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The sleaze in the statehouses.

Inside the fortress nestled in the woods of Fairfax County, Virginia, that is Mobil Oil Corporation's world headquarters, four company officials sat at a conference table and tried to explain what they didn't do to kill a clean air bill supported by environmental groups and more than two thirds of Virginia voters.

The measure, slated to take effect in 1997, would have required all new cars sold in Virginia to meet California's tough emission standards--a move that would cost the oil companies billions of dollars. Thus it's reasonable to believe Virginia state Senator Edward M. Holland, the sponsor of the bill, when he says that the industry financed a "carefully coordinated, major lobbying effort" to ensure the bill would fail. But to hear the Mobil execs tell it, that little bill died all by itself:

"There was no advertising campaign," said one, "and our public relations campaign amounted to this: Responding to queries, always being there to talk to whoever asked to talk to us--that's our public relations campaign."

"There really wasn't any grand strategy," said another.

"The enormous campaign that we mounted amounted to Ben and two very bright technicians," added a third.

And so on.

Somebody's lying here. But in Virginia and many other states around the country, even the most intrepid journalist would have a tough time telling you who. That's because, as campaign finance reformers focus on big-business vote buying at the national level, state campaign finance laws make the besieged federal rules look downright draconian.

In Virginia, for instance, campaign finance limits are pretty simple: There are none. There--as in Colorado, Illinois, New Mexico, Idaho, and Oregon--orporations, individuals, political action committees (PACs), and unions can spend millions buying small-town legislators without even bending the rules. That's precisely what the federal government was trying to prevent when it limited individual campaign contributions to $1,000 and PAC contributions to $5,000 annually.

Of course, most states' laws are subtler than Virginia's; there are a few limits, but with loopholes you could drive a limousine through. Twenty-one states have no cap on the amounts PACs may give; 18 allow unlimited personal contributions. Combine that with reporting requirements for lobbying that demand about as much vigilance as Reagan's oversight of the S&Ls, and you've got a recipe for disaster--or rather, a recipe for just the kind of backroom dealmaking that's made so many average Americans feel shut out of the democratic process.

As soul-searching about big-money influence slowly gathers momentum in Congress, state legislators and the corporate powers they serve have been peculiarly insulated from the zeitgeist. That's too bad, since the New Federalism of the Reagan-Bush era greatly increased the influence of state legislators and the interests they serve. And when they exert pressure at the state level, their power is harder to trace and fight.

Pac men

During the past five years, scandals in a passel of state legislatures have provided some racy reading. There was the FBI sting that snared California state Senator Joseph Montoya extorting funds from lobbyists for foreign medical schools. And there were the Arizona legislators whose shenanigans were caught memorably on videotape: Rep. Don Denney stuffing stacks of $100 bills into a gym bag while promising to play "quarterback" for a bill supported by gambling interests.

But in states like Illinois, that kind of criminality doesn't have to happen. That's because, while Arizona has a handful of annoying campaign finance laws, Illinois' affluent interests can boldly buy their votes on the right side of the law, And because they can, they do. Consider the 1992 bill that lifted the cap off what local telephone companies could charge customers. Illinois Bell, which stood to make hundreds of millions of dollars if the measure passed, spent at least $1.9 million in campaign contributions and lobbying costs.

Thanks to post-Watergate reforms, such blatant vote-buying could get you jail time at the federal level. But only 20 states have similar strictures. And while the federal government outlawed direct contributions from unions more than 40 years ago, a mere nine states prohibit union donations. Not that the federal laws are particularly tough--corporations and unions may establish their own PACs with donations from executives or workers and can contribute unlimited amounts of "soft money" through party political organizations---but at least those contributions are on the books.

What happens when there are no books is utterly predictable. Affluent, usually corporate, interests tend to dominate the political process. In Richmond, Virginia, it's only fitting that the concrete and glass towers emblazoned with the logos of Ma Bell and Crestar Bank seem to dwarf the state capitol. Public interest waxes and wanes, news coverage of legislative issues is spotty---but business, politicians know, is a pretty steady date. That fact surely wasn't lost on Democratic state Senator Jackson Reasor when Governor Douglas Wilder's clean air bill came to his transportation committee. Faced with a close vote, Reasor broke party lines and voted against the bill after receiving $14,708 in campaign funds from the oil interests--more than any other single committee member. Fatal move? Not likely. Few Virginia voters know his name, let alone follow the intricacies of committee politicking, although they may be breathing the fumes of his pivotal choice for decades.

The difficulty of making the public see and understand the insidious nature of individual money-politics transactions necessitates clearly defined, across-the-board laws. But when public interest types start pushing their reform bills, they usually find the lawmakers scrambling to get in line with the corporate lobbyists.

That's hardly surprising, because advocates for state-level campaign finance reform usually consist of a few true believers with an annual lobbying budget that's less than what the average oil company spends on a month of lunches. "This is Common Cause and Jim's Electronics," drawls that organization's South Dakota headquarters--a message not likely to breathe fear into the soul of a money-gorged pol. And fear of grassroots wrath is exactly what's necessary to overcome politicians' natural inclination toward lax campaign finance laws.

This makes the press essential in exposing unsavory money-politics connections at the state level. When a utility or an oil company attempts to buy votes, and when politicians accede to their intentions, the message isn't just that the corporations are blackhearted vote buyers it's that the system encourages them to do it.

Caps on contributions that at least match the stringency of those at the federal level are a necessary first step to campaign finance reform, leveling the playing field for the less affluent. Or at least they will if they aren't set, as Nevada's are, so absurdly high$20,000 per group per election cycle--as to make them irrelevant. (Surely Nevada politicians come cheaper than that.) Yet as other states rum to less superficial reform models for help--we recommend Alabama with its $500 cap--it's worth remembering that without adequate public disclosure of contributions and lobbying efforts, "reform" may be just as ineffectual as anarchy.

Consider Virginia again, where contributions under $100 don't have to be reported at all. A favorite trick of local businessmen is to get family members and employees to donate $99 apiece. The $100 reporting requirement makes sense; what's needed, however, is a mechanism to allow the under-S100 donations to be traced--a regulation that would scare off potential abuse of the system.

Still, campaign contribution disclosure laws are water-tight compared to those that govern the reporting of lobbying. Although nearly all states require lobbyists to keep some sort of record of what they spent--and who they courted---on what issue, those laws vary widely on what constitutes lobbying and how much must be disclosed. Many states' definition of lobbying is so vague that lobbyists can include just as much information on their disclosure forms as they please. In Virginia, lobbying disclosure forms include sections on research, dinners with legislators and their staff, and other lobbying activities, but it is up to the lobbyists themselves to determine whether a particular activity "influences . . . a member of the General Assembly" to their clients' advantage.

Until 1993, Virginia's lobbying law had an even greater flaw: It only covered lobbying that went on between November 15 and the end of the legislative session in March, completely ignoring seven and a half months of activity. A reform passed this year eliminates this restriction in Virginia's law, but unfortunately, similar loopholes are common in many other states' regulations. In New Mexico, for instance, the legislature meets for only 30 days on even-numbered years and 60 on odd. Any lobbying of committees that takes place between sessions--when most key bills are, of course, being hammered out--needn't be reported. And up in Indiana, a lobbyist can throw a party or fund a trip for one legislator or, heck, the entire general assembly, and it's all off the books.

Georgia on my payroll

One result of so much recent state-level chicanery is that reform-minded states now have models like New Jersey to emulate. There, in a state notorious for its political corruption, a lobbyist for one of the state's best-funded political action committees, Lawyers Encouraging Government and Law, blew the whistle a few years back on four assemblymen who told her that unless her organization contributed $20,000 to a Democratic joint campaign fund, bills important to the group would not be "posted" in the upcoming legislative session.

In the wake of her allegations, chronicled in The Bergen Record, the state revamped its lobbying disclosure laws into some of the toughest in the nation. It has eliminated a loophole that limited reporting of lobbying to contacts with legislators in which a specific bill was "expressly" discussed. And it extended disclosure laws to cover contacts with staff members of legislators and lobbying of the executive branch. To give those laws teeth, New Jersey created an independent agency that analyzes campaign finance and lobbying data, investigates abuses, and punishes offenders with stiff fines.

While each state's situation is distinct, most experts agree that there are principles that will help keep the system honest and prevent the big guys from exerting an overpowering influence on state legislatures, such as a well-funded, bipartisan ethics commission to watch over the pols and their friends. Ideally, such commissions would have the power to initiate investigations, punish law breakers with hefty fines, and perhaps make summaries of their findings easily accessible to the public.

Of course, in most states, campaign reform isn't exactly at the top of the agenda, or even--sad to say--on it at all. Unless the case involves outright extortion a la New Jersey, mustering the force for ethics reform is difficult. But especially if the press is willing to commit the time and resources to follow the trail, it's not impossible. Often a few slimy deals, taken together and clearly presented, can trigger the good old-fashioned public irritation that can make the difference between a vacuum and real reform. You can ask Georgia House Speaker Tom Murphy about that.

Murphy, a rural Democrat, took an infamous 1987 holiday to Fort Lauderdale with lobbyists representing a front for BCCI. The bank wanted a law to allow it to do business in the state; after the boisterous three-day, $15,000 trip, the bank got its go-ahead. A few years later, the BCCI investigation unearthed the trip just as ethics advocates were preparing new reform legislation. Suddenly, Murphy became the reformists' symbol of the old era: What he did was legal, but it didn't smell right--and nobody had had to report it under the old system. The reform laws passed over Murphy's opposition.

Reforms like Georgia's won't guarantee there will be no more Murphys--or God knows, no more Mobils willing to spend enough money to drown out the public will. But after the next clean air bill quietly dies inside some statehouse anteroom, the public will be able to march in, count up the money, and know who killed it.
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Title Annotation:inadequate state campaign finance laws
Author:Greenberger, Scott
Publication:Washington Monthly
Date:Apr 1, 1993
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