Federal Campaign Finance Reform: The Long and Winding Road.

On February 26, 2001, Senator John McCain (R-Ariz.) spoke at the University of Oklahoma to an enthusiastic crowd of fifteen hundred people from the university and surrounding communities. Oklahoma was one stop in a series of events throughout the country that the senator and his reform ally, Senator Russell Feingold (D-Wis.), were conducting to put pressure on their fellow senators to vote for campaign finance reform legislation. Given the current prospects for such legislation, McCain's stop in Oklahoma was perhaps a symbolic linkage between the beginning and the completion of a reform effort that began in the mid-1980s. He was invited to Oklahoma by the president of the university, David Boren. A former Democratic U.S. senator from Oklahoma, Boren was a key figure in starting the recent reform process.

This article traces the series of reform fights in Congress over the past fifteen years, as the problems in the campaign finance system altered and as a changing cast of members of Congress took up the torch of reform with proposals responding to the different problems. The article is intended to offer some perspective for those who first began paying attention to campaign finance reform during the 2000 presidential campaign, when McCain brought the issue to the nation's attention and made it a priority in the crowded agenda of the nation's capital.

Overview: Watergate and Beyond

In 1974, in the wake of the Watergate scandal, the landmark Federal Election Campaign Amendments (FECA) were enacted, setting contribution limits for all federal campaigns and establishing a system of public financing and spending limits for presidential campaigns. In 1976, Congress passed legislation making changes to the 1974 act in response to the Supreme Court's Buckley v. Valeo decision, which upheld FECA but struck down some of its provisions. In the late 1970s, efforts to pass public financing for congressional campaigns were turned back, and in 1979 Congress enacted some minor changes to FECA. It was not until 1985 that Common Cause and its reform allies in Congress were able to get Congress to vote on significant reform legislation.

From 1979 until 1985, there were no significant reform votes. This break was in some sense artificial; reformers did not totally retreat from their efforts. Rather, the early years of Ronald Reagan's presidency (he was elected in 1980) were not conducive to reform, and some of the groups pushing reform became engaged in other issues.

Changing Problems: PACs and Soft Money

During the period from the mid-1980s to the turn of the new century the landscape of the nation's campaign finance system changed profoundly These changes determined which reform proposals were brought before Congress. In general, reform advocates attempted to focus on the worst problems in the system at the time, but they were also influenced by their view of what could be passed in the Senate or House.

In the mid-1980s, the problem at the top of the agenda was the influence of political action committee (PAC) contributions, particularly their role in protecting incumbents in the House of Representatives. Under FECA, PACs may contribute up to $5,000 to a candidate in each election. Although a corporation, union, or other organization may establish a PAC and pay for its administrative expenses, all contributions made by the PAC must come from funds that are voluntarily contributed by employees of the corporation or members of the union.

The recent reform effort started during Reagan's presidency with a proposal of a fairly simple limit on the amount of PAC contributions that candidates could accept. Over the period from 1988 to 1994, when Democrats were in control of both houses of Congress, public financing measures were a key part of the reform agenda in Congress. Common Cause and other reform groups championed various forms of public financing: matching grants, communications vouchers, and free or reduced-cost TV time. The Republican takeover of Congress in 1994 effectively marginalized public financing as a near-term reform goal. It remains a key reform in many states and a long-term goal at the federal level.

More recently since 1995, McCain and Feingold in the Senate and Representatives Christopher Shays (R-Conn.) and Martin Meehan (D-Mass.) in the House have focused their efforts on the most egregious problem in the campaign finance system today: soft money. The term refers to unlimited donations from corporations, labor unions, and wealthy individuals to the political parties, which in turn funnel the money into federal campaigns. Much of this money would be illegal if given to candidates directly such as money from corporations and labor unions. Although a corporation or union may establish a PAC, it is prohibited from making donations directly from its treasury to a party's federal account and to a candidate.

The soft-money system had its origins in a 1978 Federal Election Commission ruling, but it was not until the 1988 campaign that soft money became a major factor in elections. Soft-money contributions went from an estimated $19 million in the 1980 election to $45 million in 1988 but then …