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How Big Bucks Are Affecting the Political Agenda

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On Saturday, Steve Forbes won the Delaware primary. While the multibillionaire is financing his own campaign, he is getting some help. We’ll take a look at some of the investment companies investing in Forbes. In order to become president today, for all practical purposes, you must either raise millions of dollars from the economically interested or finance your own political campaign. This means that our presidential candidates have not been selected by the people as a whole, but by lawyers and lobbyists, the entertainment industry, by the Wall Street securities firms and insurance and gambling interests, by healthcare, oil and gas industries. We are joined by Ellen Miller, executive director of the Center for Responsive Politics, one of the few groups following the money in presidential politics. We will talk about money and the presidential candidates and what this means for our democracy.

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This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: Welcome to Democracy Now!, Pacifica’s national, grassroots, daily election show. On Saturday, Steve Forbes won the Delaware primary. While the multibillionaire is financing his own campaign, he is getting some help. We’ll take a look at some of the investment companies investing in Forbes. Then, Pacifica national affairs correspondent Larry Bensky is in Arizona, just before tomorrow’s primary there. Among the activists he’ll be talking to are a group that’s been the target of repeated death threats. And finally, responding to Cuba’s downing of two U.S. planes, which Cuba says entered its waters, we’ll talk with a Cuban official, a U.S. military expert who just returned from Cuba, Pacifica’s Saul Landau and Reverend Lucius Walker on the sixth day of a fast on the U.S.-Mexican border. He’s protesting the U.S. customs seizure of 400 computers headed for Cuba. That’s all on today’s Democracy Now!

Moving into our first segment, if it’s Monday, it’s money. In order to become president today, you must, for all practical purposes, do one of two things: raise millions of dollars from the economically interested or finance your own political campaign. This means that our presidential candidates have not been selected by the people as a whole, but by lawyers and lobbyists and the entertainment industry, by the Wall Street securities firms, insurance and gambling interests, by healthcare conglomerates and the oil and gas industry. And if anyone thinks these economically interested contributors are going to melt into the background after Election Day, you’re kidding yourselves.

Joining us to talk about money in presidential politics is Ellen Miller, executive director of the Center for Responsive Politics, one of the few groups following the money in presidential politics and what this means for our democracy.

Welcome to Democracy Now!, Ellen.

ELLEN MILLER: It’s great to be here.

AMY GOODMAN: Well, why don’t we begin with that question. What does this kind of money mean for democracy?

ELLEN MILLER: Well, I think we have to start really at the beginning and look at how few people give money that is meaningful in politics, whether it’s presidential politics or congressional politics. We know that less than one-third of 1 percent of the American people make a campaign contribution of $200 or more in congressional elections. That’s less than one-third of 1 percent. We are talking about a very tiny minority of people who select our candidates for president or—for the presidential race or for congressional races. What this means, ultimately, is that that money skews who our candidates are, and it skews public policymaking once the election is over. So, you know, we’re drifting toward an election system which is very much in the hands of the wealthy and the economically interested. The vast majority of us have no say in candidate selection.

AMY GOODMAN: How did this whole way of campaign financing begin? How did we evolve this system?

ELLEN MILLER: Well, the current campaign finance system, which is really more loophole than law at the moment, is a result of reforms in the 1970s, the post-Watergate reforms, which were worthy in and of themselves, but they had problems because they simply did not go far enough. For example, they decided that a reasonable contribution limit, a noncorrupting one, was at a thousand dollars. But nobody in this country can give a thousand dollars. Actually, it’s about 160,000 people out of 260 million, who make a contribution of a thousand dollars or more. So, those ’70s reforms set the limit of what you could give at such a high level that very few people can contribute and can, we call, pay to play in this political system.

AMY GOODMAN: And this was in reaction to Watergate?

ELLEN MILLER: This was in reaction to Watergate, where there were bags of—brown bags of cash going under the table at the White House to buy political influence. What in fact the Watergate reforms did was to make it perfectly legal to write checks for that amount, and now they go over the tables at the White House, and of course, you know, in congressional offices, as well.

AMY GOODMAN: And also, wasn’t the whole system of PACs, political action committees, set up then?

ELLEN MILLER: Very much so. Political action committees were thought to be a way of getting greater disclosure and greater understanding of the campaign finance system and put it sort of above the table, as it were. And, in fact, in some ways, the PAC system has worked reasonably well. It’s pretty easy to identify. But PACs only give 25 percent of the money for congressional campaigns. The far larger source is this money that comes from large individual contributors whose interest we identify, quite neatly, as lining up with those of the PACs. It’s harder to follow. It’s limitless because of bundling, the ability to walk up and down the halls of a Wall Street security firm or a Hollywood studio and collect thousand-dollar contributions. This is not money coming from ordinary folks.

AMY GOODMAN: Now, when you say “bundling,” you mean collecting all those thousands of dollars and then what? And then giving it over—

ELLEN MILLER: And then giving it—handing it in one single bundle.

AMY GOODMAN: But it looks like it’s a bunch—but it looks like it’s a bunch of individuals?

ELLEN MILLER: That’s correct. But when we do our analysis, we can often find, you know, all the executives of U.S. tobacco giving to—the same day, to the same candidate. And that’s quite a typical pattern. It’s not just the tobacco industry. But we find it both for Democratic candidates and Republican candidates.

AMY GOODMAN: Let’s go to some specifics. This past Saturday, Steve Forbes had his first win, and that was the Democratic primary—rather, the Delaware primary. Tell us about Steve Forbes. Now, most people know that he is spending his own money, I think to the tune of something like so far $26 million, and they think that that’s it. But, in fact, he is getting other money, isn’t he?

ELLEN MILLER: Well, that’s right. One of the interesting things that came to light was that it was not that Steve Forbes is sort of giving himself a grant for this campaign. He’s actually loaning himself the money, which means that if he is successful, he can be paid back by anyone who wants to invest in him. Now, you know, what we’re looking at, the Steve Forbes phenomenon represents one of two ways you can get into presidential politics. Either you can build your campaigns on the wallets of the rich and interested—Bob Dole is a great example of that, so is Alexander—or you can be the rich and interested and finance your own campaign. But Forbes is really paving the way for a third way, which is you can pay your own campaign expenses, but you can also allow others, other economically interested folks, to invest in you.

And that’s what Forbes has done. By the end of last year, he had raised, I think, about $1.8 million in private money. Now, you know, one might think that this is a grassroots kind of effort, but in fact it’s not. Our analysis shows that a lot of the Wall Street securities firms, like Bear Stearns, Merrill Lynch, Salomon Brothers, Paine Webber, have invested in his campaign to the tune of at least $2 million thus far. And what’s fascinating about is that these very same Wall Street firms have invested in other candidates. So, first, frankly, they went to Bob Dole. And now that they’re beginning to see a weakening in that campaign, they’re thinking, “Hey, we better find another horse to ride,” and so they’re starting to give money to Steve Forbes.

AMY GOODMAN: And isn’t the largest receiver of investment company money actually President Clinton?

ELLEN MILLER: That’s right. The Wall Street firms illustrate another great adage about money in politics, which is, this is not money that is ideologically driven. It is driven because they want access and influence with whoever is in the White House. And if that’s going to be a Democrat, well, they’re perfectly content with a Democrat in the White House.

AMY GOODMAN: You know, yesterday, when I was watching the Sunday talk shows on television, one of the questioners was asking Pat Buchanan why he emphasizes Goldman Sachs when he talks about Wall Street, suggesting that he had a kind of anti-Semitic tinge to what he was saying as he talked about Goldman Sachs. But the fact is, and even Pat Buchanan didn’t say this, Goldman Sachs is the number one contributor to President Clinton’s campaign.

ELLEN MILLER: Well, they certainly were in the last election cycle. In the 1992 cycle, Goldman Sachs was way and above the largest contributor to Bill Clinton. And interestingly, one of the partners, former partners, of Goldman Sachs, of course, is now Secretary Treasurer Bob Rubin. You know, Goldman Sachs is just a terrific example, but it is not an exclusive example. Bill Clinton, in this election cycle, has certainly much larger campaign contributors. Actually, the top contributor comes from the accounting firm of Ernst & Young for Bill Clinton this time. And so, you know, they may bounce all over, depending on who the fundraiser is and what they might want after Election Day, but the most important point is, we are ordinary people funding these election campaigns. These candidates have been selected by the wealthy and the interested, those who want something in return after Election Day. The vast majority of the people are not on this radar screen.

The other thing I want to add is, you know, money will not necessarily buy an election. I’ve never quite believed that. But it is absolutely necessary for getting into the game. If Phil Gramm did not have that $20 million as his goal—and he ultimately achieved it—he would not have been regarded as a viable presidential candidate. But it couldn’t buy him votes, and it couldn’t buy him love, so he’s dropped out. I would suspect that if there are other Steve Forbes out there and they cannot finance their own campaign, you know, they’re not even on our radar screen. Morry Taylor, another sort of almost unheard-of candidate, is financing his own campaign. He gets in debates. But the question is: Does this man have anything to offer to us? The only reason he’s there is because he’s got a fat wallet.

AMY GOODMAN: We’re talking to Ellen Miller, who’s executive director of the Center for Responsive Politics, based here in Washington, D.C. You know, on Friday I was on C-SPAN debating the American Enterprise Institute, the editor of The American Enterprise, which is their magazine. And when I brought up the issue of money in politics, he responded that we pay less for candidates than we do for bubble gum in this country; it’s hardly something to get upset about. What’s your response to that?

ELLEN MILLER: Well, the answer to that is, you know, it’s an apples and oranges kind of analogy. First of all, you know, I think relating how much we spend in sort of the capital economy on goods and services has no relationship to what we spend in terms of politics. You know, that argument suggests that if we spent more money, we’d have more information, which I think is patently absurd, given 1996 politics and the fact that we know that they’re spending all of their money on negative advertising, which doesn’t give anyone any information. And I suspect, frankly, if we could change the system we have for campaign finance, we’d spend a lot less money on yogurt and antacids than we would on spending politics. It’s an absolutely irrelevant comparison.

AMY GOODMAN: Would you recommend that the networks would have to run free advertising? I mean, is that the bulk of the cost of campaigns, is television ads?

ELLEN MILLER: Depending on what level of campaign depends on how much candidates actually spend on media. Presidential campaigns spend more. House campaigns, for example, spend only about 20 percent of their money on media advertising. Of course, the airwaves belong to the people. And the owners—or, not the owners, but the folks who are running their commercial shows ought to give some of this time back to candidates. This is a democracy, in fact. You know, what better use could we actually have of the money? That’s one major piece of it. But it wouldn’t replace all the money that is necessary for a political campaign. The issue is the conflict between the private financing of public elections. And when you have private financiers, like Wall Street, like Hollywood, like lawyers, like accountants, and you have so few people giving money, then you have this inevitable conflict, as well as a host of other problems.

AMY GOODMAN: Coming up on Democracy Now!, we’re going to Arizona, to Tucson, where Larry Bensky is standing by, and we’re going to be talking about environmental issues. After that, we’re dealing with the issue of Cuba and what this means for presidential politics. We’ll be going to the Mexican-American border, where a group of people are on a hunger strike because they can’t get their computers, part of a Cuba caravan, to Cuba, this at the same time that the U.S is now enmeshed in quite a controversy with Cuba. The U.N. Security Council, the U.S. is pushing for it to criticize Cuba for downing two U.S. planes, and Cuba has just come out with some new information, saying it’s got one of the pilots involved with the group that had its planes downed. And we’re going to be talking about what all this means. But right now we’re talking with the Center for Responsive Politics, Ellen Miller, and they have a study out called “The First Primary: Early Fundraising in the 1996 Presidential Election.” Overall, what did you find in this?

ELLEN MILLER: Well, we found—we found that every candidate had a particularly large, economically interested backer. We found that industries and interest groups had picked their candidate. For example, Bill Clinton was the favorite of the lawyers and lobbyists in D.C., but Phil Gramm was the favorite of the health professionals. So the question is where that money will go at this point. We found that the securities and investment industry had invested heavily in each of the candidates. We looked at where the money was coming from geographically. And surprisingly, for example, we found that—or perhaps not surprisingly—some of the candidates, like Alexander, were regional favorites. About half of his money came from Tennessee and very little from anyplace else.

One of the other fascinating things in this study is to look at Pat Buchanan’s money. I mean, we tend to think that there are problems when money comes from the economically interested, the wealthy elite of the country, how much large, individual money is coming, you know, and where it’s coming from. But, for Pat Buchanan, in fact, individuals who gave under $200 comprised about 80 percent of his money. And so he is raising a lot in small donor money. I mean, no doubt he has the list that belonged to some of the more conservative, indeed right-wing organizations in this country. But from a money politics perspective, this is money that is more ideological rather than economically interested-driven. It also says a lot about the Buchanan campaign, which is, it’s a low-budget campaign. He’s raising money in small increments. There are a lot of people who will give, you know, $10, $20, $25, in small amounts, to a campaign, and it could sustain him much further than some of the other candidates who are raising big bucks.

AMY GOODMAN: For Buchanan, aside from those $200 contributions, what are the big contributors? Who has been funding Pat Buchanan’s campaign?

ELLEN MILLER: Well, his single-largest contributor is Milliken & Company. His second-largest contributor was Leigh Fibers. So we’re looking at textile industries, you know, that are supportive, I suppose, of his protectionist trade policies; a lot of smaller organizations and interest groups that really do not appear on the major radar screen of—you know, in the money-in-politics community. His backing looks quite different than most people.

One of the other things—I don’t want to go too far in terms of what might be deemed as praise of his campaign contribution profile—he did only identify about 50 percent of his contributors. And that is something that is required by law. At least the candidates have to make their—what’s called their best effort at identification. So he could do an awful lot better in that realm.

AMY GOODMAN: Clinton, I notice one of the things that came out of your report, “Financial Sector Tops Presidential Giving: Clinton Cashes In with Lawyers,” is that in addition to law firms that figure prominently on his list, Clinton also received over $145,000 from employees of the federal government and their immediate families, particularly the Department of Agriculture. Why?

ELLEN MILLER: Very interesting, not altogether clear to us. We often do not know what is driving the campaign contributions; we simply report on it. We’ll hand it over to reporters and say, “You figure this out.” But interestingly, there was a bit of a scandal in the 1992 race, in which members—or, government employees of the Agriculture Department were discovered to have been giving a substantial amount of money to the Clinton campaign. And interestingly, at least the allegation goes, a number of them got raises and increases in their particular position. This is something that’s been investigated by The Hill. And, you know, the question is whether there’s some lurking scandal here. It strikes me as somewhat unusual.

AMY GOODMAN: Well, Ellen, we’re going to have you back next Monday to talk about soft money. You’re going to be coming out with a report then. And if people want to get more information, do you have a number that they can call, or a website or an email address?

ELLEN MILLER: Well, I think the easiest way for people on the email is to write us at And we can send out to you a brochure of our information and a publications list. Or they can call us at 202-857-0044.

AMY GOODMAN: And again,—that’s O-R-G—or you can phone in Washington, 202-857-0044. Ellen Miller is the executive director of the Center for Responsive Politics. She’ll be back next week to talk about soft money. Thanks for joining us on Democracy Now!

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