In Democrats’ First Bill, There’s a Quiet Push to Make Public Campaign Finance a Reality

If voters this year made any of their demands heard, rooting corporate and PAC money out of politics was one.

House Minority Leader Nancy Pelosi, D-Calif., is joined by fellow Democrats at a news conference to discuss their priorities when they assume the majority in the 116th Congress in January, at the Capitol in Washington, Friday, Nov. 30, 2018. From left are, Rep.-elect Tom Malinowski, D-N.J., Rep.-elect Chris Pappas, D-N.H., Rep. Terri Sewell, D-Ala., Rep.-elect Ilhan Omar, D-Minn., Rep. John Sarbanes, D-Md., Rep.-elect Veronica Escobar, D-Texas, and Rep.-elect Mary Gay Scanlon, D-Pa. (AP Photo/J. Scott Applewhite)
House Minority Leader Nancy Pelosi, center, is joined by fellow Democrats at a news conference on Nov. 30, 2018. to discuss their priorities when they assume the majority in the 116th Congress, including HR 1. Photo: J. Scott Applewhite/AP

The first bill Democrats plan to move in January when they take control of the House will mark a major step forward on a longstanding progressive goal: public financing of congressional campaigns.

The provision is a largely overlooked part of a sweeping anti-corruption bill Democrats plan to start the year with and will be bestowed with the symbolic designation of HR1. The program, based on Maryland Rep. John Sarbanes’s “Government By the People Act of 2017,” would offer subsidies for individuals who want to make small contributions to political candidates. And eligible candidates would qualify for matching contributions that vary based on a candidate’s agreement to restrictions on how they finance their campaigns.

Combined with the broad surge of small-dollar contributions — Democrats alone raised more than $1 billion that way in 2018 — the public financing system would dramatically reshape the political economy of federal politics. Of course, it stands no chance of being passed by a Senate controlled by Mitch McConnell, a Republican from Kentucky, but it sets the stage for potential passage in 2021 if Democrats retake control of Congress and the White House.

HR 1, led in large part by Sarbanes, would revamp for the first time since the 1970s the Watergate-era model for public financing of presidential campaigns and establish a national pilot program to fund congressional campaigns. The measure intensifies pressure to stop rewarding candidates with the most money from large donors and corporate PACs, or outside dark-money groups propping them up, the status quo in a post-Citizens United electoral system. The idea driving HR 1 is to fight and end the dominance of big money in politics.

Successful candidates this year echoed calls to drain the swamp and dispense with corporate PAC funding, uniting people across ideology and mobilizing Americans in both the working and middle classes. Eighty-five out of 208 candidates who ran this year on pledges to disavow corporate or PAC money won their primaries, and 42 went on to win seats across both chambers.

Since then, Rep. Mark Pocan, D-Wisc., co-chair of the Congressional Progressive Caucus, has pledged to give up corporate PAC money. Rep. Raúl Grijalva, D-Ariz., a former co-chair, told The Intercept that he has decided to do the same.

Joining the no corporate PAC team doesn’t mean that a candidate won’t take any money from people who work for corporations, as many still receive individual donations directly from corporate executives and employees or indirectly through other PACs and dark-money groups that don’t have to disclose their donors.

Under the HR 1 plan, individuals who contribute to House campaigns would be eligible for a one-time federal tax credit on up to $50 of political giving. Those who make contributions of $300 or more to any candidate or committee, including PACs, would not be eligible for the credit. People in the states selected to pilot the voucher program would have the option to request a “My Voice Voucher” and allocate funds in increments of $5 to multiple candidates of their choice. Taking part in the voucher program also precludes eligibility for the tax credit.

Participating candidates are entitled to a 6 to 1 match of the amount they receive in small-dollar contributions. If candidates agree to further financial restrictions outlined in the bill — that would cap them at accepting a maximum contribution of $1,000 from any individual, and require at least $50,000 in total individual contributions — the match they’re entitled to increases by 50 percent.  

The goal of the restrictions and requirements is to minimize the possibility that a scammer could get access to matching public funds, as raising $50,000 in individual donations is a difficult feat that separates serious candidates from unserious ones. By capping contributions at $1,000, but matching $150 contributions at a 6 to 1 rate, the law incentivizes candidates to target regular people for smaller donations rather than rich people for big ones.

House Democrats will also pursue related legislation, including but not limited to HR 1, that would enforce higher standards of disclosure and transparency with an aim to reveal sources of dark money in campaign funding, push for enhanced disclosure for online ads, limit coordination between Super PACs and campaigns where current federal law has failed, and revamp the Federal Election Commission’s authority for oversight and enforcement action. A focus on reinstating voting rights, combatting partisan gerrymandering, addressing election security concerns, and revamping the Office of Government Ethics are all also part of the overall strategy to expand and restore the role of voters in the electoral process.

“At the polls earlier this month, the American people sent us a clear message,” Sarbanes said in an emailed statement to The Intercept. “They want to end the culture of corruption in Trump’s Washington, hold elected officials accountable and make government more responsive to the people. On the first day of the new Congress, Democrats will introduce a bold and sweeping democracy reform package that will … ensure that public servants behave in Washington and make it easier, not harder, to vote.”

“And it will be strongly backed by the new Democratic House majority — which is built on a diverse class of freshmen who are unified in their promise to restore our democracy — along with a new coalition of nearly 100 grassroots organizations that want to get this reform package over the finish line,” the statement read.

While it won’t be part of the first bill they plan to push in January, House Democrats are also eyeing a resolution to recommend overturning Citizens United. Conservative policy analysts say the 2010 ruling upholds the crucial democratic pillar of free speech by allowing corporations and unions to make independent political expenditures without restrictions. A 2015 Bloomberg poll shows an overwhelming 78 percent of respondents think it should be overturned.

Recent local and state iterations of public campaign finance programs in places like Baltimore, New York City, Seattle, Denver, and Washington, D.C. offer teachable lessons for legislators developing a national framework. “I think it’s not an accident that we’re suddenly kind of seeing so many localities pass these things. There’s a frustration and a feeling that people don’t have a voice, and they’re being ignored completely,” Larry Norden told The Intercept. He’s the deputy director of the Democracy Program at the Brennan Center for Justice, a nonpartisan, pro-campaign finance reform public policy institute at New York University Law School.

Proponents of local initiatives say shifting the bulk of campaign financing from the corporate to public sector encourages broader civic participation and helps people feel like they’re taking a meaningful part in the electoral process — and that the process itself is actually democratic. “Public financing programs, one of their big goals is increasing participation,” Aaron McKean at the Campaign Legal Center told The Intercept. A second goal is “changing how our public officials actually engage with voters or with their constituents,” he said.

Seattle used a $3 million tax on property owners to pilot a voucher program as part of a $4.2 million earmark for the 2019 city council race, where residents will get four vouchers totaling $100 that they can distribute in support of candidates of their choice. Choosing to participate in the program also limits a candidate’s funding pool to Seattle residents.

FILE - In this Nov. 12, 2015 file photo, Alan Durning, author of an initiative passed by Seattle voters that created the nation's first voucher system for campaign contributions, poses for a photo in his office in Seattle while holding an artist's depiction of a possible design for the vouchers. A lawsuit filed Wednesday, June 28, 2017, is challenging the voucher system for publicly financing political campaigns. (AP Photo/Ted S. Warren, File)

Alan Durning, author of an initiative passed by Seattle voters in 2015 that created the nation’s first voucher system for campaign contributions, poses with an artist’s depiction of a possible design for the vouchers on Nov. 12, 2015.

Photo: Ted S. Warren/AP

The Seattle model is designed to encourage and reward grassroots campaigns — only candidates who receive 150 individual contributions are eligible for funding via the public vouchers. But candidates can only exchange those vouchers for hard cash once they’ve received 400 individual contributions and gotten the same number of signatures verified.

The stance on big money has quickly become a litmus test among candidates, at least for Democrats. Before Election Day, 104 congressional candidates signed a letter refusing to take corporate money.

Support for the movement is more scarce among Republicans — Reps. Phil Roe of Tennessee and Francis Rooney of Florida are the only party incumbents who don’t take corporate or Super PAC money, according to End Citizens United, a political action committee focused on campaign finance reform. That excludes the contributions they receive from their official committees.

Fewer than a handful of Republican candidates in rare cases have parroted the anti-big money message to their advantage. Montana Rep. Greg Gianforte — who quickly began accepting PAC money after his election — ran his 2016 gubernatorial campaign on a pledge against it, echoing in his 2017 special election campaign calls to “drain the swamp.” Other Republicans have explicitly expressed that they believe voters don’t care if elected officials take corporate money.

Rep. Ro Khanna started the No PAC Caucus last summer. The Congressional Progressive Caucus announced in April that it would no longer accept corporate donations, but nearly all of its members, except Khanna, Pramila Jayapal, Tulsi Gabbard, and David Cicilline, still take corporate money. Reps.-elect Ilhan Omar, Rashida Tlaib, Alexandria Ocasio-Cortez, Jahana Hayes, and Ayanna Pressley have all also said they’ll reject corporate PAC money, joined now by Pocan and Grijalva.

Washington, D.C. Mayor Muriel Bowser in March reversed her previous opposition to the idea and signed a bill creating a public financing program for local campaigns in the district that’s expected go into effect for 2020. Like the Seattle program, it incentivizes small-dollar financing, but instead requires candidates to meet a threshold in order to qualify for a base grant to their campaign and to be eligible for a 5 to 1 match for individual contributions. Bowser in January criticized the bill for what she said was a diversion of tax dollars at a time when residents have more immediate concerns. The bill unanimously passed the D.C. council in February.

Opponents of a national public campaign finance system argue that individuals shouldn’t be forced to pay for the campaigns of politicians they don’t support. Or that people who don’t want to put their money into a failing political system should not have to. Local pilot programs have been criticized for not actually keeping money out of politics, and instead making it easier for financially and politically connected incumbents and otherwise already well-established figures to win re-election, crushing newcomers who don’t have as much financial support out of the gate. Some say that the idea creates unintended pressures that encourage fraud and misuse of public funds, instead of enhancing the overall integrity of the system.

“I think that you could say that, sort of the alternative to that does the same thing to a higher level though,” said Austin Graham at the Campaign Legal Center. In the current system, he said, “candidates relying on what we would call a privately financed campaign are going to have the same benefits in terms of established networks. And they can actually raise money to much larger amounts. Whereas with the voucher program, at least the program basically directs the focus of the candidates to their prospective constituents.” He had heard about confusion among candidates regarding qualification requirements for Seattle’s voucher program, but noted that the city council had since taken feedback and amended the program ordinance for the next cycle.


Democrats should also be wary, David Keating said, of creating a mechanism for public campaign finance that could be weaponized by one party against the other.  He is the president of the Institute for Free Speech, a conservative, pro-deregulation nonprofit, previously known as the Center for Competitive Politics. Ostensibly, Trump would be the one to appoint people to any committee tasked with auditing potentially corrupt campaigns, Keating explained. “Why would they want to trust someone like Trump to appoint a majority of the people who are on the enforcement commission to audit these campaigns? Basically you would have Trump allies who could go through and audit all the Democratic candidates across the country and make announcements during the campaign, that ‘Oh, look here. This is something that was not done right. We’re going to slap this candidate with a fine and announce he’s broken the law.’”

Democrats say they’re clear-eyed on the bill’s prospects in the Senate, where McConnell, the majority leader, has long been an outspoken opponent of efforts to reform the campaign finance system. The bill, then, is more of a nod to the burgeoning support for the movement against big money, and Sarbanes’s office hopes it will establish a party-wide standard that Democrats are taking seriously calls to fix a broken electoral system that rewards fundraising prowess over effective policy or messaging.

Both parties, however, tend to be good at passing legislation important to their respective bases when the opposition party is in the White House and it has little chance of passage. With George W. Bush in the White House, Democrats passed sweeping labor law reforms through the House. When a Democrat took the White House, that same Democratic caucus failed even to bring it to the floor for a vote. Tea party Republicans, with Obama in the White House, repealed Obamacare on what seemed like a weekly basis. Once they had a president willing to sign it, the votes to repeal evaporated.

Passing HR 1 will set a marker for progressives in 2019, but it’ll require continuous pressure to see it made into law.

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