Take the money and run

Take the money and run – Republican Party-dominated Congress attacks Federal Election Commission

Vicki Kemper

Angered by new regulations that restrict the use of campaign funds, members of Congress have gone after the nation’s elections watchdog.

Although they’re in the business of policing electoral campaigns, employees of the Federal, Election Commission (FEC) don’t concern themselves officially with who wins elections. Their job, simply stated but none too simple, is to ensure that all money that goes into and comes out of campaign war chests is legal and accounted for and, ultimately, that the nation will never again be rocked by a Watergate-scale political scandal financed by secret slush funds.

Last year the overworked and much maligned watchdog agency collected a record $1.7 million in civil penalties for illegal campaign financing activities; processed and disclosed record volumes of data on some 2,350 congressional campaigns; ruled that House Speaker Newt Gingrich’s secretive political action committee, GOPAC, had violated campaign laws and then sued the PAC when it refused to pay a $150,000 fine; and finally developed and issued regulations that implement the 1979 law barring federal candidates from converting campaign funds to personal use.

But the 1994 election results threaten to weaken the agency for years to come. While the Republicans who won both the elections and control of the House boast of the accomplishments of their first 100 days, it took them just over a month to quietly approve a series of actions that could cripple the FEC – and undermine the integrity of the nation s electoral system – even as it moves into what will surely be the busiest federal election cycle in history.

From late February, to early April, some of the agency’s strongest critics, now in powerful House positions, hit the FEC with a triple whammy: First, the House Appropriations Committee voted to strip the FEC of almost $2.8 million, roughly 20 percent of what’s left of its budget for the current fiscal year. (In mid-May a House-Senate conference committee cut the rescission in half, but in June President Clinton vetoed the entire spending-cuts package.)

Then, with the agency still reeling from the impact of that cut, the House Oversight Committee rejected the FEC’s budget request for the 1996 fiscal year, authorizing $27.6 million – barely half a million dollars more than its 1995 pre-rescission budget and almost $4.2 million less than the agency said it needed.

All this while there’s been an explosion in campaigns for Congress and the presidency. Since 1990 the number of federal candidates has increased 34 percent; the amount of campaign money raised and spent is up 54 percent; the number of campaign-related complaints filed with the FEC has increased 45 percent; and the number of information requests is up 17 percent.

Few believe the budget cuts are unrelated to recent FEC enforcement actions, although it probably was just a coincidence that the Oversight Committee acted precisely one day before the most-hated regulations ever promulgated by the FEC – rules that bar candidates from using campaign funds for vacations, cars, meals and other personal expenses – took effect on April 5. And it wouldn’t be the first time Congress has penalized the agency for doing its job; after random FEC audits of 1976 House campaigns revealed that one-third of House members whose reelection campaigns were reviewed had received illegal contributions, Congress prohibited the agency from conducting random audits.

But while that restriction (which still stands) targeted a specific enforcement tool of the FEC, the House’s recent budget-cutting actions appear designed to undercut all the agency’s policing powers and capabilities. Republicans want the agency to spend a greater proportion of its smaller budget on computer upgrades, electronic filing and other disclosure functions – leaving less money and personnel for the actual enforcement of campaign laws. This same Congress that calls for tougher anti-crime measures is working to disempower the agency charged with policing its own campaign activities.

And while House Republicans try to defend cuts in the FEC budget as nothing more than other government agencies and programs are experiencing in the current anti-spending climate, they’re even harder pressed to disavow the political and retaliatory overtones of their third, icing-on-the-cake anti-FEC action: a closed-book, “adversary” probe of the agency’s operations by the House Appropriations Committee’s own investigative staff.

The FEC has never lacked for congressional critics, but the leading force behind this crash of legislative action against the agency is House Appropriations Chair Bob Livingston (R-La.), an agency opponent who now controls its purse strings. Livingston, who adamantly opposes the personal use rules, tried to slash the FEC’s budget last year – precisely so it wouldn’t have the funds to regulate and enforce campaign spending.

“While the FEC complains about not having the resources to handle its workload,” he said at the time, “it has continued to promulgate such new regulations on how federal candidates can spend campaign funds.” Never mind that the regulations merely are designed to enforce a law passed by Congress – 16 years earlier. Livingston, now serving his 10th term in Congress, later referred to the agency as “a burdensome bureaucracy which makes running for office … a complex and even dangerous endeavor,” and charged that it “may be making criminals out of honest folk.”

Livingston’s budget cuts are, in fact, designed to impede the FEC’s regulatory and enforcement activity. In a classic example of legislative action that puts politics above common sense, Livingston has criticized the agency’s computer system and ordered the FEC to spend more money upgrading it – even as he gives the agency less money overall. As FEC Vice Chair Lee Ann Elliott explained to the Oversight Committee, because the commission is scrambling to deal with the proposed cut to this year’s budget, “Computer expansion has been put on hold, [and] we literally have wires hanging from the ceiling … waiting to be connected to personal computers.”

In addition, while Livingston and Oversight Committee Chair Bill Thomas (R-Calif.) complain that the FEC takes too long to respond to complaints and to investigate and punish campaign law violators, their reduced budgets for the agency – combined with a mandate for more money for computers – guarantee that the FEC will have fewer resources to devote to enforcement activities. And the Appropriations Committee’s investigation of the FEC – which, unlike inquiries conducted by the General Accounting Office (GAO), offers the agency no opportunity for input or recourse – seems directed at finding mismanagement and inefficiency at the agency and thereby justifying greater congressional control.

“This is an adversary process,” says Bill Vandergrift, chief of the committee’s surveys and investigations staff.

FEC officials, agency watchers and even some congressmembers say on background they believe the budget cuts and, in particular, the investigation are consequences of Livingston’s “personal vendetta” against the agency – and his increased power. In fact, Livingston’s statements about the agency have changed markedly since the FEC announced it would be formulating rules spelling out exactly what types of expenditures constitute the “personal use” prohibited by law.

In a March 1993 meeting of the House elections subcommittee, Livingston said he was “very, very concerned that we are piling task upon task on [the FEC] and not giving them the resources for them to do the job for which they were intended.” He also expressed support for the agency’s enforcement role. “It would seem that if we are serious about enforcing the federal election laws, we ought to have a commission with the teeth to perform that enforcement,” he said. “And if they have neither the resources nor the process available to them to carry out their tasks, then the entire election laws of this country become a farce.”

But then the FEC set about to enforce one of those laws – and Livingston began to change his tune. Campaign spending records showed that candidates – including many members of Congress – were letting their campaigns pay for everything from salaries, new wardrobes and country club dues to their daily expenses and family members’ hotel rooms. In the name of “campaigning,” many congressmembers were using their campaign funds to finance lavish personal lifestyles.

Speaking at a symposium on the FEC in October 1993, Livingston defended the agency’s increased budget request but criticized its “proposed microscopic rules on the use of campaign funds.” Citing the concern of “every congressman and senator,” he said, “We don’t think that the FEC should be micro-managing our campaigns.”

By the time the House elections committee held its heating on the FEC budget request last year, the FEC had held a public heating on personal use rules and clearly was continuing to develop them. Livingston made a direct connection between the two issues.

No wonder the agency wanted more money, he inferred, when “it would appear that the FEC is actively searching for more things to go out and regulate.” Later in the hearing Livingston suggested that the FEC disclose campaign spending records and “let the voting electorate determine whether or not that was wise or just or proper.”

Finally, last June – a month after then-Minority Whip Newt Gingrich (R-Ga.) called the FEC lawsuit to force GOPAC to disclose its financial reports “an outrageous power grab” – Livingston lowered the boom on the agency. After repeatedly defending FEC requests for more funds, Livingston appeared on the House floor to slash $3.5 million from its committee-approved budget. His amendment passed with the support of 59 Democrats and all but four Republicans, leading then-FEC Chair Trevor Potter to remark, “We are being penalized for proceeding on personal use regulations.” (The funds were restored in House-Senate conference.)

Despite this record, Livingston spokesperson Quin Hillyer says any charge that Livingston is acting out a “personal vendetta is BS…. Why would he have a vendetta against the FEC? He’s sick and tired of them coming back for more and more money and not doing anything with it….

“We expect them not to ask for any more money until they put the money to good use instead of into a bureaucratic black hole,” Hillyer says. “We don’t want them hiring more people to sit around and twiddle their thumbs. There is no reason they can’t get the job done,” he adds, “if they are organized and efficient. We will give them money for computers and not for personnel.”

Hillyer insists the investigation also “has nothing to do with [Livingston’s disdain for the new] personal use rules.” However, he adds, “They don’t make law; we do.”

But Elizabeth Hedlund, project director for FEC Watch at the Center for Responsive Politics, believes the investigation is “largely political,” inspired by congress-members’ anger over new FEC regulations that purport to tell them how they can and cannot spend their campaign money. Interviewed recently by three Appropriations Committee investigators, Hedlund says she told them she “didn’t think they’d be here if it weren’t for the personal use rules.”

Hedlund concedes the FEC has its share of problems, but says “none of them has ever been an overabundance of resources or wasting money.” The disclosure vs. enforcement debate is bogus, she says, pointing to Congress’s conflicting directions to the agency. When Congress complained that the FEC was too slow in rendering decisions on campaign violations (taking as long as six years in one high-visibility case) and spent too much time on frivolous cases, for example, the agency responded by dropping 137 cases to erase a backlog and then developing a priority system that gives more weight to allegations of serious offenses.

Now House members complain about labor-intensive enforcement efforts and say the FEC should instead spend more money on computerization to streamline disclosure activities. But they give the agency less money to do it. “It’s nothing but a set-up,” Hedlund says. The budget cuts are designed “to limit [the FEC’s] ability to oversee congressional campaigns,” she adds. “It’s a punishment.”

An aide to the Appropriations subcommittee with jurisdiction over the FEC rejects allegations that the investigation is politically motivated. “This did not come from the top down; it came from the bottom up” as part of the subcommittee staff’s standard work, he says. “There is no partisan witch hunt here,” he adds, noting that in addition to Livingston and subcommittee chair Jim Lightfoot (R-Iowa), ranking members David Obey (D-Wis.) and Steny Hoyer (D-Md.) “signed off on it.”

But agency officials smell nothing but trouble. “If the Congress wants to look at any of our activities, they are more than welcome,” says FEC Chair Danny McDonald, noting that “as a disclosure agency we don’t have much ground to refuse to disclose our activities.” But “obviously it’s a very peculiar situation,” he adds. “The people investigating are from the very body that we regulate.”

Whatever the intent, the chilling impact of the investigation is clear. As many as six investigators at a time roam the FEC offices and interview personnel – requiring the assistance of what McDonald estimates is three full-time employees a day. Agency staffers feel harassed, “petrified and outraged,” sources say. Their lack of confidence in the process has been amplified by the realization that the investigators are unfamiliar with the agency, its process, and the laws it’s charged with enforcing. “We have to keep bringing them up to our level of knowledge,” says the agency manager.

McDonald says he’s also concerned about the process, that the agency “will never have the opportunity to see, [or] respond [or] evaluate” the investigators’ report, expected in June. Despite these ground rules, McDonald says he will ask Livingston to let agency officials see the report before it’s made public.

“This is a private plumbers’ unit doing work that the GAO should be doing out in the open,” says one FEC source. “It’s an abuse of power and a clear conflict of interest. We regulate the members who have sicced these guys on us.”

Meanwhile, if Republican House members have their way and their investigation and budget cuts have their likely effects, the policing of federal elections – and their reelection campaigns – will be greatly hampered. Voters can expect the FEC’s productivity to dip – and undetected campaign law violations to rise – just as the country heads into a presidential election year.

At a time when voters are more disgusted than ever by the big-money business of political campaigns, they at least deserve to know there’s a cop on the beat.

Vicki Kemper is editor.

COPYRIGHT 1995 Common Cause Magazine

COPYRIGHT 2004 Gale Group