Show Me the Money

Prop. 34 Offers Some Campaign Finance Restrictions, But at What Price?

BY TRACY IDELL HAMILTON

On its surface, Proposition 34 looks like the answer to campaign finance reform in California.

The proposition would limit contributions to candidates, require more frequent disclosures of donations, increase the penalties for violating those requirements, and limit campaign money transfers between candidates.

Why, then, are so many groups committed to campaign finance reform arrayed against the measure?

Former Secretary of State Tony Miller, who is leading the opposition, calls Prop. 34 a cynical attempt to nullify Prop. 208, a measure with far more teeth, which has been tossed about in the courts since voters overwhelmingly approved it in 1996. He joins groups such as Common Cause, the American Association of Retired Persons, the League of Women Voters, and even millionaire Ron Unz, who tried unsuccessfully to pass his own version of campaign finance reform last election.

Even if that measure is upheld by the courts, Prop 34 would nullify its key provisions. Additionally, Prop. 34 leaves soft-money loopholes large enough to drive a Brinks truck through.

Under Prop 34, donations to the parties are limited to $25,000. But an individual or corporation would be allowed to give unlimited amounts to the party if the cash is earmarked for "other party activities." And it does not limit the amount parties may then give candidates, making them, in essence, the state’s political kingmakers.

Senate leader John Burton, who co-wrote the measure with Assembly Speaker Robert Hertzberg, agrees that the measure would strengthen the parties.

His measure reads in part, "Political parties play an important role in the American political process and help insulate candidates from the potential corrupting influence of large contributions."

But Miller calls it nothing short of political money-laundering. Money donated to parties, then used for campaigns, would be virtually untraceable. He offered a scenario to an Associated Press reporter: "[Gov. Gray] Davis tells IBM, 'It would be really helpful if you gave a quarter of a million to the Democratic Party' and lo and behold, they do. Gray knows, and he appreciates it, but you and I wouldn't know it."

Having party-controlled financing of campaigns can also mean more party influence over candidates–and parties are generally further from the center than their candidates.

Strongly supported by Davis, the measure features other choice provisions favoring the Democrats. For example, none of the spending caps would be in place until 2002, making Davis free "to pillage donors" for the next two years, said Shawn Steel, vice chairman of the California Republican Party.

Still, despite Steel's remarks, the measure enjoys official support from the Republican party. Although they may not stand to benefit as greatly as Democrats, Republicans would still see a flow of unlimited contributions from big donors into their coffers.

Fear that the courts may uphold Prop. 208 has made for some strange political bedfellows in the effort to pass Prop. 34. Unions support the measure thanks to the provision that allows each local union to be considered a separate political entity, rather than belonging to one statewide or larger organization. This means each group could donate the maximum.

Laurence Houlgate, the Democrat who is challenging Abel Maldonado for the 33rd Assembly seat, breaks with his party to oppose Prop. 34. "I want genuine campaign finance reform," he said. "I can't be two-faced about this. If that means making some union friends unhappy, so be it."

Maldonado, during last week's debate with Houlgate, also came out strongly against the measure. "It's written by politicians for politicians," he said. "Let's let the courts decide on 208."

Prop. 34 does introduce spending limits that are more realistic than Prop. 208's, one of the criticisms of that measure. Those limits are $3,000 for legislative races compared to $250 from Prop. 208, $5,000 for statewide office (except the governor at $20,000) compared with Prop. 208's $500 limit for each.

Penalties for not complying with Prop. 34's stricter reporting provisions–more frequent disclosures, including online reporting– would also be at the same levels as those in Prop. 208.

Proponents of Prop. 34 also offer a "better than nothing" argument, that, while hardly a ringing endorsement, may sway some voters anxious to stem the flow of big money in political races.

That's the fear of San Luis Obispo Mayor and political science professor Allen Settle. He fears that, as with the pair of insurance initiatives in March, where "yes" meant "no" and "no" meant "yes," people will see "campaign finance reform" and vote for it.

"It's just outrageous," he said. "This is a classic deception as a ballot measure."

Contributions to staff writer Tracy Hamilton –please mail care of New Times–will only insure access, not favorable stories.