Chairmen join in call for reform of campaign funding Republican party chief denounces union spending


November 08, 1996|By LOS ANGELES TIMES

WASHINGTON -- The chairmen of the Republican and Democratic parties denounced the current campaign finance system yesterday, even as the Democratic National Committee said it was returning two more contributions from a foreign source.

Sen. Christopher J. Dodd of Connecticut, the Democrats' general chairman, described the current system as a "Wild West" of unfettered fund raising. He said Congress must address broader problems of "soft money" contributions by corporations and other special interests.

Republican Party Chairman Haley Barbour said he viewed the biggest problem as unlimited labor union spending financed by members' dues.

The two leaders, whose parties broke all records in raising special interest money this year, expressed their views during a meeting with the Los Angeles Times.

Their criticisms came as the Democratic National Committee said it had returned two contributions totaling $50,000 from a Greek company that had not generated the money from its U.S. operations.

The $50,000 came from Psaltis Corp., whose owner, George Psaltis, was represented by the Washington-based law firm of Hogan & Hartson.

"There was no reason to question the legality of the contribution," DNC spokeswoman Amy Weiss Tobe said.

But, she said, Hogan & Hartson "came back to us a few days ago and indicated that the contribution was inappropriate because the sole owner was a Greek national and the company did not have income from its U.S. operations at the time the contributions were made."

Federal campaign finance laws prohibit the acceptance of money from a foreign company if the company's U.S. operations did not earn at least the amount of the contribution.

To date, Democrats have refunded 11 soft-money donations totaling $772,000 in the weeks following disclosures of a series of illegal or suspect donations, most of them solicited by the vice chairman of the DNC finance committee, John Huang. The Federal Election Commission is investigating several six-figure donations Huang solicited that proved to be illegal or suspect.

Barbour said that whatever attempt is made at rewriting campaign finance laws would deal with the role unions play in contributing funds raised from union dues to political activities.

Dodd pointed out what he called an irony of the current campaign finance system: "We've spent more money than has ever been spent in political campaigns and had the lowest [voter] turnout since the 1920s."

Pub Date: 11/08/96

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