The booming new concerns of the Industrial Revolution—oil, steel, rail, finance—began pouring money into campaigns, in pursuit of specific policies, particularly protectionist tariffs. Journalists would joke about “the senator from Standard Oil,” and Mark Twain observed in The Gilded Age that Congress was for sale, noting that when it came to buying representatives, “the high moral ones cost more, because they give tone to a measure.” In 1896, Mark Hanna, Karl Rove’s idol as a political operative, used the specter of the populist Democratic nominee, William Jennings Bryan, to garner contributions from banks equal to 0.25 percent of their capital bases—sort of an informal tax on behalf of his candidate, William McKinley. Hanna spent Bryan into the ground.
Over the ensuing years, journalistic and legislative investigations into corruption eventually ensnared a Republican president and prompted him to demand the first thoroughgoing campaign-finance laws. Teddy Roosevelt told Congress in 1904 that there was “no enemy of free government more dangerous and none so insidious” as corruption, and in 1905 he came back at Congress again, insisting, “All contributions by corporations to any political committee or for any political purpose should be forbidden by law.” A Senate report on the resulting legislation, known as the Tillman Act of 1907, noted, “The evils of the use of [corporate] money in connection with political elections are so generally recognized that the committee deems it unnecessary to make any argument in favor of the general purpose of this measure.”
Down through the decades, the rising political power of other groups, like unions, prompted new restrictions. The biggest reset of the fund-raising rules came after Watergate, which is remembered largely for the break-in and cover-up but was also a whopping campaign-finance scandal. Donors gave money to Richard Nixon’s reelection campaign in exchange for ambassadorships; the Associated Milk Producers promised $2 million to the campaign, and the president hiked up the federal subsidy for milk. In all, 31 executives from companies like ITT and American Airlines were charged with giving money for government benefits, and Congress in 1974 enacted a new, extremely rigid campaign-finance regime: it set up the FEC and public financing for presidential campaigns, and it restricted not just campaign contributions but campaign spending. Two years later, in the landmark case Buckley v. Valeo, the Supreme Court struck down the spending limits, saying they undermined free speech. But the Court said that Congress could restrict contributions, to avoid “the actuality and appearance of corruption.”
Corruption, of course, can occur across a wide spectrum, and it can appear to occur across an even wider one. Since Watergate, there have been a handful of egregious instances, like the Indian-casinos scandal of the last decade, in which the lobbyist Jack Abramoff supplied campaign money, along with bribes in the form of skybox seats and a golfing trip to Scotland, in exchange for legislative support for his clients.
But such clear cases are at the extreme. Corruption—or its appearance—tends to take more-amorphous forms, like the spectacle of five senators pressuring bank regulators on behalf of a big contributor (the Keating Five scandal, which, in an echo of Roosevelt’s campaign for reform, turned one of those senators, John McCain, into a crusader for tighter rules—a challenge to Bopp’s notion that incumbent self-interest, rather than something more hard-earned and principled, drives reform). Or like the spectacle of President Clinton insisting that he did not rent the Lincoln Bedroom to Democratic Party donors and that, in his last hours in office, he did not pardon the financier Marc Rich in exchange for money for the Democrats. This is all fairly tawdry, but is it corrupt?
As a member of the White House press corps, I once joined in the contest as Bill Clinton spent 51 minutes, one hand casually tucked in a pants pocket, parrying questions about his fund-raising. “I can tell you this: I don’t believe you can find any evidence of the fact that I had changed government policy solely because of a contribution,” he told us at one point. It was an artful dodge—a deft flick of the adverbial cape over the charging bull—and, I suspect, it was the simple truth. The question, of course, is how much of the unspoken “partly” we can, as a democracy, successfully abide alongside that “solely.”
“This is a very sophisticated system,” says Fred Wertheimer, the president of Democracy 21, who has been fighting for tighter controls on political money since the Watergate days. “That’s the beauty of the system for these guys. This is a legalized-bribery kind of system where no one has to say anything. I don’t have to say what I want—you know what I want.”
Hardest of all to discern, he said, is what action doesn’t happen as a result of campaign donations. What subsidies are left in place? What bill inconvenient to some interest languishes and then dies a quiet death? This is an old Washington game. In the run-up to the vote on the Tillman Act itself, The Washington Post editorialized that “boodle is become an indispensable factor in our elections” and wondered if Congress would find a way to avoid passing the politically popular campaign-finance bill. “No man in Congress dare say a word in opposition to it; no man in Congress dare vote against it,” the paper declared. “The only way to beat it is to lose it in the shuffle.” ThePost added: “Is it already lost in the shuffle?”
Such political games take a toll on the citizenry. In its Citizens United decision, the majority wrote, “The appearance of influence or access … will not cause the electorate to lose faith in our democracy.” But polling suggests otherwise. Indeed, voters have good cause to wonder which branch of government is taking their views of politics into account. Citizens United itself appears not to have helped matters. Early this year, a study by the Pew Research Center found that a strong majority of people—of whatever political persuasion—who had heard about the Court’s decision felt that it was having a “negative effect” on the 2012 campaign.
Jim Bopp doesn’t worry much about that public attitude. He sees it as a reflection of healthy skepticism of politics in general. As for the distortions and contortions of how politicians gather money and then perform in office, he sees those as a function of a crazy system that, by restricting money in the financing of candidates’ campaigns, sends it off into other sorts of less politically accountable groups. “This is not the best system,” he told me. “The best system is the most accountable and transparent system.” The way to achieve it, he argues, is to lift contribution limits. On some days, he says, he wakes up feeling a bit cynical, and he thinks to himself that maybe there should be a $100,000 limit on contributions to members of Congress. “I do think you can buy a congressman or two for $100,000,” he said. But that’s only on some bad days. “Other times, I wake up not as pessimistic and cynical, and I say: ‘No limits.’ ”
It’s a seductive idea. Maybe all the money flowing into super pacs would instead flow directly to the campaigns. But on reflection, it’s not clear why this is an either/or proposition. Super pacs have proved useful to candidates not just as vehicles to raise unlimited contributions, but as allies that create particularly nasty ads that the beneficiary can distance himself from. It is also hard to imagine why the donors who are now choosing not to reveal themselves would suddenly want to step into the light of day.
The growing river of anonymous money is a result of the brokenness of our political system; no branch of government made an affirmative decision to let this money in. If it chose, the IRS could demand that the politicking social-welfare nonprofits, as well as business associations like the Chamber of Commerce, disclose their secret donors. In July, Senate Republicans filibustered a bill, the Disclose Act, that aimed to compel groups to name the big contributors behind political advertising. In Citizens United, eight justices favored disclosure (Clarence Thomas was the exception). No less a conservative light than Antonin Scalia, in a 2009 case, declared:
Requiring people to stand up in public for their political acts fosters civic courage, without which democracy is doomed. For my part, I do not look forward to a society which … campaigns anonymously and even exercises the direct democracy of initiative and referendum hidden from public scrutiny and protected from the accountability of criticism. This does not resemble the Home of the Brave.
Bopp had an answer ready when I asked him about the Scalia quotation: “I’m for political courage. I’m not for government-fostered harassment.” He didn’t mention it, but corporations are particularly vulnerable to a backlash when they publicly play at politics. In fact, corporations—except for the odd shell company—do not appear so far to be giving much to super PACs, which must name their contributors. But money from anonymous sources is pouring into the politically active social-welfare nonprofits and trade associations. Last year, as Aetna’s president publicly supported President Obama’s health-care-reform bill, the company gave $3.3 million to a nonprofit attacking lawmakers who backed it—a fact that became known only because the company mistakenly revealed the donation to insurance regulators. Aetna also accidentally disclosed that it gave more than $4.4 million to the Chamber of Commerce.