PETER MANIKAS: Research coordinator for the Better Government Association, he formerly served on the staff of a U.S. congressman in Washington, D.C.
WILLIAM L. HOOD, JR.: A graduate of Northwestern University School of Law, he was an attorney/investigator for the Better Government Association for six years and recently joined Continental Bank as a governmental relations attorney.
. . . disclosure requirements deter actual corruption and avoid the appearance of corruption by exposing large contributions and expenditures to the light of publicity. ... A public armed with information about a candidate's most generous supporters is better able to detect any post-election special favors that are given in return.'
ON JANUARY 30, 1976, the U.S.
Supreme Court upheld the disclosure
provisions of the Federal Election
Campaign Act. The court merely restated the wisdom of Justice Brandeis'
statement of 50 years before: "Sunlight
is said to be the best of disinfectants; lectric light the most efficient policemen." Unfortunately, the court's opinion is better history than prediction. Campaign ledgers are open to public
scrutiny but, in Illinois at least, the role
of money in politics remains unchanged.
Special interests and individuals who
have received government contracts and
jobs continue to inject a steady stream of
cash into the campaign coffers of both political parties.
In federal elections, campaign funds disclosure has been required since the first decade of this century (36 Stat. 822, 1910). However, Illinois did not have a disclosure law until September 3, 1974, when the Illinois 78th General Assembly embraced the philosophy that the sources of campaign funds should be revealed (P.A. 79-1183). The linchpin of the new law is the reporting requirement of Article 9. Statements are filed by a candidate or political committee with either the county clerk or the State Board of Elections itemizing contributions received and expenditures made in excess of $150. The reports must be made available for public inspection.
The legislation's underlying assumptions are clear: democracy will be cleansed if the amount and source of campaign contributions are known. Special or corrupt interests will be intimidated by the prospect of public visibility. In any case, informed voters will be able to contrast the financial support of political opponents and cast their ballots accordingly.
Recent reports detailing how campaigns for major public offices in Illinois have been funded challenge these assumptions. Through the maze of electoral politics, one central question has emerged: if our objective is to restore confidence in the political process, is disclosure enough? Because of the new law, we can now paint a fairly accurate portrait of who gives and who gets political money in Illinois. At both the state and local level contributors with a financial stake in government play a prominent role.
In Chicago, of course, old-style party politics dictate the pattern of political money-giving. Since the days of Mayor Anton Cermak the Democratic party's monopoly over patronage, pressure and the election machinery has guaranteed large political war chests. It should come as no surprise that a large portion of Mayor Richard J. Daley's financial support comes from those receiving favors from city hall. Public disclosure of the mayor's campaign receipts merely confirms what cynics, at least, long presumed to be an eternal verity of Chicago politics. Analyzing the mayor's campaign reports, Chicago Tribune reporter Chuck Neubauer found that government contractors, city employees and public officials who rely on the mayor's approval for slatemaking contributed one-half of the mayor's itemized campaign funds during the last mayoral election. Over one-quarter of approximately $600,000 itemized came from contractors and others doing business with the city (Chicago Tribune, March 30, 1975).
Leading the list of contributors are architects, engineers and law firms who receive non-bid contracts for city business. Bankers, many from banks receiving interest-free government deposits, contributed over $4,000 to a Cook County Democratic fundraising dinner in May 1975 (Chicago Tribune, August 28, 1975).
8 / September 1976 / Illinois Issues
At the state level the same basic pattern has emerged. Those with a financial stake in state government are also substantial investors in the political process. The Better Government Association (BGA) has detailed how State Fair contractors were solicited for contributions to the Governor's Illinois Democratic Fund (IDF) in 1974. In a sworn statement, the assistant State Fair manager reported that he had contacted contractors about making $1,000 donations. A Sangamon County grand jury found that the fair management had earlier awarded over $1 million worth of improperly bid contracts (Chicago Sun-Times, March 2, 1975).
Out-of-state contributors
Right or wrong, the public does seem
to suspect that political contributions
may lead to political favors. A nationwide survey by the Twentieth Century
Fund found that 35 per cent of those
interviewed believed that large political
contributions are solely motivated by
personal gain. Another 34 per cent
thought personal gain was one of several
reasons for large political gifts (Twentieth Century Fund Task Force on
Financing Congressional Campaigns,
Electing Congress, 1970). If public disclosure has not deterred the use of money from those who do
business with government, it might still
be claimed that at least now the public is
informed. Voters can decide which
candidates to support on the basis of
how and by whom a campaign has been
financed. Unfortunately, the available
evidence suggests that disclosure often
fails to achieve even this limited objective. The intense coverage of campaign
financing during the last presidential
election had little impact on voting
behavior. Two experts in the field,
David Adamany and George Agree,
concluded that although 62 per cent of
the people surveyed by the Twentieth
Century Fund heard or received something about campaign financing, "what
was heard, or at least remembered, was
so indefinite and unclear that it was
unlikely to prompt much attitude
change or electoral judgment" (Adamany and Agree, Political Money, Johns
Hopkins University Press, 1975, p. 107).
The local front
Moreover, despite the criticism directed toward Gov. Walker's fundraising practices, both of the present gubernatorial candidates, Republican
James R. Thompson and Democrat
Michael J. Hewlett, accept contributions from firms receiving government
contracts. Donors to the Hewlett
campaign include road builders, real
estate firms, bankers and attorneys, all
of whom receive business from some
governmental unit (Chicago Tribune,
March 14, 1976). Republican candidate
Thompson stated early in his campaign
that he too would accept contributions
from state contractors, including those doing non-bid business with the state.
The Republican candidate hastened to
add that, "there will be no question
about who owns Jim Thompson. Nobody does and nobody will" (Chicago
Sun-Times, August 22, 1975). Yet,
despite candidate Thompson's disclaimer, if both candidates' policy of
accepting funds from such sources is not
an anomaly, an important rationale for
the law is undermined. The voter may be
faced with the dilemma of choosing
between two candidates of whose
finances he disapproves.
Last August the BGA reported that
highway engineering consultants who
received $8 million in state contracts
each provided IDF with $1,000 contributions. Contractors from as far away
as Aurora, Ohio, and Bellevue, Washington, contributed to the governor's
campaign fund. These out-of-state
contributors received almost $2 million
of state business (Chicago Daily News,
August 14, 1975). The St. Louis Post-Dispatch and the BGA analyzed a series
of large contributions from the St. Louis
area reported by IDF in 1975 and found
that many of these contributors' firms
had contractual ties with the state (St.
Louis Post-Dispatch, April 6, 1975). In
response to these disclosures, Norton
Kay, the governor's press secretary,
said, "There is no law against donations
from people who do business with the
state" (St. Louis Post-Dispatch, August 14, 1975). Commenting earlier on
the acceptance of such contributions,
Kay said: "The important thing is that
the public knows about it. The public
has the ability to make a judgment of
whether there is anything going on"
(Chicago Tribune, March 3, 1975).
Disclosure did not fulfill its promise
of reform at the national level in a
contest literally overrun with issues of
political finance. What might be expected then in contests at the local level,
where the coverage of campaign financing is likely to be less complete? In its
December 1975 number, Illinois Issues
reported that 100 reporters, students
and other citizens had inspected about
2,000 reports filed pursuant to the new
state law. However, the quality and quantity of the information disseminated to the public is less easily determined. The finances surrounding Chicago's recent mayoral election and Gov.
Walker's fundraising effort have been
analyzed with some care, but financing
for lesser office seems to have escaped
attention altogether.
Few complaints
This experience with state enforcement is consistent with the history of
disclosure laws at the federal level. The
report of the Watergate Special Prosecution Force criticized the Justice
Department for having prosecuted only
one case, in 1934, under the federal
Corrupt Practices Act. No prosecutions
have ever been brought under the more
stringent statute prohibiting contributions from government contractors
(Watergate Special Prosecution Force
Report, October 1975). Prosecution of
Watergate-related offenses was vigorous, but recent events cast some doubt
on whether this momentum will be
maintained. For example, the head of
the Justice Department's Criminal
Division stated last November that he
would decline to prosecute certain cases
despite Federal Election Commission
policy to the contrary (New York Times,
November 7, 1975). Also, media treatment of campaign
financing has been and may continue to
be sparse. Ironically, the most widely
reported campaign disclosure story
The efficacy of disclosure is questionable on still other grounds. Effective
enforcement of the law is doubtful. The
State Board of Elections decided soon
after its creation that it would not initiate its own investigations. Instead, the
board only reacts to complaints filed by
citizens or groups who must themselves
monitor campaign practices. Furthermore, the few complaints brought
before the board have not elicited strict
application of the law. The statute is
construed in favor of the respondent,
since a criminal penalty might eventually be imposed if a violation is found.
Individual state's attorneys and the
Illinois attorney general have also failed
to bring any complaints before the board.
September 1976 / Illinois Issues / 9
Disclosure could alter the
outcome in a few elections.
The problem is that as a
remedy, it has been oversold
outlined attempts (albeit rather clumsy
ones) to comply with the new law.
Newspaper readers may remember that
Alan Dixon, state treasurer, bought
sheets and pillow cases and that Lt. Gov.
Neil Hartigan chose to pay the rent for
the swimming pool at his official
Springfield residence with political
rather than public funds. Both Dixon
and Hartigan were acting legally and
trying to avoid questionable use of
public money. Yet the criticism heaped
on them by political commentators and
opponents has caused many to wince
and doubt the wisdom of truthful
disclosure of contributions and expenditures.
Clearly disclosure does have its
virtues. For the few who are interested,
it will provide more information about
the political process. The possibility
exists that candidates might effectively
make an issue of their opponents'
campaign contributions and expenditures. All other things being equal,
disclosure could alter the outcome in a
few elections. The problem is that as a
remedy, disclosure has been oversold. If disclosure has not been an unmitigated success, what more is needed?
Most of the major provisions of the
federal Election Campaign Act have
been upheld. Nevertheless, serious
problems are raised when governmental
policies tend to limit campaign spending
and the voters' access to information
about candidates. Selective prohibitions
and limitations on campaign funding
have always been problematic. They
often restrict political participation
without achieving the desired reform.
For example, corporate and union
contributions are prohibited in federal
elections, but the law does not prevent
corporate or union officials from
forming voluntary associations to solicit
and dispense political funds. Of course,
all associational contributions could be banned, but this would likely be viewed
as an intolerable restriction on the
political process. A major issue in our present system of
campaign financing is the threat that
large contributions from wealthy donors will distort the political process.
Limitations on the amount of contributions are a direct way of dealing with the
problem but these limitations can also
be evaded. The Supreme Court's recent
ruling upheld limits on contributions to
an official campaign for elective office.
But the court also ruled that individuals
cannot be prevented from independently making expenditures (rather than
giving contributions), to promote a
candidacy. Consequently a supporter
can spend unlimited funds promoting a
candidate as long as the candidate
himself is not consulted on how the
money is spent.
A call for reform
The objective of reform should not be
to establish a ceiling on campaign
spending. Expenditure limitations favor
incumbents and the two existing political parties. Instead, what is needed is a
floor on the money available for political activity. Reform ought to ensure that
candidates who demonstrate a minimum level of popular support have
access to voters without necessarily
appealing to powerful organized interests. It now costs approximately $2
million to run for governor of Illinois. In the 1972 race Daniel Walker spent
$528,633 and Richard Ogilvie $702,293
on radio and television time alone
(Broadcast Spending, 31 Congressional
Quarterly Weekly Rep. 1134-37 [1973]).
In statewide elections a small subsidy
for media outlays might go a long way
toward encouraging additional credible
candidates to enter the political arena. Reformers might also profitably
focus on the procedures that allow
public officials such wide latitude in
directing the flow of government business. Unfettered discretion is, after all,
one incentive for government vendors to
contribute to officials' campaign funds.
For example, the mayor of Chicago
shifted over $2 million of government
business to his son's insurance firm not
long ago. In many instances, the power
to grant official favors is virtually
unchecked. The state's Purchasing Act
calls for competitive bidding as a basis
for awarding most contracts, but contains major exceptions. For example,
professional services are exempted from
bidding requirements. Architects, lawyers, insurance brokers and an ever-increasing supply of consultants may be
awarded lucrative contracts on a non-bid basis. Even when professional
review panels are created to review
awards, they are frequently composed
of persons with the most to gain from
public business. This unchecked power to confer
official benefits increases the possibility
of preferential treatment. Examining
how public officials exercise their power
and determining how that power can be
realistically confined lacks the appeal of
a crusade to reform our campaign laws.
But it might eventually turn out to be
one of the most effective ways to remedy
the abuses of big money in politics. The problem of special interest
money in political campaigns has been
with us a long time. What is startling is
not its intransigence, but that we
expected so much from the simple
mechanism of disclosure. Even when the
far more stringent federal requirements
failed to solve the problem, reformers
persisted in trumpeting the glories that
disclosure would bring. Campaign
finance disclosure certainly has merit.
Indeed, it is an essential component of
any attempt to end the abuses of money
in politics. In the long run it may
increase the demand for reform. But
alone it will not produce the results that
were claimed in its name.
These are serious problems that go to
the heart of campaign finance reform.
Their recognition, though, does not
mean that all reform will prove to be
ineffective. Ultimately, a system of some
type of public financing will probably be
required. However, to overcome many
of the criticisms of the present federal
law, the underlying assumptions of our
system of financing presidential elections must be reexamined.
10 / September 1976 / Illinois Issues