WASHINGTON - June 26 - The following is a statement by Democracy 21 President Fred Wertheimer on the Federal Election Commission:

Democracy 21 strongly endorses the legislation introduced in the Senate by Senators John McCain (R-AZ) and Russell Feingold (D-WI) and in the House by Representatives Christopher Shays (R- CT) and Marty Meehan (D-MA) to replace the Federal Election Commission (FEC) with a new agency to enforce the nation's campaign finance laws. The bill was introduced last Thursday.

A summary of the legislation and a summary of the principal differences between the proposed new agency and the FEC are set forth below.

The FEC is a failed agency.

It also is a captive agency.

Washington Post columnist David Broder has described the FEC as an agency "whose six members are famously responsive to the members of Congress who put them in their jobs."

The failure of the FEC to do its job is illustrated by the agency's central role in creating the soft money system, which turned into a $500 million national scandal ended by Congress in 2002 when it banned soft money; in issuing flawed regulations that opened new soft money loopholes in the 2002 law banning soft money, which were overturned by the courts; and in allowing 527 groups to become a vehicle for circumventing the soft money ban, an FEC decision which has been challenged by a court decision.

The Supreme Court in upholding the 2002 law banning soft money strongly admonished the FEC for having "subverted" and "invited widespread circumvention" of the 1974 campaign finance laws by creating the soft money system in the first place.

This did not stop the FEC, however, from repeating history by adopting a number of regulations that opened new soft money loopholes in the 2002 law banning soft money.

It took rulings by a federal district court judge and the D.C. Circuit Court of Appeals to overturn the numerous loophole- opening regulations issued by the FEC to implement the soft money ban.

Federal district court judge Kollar-Kotelly found, for example, in striking fifteen FEC soft money regulations as contrary to law, that one of the FEC regulations "runs completely afoul" of basic campaign finance law and "would create an immense loophole," that another "severely undermines FECA" and would "foster corruption," that another "would render the statute largely meaningless" and that yet another has "no rational basis."

Judge Kollar-Kotelly also rebuked the FEC for acting as a "super-legislature disregarding congressional intent."

The D.C. Circuit Court found that the Commission's regulations in one area "fly in the face of (Bipartisan Campaign Reform Act's (BCRA)) purpose because they reopen the very loophole the terms were designed to close," and called one of the FEC's regulations an "absurdity." The Circuit Court further stated, "Whereas BCRA aims to shut down the soft money system, the Commission's rules allow parties and politicians to perpetuate it ..."

The case against the FEC for failing to properly enforce the laws is overwhelming.

The need for a new enforcement body is equally clear.

The legislation introduced last week by Senators McCain and Feingold and by Representatives Shays and Meehan, and previously introduced in the last Congress, would establish a new, effective agency to enforce the nation's campaign finance laws.

The bill would create a new independent agency, the Federal Election Administration (FEA), to replace the FEC. The new enforcement agency would include a Chairman with strong powers and two other members appointed by the President and confirmed by the Senate. The Chairman would serve for 10 years and have broad powers to manage and administer the agency. The other two members would serve for six year terms. No two members of the new FEA could be from the same political party.

The FEC consists of six Commissioners, three from each political party. The position of FEC Chairman rotates on an annual basis among the Commissioners and does not have the authority to manage and administer the agency.

The new agency would use impartial administrative law judges to hear and decide campaign finance enforcement proceedings, an approach currently used by a number of other oversight and enforcement agencies to provide for independent, impartial decisions, but not used by the FEC.

The new agency would have real enforcement powers, including the power to find that violations of law have occurred, to directly impose civil penalties and to issue cease and desist orders. These are enforcement powers available to other federal agencies but not available to the FEC.

On May 15, 2002, Democracy 21 released NO BARK, NO BITE, NO POINT, a comprehensive 142-page report prepared by a blue ribbon task force that detailed the failures of the FEC and made recommendations for the creation of a new agency to enforce the nation's campaign finance laws.

The Democracy 21 task force report found that among the major reasons for the failure of the FEC are the ineffectual structure and cumbersome procedures of the Commission, the politicization of the appointment of commissioners, the lack of effective enforcement powers, the denial of adequate resources and congressional interference with the agency.

A summary of the legislation and a summary of the principal differences between the proposed new agency and the FEC are available at http://www.democracy21.org.

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