Reality Check: McCain-Feingold Campaign Finance Reform

Since the last federal election, there have been some changes in election law, such as the McCain-Feingold Campaign Finance Reform. Both of Wisconsin’s U.S. Senate candidates, Senator Russ Feingold and Tim Michels, are trying to explain their views of it through TV ads. News 3 helps make sense of it in our Reality Check series.

If there’s one piece of legislation Russ Feingold is famous for, it’s campaign finance reform. After all, he and John McCain authored and campaigned for it. Now, he’s defending it with a TV ad.

But, let’s start with Republican challenger Tim Michels’ critique in his TV ad.

The ad, narrated by Michels, states, “Every time you hear, ‘I approve this message,’ thank Russ Feingold. He spent 12 years fighting for campaign finance reform. Now every politician has to say, ‘I approve this message.’ Wow, 12 years for eight words. Has that really helped us in Wisconsin?”

This is misleading. The McCain-Feingold Campaign Finance Reform bill included much more than the “stand by your ad” provision, which Michels’ labels as simply “eight words.”

First of all, the bill was introduced in 1995 and signed in 2002, so it took seven years to pass, not 12. It does require candidates to say something like “I approved this message,” but it did much more. It banned so-called “soft money” to the national parties. Soft money is unregulated and unlimited cash the parties used to raise and spend in the millions.

“Special interest groups would give $500,000 or $1,000,000 contributions on a Tuesday. Then, on a Wednesday or Thursday, in a key committee in Congress, they would have a special break provided to them,” said Jay Heck, of Common Cause in Wisconsin, a non-partisan reform advocate.

The bill also bans so-called “issue ads.” The ads attacked a candidate without using his or her name. That’s now illegal 60 days before the general election.

Corporations and unions can still buy ads through non-profit groups, but the source of the money must be disclosed.

“And that’s important because that way, people know who’s paying for these ads and the money’s coming from regulated sources,” Heck said.

Michels makes the argument at the end of his ad that Feingold’s time on this issue would have been better spent on issues that, in his view, directly affect Wisconsinites like health care.

Feingold has said he can do both and that’s up to the voter to decide.

Senator Feingold, in his ad, has a drastically different view of campaign finance.

“Big money corporation versus the average American citizen,” Feingold said.

In his ad, Feingold points to health care where, in his view, special interests always seem to win.

“All because there wasn’t a level playing field. But thanks to the passage of the McCain-Feingold bill, unlimited contributions like these, that are little more than bribes, are now illegal,” Feingold said.

The dollars he kicked out in his TV ad represent soft money to the political parties. It’s true that are now illegal, but there’s more to campaign finance reform.

The bill has legitimate critics. For example, some opponents believe that political money will always find its way into the system. Before McCain-Feingold, unlimited donations flowed freely to political parties and directly into the system. But blocking this, the theory goes, creates other holes like the 527s.

The now infamous Swift Boat ads, or all the ads by, are non-profit groups intended to influence the election – 527s in the federal tax code. A lot of money has shifted to those groups. Many call it a loophole.

McCain and Feingold unsuccessfully asked the Federal Elections Commission to regulate the groups. They then introduced legislation that would regulate the unlimited donations, but it won’t have any effect on this election.

The bottom line is that campaign finance reform is working in some areas and a work in progress in others. Where the candidates disagree is whether or not it’s worth working on at all.