Campaign Finances and Corruption

In one of the great ironies of contemporary politics, Congress [last month] passed an economic "stimulus" package the day after the recession was declared to be over. Obviously, the legislators didn't really care about stimulating the economy, which had already stimulated itself. They were clearly interested in stimulating something else: stimulating the growth of government, stimulating pork-barrel spending in their districts, or stimulating their re-election campaigns. The same pattern applies to the approval this week of new campaign finance controls, supposedly designed to limit congressional "corruption"--yet passed in the total absence of any actual campaign finance scandal.

The idea of imposing state controls on private political activity--particularly this bill's worst feature, its ban on ads by independent advocacy groups--is impossible to justify under any circumstances. But if one were to try, the logical first step would be to find a few campaign finance scandals. The whole basis for the new law is the claim that wealthy special interests trade campaign donations for government favors. So where are the examples to demonstrate this claim?

The substitute for a real campaign finance scandal is the Enron case. Like the "stimulus" package, campaign finance controls had seemed to be dead; the legislation was quietly bogged down and buried in deliberations last year. Then the Enron scandal revived it, with apparently irresistible force.

But the Enron case is not a campaign finance scandal. Aside from a few loose allegations thrown around by newspaper editorialists, there has not been a single demonstration that any politician granted special favors to Enron, despite the fact that dozens of congressmen--including the ones we see on C-SPAN lecturing Enron executive with pursed-mouthed righteousness--accepted donations from the company.

There is no evidence that Enron was exempted from regulations or that legislation or government spending was approved on its behalf. Most glaringly, Enron's request for the ultimate special favor, a government bailout, was refused. Enron and its top executives may have lavished donations on the Bush campaign, but they clearly didn't get much in return. In short, there is nothing to suggest that the Enron story is about anything more than garden-variety business fraud, just on a larger scale.

Yet the scandal's most immediate, most visible result is the passage of campaign finance controls. It's as if the bill's boosters were looking for some scandal as an excuse to pass the thing, and they didn't really care what kind of scandal it was.

Some have suggested that politicians voted for this bill because it changes the system in ways that actually benefit incumbents. But I doubt that specific calculations of gain decided the issue. The changes to campaign finance law are too complex, too unpredictable, too open to reinterpretation by the courts and by regulators. It is impossible to know for sure how they might benefit one party or candidate.

The deepest motive is not practical, but moral, and it is revealed by a phrase advocates like John McCain use to justify campaign finance controls. These laws, they say, will eliminate, not corruption itself, but "the appearance of corruption." That phrase always caught my attention. Ask yourself: Why would congressmen be so obsessed about the appearance that they are corrupt?

The answer: these people throw around government favors all day long, and more than that, they think it's their job to throw around government favors. Most are committed to the idea that the government ought to determine, for example, whether telecommunications legislation should favors the Baby Bells or the cable companies, whether congressional hearings should favor Microsoft or its jealous rivals, whether trade laws should give preference to domestic steel producers or to companies that rely on cheap foreign steel, and so on. The politicians say they are doing all of this in the "public interest," but it is impossible to determine, by that nebulous non-standard, which legislation is motivated by high-minded idealism, which is motivated by populist vote-buying, and which is a quid-pro-quo for campaign donors.

The only truly "impartial" position on business issues would be to get government out of the way and let the market decide. But most congressmen prefer to maintain their power.

This--the politicians' arbitrary power over the economy--is the real scandal, and campaign finance laws are a way of diverting attention from it. They are a way for politicians to declare the purity of their intentions--while continuing to play "masters of the universe" with life-and-death power over private companies.

Robert Tracinski was a senior writer for the Ayn Rand Institute from 2000 to 2004. The Institute promotes the philosophy of Ayn Rand, author of Atlas Shrugged and The Fountainhead. Mr. Tracinski is editor and publisher of The Intellectual Activist and TIADaily, which offer daily news and analysis from a pro-reason, pro-individualist perspective. To receive a free 30-day trial of the TIA Daily and a FREE pdf issue of the Intellectual Activist please go to TIADaily.com and enter your email address.