[*PG105]THE MONEY CHASE: HOW PROPOSED CHANGES TO CAMPAIGN FINANCE LAWS COULD IMPACT FEMALE CANDIDATES

Jason P. Conti*

MADAM PRESIDENT: SHATTERING THE LAST GLASS CEILING. By Eleanor Clift & Tom Brazaitis. New York: Scribner. 2000. Pp. 324.

Abstract:  In their book, Madam President: Shattering the Last Glass Ceiling, Eleanor Clift and Tom Brazaitis shed light on the various reasons why a woman has yet to ascend the political ladder and occupy the Oval Office. While the authors do include some mention of female candidates’ difficulty with fundraising, the authors fail to address a key component of any political analysis: Campaign finance reform. Reforming the federal election laws could have a profound influence on the prospects of current and future female politicians. Two reform proposals, including banning or restricting soft money and banning or restricting the practice of bundling, have consistently appeared on the short list of suggested changes to campaign finance laws. This Book Review explores these reform proposals and explains why banning soft money or bundling would take away two essential sources of campaign funds for women, thereby hindering their ability to rise through the political ranks.

In their book, Madam President: Shattering the Last Glass Ceiling, Eleanor Clift and Tom Brazaitis use contemporary female politicians to chronicle the difficulties of women in politics, particularly the difficulty of a woman ascending to the presidency.1 The authors chronicle the recent failures of female candidates, including Elizabeth Dole’s (R) aborted bid for the 2000 Republican nomination and Geraldine Ferraro’s (D) fall following her 1984 Democratic vice-presidential nomination, to highlight the challenges female candidates face in their pursuit of higher office.2 In addition, the authors parse the resumes and future prospects of current high-ranking female politicians, from Arizona Governor Jane Hull (R) to California [*PG106]Senator Dianne Feinstein (D), ultimately concluding that because of the hurdles female candidates face, both Hull and Feinstein as well as most other current female politicians, are not likely to wind up in the Oval Office.3

The authors briefly acknowledge that one major setback for female candidates is their difficulty raising money.4 Harriett Woods’ (D) near-defeat of incumbent John Danforth (R) in the 1982 Senate race in Missouri is an apt illustration.5 The authors also detail the success of Emily’s List, a group that funds pro-choice Democratic women running for office, explaining that an endorsement from the group goes a long way in legitimizing a female candidate and improving her chances for election.6 Unfortunately, the authors’ discussion of female candidates’ fundraising difficulties fails to raise the subject of campaign finance reform.7 In an age in which campaign finance reform receives considerable press, and in which various proposals as to how to alter the system sit on Capitol Hill, the authors’ omission of an assessment of these proposed changes and, in particular, their effect on female candidates, is notable.8

Proposals abound for ways to alter campaign finance laws.9 Two proposed changes—banning or restricting soft money and banning or [*PG107]severely restricting the practice of bundling—would negatively affect challenger candidates.10 Since few women hold federal elective office, most female candidates tend to be challengers.11 Women are, therefore, most susceptible to the effects of these proposed changes to [*PG108]campaign finance.12 Part I of this Book Review provides an overview of the current laws governing campaign finance. Part II explains proposed changes to soft money and applies those changes to the prospects for challenger candidates, and by extension, female candidates. Part III assesses proposals to close the bundling loophole and its impact on female candidates. This Book Review concludes that two popular proposed changes—banning soft money and the practice of bundling—would damage the prospects for challenger candidates and, in particular, female challenger candidates.

I.  Overview of Current Campaign Finance Law

The Federal Election Campaign Act of 1971 (FECA), which Congress heavily amended in 1974 in the post-Watergate era, governs federal campaign finance law.13 The current system sets specific per-election limits on both individuals and political action committees (PACs) during an election cycle.14 Buckley v. Valeo, the 1976 watershed [*PG109]U.S. Supreme Court case in the area of campaign finance law, upheld the individual contribution limits, the disclosure and reporting provisions of the Act, and the public financing scheme for presidential elections.15 In contrast, the Court found limitations on campaign expenditures, independent expenditures by individuals and groups, and limits on expenditures by a candidate from his personal funds, to be unconstitutional.16 The decision had a far-reaching and immediate impact on campaign funding.17 The decision, in emphasizing contribution limits but not a general cap on overall campaign expenditures, served as a catalyst for escalating campaign costs.18 The practical effect of the Buckley decision has been to put a greater emphasis on PAC contributions because of their $5,000 limit, as opposed to the $1,000 limit for individuals, igniting an explosion in the number of PACs.19

[*PG110]A.  The Bundling Loophole

One FECA provision, 2 U.S.C. 441a(a)(8), and its accompanying Federal Election Commission (FEC) interpretation, has enabled a growing number of PACs to raise large amounts of money for specific candidates that is not subject to the $5,000-per-candidate PAC limit.20 This loophole, known as bundling, requires certain reporting criteria for “earmarked” donations.21 Earmarked donations are those in which there is “a designation, instruction, or encumbrance, whether direct or indirect, express or implied, oral or written, which results in all or part of a contribution or expenditure being made to, or expended on behalf of, a clearly identified candidate or a candidate’s authorized committee.”22 Reporting of such earmarked contributions requires that the conduit or intermediary report to the FEC and the recipient candidate the donor’s name and mailing address, and for individuals making contributions over $200, their occupation and employer.23 The recipient then must report any conduit that provided one or more earmarked contribution over $200, the total amount of contributions from the conduit, and the information identifying individuals giving more than $200.24

The FEC regulations alter this structure if it is determined that the conduit exercised “direction or control” over the choice of the recipient candidate; if no “direction or control” exists, then there is no effect on the conduit’s contribution limit to the candidate; however, if the FEC determines there was “any direction or control,” the contribution will count against the limits of both the individual and the conduit.25 The term “direction or control,” however, appears meaningless in light of the District of Columbia Court of Appeals de[*PG111]cision in Federal Election Commission v. National Republican Senatorial Committee, in which the court found no “direction or control” when a national party helped a small, defined number of candidates.26 In this case, the National Republican Senatorial Committee (NRSC) pre-selected four 1986 Senate candidates and proceeded to solicit donations on their behalf.27 The Committee sent out letters saying it would divide the money equally among four candidates, only giving their states and not their names.28 The court said this was not “direction or control.”29 Since this decision, there has been an increase in the number of political interest organizations that have supported federal candidates by bundling.30 This loophole has been one target of proponents of campaign finance reform.31

B.  The Soft Money Loophole

Another loophole that reformers target arose out of the 1979 amendments to FECA, which Congress amended to include regulations that exclude state and local party building activities from the federal contribution limits.32 The Federal Election Commission has since decided the 1979 amendments allow individuals and organizations to give unlimited amounts of money to the national parties’ state and local party building campaign accounts.33 The money—referred to as soft money—is generally supposed to be used for party building expenditures at the state and local levels, and cannot be spent in conjunction with federal candidates.34 Soft money provides a vehicle [*PG112]through which wealthy individuals and groups can help influence policy by contributing unlimited amounts of cash to the national parties.35 Soft money has grown increasingly more influential in elections across the country, growing at an exponential rate from 1992 to 1996 and from 1996 to 2000.36

Both political parties have turned to “issue advocacy” as another means of utilizing soft money.37 Issue advocacy ads, which advocate or oppose the cause of a candidate, can be partially paid for with a party’s soft money so long as they do not contain “magic words,” including “vote for,” “elect,” “cast your ballot for,” “vote against,” or “defeat.”38 Through this new method, parties have increased the usefulness of soft money and now can use these funds to pay for ads that directly aid federal candidates.39 Because of the potential for abuse, and the significant increase in donations of this variety, soft money has become one of the largest targets of campaign finance reform.40

II.  The Effects of Banning Soft Money on Female Candidates

Commentators and reform-minded politicians attack the heavy role of the two major political parties through the use of soft money, arguing that “parties [through soft money and other mechanisms] are [*PG113]eroding the basic elements of our campaign finance system.”41 While those same commentators will admit that the parties play a pivotal role in elections and should continue to do so, the use of soft money is seen by many to be in need of reform.42 As a result, many are calling for the effective ban of soft money by subjecting all party money used in federal elections to regulation.43 Senators John McCain (R) of Arizona and Russell Feingold (D) of Wisconsin have put forth one of the more popular, much touted, reform plans that would ban soft money.44 Their proposed legislation would eliminate soft money by subjecting all party money to the limitations, prohibitions and regulations established in FECA.45 Although this legislation has been proposed and has failed in past years, the McCain-Feingold bill has gained supporters since its last defeat and has a better chance of passage in 2001.46

[*PG114] While soft money has been used by both political parties to help many different kinds of candidates, a ban on such funds likely would have the most serious impact on challengers.47 In general, incumbents have an easier time than challengers in raising money and therefore would not be as adversely affected if soft money were to dry up.48 In fact, some argue that reducing the fundraising abilities of the political parties would reduce challenger vote shares in the electoral process, mainly because non-incumbents have a much easier time attracting party money than they have attracting PAC money.49

Challengers have a particularly difficult time raising adequate funds to mount competitive campaigns.50 Compared to both individuals and PACs, parties are much more likely to invest in challengers because parties are trying to spread their money strategically to either gain control or maintain control of Congress.51 If soft money were to be banned, parties would be greatly restricted in their ability to help these challenger candidates, thus drying up an essential source of campaign funds.52 Therefore, a ban on soft money would affect challengers more than incumbents.53

A dearth of females hold elective office today: Although there were increases following the 2000 election, only five female governors, thirteen female senators and sixty-one female House members held office at the beginning of 2001.54 This represents a severe numerical [*PG115]inequality in each chamber of Congress and in the governors’ mansions across the country.55 For these numbers to improve, more female challengers will have to either win open seats or beat incumbents.56 However, in order to do this, female candidates will have to overcome historically great odds and raise a significant amount of money, an element of running for office that former California Secretary of State March Fong Eu (D) once called, “the greatest barrier to the election of more women.”57 Therefore, because female candidates are underrepresented, and tend to be under-funded challenger candidates in need of party support, banning soft money would have a negative impact on female candidates.58

For these reasons, many female candidates and female political operatives oppose the elimination of soft money.59 One high-profile example of this general view was on display in the 2000 New York Senate race in which Democrat Hillary Rodham Clinton faced Republican Rick Lazio.60 While Mrs. Clinton is a somewhat unusual case study for campaign finance and female candidates in general because of her high name recognition and ability to incite strong feelings in voters, her agreement to ban groups from using soft money to buy advertising, although perhaps a helpful political strategy, was seen as potentially financially dangerous.61 The New York Times noted that [*PG116]Clinton, in accepting the ban, “said her campaign would suffer because of the ban. . . . ‘Well, I made a commitment to this principle over a year ago, and disadvantaged or not, I will honor it because it is the right thing to do.’”62 Because of Lazio’s greater ability to attract hard money campaign donations from across the country by running against the much-maligned First Lady, the soft-money ban left even this famous female candidate scrambling for cash like many other female candidates.63

Clift and Brazaitis, while highlighting the difficulty for female candidates in attracting campaign donations, fail to address the further difficulty female candidates for the House and Senate—important positions in the line to the presidency—would face should a ban on soft money become a reality.64

III.  The Effects of Banning or Restricting Bundling on Female Candidates

Banning bundling has not occurred very often in the states; only three states, Oregon, Missouri and Washington, have banned bundling outright through ballot initiatives.65 However, banning bundling by PACs (or at least significant restrictions on the practice) is a popular idea for those advocating a reform of the current campaign finance system.66 Past bills in Congress that have attempted to address the issue of bundling have failed.67 The 103d Congress attempted to regulate the practice of bundling: Senate Bill 3 (S. 3) proposed a ban [*PG117]on PACs and on bundling, but was unacceptable to the House.68 House Bill 3 (H.R. 3) regulated bundling but also contained an important exemption: political committees not engaged in lobbying activities would have been exempt from the new bundling regulations.69 The exemption was inserted to help Emily’s List continue to raise money for female, Democratic, pro-choice women, because the group does not technically engage in lobbying.70

Emily’s List, mentioned throughout Clift and Brazaitis’ book, is dedicated to raising money to help usher female politicians into elective office.71 To achieve this end, the group engages in the practice of bundling, soliciting money for candidates, combining the donations and then sending the money to candidates that the group endorses.72 Ellen Malcolm, the group’s founder, is a large proponent of bundling and pushed for the exemption for non-lobbying PACs in the 1993 House legislation.73 Malcolm has gone as far as to claim that politicians who support proposals to outlaw bundling are voting against women.74

Some have suggested that the Emily’s List exemption, had it passed, would have created a new loophole immediately, whereby most PACs could just rearrange themselves as non-lobbying PACs to circumvent the law.75 Indeed, some female political activists agree and do not support such exemptions.76 Margery Tabankin, former executive director of the Hollywood Women’s Political Committee, says that bundling will not close the gap between female and male candidates, and instead advocates closing all the loopholes instead of partially closing only the bundling loophole.77 Fred Wertheimer and Susan Weiss Manes, former president and former vice president for issue development, respectively, of Common Cause, write, “The bundling loophole poses a serious threat to the integrity of existing federal contribution limits . . . .”78 And professors Ian Ayres and Jeremy Bulow [*PG118]contend that bundling “allows groups of individual contributors to buy access or influence.”79

However, the more popular position among female activists is that cutting out bundling as an option for PACs without an exemption for non-lobbying PACs will have a disproportionately negative impact on female candidates.80 Representative Rosa DeLauro (D-Conn.), a former head of Emily’s List and Herbert Alexander, former director of the Citizens Research Foundation at the University of Southern California, both strongly support the continuation of bundling.81 In addition, Malcolm wrote in a New York Times op-ed column that because groups like Emily’s List are merely trying to help elect certain candidates, and not lobby these members once elected, such groups help open up the political system.82 Malcolm wrote, “‘The last thing Emily’s List wants is a loophole that would pour special-interest money into campaigns. That would take us back to the very system that kept women out of office.’”83

Clift and Brazaitis certainly discuss Emily’s List’s participation in various elections, from Harriett Woods’ 1986 Senate race in Missouri to Barbara Mikulski’s (D) 1986 Senate race in Maryland.84 The authors discuss numerous other elections leading up to the group’s present prowess, noting that by 1998 Emily’s List had grown to 50,000 members in fifty states with total contributions of $7.5 million, all of which helped elect seven new pro-choice Democratic women to the House in 1998.85 But despite the heavy mention of the group as having “established itself as a player in American politics,” the authors fail to address the practical result of campaign finance laws that would limit bundling, and by extension, Emily’s List’s ability to help female candidates.86

Little question exists, given the nature of the fundraising by Emily’s List and other groups like the Republican counterpart, [*PG119]Women in the House and Senate (WISH) List, that banning bundling would handicap these groups.87 Some even have called the bundling loophole Emily’s List’s “life blood.”88 Without Emily’s List and similarly minded groups’ ability to generate funds, female candidates, who already struggle to raise enough campaign money, would be stripped of one of their few financial advantages and thereby would be placed in an even more unenviable position.89 Indeed, the 2000 election shows the continued strength of Emily’s List: The group doled out almost nine million dollars to female candidates.90

Proponents of a ban on bundling sometimes make the argument that because there have been numerous failed bids by female politicians to upset incumbents, bundling has not enabled women to rise above the bias in the system.91 This argument has obvious flaws; the number of women elected has risen since Emily’s List was founded, and the mere fact that the playing field for men and women is not equal in politics does not mean that this group’s ability to donate heavily has no effect.92 Although this money is not the ultimate panacea to cure the financial schism between male and female politicians, it has helped in slowly raising the number of women in elective [*PG120]office.93 Gail Collins, an editorial writer for the New York Times, weighed in on funding for female politicians, noting:

[C]ampaign finance reform keeps receding, and some contrarians say that Emily’s List is one of the reasons. That’s near-heresy: Emily’s List, a political action committee that “bundles” donations from backers interested in promoting Democratic women in politics, has done more than any group to put women’s campaigns on an equal financial level with men’s. Still, nearly any discussion of finance reform inevitably raises the question of what such reform would do to Emily.94

While Clift and Brazaitis address Emily’s List’s influence in elections, and the difficulty female candidates have in raising money, the authors fail to note that female candidates could have another serious setback should banning bundling become a reality.95

Conclusion

In their book Madam President: Shattering the Last Glass Ceiling, Eleanor Clift and Tom Brazaitis do an admirable job describing the pitfalls that line the road to political office for female candidates.96 While the authors address the challenges female politicians face when attempting to attract campaign donations, they do not touch upon campaign finance reform and the effects possible alterations in the law could have on aspiring female politicians.97 Banning soft money and closing the bundling loophole are proposals that have been and likely will continue to be presented as viable, meaningful campaign [*PG121]finance reforms.98 Furthermore, each of these reforms could have a serious impact on challenger candidates, particularly female candidates.99 As Gail Collins says, “The issues that women gravitate toward in politics—day care, education, child protection—do not attract a lot of big donors.”100 Given this reality, and the fact that any change in the current campaign finance laws could have a serious effect on female candidates, Clift and Brazaitis should have addressed this topic in a book that purports to probe all the reasons why women have a hard time rising through the political ranks.101

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* Staff Writer, Boston College Third World Law Journal (2000–2001). ?? ??