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Our Need for Campaign Finance Reform Seen in New Bankruptcy Bill
Published on Monday, March 19, 2001 in the Philadelphia Inquirer
Our Need for Campaign Finance Reform Seen in New Bankruptcy Bill
by David Gartner
At the very moment when the stock market has taken a nosedive and layoffs are mounting, Congress has just passed a bankruptcy bill that snatches the life preserver from many Americans drowning in debt. Bills like this one are prime examples of why campaign-finance reform is so urgently needed.

Despite mounting personal debt among Americans, the rate of bankruptcy has actually gone down for the last two years. Over the same time, credit-card profits have grown nearly 50 percent. Last year, the credit-card industry sent out a projected 3.3 billion mail offers, according to the Consumer Federation of America.

The bankruptcy bill makes it harder for families stuck in debt to qualify for a fresh start by filing under Chapter 7. Instead, more Americans will be subject to financial micromanagement by a trustee for the creditors. Since most of these repayment plans fail, these families could lose their homes or face collections for the rest of their lives.

It's fair to ask who was protected under the old system.

A study by Harvard law professor Elizabeth Warren reported that nearly half of those who filed for bankruptcy did so because they could not cope with medical bills or the financial consequences of injury or illness. In most cases, they had insurance, but it wouldn't cover the catastrophic costs.

It's even more important to ask why this bill was one of the first major pieces of legislation taken up by the Congress. After all, no candidate ran on this issue, and few Americans even know about the bill, which is similar to one President Bill Clinton vetoed last year.

One place to look for answers is campaign contributions.

Credit-card companies and banks together gave $37.7 million to candidates and parties in 2000, according to Public Campaign. The largest single contributor to President Bush - MBNA America Bank - happens to be the nation's leading credit card issuer. Bush has said he will sign the bankruptcy bill.

This issue is but one example of the explosion of money in our politics. Key to this problem is "soft" money: unregulated money given to political parties to avoid limits on direct contributions to candidates. In the last election cycle, soft-money contributions nearly doubled to more than $463 million. This week the Senate will debate the McCain-Feingold bill, which would ban soft money. It would also stop bogus "issue ads," which are really disguised contributions to candidates. For the first time, it appears to have a good chance to pass.

Opponents of the bill have two strategies. First, Republican Sen. Chuck Hagel of Nebraska has offered a sham alternative proposal. His bill would limit soft-money contributions only to national parties, allowing unlimited contributions to state parties. Hagel's bill would also triple the limit for direct contributions to candidates.

That is a bad idea when so few Americans can afford to give anywhere near the current limit. Under Hagel's bill, individuals could give a total of as much as $270,000 to national parties in one election cycle.

The second strategy of opponents is to pass a "poison-pill" amendment to McCain-Feingold to force its supporters to vote against it. The most likely amendment imposes new restrictions on unions but not on the corporations that outspend them 15-1 in political campaigns.

Clearly, the coming week presents a critical opportunity for campaign-finance reform. Stopping the flow of unregulated softmoney is a much-needed first step toward limiting the influence of big campaign contributions on lawmaking.

If you don't think we need reform in the way campaign contributions are regulated, consider the effect of bills like the new bankruptcy bill. Consider whom it serves and who pushed hardest for it.

When you follow the money trail, you find that money lines the path to success. Don't be surprised when bills that favor money have been fueled by money. And the one way to improve that process is to improve the oversight of campaign finance.

David Gartner ( is an attorney and a doctoral candidate in political science at M.I.T.


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