Mr. Speaker, pursuant to House Resolution 755, I call up the bill (H.R. 513) to amend the Federal Election Campaign Act of 1971 to clarify when organizations described in section 527 of the Internal…
Mr. Speaker, pursuant to House Resolution 755, I call up the bill (H.R. 513) to amend the Federal Election Campaign Act of 1971 to clarify when organizations described in section 527 of the Internal Revenue Code of 1986 must register as political committees, and for other purposes, and ask for its immediate consideration in the House.
Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise in support of H.R. 513, the 527 Reform Act of 2006. Today we have an opportunity to right one of the wrongs of the Bipartisan Campaign Reform Act of 2002. All my friends on the other side of the aisle who voted for BCRA because they believed we needed to get soft money out of politics must support this legislation today because it does indeed get the soft money out of politics.
Just a word of explanation. I have used the term ``BCRA.'' That is the acronym for Bipartisan Campaign Reform Act, which we worked on very, very hard a few years ago to get the soft money out of politics. What do we mean by soft money? That is money that is unregulated, both in quantity and disclosure to the Federal Election Commission.
While BCRA was supposed to curtail the influence of soft money in Federal elections, it did not achieve that goal. In the 2004 election cycle, the first conducted under the rules imposed by BCRA, over a half a billion dollars in soft money was spent to influence the outcome. Just four individuals alone spent over $73 million total.
While BCRA was supposed to reduce the influence of special interests, it actually empowered these ideologically driven outside groups. The power these outside groups gained came at the direct expense of political parties which saw many of the activities they had traditionally performed limited by BCRA, and thence taken over by these new organizations, the 527s. Again, let me explain, the term 527 refers to the section of IRS Code which governs their operation, and we simply use that designation for them.
We now have a system where soft money continues to thrive. Our political parties, especially those at the State and local level, are increasingly unable to carry out core functions such as voter registration activities. We now have a system where the influence of billionaires is greatly enhanced. In some cases, representatives of 527s have made boasts about taking over the party. For example, Eli Pariser of MoveOn.org sent an e-mail to supporters after the 2004 elections stating, ``Now it's our party. We bought it, we own it, and we're going to take it back.'' What more evidence do we need of the corruption that has appeared here? This does not represent progress. Today we have an opportunity to reverse this negative trend, and this bill will help restore some balance to our system.
H.R. 513 would require 527 groups spending money to influence Federal elections to register as Federal political committees and comply with Federal campaign finance laws, including limits on the contributions they receive. Thus, 527 groups would be subject to the same contribution limits and source restrictions that are applicable to Federal political action committees. There would be no more $23 million soft money contributions allowed from a lone, extremely wealthy donor. When this bill passes, individuals will be limited to $30,000. In other words, soft unregulated money will be replaced by hard regulated money which will be reported to the Federal Elections Commission.
Those 527s that engage exclusively in State or local elections or in ballot initiatives would not be restricted by this bill. However, if they decide to engage in Federal election activity such as making public communications that promote, support, attack, or oppose a Federal candidate during the year prior to a Federal election, or conduct voter drive activities in connection with an election in which a Federal candidate appears on the ballot, they will be restricted by this bill. In other words, State and local activities would be free to continue as they have in the past. Those dealing with Federal candidates or issues will be restricted by the bill, and will have to use hard money.
H.R. 513 would also impose new allocation rules on 527 groups regarding expenses for Federal and non-Federal activities. For instance, 100 percent of expenses for public communications or voter drive activities that refer only to a Federal campaign would have to be paid for with hard money. If both Federal and non-Federal candidates were mentioned, then at least 50 percent of such expenses would have to be paid for with hard money. In addition, under H.R. 513, at least 50 percent of a 527 group's administrative overhead expenses would have to be paid for with hard money.
This bill, H.R. 513 has been endorsed by the reform community and rightfully so. Common Cause, Democracy 21, the Campaign Legal Center, and other like-minded reform groups have sent several letters to House Members asking them to support H.R. 513. In a letter sent just this week, these groups argued that H.R. 513 is needed in order to ``close the loophole that allowed both Democrat and Republican 527 groups to spend hundreds of millions of dollars in unlimited soft money to influence the 2004 presidential and congressional elections.''
Mr. Speaker, I will be including a copy of the letter for the Record.
Mr. Speaker, I know many of my friends on the other side of the aisle are usually interested in what The New York Times has to say on these issues, so I would like to include some editorials from The Times as well; and an editorial from today's Washington Post also calls on the House to pass this bill.
Mr. Speaker, I will include these editorials in the Record.
Mr. Speaker, I expect many of my friends on the other side of the aisle would be arguing that BCRA should not be applied to 527s because they are independent organizations and have no connection to officeholders. The claim will be that we have already severed the link between large donors and Federal officeholders. This is nonsense; this is bunk. The 527s that have soaked up all the soft money were, in many cases, set up and staffed by former party operatives and congressional staffers. In some cases, Federal officeholders attend fundraising events for these 527s in an attempt to grant an official stamp of approval and signal to their donors where soft money donations should be steered. I do not intend to name names, but I will include in the Record a number of articles that describe how 527s have been set up by people who used to work for Federal officeholders or national parties.
The soft money shell game we spawned 4 years ago is clearly demonstrated in these articles. They demonstrate that these so-called ``independent'' 527s are, in many cases, independent in name only. In reality, they
have been set up by people who used to work for our parties. They left to organize 527s to escape the restrictions BCRA placed on the parties. Had their candidate for the presidency won, many of them would be working in the administration. Would not they feel indebted to the millionaire donors who helped put them in office? Is not that what BCRA was supposed to stop? Let us stop pretending that these 527s are anything other than campaign organizations established to influence our Federal elections.
This is not the first time Congress has dealt with the 527 issue. In fact, some time ago, 6 years ago to be exact, Roll Call reported on the debate that was going on at the time and included a quote from a powerful congressional leader of the time. In 2000, 527s did not have any disclosure requirements, and a bill was pending to require them to disclose their donors. At an event held to rally support for the bill, this leader was quoted as saying, ``Now more than ever, we need to assure the American people that we are not willing to let our system of government be put in jeopardy by wealthy special interests, unregulated foreign money, and, most importantly, a system of secrecy. It is time for disclosure.'' The leader who said these words was Minority Leader Richard Gephardt. We passed a disclosure bill then, but the problem of wealthy special interest money jeopardizing our system of government has only gotten worse in the ensuing 6 years, and I suspect the minority leader would say the same thing today.
Not extending the contributions restrictions in BCRA to all 527s was a terrible mistake that we are today seeking to rectify. Today we can restore some sanity to our system. The status quo allowing 527 groups to raise unlimited amounts of soft money while our parties continue to lose power and influence is unacceptable. It threatens the health of our democracy.
We must subject 527s to the same regulatory restrictions that are applicable to all other parties, candidates and committees. I urge my colleagues to support H.R. 513.
Mr. Speaker, I reserve the balance of my time.
Mr. Speaker, it is my pleasure to yield 4\1/2\ minutes to the gentleman from California (Mr. Doolittle).
Mr. Speaker, I am pleased to yield 2 minutes to the gentlewoman from Florida (Ms. Ginny Brown-Waite).
Mr. Speaker, I am pleased to yield 3\3/4\ minutes to my colleague from New York (Mr. Reynolds).
(Mr. REYNOLDS asked and was given permission to revise and extend his remarks.)
Mr. Speaker, I am pleased to yield 30 seconds to the gentleman from New York to respond.
Mr. Speaker, I yield 5\1/2\ minutes to the gentleman from Connecticut (Mr. Shays), the author of this legislation.
Mr. Speaker, I reserve the balance of my time to close.
Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from Massachusetts (Mr. Meehan), the other sponsor of the bill from the minority side.
Mr. Speaker, I yield myself the balance of my time to close.
I just have to say, I am a little disappointed in this debate. In fact, I am greatly disappointed in this debate. I am just a simple person who grew up in a small town, and I grew up in an area where we said what we meant, and we meant what we said.
I have heard so much diversionary discussion on this topic from the minority today, it is very disappointing to me.
The proposition of the bill is very simple: unlimited spending of soft money was intended to be banned under BCRA. A diversionary tactic has developed which allows the expenditures of huge amounts of money, unregulated soft money, and this bill today is an attempt to stop that practice which is being carried out by people who are violating the intent of a law we passed a few years ago. That plain and simple is the issue here.
I urge the body to adopt the bill and stop the abominable practice of huge amounts of unregulated, unreported money influencing elections. Let's get back to the original intent of BCRA and put it in place and enforce it.
Mr. Speaker, I include for the Record the material I previously referred to.
[From the New York Times, Dec. 29, 2004]
The Soft Money Boomerang
It's encouraging to see signs of life in Washington,
particularly on the Republican side of the aisle, over the
obvious need to plug the newest subterranean pipe for
unregulated campaign funds from big labor, big corporations
and just plain big money.
Of all the subplots in the presidential election, none were
as sorry as the Democrats' pioneering ``527'' groups--named
for the section of the tax code that governs them. The 527's
were intended to circumvent the law's strictures against
having unlimited soft money flood into political races. The
Democrats built these new shadow-party advocacy groups to
attack the president early in the campaign season and build
voter-turnout machines. Then they watched Bush partisans
adapt the same financing device to float the campaign's most
notorious and devastating attack ads, the Swift boat assaults
on John Kerry's heroic war record and his antiwar activities
after he returned from Vietnam.
Dollar-wise, the Democrats proved better at milking the 527
strategy, spending more than three times as much as the
Republicans in stealth-party ads favoring their presidential
ticket. But the Republicans wielded their ads like a rapier
once the Federal Election Commission, true to its track
record, shirked its responsibility by deciding that the new
breed of advocacy groups should not be controlled under the
campaign finance reform laws.
A commission majority endorsed the fiction that the 527's
are independent. The truth is that they were strategically
linked to the candidates and perfect targets for aggressive
F.E.C. regulation and spending limits. The 527 fund-raisers
were the V.I.P. toast of the party conventions last summer,
raising money in luxury suites with a wink and a grin.
After this year's election drubbings, you would think the
Democrats would now see the folly of the 527 committees. But,
no, ranking Democrats are determined to make them a permanent
campaign weapon, with no dollar caps on the corporations,
labor unions and fat-cat partisans who spent more than $550
million on such committees in this year's races.
President Bush condemned the 527's and promised a crackdown
when the Democrats first exploited them and caught the G.O.P.
short. But later in the campaign, he failed to condemn the
Swift boat ads when Senator John McCain did so and pointedly
asked for the president's support. Now Mr. Bush has another
chance to put his considerable political weight behind Mr.
McCain, who is determined to use the coming Congressional
session to pass legislation that would force this blowzy
lucre-genie back into the bottle.
Senator McCain overcame whatever past bad feeling there was
between himself and the president and became a dogged Bush
campaigner this year. We hope the president repays him by
explicitly backing the McCain fight to stop the 527
gamesmanship as an abuse of fair elections. And it's equally
important for the president to enlist in the senator's
campaign to overhaul the election commission. The F.E.C. is a
transparent extension of hack party politics, beholden to
members of Congress who are more concerned with their own
incumbency than the public interest.
Mr. Speaker, I yield back the balance of my time.