Congressional Extortion

Posted: Jan 12, 2014 12:01 AM
Congressional Extortion

Some of the world’s most famous people became such by challenging conventional wisdom. Who does not know the name Galileo? He was scorned as a heretic in his day. Or what American does not know of Jonas Salk, who developed a nonconventional process and saved the world from the dreaded polio disease. Now comes along a man challenging conventional wisdom. The subject is not as lofty as curing polio or defining the center of the universe, but it challenges an accepted orthodoxy that has been beaten into our brains for decades.

Though campaign finance reform dates back to 1867 when Andrew Johnson was President, the real push started in the 1970’s and has been drummed into the political psyche since then. What Americans have been sold is that big money interests have twisted the political system -- taking advantage of the poor, downtrodden elected officials. Americans may hold Congress in low esteem, but most think their personal Congressman is the reincarnation of Jefferson Smith (Jimmy Stewart in Mr. Smith Goes to Washington). The poor befuddled representative has to claw and fight their way through a thicket of special interests trying to buy his/her vote.

Peter Schweizer dismantles the idea of the innocent Washington politicians in his book Extortion. In chapter after chapter he explains how the current system extracts millions from corporations and other interest groups by manipulating legislation to feed the elected officials various different funds. Schweizer told me “Politics is destroying money; not the reverse.”

The entire system is organized to not fix problems. Schweizer details how our elected representatives are running basically a protection racket. As Schweizer stated, “The goal is to create more problems or let problems fester.” Members of Congress go to special interest groups and tell them if they don’t hand over big bucks then a bill which may have a small chance of passing or has been presented annually will be brought up at great detriment to the target’s business interests. One of the favorite techniques of raising money is called a “double-milker.” That is when a Congressman raises money from interest groups on both sides of an issue by telling one-side that they are working on passing the bill and the other side that they better cough up the dough or the dreaded bill will pass.

As Schweizer writes in the book, bills are brought up and then die after the fundraising is completed. He writes, “The bill might go away; the executioner might take away the guillotine for a time. But it will return. The bill will reemerge, and the money will be extorted again by both sides. Sometimes bills only finally pass after the donors have been wrung dry.”

When I asked Schweizer what most surprised him of what he found from his research, he actually had two matters that set him back. The first is how, particularly in the House, committee assignments are principally made to members who agree to raise a preset amount that can exceed a million dollars to go to their political party. This practice was begun by both political parties in the 1990’s. Certain committees like Budget or Ways and Means have high-minimum party contributions. Others like Foreign Affairs or Ethics have no constituency and thus the required contributions are low. Schweizer told me that the big dollar committees have little appeal to the Congressman’s hometown constituents, so the money they raise principally comes from lobbyists or industries affected by the committee’s potential legislation. The Congressman then twists the arms of whomever to extract the required funds to pay the party dues.

The second thing that surprised Schweizer was how many pockets our elected officials can pull money from to feed their operations. He said they have five or six legal sources. He was also stunned by how, with tools like Leadership PACs, our Washington officials use the funds they raise to pay for their personal expenses.

The most revealing statement in the book is a quote from the former President of Shell Oil, John Hofmeister, which defines matters clearly and completely. He says, “They deliberately write ambiguity into the law. It’s part of a career-building process. If you are a congressional staffer, you spend your career crafting complex legislative language. This equips you to leverage your postgovernment competence.” Schweizer adds, “And complexity begets complexity”; then finishes with the Hofmeister’s final words, “The whole system builds on itself.” The reason these words are so revelatory is that business leaders typically keep their mouths shut and don’t run to the press to express how they are being abused. After all, the entire idea behind extortion is that the victim does not allow anyone to know how they are being coerced because of the power the extortionist has to punish the victim for any public commentary.

When asked what the solution to the problem is, Schweizer offered two. First, he suggested no fundraising be allowed when Congress is in session. Many days senators and representatives run from committee meeting to fundraiser and back to committee meeting and then to another fundraiser. The other suggestion is to have single-issue bills. When there are omnibus bills like Dodd-Frank or the Senate Immigration bill, they are made purposefully complicated to extract funds from targeted pigeons who cannot say no.

Schweizer has put forth a highly readable book in Extortion that redefines how we should look at the political fundraising process and educates us on how it is done. But Schweizer and I agree in the end the best way to eliminate the fundraising sham is to limit the money flowing through the government’s hands. That is truly the best way to end the shenanigans.