Whatever else might be said about federal campaign finance regulation, it’s impossible to argue against the positive effects of the increased transparency resulting from disclosure of the names and amounts of donors and recipients. But two yawning loopholes remain in the rules governing contributions to incumbents and challengers. Recipients are only required to disclose donations of $200 or more, and money given to tax-exempt foundations established by former officeholders does not have to be disclosed.
Conventional political wisdom holds that the intensity of giving by small donors is a powerful indicator of public interest in campaigns and public policy issues — witness the success of direct-mail appeals that generated untold millions of checks written for $10, $25 or $50 during the 1970s. Those dollars fueled the growth of the conservative movement and helped put Ronald Reagan in the White House. Now, the small contributions are rolling in via the Internet in a flood of secret money totaling approximately a third of all donations. Sen. Barack Obama’s campaign for the Democratic presidential nomination has been especially adept on this front, receiving more than $31 million last year. It is illegal for foreigners to contribute to U.S. candidates, and individual U.S. citizens are limited to no more than $4,600 combined per candidate in the primary and general election. The $200 threshold for disclosure is an obvious invitation to abuse, either by unscrupulous corporate or labor union operators with cash to hand out or, as happened in President Clinton’s 1996 re-election campaign, foreign representatives doing the same thing. The solution is simple — all donors and amounts should be disclosed by recipients.
The same principle of complete transparency apply to entities like foundations established by former presidents. Jimmy Carter has accepted millions of dollars from Arab oil interests, though the total amount given to his Carter Center at Emory University has never been disclosed. Does it make a difference? Critics like Harvard’s Alan Dershowitz note that, despite its human rights focus, the Carter Center never criticizes abuses in places like Saudi Arabia or Egypt. Similarly, donors to Bill Clinton’s foundation can be anonymous even though it funds his presidential library. Thanks to The Washington Post, at least this much is known: The Saudi Royal family has given $10 million to Clinton and the same amount to former President George H.W. Bush’s library. Again, the solution is full disclosure of all donations to any entity in which a former president or other federal officeholder is an officer, adviser or consultant.
