The Hard Truth about McCain's Soft Money Ban

Everyone jumped all over John McCain after the news broke that he had intervened with the Federal Communications Commission on behalf of a generous campaign contributor. Here's a candidate who has made campaign finance reform the centerpiece of his campaign, and he was caught committing a blatant act of favoritism for a contributor. What could be worse than that?

Lots. The real scandal is not that McCain did the favor despite his crusade to clean up government. Nor is it that "everybody is tainted by the system," as McCain himself said. The real story is that McCain's campaign finance reform proposal won't clean up the sort of mess McCain--and every other candidate--finds himself in.

McCain wants a ban on "soft money," the unlimited contributions that flow into political parties spawned by a loophole in the election laws. Soft money is a real scourge on the body politic, and eliminating it would be a significant step. But when McCain took money from Paxson Communications's executives and lawyers, as first reported by The Boston Globe, it wasn't soft money he was taking. The $20,000 his presidential campaign collected from this interest came in as "hard money," subject to the $1,000-per-donor-per-election limit under current campaign finance law.

It can be easily argued that candidates' reliance on "hard money" is as problematic as soft money for the body politic--or even more so. In the 1996 presidential election cycle, soft money accounted for just 11 percent of the total raised by federal candidates and political parties--$262 million out of $2.4 billion. This time around it may amount to 16 percent--$500 million out of perhaps $3 billion. And company executives regularly "bundle" hard money contributions to politicians, particularly ones in a position to do something for them in return. As chairman of the powerful Senate Commerce Committee, which regulates telecommunications, McCain collected nearly $329,000 in large contributions from communications and electronics executives between 1993 and 1998, according to the Center for Responsive Politics. That's not even counting the additional $237,000 he collected from this industry's PACs over the same time period. Not a dime of the money that "corrupted" McCain was soft money.

And he's not alone. Every dollar of the $67 million raised by the Republican front-runner in 1999 came in hard money. George W. Bush likes to claim that this shows the breadth of his grass-roots support, but it's telling that his fundraising operation has given its top money men individual tracking codes for donors to write on their checks. An internal memo written by the head of the electric power industry's main lobbying group explains to potential donors why these codes are important, with capitalization used in the original document for emphasis: "IT DOES ENSURE THAT OUR INDUSTRY IS CREDITED, AND THAT YOUR PROGRESS IS LISTED AMONG THE OTHER BUSINESS/INDUSTRY SECTORS." If there's no quid pro quo connected to contributions, why else should Bush keep track of which industries are favoring him and by how much?

A soft money ban--the proposal McCain has advanced--wouldn't take him or any other presidential or congressional candidate off the hook. As long as candidates are dependent on private money for their campaigns, they will be subject to legitimate conflict-of-interest charges.