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Corporations and American Democracy

Read the Brennan Center’s op-ed on how the new campaign finance law will affect the public.

Published: April 2, 2002
April 2, 2002

Corporations and American Democracy McCain-Feingold Reinstates an Old but Necessary Principle: Restraint of Corporate Power
By E. Joshua Rosenkranz

Since President Bush signed the campaign finance bill into law, we’ve heard a lot from Sen. Mitch McConnell, R-Ky., and special-interest groups about how the new law will affect them. No one seems to be talking, though, about how the new law will affect the public.

It’s a critical question, because average citizens – the millions of Americans who go to the polls every other November – are the intended beneficiaries of this new campaign law. By protecting our elections from the distorting and corrupting influence of almost bottomless aggregations of wealth held by corporations, the new law makes our democracy more representative of the people.

If there is one lesson the last century has taught us about politics, it is that corporations, relentlessly driven to increase profits, will inevitably find a way to corrupt politics – unless we remain vigilant. Teddy Roosevelt knew it firsthand, which is why he railed against corporate influence in 1905, declaring, “There is no enemy of free government more dangerous and none so insidious as the corruption of the electorate.”

The nation’s very first campaign finance law, the Tillman Act of 1907, was a response to the public outcry over huge oil companies, steel manufacturers, banks, and railroads that pumped eye-popping sums of money into the political parties in return for political favors. So, too, was the Federal Corrupt Practices Act of 1925, which Congress passed in the wake of Teapot Dome, another campaign finance scandal in which the oil industry secretly paid huge sums of money to federal officials who doled out oil leases. And then, of course, there was the Federal Election Campaign Act of 1974, which was a direct response to the Watergate scandal, in which millions of dollars of illegal corporate contributions flowed into at least three secret slush funds.

We may be excused for forgetting the robber barons, Teapot Dome, and Watergate. But as we consider the cries of special-interest groups, let’s not forget this generation’s equivalent abuses that motivated the new round of reform: The sale of the Lincoln Bedroom and the Clinton coffee klatches. The Republican Team 100 and Regents, whose $100,000 and $250,000 gifts were rewarded with special access to party leaders and committee chairs and special legislative favors. Roger Tamraz, who, though widely condemned for paying $300,000 for special access to President Clinton, unabashedly quipped in his congressional testimony, “I think next time I’ll give $600,000.” The energy industry tycoons who wrote Dick Cheney’s energy policy behind closed doors. And so on.

Congress responded this generation, as it has in the past, for one simple reason: In our democracy, we elect people, not corporations, and, likewise, we choose to have people, not corporations, do the electing. This government of the people and by the people is a government more likely than any other to address the needs of the people. Left unchecked, money’s distorting influence on politics makes our government less democratic.

So, how will the new law affect ordinary citizens? People will know who is spending money to elect or defeat a candidate. They’ll be able to rest assured that people, not big companies, are doing that spending. To be sure, with the ban on soft money, you will have to stop sending checks in excess of $25,000 to your favorite political party – if you were in the habit of doing so. And beyond that, you can look forward to a continuation of the values that have guided our democracy since 1907, when Teddy Roosevelt pushed through the Tillman Act.

E. Joshua Rosenkranz is president of the Brennan Center for Justice at New York University School of Law.