Boston Globe | April 26, 1990 | Michael Kranish
A few weeks ago, Sen. John Kerry, who proudly refuses all political action committee money, flew to a Houston reception held by an oil and gas company and picked up $ 10,000 in campaign contributions from people associated with the firm.
Shortly thereafter, Kerry called for public financing of elections, saying the public thinks that "the system is rigged, that special interests get special favors because they contribute money to politicians."
Asked about the Houston donations, Kerry said in an interview that it was not special-interest money because it came from individuals associated with the company rather than a political action committee, and that no influence had been sought by the individuals."I don't even know what my views on oil and gas are," Kerry said. Now, for the first time since Watergate, campaign finance is one of the hottest issues on Capitol Hill, and Kerry's public financing proposal is among those under consideration. The debate on the Senate floor could begin as early as today.
The debate is sharpened because even proponents of reform like Kerry sometimes engage in fund-raising practices that raise eyebrows and trigger criticism.
A typical senator raises $ 12,650 a week, every week, during a six-year term. A typical House member raises $ 4,000 per week.
Campaign finance has become an issue this year largely because of public outcry over the "Keating Five" scandal, in which five senators are under investigation by the Senate Ethics Committee on charges of performing favors for a savings and loan operator who contributed to their campaigns. The senators took money from the banker, Charles Keating, and then lobbied to help his bank stay afloat. After the bank's eventual failure, it was reckoned that the delay in shutting it down will cost taxpayers billions of dollars.
More than ever, members of Congress routinely face questions about their fund raising.
There is general agreement that the system should be changed, but members of Congress disagree on how. Kerry presented his public financing proposal last Friday to a private meeting of Senate Democrats.
Kerry acknowledges that his proposal, which would create a tax-form checkoff for congressional elections similar to that used to fund presidential campaigns, faces an uphill battle.
Under Kerry's proposal, a version of which he first aired in 1985, an incumbent and a challenger would receive equal amounts of public funds in a general election, and candidates could solicit private donations of no more than $ 25 per person. Kerry's bill would have a spending cap and also exempt a candidate from public funding if he uses more than $ 20,000 of his own money.
Many observers said Kerry's proposal has little chance for approval, largely because President Bush has threatened to veto a public financing plan, preferring his own proposal to eliminate most PAC money and reduce advantages held by incumbents in the Democratic-controlled Congress.
Several other proposals are also under serious consideration, including one that would place limits on campaign spending based on state population, and another that would allow large increases in campaign spending. But there is disagreement within both parties, and some observers worry that the end result will be cosmetic tinkering rather than real change.
Meanwhile, reform proponents of change do not escape criticism. Republicans charge that Kerry is "hypocritical" for advocating campaign reform while raising so much money from people associated with special interests. Kerry, in turn, has criticized his challengers, Jim Rappaport and Dan Daly, for accepting PAC money and financing their campaigns with large personal loans. Gerry Lange, a political consultant for Rappaport, said that from January through June 1989, Kerry accepted $ 135,7000 from "developers, realtors and others involved in real estate development," and $ 66,375 from "bankers, investment bankers and financial concerns."
Rappaport said of Kerry: "It is hypocritical for him to say he is doing it in the purest possible sense because he doesn't take PAC money. What is the difference between taking $ 18,000 from lawyers and getting it from a PAC?"
Kerry responded said that there is a difference. While acknowledging that he does receive many contributions of as much as $ 2,000 each from various lawyers, bankers, developers and others in the business community, he said it is not special-interest money because all of the contributors have an array of interests. Kerry acknowledged that he sometimes gets multiple contributions from people associated with one company, as in the case of the Houston oil and gas firm, but he denied that it is special-interest money.
Kerry, who sits on committees overseeing banking and commerce, acknowledged distaste for his money-raising efforts, which this year occur at a $ 9,000-a-day pace. "I think raising money alone is horrible. . . . The system, I think it stinks, but it is the only way to run for office. What am I supposed to do, not raise any money?"
The arguments in the Massachusetts Senate race are echoed in many races nationwide. Kerry said there is "no inconsistency" in criticizing the system in which he is a participant.
He said he is one of only three senators who refuse political action committee money, and the only one who discloses the source of every contribution. He said he has the lowest average contribution, $ 64, and he has the highest number of contributors, 53,000. He said that he has "rarely" been asked for favors and that he has never performed them.
Kerry has been lauded by public-interest lobbyists for leading the fight on campaign finance reform. Kerry "should be given a hell of a lot of credit," said Joan Claybrook, the head of Public Citizen.
Rappaport, meanwhile, defended PACs. He criticized Kerry for "insinuating that PACs are wrong, when in cases employees get together to give money to a candidate they believe in." Rappaport acknowledged that he has not developed his own proposal for campaign finance reform other than a general call for removing the advantages of incumbency.
The main problem with the current system, according to public interest groups, is that it is filled with loopholes allowing politicians to get around the post-Watergate reforms. In the mid-1970s, Congress forbade company gifts and limited private contributions to $ 1,000 per primary and general election cycles. But Congress also allowed special-interest "political action committees" to donate $ 5,000 each in primary and general elections.
In theory, those reforms were supposed to curb campaign costs and end most conflicts of interest. But costs have skyrocketed and more members of Congress are under investigation for possible campaign-finance violations than ever. There is no limit on total campaign contributions and a giant loophole allows millions of dollars of so-called "soft money" or "sewer money" to be funneled to general party organizations in support of candidates. An individual who cannot give more than $ 1,000 directly to a candidate's campaign can give $ 1 million to a state or local party organization, which can spend it on behalf of the candidate.
Kerry said that although he is one of the top fund-raisers in Congress, his expenses are unusually high because he solicits so many small contributions by direct mail and telemarketing methods. His campaign manager, Patricia Foley, said Kerry has raised $ 3.7 million for the 1990 race, in addition to $ 1.6 million previously raised to pay off a 1984 campaign debt.
Kerry has about $ 1 million on hand, none of which comes from his personal funds.
His two Republican challengers financed their campaign largely through personal loans. Daly has raised $ 99,164, has loaned his campaign $ 295,000 and has on hand $ 12,735. Rappaport has raised $ 306,000, loaned his campaign $ 600,000 and has $ 180,000 on hand.