The Scandal of Reform: The Grand Failures of New York's Political Crusaders and the Death of Nonpartisanship

15. Campaign Finance Follies

245 15 Campaign Finance Follies “The proposal could damage the city’s campaign finance system— perhaps the finest in the nation.” New York Times, November ,  By the end of the s, as the rise of media technology weakened the party machines and made elections more candidate-centered, the corrupt financial bargains that reformers had always accused party bosses of making were now thrust upon individual candidates themselves, leaving no candidate, reform or regular, unsullied. Compounding matters, the growing importance of radio and television advertising to political campaigns sent their costs skyrocketing, pressuring candidates to pursue moneyed interests more aggressively than ever. These pressures could not be restrained by the nation’s weak campaign finance regulations, which had remained largely unchanged since , when the Teapot Dome scandal had led Congress to pass a set of reforms that it never enforced. In the  presidential election, Hubert Humphrey’s campaign evaded limits on individual contributions by establishing dozens of separate committees , while Richard Nixon’s campaign accepted several million dollars from an insurance executive. Both campaigns kept two sets of books. When the public eventually caught wind of the abuses, the scandal led, once again, to reform. In , Congress passed the Federal Elections Campaign Act, which tightened disclosure requirements and placed limits on media advertising spending. Before the act went into effect, however, Nixon’s reelection campaign used a secret fund to pay for the Watergate break-in, setting in motion the most infamous political scandal in the nation’s history—and giving reformers a scandal worth its weight in gold. “Watergate was not primarily a story of political espionage,” wrote John Gardner, who founded Common Cause in , “nor even of White House intrigue. It was a particularly malodorous chapter in the annals of campaign financing. The money paid to the Watergate conspirators before the break-in—and the money passed to them later—was money from campaign gifts.” Reformers used Watergate as a battle cry to rally public support for their latest crusade: public financing of campaigns and spending limits. In , Common Cause and other newly formed advocacy organizations , such as Ralph Nader’s Public Citizen, succeeded in pushing Congress into passing various revisions to FECA, including caps on spending for House and Senate candidates and a system of public financing for presidential candidates who agreed to limit their spending. Before the first election under these new rules, however, the Supreme Court, in Buckley v. Valeo (), struck down the mandatory spending limits for House and Senate races, while upholding voluntarily spending limits for presidential candidates who abide by them in return for public funds. Buckley v. Valeo was a crushing defeat for reformers. In the years that followed, different reform groups pushed for different campaign finance fixes: banning contributions from political action committees, lowering contribution limits, and eliminating unrestricted contributions to political parties, which came to be known as “soft money” because it was not subject to FECA’s hard contribution limits. In , after a seven-year effort led by senators John McCain (R-AZ) and Russ Feingold (D-WI), Congress passed a law banning soft money and restricting campaign spending by advocacy groups, the biggest triumph for reformers since . Yet it still left them far short of the goal they had been pursuing since Buckley: a voluntary system of public financing and spending limits for congressional elections. Although stymied at the federal level, reformers have succeeded in passing such systems in cities and states, and the one they point to most often as a model for the nation is New York City’s. In , New York became the first large city in the nation to enact a public financing program. The law matched private contributions with public dollars at a rate of one dollar to one dollar, up to the first , dollars contributed. Thus, a donation of  dollars from a city resident would be worth , dollars to the candidate, and a donation of , dollars would be worth , dollars. In return for public funds, the law required candidates to abide by spending limits, which would otherwise be unconstitutional, and contribution limits that were THE BATTLE OVER NONPARTISAN ELECTIONS 246 lower than state levels (though still higher than federal levels). In the municipal elections of , , and , candidates for mayor, public advocate/council president, comptroller, borough president, and council member qualified for a combined total of  million dollars in public funds. In , good government groups and their allies in city government...