CONTENTS

During the 2000 election cycle, the Republican Party raised $447 million in soft money, whereas the Democrats brought in just $270 million, according to the Federal Election Commission. Once the Bush-Cheney ticket rode into Washington D.C., they continued with fund-raising events.

For eight years, the GOP objected to the Clinton-Gore fund-raisers on government property. Then Cheney quickly changed his mind. On May 21, 2001, he raised about $100,000 at a reception held at his official residence that was attended by 400 top donors.

Cheney's reception, first reported in Newsweek, was for members of the RNC's two most elite donor clubs: the Regents, people and companies who give at least $250,000 per election -- and Team 100, for those giving at least $100,000 over four years. About 300 members of those clubs were invited along with about 100 other people, including top state and national Republican officials and supporters who helped organize the gala. The event at the Naval Observatory, the vice president's mansion, brought back memories involving the sale of the Lincoln Bedroom and the White House coffee klatches.

Incredibly, RNC press secretary Trent Duffy claimed, "This is absolutely not a fund-raiser. It's a reception at the vice president's house with supporters of the party who have given in the past, and other supporters of the party." Senate Majority Leader Lott amusingly defended the Cheney event by saying, "I'm sure it's being done in an appropriate way, or Dick Cheney wouldn't do it." Another GOP official claimed that there was "no link to future solicitation," which would distinguish the event from the Democratic coffees, which were followed by phone calls from party fund-raisers. (New York Times, May 22, 2001)

Campaign finance watchdog groups and Democrats criticized the use of the government property, saying it was no different from President Clinton's use of the White House or the use of the vice presidential home for events during the 1996 presidential campaign. Jeff Cronin, spokesman for the watchdog group Common Cause, said, "The tactics are reminiscent of the Clinton era coffees, but so are the excuses." (Washington Post, May 22, 2001)

The Senate Republicans' campaign committee kicked off its springtime fund-raising with a shipboard dinner followed by a two-hour Potomac River cruise aboard the Odyssey for lifetime members of the committee's Inner Circle. Individuals paid $10,000, while couples forked over $15,000. The dinner address was given by Commerce Secretary Donald Evans after other Cabinet members reported schedule conflicts.

The next evening, a black-tie dinner for the Republican National Committee marked Bush's debut as a major fund-raiser as well. The RNC netted $23.9 million at Washington's National Guard Armory. Which was attended by 2,000 GOP donors at ticket prices ranging from $1,500 per person to $20,000 for a corporate table. The largest corporate contributors included AT&T, Bristol-Myers Squibb, and Philip Morris which handed over $19.7 million during the last election cycle.

In the 2000 campaign, a record $3 billion was spent on presidential and congressional campaigns, according to Common Cause. About $483 million of that was in "soft money," although the ads purchased with soft money often benefit candidates by linking them to particular issues. Corporations and trade unions were the chief sources of soft money, with Republicans being the largest beneficiaries. But in 2000, Democrats collected 48 percent of all soft-money donations. $2.2 billion was spent on the 1996 campaign and approximately $600 million in 1992.

THE SENATE PASSES McCAIN FEINGOLD. Throughout Campaign 2000, Senator John McCain appeared to be more of a progressive than a Republican. He consistently campaigned for the McCain-Feingold bill -- to eliminate soft money -- something that Bush would never oppose since the GOP were reliant on that money during election season.

After Bush moved to 1600 Pennsylvania Avenue, McCain still pledged an all-out battle to force the Senate to consider an overhaul of the campaign finance law. With some of the same fire that had characterized his bid for the presidency, McCain said, according to the New York Times(January 5, 2001), that he would not bow to Republican leaders who want to put the debate off until later in the year behind some of the key elements of Bush's own legislative agenda. "I promised millions of Americans when I ran for president of the United States that I would not give up on this crusade of reform," McCain said. "The gateway to which is campaign finance reform."

McCain's lead was supported by Democratic co-sponsor, Senator Russell Feingold of Wisconsin, and GOP Mississippi Senator Thad Cochran joined the bandwagon. Cochran's support for reform was a political embarrassment to Senator Trent Lott, the majority leader, also from Mississippi, who had signaled that he wants the legislation put off until later in the year after consultations with the new president.

Bush and McCain met on January 24 to discuss changes in how political campaigns were financed. Just as he had done throughout Campaign 2000, the Arizona senator pressed the new president for quick action on campaign finance reform. McCain and his allies believed that the 2000 election cycle, which saw both the Republican and Democratic parties shatter all records for raising money, had given new impetus to their reform effort. The meeting did not reconcile any of the key disputes between Bush and the reform effort, but McCain sought to stress the positive. McCain said, according to the New York Times (January 25, 2001), "I come away with the distinct impression that he's favorably disposed toward continued discussions on this issue and seeing if we can't work out something with the belief that both of us hold that this system needs to be fixed."

The McCain-Feingold bill allowed individual contributions to state parties to double, to $10,000, while the overall amount that individuals could give to federal races each election cycle would rise to $30,000 from $25,000. Big donors would be more speedily identified and the hypocrisy of pretending that issue advocacy ads financed by soft money have nothing to do with individual races would be exposed.

Several issues made up the centerpiece of McCain-Feingold. First, soft money would be banned. Second, there would be a ban on corporate and union spending on advertisements within the final 60 days of a campaign that purport to focus on issues but mention a federal candidate by name. Third, the bill would strengthen a ban on foreign nationals from making any sort of political donations and would bar candidates from using funds for personal benefit or raising money on federal property. Fourth, the yearly limit on the amount individuals may contribute in federal elections would be raised to $30,000 per year from $25,000.

With pressure to address the issue, Senate Majority Leader Trott finally agreed to consider an overhaul of the campaign finance law in March and said he would discourage efforts to kill the legislation through prolonged debate. He said that the timing would give McCain the early debate he sought for his signature issue but would also give the Senate time over the two months to vote first on Bush's education proposals and, possibly, an outline for a federal budget and tax cut. This was a reversal from Lott's previous strategy, because earlier he had used parliamentary tricks and filibusters to stop the bill from ever coming to a final vote.

The Bush administration, along with the leadership in Congress, supported Nebraska Senator Charles Hagel's proposal which would have tempered McCain-Feingold. Hagel proposed limiting soft money contributions to $60,000 per individual or group over a two-year election cycle. But in the end, the Senate soundly defeated Hagel's bill, and McCain-Feingold passed easily by 65- 35.

THE HOUSE TORPEDOES THE REFORM BILL. When campaign finance reform reached the House in July, it had two bills to debate. The White House supported the bill sponsored by House Administration Committee Chairman Bob Ney. Under its provisions, a single individual would be allowed to contribute $1,335,000 in hard and soft money in a two-year election cycle. The Ney bill included huge increases in the hard money limits. It allowed one individual to give up to $435,000 in hard money in a two-year election cycle. And a married couple could give $870,000 in hard money in a single cycle.

The Ney bill did not ban soft money at the federal level. Like the bill proposed by Hagel, the Ney bill had no caps on soft money. It proposed to limit, rather than ban, soft money by permitting any corporation, labor union, or individual to give $150,000 in soft money to each national party committee per two-year election cycle.

Since each of the six national party committees (the DNC and RNC, the two Senate campaign committees, and the two House campaign committees) could accept this money, this would allow a single donor -- including a corporate or union donor -- to give up to $900,000 in soft money per cycle. Adding together the hard and soft money permitted by the Ney bill, a single individual donor could give $1,335,000 in a single two-year cycle.

The Ney bill did not address several issues. First, it did not ban soft money at the state level. So the "cap" on soft money had no real effect, since donors could give unlimited soft money donations to state party committees. These state organizations could then use this money to influence federal elections by, for instance, running campaign ads that mention federal candidates. Second, the bill did nothing to stop federal officeholders and candidates from continuing to raise unlimited soft money. Third, it did nothing to stop the current practice of having federal officials solicit unregulated and unlimited soft money donations in exchange for access and influence. It left the current influence-peddling soft money system in place. Fourth, it did nothing about the problem of campaign ads masquerading as issue ads. It did not restrict corporations and labor unions from funding these sham ads. And it did not even require groups running these sham ads to disclose the real source of the money behind the ads. (Common Cause, July 2001)

The second House bill, authored by Christopher Shays and Martin Meehan, outlawed all soft money. Political parties could not raise and spend money on behalf of candidates. In the past, the House twice passed similar Shays-Meehan bills by large bipartisan margins over Republican leadership objections. However, those were free votes, in that it was understood the bills had no chance of enactment. But the ground rules changed after the Senate passed the McCain-Feingold bill. (Washington Post, July 9, 2001)

House Republicans were able to torpedo the Shays-Meehan bill when Speaker Dennis Hastert injected obstructionist rules for debate to kill campaign finance reform. Unable to get his way on the parliamentary ground rules for considering the Shays-Meehan bill, he simply abandoned his promise of a fair vote and took it from the floor.

Hastert apparently feared that he did not have the votes to defeat the bill. So on the eve of the expected vote, he employed an unfair rule for debating and voting on the measure. The rule would have required that 14 different amendments carefully designed by supporters to improve the bill and secure votes be voted on one by one and not as a package. Since each amendment affected a different part of the bill and a different group of House members, the effect was to make it impossible for the measure to pass. The speaker allowed a single "yes" or "no" vote for all the amendments, only if his GOP colleagues would be permitted to offer their own amendment to the bill. The catch was that the amendment could come up any time, with no advance warning and no requirement that it be pertinent to the legislation. (New York Times, July 13, 2001)

Rarely to members of the majority party defy his or her party's leadership on a parliamentary issue. Yet Representative Christopher Shays and 18 other Republicans crossed over to vote with Democrats in an effort to reject Hastert's unilateral move.