`Soft money' overrated

January 28, 2002|By Steve Chapman

CHICAGO - The Enron fiasco encompasses any number of scandals - involving accounting, corporate governance, employee retirement plans and heaven knows what else to come. What it lacks so far is a juicy political scandal.

Over the years, Enron executives gave millions of dollars to candidates and parties, including President Bush.

But when the company found itself hurtling toward disaster, chairman Kenneth Lay learned firsthand the wisdom of Harry Truman's remark that if you want a friend in Washington, you should get a dog.

When his company needed help in a crisis, it reaped a handsome harvest of ingratitude.

You might think that the refusal of politicians to come to the aid of their benefactor proves that the campaign finance system is not as sordid and corrupt as reformers believe. But advocates of stricter regulations say the scandal is precisely that nothing happened.

"It's pretty clear that the reason the administration didn't act is that it was so deeply and widely enmeshed with Enron financially that anything it did would have looked like payback," writes Nicholas Lemann in The New Yorker. "The political system cannot deal cleanly with a company that makes such an enormous investment in a particular set of politicians."

If politicians who got Enron money had come to the rescue, that would have proved the need for campaign finance reform. But since politicians who got Enron money didn't come to the rescue, that also proves the need for campaign finance reform. You follow? Neither do I.

But proponents of change regard the Enron affair as a huge boost to their cause. House Democratic Leader Richard Gephardt vows, "We are going to clean up politics in this country once and for all."

Enron certainly tried to purchase allies in the halls of power. Over the last decade, its executives and political action committees made nearly $6 million in political contributions. Among the beneficiaries are 71 senators and 188 House members. Muckrakers point out Enron donated $114,000 to Mr. Bush's presidential campaign. The Bush connection, says a New York Times editorial, raises "the taint of influence-peddling."

How can anyone take that charge seriously? During his presidential campaign, Mr. Bush spent $193 million. In that sea of cash, Enron's donations were barely enough to earn Mr. Lay a presidential nickname ("Kenny Boy").

One of the most important favors the company got from Washington was an exemption from a 1940 law, allowing its foreign subsidiaries to conceal their debts. But despite all the money it had spread around Capitol Hill, Congress killed Enron's proposal when it revised the law in 1996.

This vapor of nothing presents problems for those who regard campaign fund-raising as a den of iniquity. But there has never been much evidence that corporations can assure special assistance by giving to candidates - or that donors in general have much influence on how the recipients vote.

Of course, the danger of quid pro quos is not entirely imaginary. But no one has explained how banning "soft money" contributions to political parties is supposed to prevent a lawmaker from casting votes to help those who have helped him. Mr. Lay, like other rich people, has a First Amendment right to promote his views. So if he can't give money directly to a party so that it can support candidates he likes, he can set up his own organization to run ads praising those candidates or attacking their opponents.

Such "independent expenditures" are fully protected as an exercise of free speech. And they create exactly the same risk as direct contributions. If Ken Lay can buy a politician by giving to his campaign fund, he can probably buy one by spending money in a way designed to help the politician's campaign. The legislation favored by Mr. Gephardt, contrary to his promise, won't cleanse money from the political system - it will only launder it.

In reality, the amount of authentic corruption is far less than the reformers claim. If Enron's bigwigs thought the campaign finance system was a giant bazaar of favors bought and favors sold, they know better now. When will the reformers figure it out?

Steve Chapman is a columnist for the Chicago Tribune, a Tribune Publishing company.

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