays-Meehan could have prevented it. Even Rep. Shays admitted that Enron is going to have access "by the fact of who it is and what it does" (its money aside). Reform advocates misleadingly claim that over 250 members of Congress have received "Enron" contributions, when in fact they mean that those members have received contributions from people who worked for or owned stock in Enron. They do not mention that Shays-Meehan does not limit these contributions, and in fact raises the ceiling on them.

Then too, Shays-Meehan was supported down the homestretch by a television "issue advertising" campaign funded by the Campaign for America (CFA), a creation of Jerome Kohlberg. These ads ran in the congressional districts of wavering congressmen. In addition, CFA operated phone banks in 30 congressional districts. This campaign was paid for with unregulated soft money. In a classic example of "free speech for me but not for thee," most of that spending would remain legal under Shays-Meehan.

However, the heart of the operation to pass Shays-Meehan was not grassroots lobbying, but old-fashioned Washington lobbying. Though supporters had been pushing the bill since the 107th Congress first met in January 2001, and though the sponsors had been gathering signatures on a discharge petition to force the bill to the floor since July, they still spent the evening before the opening of the House debate, and part of the day on which the bill was being debated, redrafting the legislation. According to press reports, pro-reform lobbyists, including former McCain 2000 counsel Trevor Potter, Democracy 21's Fred Wertheimer, and Don Simon of Common Cause, drafted key portions of the bill, at times working out of offices in the Capitol. The final version of the complex, 86-page bill was unveiled a few minutes before midnight.

The bill, as it emerged from this redraft, included a highly technical provision allowing parties to pay off hard-money debts incurred before the 2002 elections (hard money being limited contributions from individuals and PACs, which may be used for any purpose) with soft money (unlimited contributions from corporations, unions, and wealthy individuals, which normally cannot be used to expressly advocate the election or defeat of specific candidates). The provision favored Democrats, who have plenty of soft money but are short on hard money. Republican operatives cried foul and charged that the provision was an intentional effort to benefit the Democrats. The more likely explanation is that it was simply an error caused by the haste of last- minute drafting. But imagine the outcry these same "reform" groups would have raised had lobbyists for any other interest helped draft a bill, and accidentally included a technical error beneficial to the bill's primary supporters in Congress. Would the reformers have given the drafters the benefit of a doubt? Never. The error briefly jeopardized the bill and drew a veto threat from the White House, before supporters used a parliamentary maneuver to change the language before the final vote.

Assuming it becomes law, the bill will not end the influence of money in politics, but instead will drive such influence further underground. A glimpse of the future may have occurred at a dinner last October that raised $800,000 for the Brennan Center, a pro-reform group. Co-chaired by pro-reform senators Hillary Clinton and Charles Schumer, and featuring Sen. John McCain, the dinner was underwritten by corporate donors, who were solicited to attend. Sponsors included over two dozen large law firms with Washington lobbying practices, plus such corporations as Coca-Cola, Philip Morris, and, naturally, Enron. If money is truly corrupting, corporations hoping to curry favor with officeholders might decide that support for such groups is a wise idea, or officeholders might "suggest" that corporations with business before their committees make donations to such groups. Shays-Meehan limits the right of federal officeholders to solicit money for political parties and other groups, but specifically allows lawmakers to continue to solicit funds for entities such as the Brennan Center.

Beyond that, the bill will probably strengthen special interests, benefit incumbents, and harm grassroots politics. The limits on soft- money contributions mean that corporations and unions may be pressured to do more independent spending to help their legislative allies. This will give these interests more control over the process, and will reduce the historical role of parties in brokering diverse and often competing interests. The limits on issue ads in the 60 days before an election will mean that such ads will run earlier, making campaigns longer and putting a greater premium on early fundraising. This will benefit incumbents, even as it requires them to spend more time raising funds. True grassroots politics -- spontaneous political activity by individuals and groups -- suffers from regulation and has been on the decline ever since the Federal Election Campaign Act was first passed in 1971. The added complexity of this bill will probably kill off such activity altogether. Indeed, Federal Election Commission chairman David Mason says that the incredible complexity of the bill is likely to lead to "invidious enforcement, singling out disfavored groups or causes" and "subjecting regulated groups to harassment by political opponents."

However, the giant foundations that have financed the drive for reform will remain untouched. So will the recipients of their largesse, such as Democracy 21 and the Center for Responsive Politics, and the lobbyists of Common Cause. Big-business lobbyists also emerge unscathed -- indeed, corporations may devote more resources to lobbying. But groups that rely less on lobbying and more on campaign support to candidates, grassroots organizing, and issue ads to rally public support will suffer.

But that, too, is a common Washington story.