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Campaign Finance:
The Anonymous Donor Plan

By Fred Hiatt
Sunday, November 2, 1997; Page C07

A reader in Maryland, whose qualifications include the fact that he is not a politician, proposes an ingenious scheme to reduce corruption in the financing of campaigns. Instead of the usual call for more disclosure, Marc Geffroy, a Wharton business school graduate and commercial real estate executive, argues for less disclosure – for as close to none as possible, in fact.

Geffroy's model is the secret ballot, one of the essential ingredients of a working democracy. A politician can offer you 10 bucks for your vote, but if he can't be sure you're delivering on your end of the bargain, it's probably not a wise investment.

Why not, Geffroy asks, apply the same principle to money? Let the fat cats give as much as they want; if politicians don't know who's giving and how much, the trade in access, influence and political favors will similarly be disrupted.

As with many ingenious ideas, this one turns out to have more than one parent. Ian Ayres, a professor at Yale Law School, and Jeremy Bulow, a professor at Stanford University's business school, have written an article that will appear in the Stanford Law Review on "mandating donor anonymity to disrupt the market for political influence." Drawing the same analogy to the secret ballot – the voting booth – Ayres and Bulow call for a curtained "donation booth" – perhaps literal, more likely figurative – to shield politicians from any knowledge of who's giving to them.

Could it work? Obviously, you couldn't stop a contributor from whispering to his candidate that he'd sent $20,000 his way. But – and here's the beauty of the idea, if you set it up right – you couldn't stop lots of other people from whispering the same thing, whether they'd given or not. You would encourage so many people to lie, in other words, that senators wouldn't know whom to believe.

Contributors would send their checks to blind trusts that would be administered by a quasi-governmental institution set up for this purpose (as Geffroy proposes) or by big financial institutions like Citibank (as Ayres and Bulow suggest). The donations would be earmarked for a specific candidate, who would receive the bundled contributions biweekly or monthly; but the original donors' checks would have no candidate's name on them, so that a contributor couldn't wave a canceled check as proof of giving. What if a contributor sat down in the presence of a candidate to write out a $50,000 contribution? The candidate would be prohibited from accepting it directly, and Ayres and Bulow suggest giving every donor a 10-day grace period, a chance to pull the money back from the trust fund once the candidate had gone home, so that even then the candidate couldn't be sure who had given and who had not.

Those who defend the current system argue that donors aren't buying anything, but simply exercising their constitutional right to support the parties and candidates whose views they like. We know this is false in many cases; we know, because so many special interests give to both parties, to both candidates in the same race – if they're not buying access (or more), why would they bother? A system of anonymous giving would weed out those access-buyers – but it wouldn't in any way diminish the ability or motivation of those contributing for the reasons all now proclaim.

For Fred Wertheimer, the dean of Washington campaign reform advocates, the idea is intriguing but raises a big concern. No matter how carefully you construct the system, Wertheimer worries, people will find a way to cheat – to let candidates know how much they've given. And if that happened, you would have the worst of all possible worlds – no anonymity, no limits on giving and no disclosure.

That's dangerous, because disclosure right now is the last, thin defense against outright corruption. The Indian tribes who believe they lost an Interior Department decision because other Indian tribes gave more money to Clinton-Gore, for example, may never overturn that ruling – but at least they have the evidence to bring their case to a federal judge and to try to embarrass the officials involved (those, at least, who are still embarrassable).

What's frightening about the current situation, though, is how close we've already come to Wertheimer's worst of all possible worlds. Not only have both parties found ways to evade limits on what corporations or individuals can donate; they also have begun to find ways to avoid disclosure.

President Clinton and his Democratic Party hold a $50,000-a-couple fund-raiser at a Florida resort this weekend, but they won't say which donors are attending to rub shoulders with Clinton, Vice President Gore and other bigwigs. The party has a "moral responsibility to respect the privacy of its donors," its chairman says.

The party at least will have to eventually disclose its contributors (though not the Florida guest list). But even that level of disclosure can no longer be taken for granted. In the waning days of the 1996 campaign, righteous-sounding organizations like Citizens for Reform and Coalition for Our Children's Future poured millions of dollars into selected campaigns, running slashing attacks on Democratic candidates. Wealthy individuals, limited by law in their direct contributions to the Republican candidates who benefited, gave hundreds of thousands to these organizations – which promised never to disclose their names.

As things stand now, in other words, you have anonymity of a different kind. We can be pretty confident that today's politicians know full well whom they're beholden to. It's only the public that's getting shut out.

The writer is a member of the editorial page staff.

© Copyright 1997 The Washington Post Company

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