Last year, bipartisan forces in the House tried to stop political action committees from becoming the dominant source of campaign cash, partly out of fear that corporate PACs might come to control the electroal process. o
They passed a bill prohibiting a House candidate from accepting more than a total of $70,000 from all PACs in any election, and more than $6,000 from any single PAC in the primary and general election combined. Currently, there is no limit on how much a candidate can take from PACs, except that no candidate can take more than $10,000 from a single PAC for the primary and general elections combined.
The bill, sponsored by Reps. David R. Obey (D-Wis.) and Thomas F. Railsback (R-Ill.), did not directly affect the Senate. But it died under a filibuster threat made mainly by conservative Republicans. This served two immediate purposes: assuring an unrestricted flow of PAC dollars to GOP House candidates in the recent elections, and avoiding an awkward double standard for PAC financing -- new limits for the House, but not for the Senate.
But election-finance experts interviewed by The Washington Post say that those who blocked the bill also may have accomplished something for the longer run: assuring Republican candidtaes of enough cash in 1982 to give them a good chance of capturing the House from the Democrats, who are now down to a slight 26-vote majority.
"The entire focus of the Republican Party and corporate, trade-association and conservative PACs will be on winning the House," said Richard P. Conlon, executive director of an organization of liberal House Democrats called the Democratic Study Group (DSG). "We are handicapped by the twin problems of divisions in our own ranks and a shortage of money, while the Republicans are unified and have incredible money resources."
Herbert E. Alexander, director of the Citizens' Research Foundation in Los Angeles, also said the problem for the Democrats "is much greater than just their defeat in 1980.
"In the many years that they controlled the Congress and occasionally the White House, they never built stable financial constituencies apart from labor," he said. "And now there is a fusion of self-interest and ideology that is going to help the Republicans immeasurably and hurt the Democrats tremendously. I foresee great difficulty for the Democrats in getting money to save their seats in 1982 and 1984 and to beat the newly incumbent Republicans who will be reinforced by redistricting and reapportionment."
Still another critic, Common Cause Senior Vice President Fred Wertheimer, said, "The new Congress is coming to town on the greatest wave of PAC money you have ever seen."
He and others told a reporter they expect the incoming Congress to make only one significant change in the 1976 election law: raising the limits on contributions by individuals. These are $1,000 a candidate and $5,000 to a PAC in connection with a primary, runoff or general election, and in a calendar year a total contribution of $25,000, including up to $20,000 to a political party's national committee or House and Senate campaign committees. p
The cheif argument for lifting the ceilings is inflation. If campaign expenses for items such as advertising increased at the same rate as prices in general, what cost $100 in september 1976 cost about $145.40 in September 1980.
Alexander supports repeal of the $25,000-a-year limit and a $5,000 ceiling on an individual's contributions to a candidate -- a fivefold increase with the argument that such action would provide several benefits. He says one would be to enhance the importance of individuals in the electoral process by enabling them to give sums directly to candidates that they now can give only indirectly, that is, through PACs. He adds that another would be to give candidates more "seed money" early, when they need it to introduce themselves and their ideas to the voters. e
Another of Alexander's arguments involves so-called "independent expenditures," in which individual, group or PAC outlays on behalf of candidates are made withouth their knowledge or cooperation. Congressional Quarterly estimated these expenditures for the 1976 elections at $792,953, for the 1978 off-year races at $147,764, and -- for just the first 15 months of the 1979-80 cycle -- at $2,148,293.
Alexander contends that during presidential campaigns, his proposal "would put independent expenditures out of business and put control into the candidates' hands."
Independent expenditures in congressional races were a major factor this year and are likely to be a bigger one in the future. Between Jan. 1, 1979, and the end of October, for example, the top three conservative PACs alone spent a total of $9 million.
One indication that independent expenditures will have a more important role comes from one of the top-spending PACs, that of the American Medical Association.
In the 1980 elections, AMPAC experimented a second time with independent expenditures by spending a relatively small amount -- $190,373 (exclusive of $14,720 spent by the Texas Medical Association PAC for an unsuccessful Gop challenger) -- as compared with the $1,405,873 spent by the national unit on direct contributions.
AMPAC ran television commericals on behalf of one Democratic and six Republican House aspirants. The commercials were identical except the names of the candidates differed. Six of the seven candidates won. AMPAC also mass-mailed a glossy four-page brochure to help seven other Republican House candidtaes, and all won (the brochures, identical except for the name and picture of the pertinent candidate, stressed inflation and "Lower Taxes and Less Government," mentioning -- in small type -- the AMA and AMPAC only on the last page).
Independent expenditures "may be the most important area for us to follow," says AMPAC Chairman Michael P. Levis, a Pittsburgh surgeon.
The special appeal of independent expenditures is that under a 1976 Supreme Court ruling, in Buckley v. Valeo , Congress cannot constitutionally limit them even though it can limit contributions. The decision helped clear the way "for citizens to attempt to influence the electroal process while circumventing the contribution limits imposed by law," Joseph E. Cantor of the Congressional Research Service said bluntly in a report last September.
Some independent outlays are "negative," meaning that their purpose is to defeat a candidate. The National Rifle Association's NRA Political Victory Fund, for example, fired 205,905 negative dollars to help stop Sen Edward M. Kennedy's ultimately unsuccessful drive for the Democratic presidential nomination.
Federal Election Commission data show that while negative outlays constituted one-third of independent expenditures in 1977-78, they slightly exceeded positive expenditures in early stages of the 1979-80 cycle.
"The issue boils down to viewing the independent committees as 'exploiting loopholes that should be closed' or as 'a constitutional right to expenditures to express oneself,'" says the American Enterprise Institute's Michael Malbin. The court made its choice clear by ruling that an expenditure ceiling, which Congess had tried to impose in the 1976 election law, "precludes most associations from effectively amplifying the voice of their adherents, the orginal basis for the recognition of First Amendment protection of the freedom of association . . . "
A situation that Wertheimer of Common Cause calls the "two cultures" of campaign financing -- public for presidential elections, private for congressional elections -- is expected to coexist indefinitely, because public funding of congressional races failed in 1979, when peak bipartisan support gave it the best shot it ever has had, or probably will have for a long time to come.
A still-embittered House Democrat who helped lead the public financing effort blamed this loss not only on most Republicans, but also on members he called "safe-seat" Democrats -- incumbants who oppose public financing lest it become the tool with which chanllengers might useat them.
Led mainly by Reps. Dan Rostenkowski of Illinois, John P. Murtha of Pennsylvania and Mendel J. Davis of South Carolina, opponents of the bill got the votes to kill the measure in the House Administration Committee.
In the 1980 election, spending on House races soared, with one Republican incumbent, Rep. Robert K. Dornan (R-Calif.), spending nearly $1.5 million on his reelection campaign by Oct. 15. Conlon, of the Democratic Study Group, has estimated that by the time the final count is in, House and Senate candidates in the 1980 elections will have spent as much as $400 million, or more than double the $194.9 million spent in the 1977-78 cycle (Alexander, however, believes Conlon's estimate is high).
The DSG estimated on Sept. 30 that the final figure on PAC contributions to House and Senate candidates for the 24-month period ending next Dec. 31 would be on the order of $55 million to $60 million. This would be "a quantum leap . . . in the influence of special-interest groups in the legislative process," the Dsg said.
Alexander, while agreeing with the DSG estimate, says, however, that, "given the size and breadth of Reagan's victory, I think that money did not play a tremendous role in the election of the Senate and House. I'm not saying that there were great [presidential candidate] coattails, but that what happened in 1980 was a convergence of a number of factors that affected the outcome.
"PACs enabled challengers to campaign effectively," he continues. "A lot of challengers had a lot more money than they had in 1976 or 1978, and one of the reasons was that there was a convergence of Republican Party money with corporate and trade association PAC money with new-right ideological money."
Congressional concern about possible big business dominance of the electral process is shared in the executive suites of some of the largest corporations, including E.I. du Pont de Nemours. "My personal feeling is that the public has learned to tolerate labor's political action committees, but I'm not at all convinced it will tolerate the same thing from business," du Pont Chairman Irving S. Shapiro has said.
Congress first demonstrated its concern about this issue in 1907, when it passed the Corrupt practices Act to prohibit campaign contributions by corporations (and later unions) in connection with federal elections. Today, however, the law appears to be endangered by separate rulings by the Supreme Court and the FEC.
In First National Bank of Boston v. Bellotti , the court held 5 to 4 in 1978 that the First Amendment guarantees corporate managers the right to spend company money to circulate facts and opinions irrelevant to their businesses.
The case involved a state referendum, but Justice Byron R. White, in the principal dissent, said the decision "clearly raises great doubt" that a ban on corporate contributions -- whether imposed by the 1907 law or the states -- would survive a subsequent constitutional challenge. Indeed, a former FEC official said the decision removed the constitional barrier and meant that corporations -- like individuals -- can contribute directly to candidates' campaigns.
Wertheimer said that the court ultimately will be asked to extend "Bellotti , and that its ruling could become the "overriding issue" in election financing.
That possibility concerned Justice White. "The special status of corporation has placed them in a position to control vast amounts of economic power which may, if not regulated, dominate not only the economy but also the very heart of our democracy, the electoral process," he wrote. "Corporate expenditures designed to further political causes lack the connection which political self-expression which is one of the principal justifications for the constitutional protection of speech," he protested.
Earlier, the FEC ruled 4 to 2 that corporate managers could set up and operate PACs that solicit stockholders, directors, officers, and midlevel and professional employes. At the time, November 1975, there were 139 corporate PACs; in July 1980 there were 1,106. In contrast to this proliferation, the number of union PACs increased by a mere 29, to 226. While they gave $7.7 million to federal candidates in the 18- to 20-month period starting Jan. 1, 1979, corparoate PACs gave $11.8 million.
Steve T. Walker of the Public Affairs Council, the organization of corporate government-relations managers, says, "The companies that have an interest in establishing PACs have, for the most part, already done so." But others say that unlike union PACs, the potential growth in the number of corporate PACs is unlimited.