I was honored today to speak at the kick off meeting of the new ReFormers Caucus. This group of over 100 former members of the U.S. Senate, the House, and governors of both parties, has come together to fight for meaningful campaign finance reform. In the bipartisan spirit of the caucus, I shared speaking duties with Professor Richard Painter, who was the Bush administration ethics czar and my predecessor before I had a similar role in the Obama White House. 

As I told the distinguished audience of ReFormers (get the pun?) gathered over lunch on Capitol Hill, I wish they had existed when in my Obama administration role I was working for the passage of the Disclose Act. That bill would have brought true transparency to the post-Citizens United campaign finance system, yet it failed by just one vote in Congress.  But it is not too late for Americans, working together, to secure enhanced transparency and other campaign finance changes that are desperately needed.  Momentum is building, with increasing levels of public outrage, as reflected in state and local referenda passing in Maine, Seattle and San Francisco just this week, and much more to come at the federal, state and local level.

Event Information

As the sixth anniversary of Citizens United v. FEC approaches on January 21, both experts and ordinary citizens believe the United States is confronting a campaign finance crisis. Citizens United and related court cases have unleashed a flood of dark money that many believe could drown our democracy. It is estimated that over $5 billion will be spent on the 2016 presidential race—more than 3 times the amount spent in 2008 (already the most expensive election cycle in history). A comprehensive poll conducted by the New York Times and CBS News in the spring of 2015 showed that 84 percent of adults—including 90 percent of Democrats and 80 percent of Republicans—believe that money has too much influence in American political campaigns. Even the richest Americans agreed: 85 percent of adults making $100,000 or more share that same belief.

There has been much handwringing about this state of affairs. But there has been too little public attention paid to finding solutions. On the sixth anniversary of Citizens United, the Governance Studies program at Brookings hosted current and former government officials, lobbyists, donors, advocates, and other experts to discuss how to resolve the campaign finance crisis. They focused on innovative reform efforts at the federal, state, and local levels which offer the hope of addressing the problem of big money in politics.

Panelists will included:

Cheri Beasley, Associate Justice, North Carolina Supreme Court
Daniel Berger, Partner, Berger & Montague, P.C.
John Bonifaz, Co-Founder and President, Free Speech for People
Norman L. Eisen, U.S. Ambassador to the Czech Republic (2011-2014); Special Assistant and Special Counsel to the President (2009-2011); Visiting Fellow, The Brookings Institution
Bruce Freed, Founder and President, Center for Political Accountability
Steve Israel, Member, U.S. House of Representatives (D-NY)
Roger Katz, Chair, Government Oversight Committee, Maine State Senate (R)
Allen Loughry, Justice, Supreme Court of Appeals of West Virginia
Chuck Merin, Executive Vice President, Prime Policy Group; Lobbyist
Connie Morella, Ambassador to OECD (2003-2007); Member, U.S. House of Representatives (R-Md., 1987-2003)
Jeffrey Peck, Principal, Peck Madigan Jones; Lobbyist
Nick Penniman, Executive Director, Issue One
Trevor Potter, Commissioner, Federal Election Commission (1991-1995; Chairman,1994)
John Pudner, Executive Director, Take Back Our Republic
Ann Ravel, Commissioner, Federal Election Commission (Chairwoman, 2015)
Timothy Roemer, Ambassador to India (2009-2011); Member, U.S. House of Representatives (D-Ind., 1991-2003); member 9/11 Commission; Senior Strategic Advisor to Issue One
John Sarbanes, Member, U.S. House of Representatives (D-Md.)
Claudine Schneider, Member, U.S. House of Representatives (R-R.I.,1981-1991)
Peter Schweizer, President, Government Accountability Institute
Zephyr Teachout, CEO, Mayday PAC
Lucas Welch, Executive Director, The Pluribus Project
Fred Wertheimer, Founder and President, Democracy 21
Tim Wirth, Member, U.S. Senate (D-Colo.,1987-1993); Member, U.S. House of Representatives (D-Colo.,1975-1987)
Dan Wolf, Chair, Committee on Steering and Policy, Massachusetts State Senate (D)

Click here for a full agenda.

Video

• The campaign finance crisis in America and how to fix it - Part 1
• The campaign finance crisis in America and how to fix it - Part 2
• The campaign finance crisis in America and how to fix it - Part 3
• The campaign finance crisis in America and how to fix it - Part 4

Audio

• The campaign finance crisis in America and how to fix it: A solutions summit (Part 1)
• The campaign finance crisis in America and how to fix it: A solutions summit (Part 2)
• The campaign finance crisis in America and how to fix it: A solutions summit (Part 3)
• The campaign finance crisis in America and how to fix it: A solutions summit (Part 4)

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• Solution Summits Agenda120
• 20160121_campaign_finance_summit_transcript

Last week, over 100 experts from across the U.S. came together at the Brookings Institution on the sixth anniversary of the Citizens United decision to analyze its disastrous consequences and how to repair them. The room was as diverse as it was packed. Two dozen current and former members of Congress, representatives of the executive and judicial branches, both state and federal, attended. They sat side-by-side with business leaders and lobbyists, activists and scholars. Conservatives and Tea Party leaders mingled with liberals and progressives. All were united by their agreement that the current system is broken—and their determination to fix it.

Several points of consensus emerged from the half day event.

First, we are facing a crisis due to the flood of money that is drowning American democracy. For example, Congressman Steve Israel expanded on his recent New York Times op-ed describing why he his quitting Congress. He related his experience of calling potential campaign donors from a small cubicle off the Capitol grounds—a practice referred to as “call time.” Invoking images from The Wolf of Wall Street, Congressman Israel compared the practice to “selling penny stocks, only it’s shares of democracy that are being traded.” The result is voter disillusionment– voters increasingly feeling like their voices are not heard because they cannot make large political contributions. Author Peter Schweizer, President of the Government Accountability Institute, argued that businesses suffer under this system as well. From his perspective, “Businesses … are targeted by politicians in the search for cash,” in a type of extortion by which politicians use their influence to benefit only those who can pay up. The Executive Director of Take Back our Republic, John Pudner, argued that the campaign finance system is the single greatest threat to national security—if domestic interests can purchase influence in our system, international interests can figure out a way to do so as well.

Ambassador Eisen with Congressman Steve Israel (D-NY 3) 

Second, there is hope for a fix. There are a wide range of innovative solutions at hand, many of which have already been successfully deployed at the state and local levels. Commissioner and outgoing Chair Ann Ravel of the Federal Election Commission laid out a reform agenda for that organization. John Bonifaz of Free Speech for People advocated for a 28^th amendment allowing for campaign spending limits, reminding the audience, “We have done this before in our nation’s history; 27 times before. Seven of those times to overturn egregious Supreme Court rulings.” Fred Wertheimer urged strategies to capitalize on the small donor revolution that technology has ushered in, as well as a renewed push for public finance. Judges and legislators from states across the union discussed how public finance and other remedies are working at the state and local levels. Still others advocated solutions including a pledge that would commit politicians to ethical fundraising standards and campaign finance reform agendas when in office; reform in the Federal Election Commission to allow greater enforcement authority; corporate governance policies that require publically held companies to openly disclose political contributions and be accountable to their shareholders; and many, many more specific solutions to tackle the problem from all sides.

Third, and perhaps the most important takeaway from the event, was that those fixes are in political reach. Expert after expert, all from vastly different backgrounds and political orientations, argued that we are much closer to achieving these solutions than we think. The entire program was evidence of that—the size, diversity, and passion of the attendees mirroring a nation of voters who are demanding their representatives do what’s necessary to fix our broken campaign finance system. In the concluding panel, Congressman John Sarbanes predicted, “I think the public is going to demand this. That’s why the time is now. The broad public has arrived at a moment where they are demanding a response to the way they feel. If they don’t get it from some of the solutions we’re proposing, because we don’t educate them that those solutions are there, they’re going to grab a pitchfork and they’re going to go somewhere else. But there’s plenty of evidence that the public will not be denied some remedy to the way they feel.”

The full audio of the event, which includes further discussion of many solutions and the reasons why they are so necessary, can be found on the event page. By clicking there, you can see all the featured speakers, and many more experts participated from the audience floor. Give a listen and you will see why it was such a remarkable day, and why change is nearer that you may think.

We have received many emails and calls in response to our blog last week about our campaign finance reform “Solutions Summit," so we thought we would share some pictures and quotes from the event. Also, Issue One’s Nick Penniman and I just co-authored an op-ed highlighting the themes of the event, which you can find here.

Ann Ravel, Commissioner of the Federal Election Commission and the outgoing Chairwoman kicked us off as our luncheon speaker. She noted that, “campaign finance issues [will] only be addressed when there is a scandal. The truth is, that campaign finance today is a scandal.”

(L-R, Ann Ravel, Trevor Potter, Peter Schweizer, Timothy Roemer)

Commenting on Ann’s remarks from a conservative perspective, Peter Schweizer, the President of the Government Accountability Institute, noted that, “increasingly today the problem is more one of extortion, that the challenge not so much from businesses that are trying to influence politicians, although that certainly happens, but that businesses feel and are targeted by politicians in the search for cash.” That’s Trevor Potter, who introduced Ann, to Peter’s left.

Kicking off the first panel, a deep dive into the elements of the campaign finance crisis, was Tim Roemer, former Ambassador to India (2009-2011), Member of the U.S. House of Representatives, (D-IN, 1991-2003) Member of the 9/11 Commission and Senior Strategic Advisor to Issue One. He explained that “This is not a red state problem. It’s not a blue state problem. Across the heartland, across America, the Left, the Right, the Democrats, the Republicans, Independents, we all need to work together to fix this.”

(L-R, Fred Wertheimer, John Bonifaz, Dan Wolf, Roger Katz, Allen Loughry, Cheri Beasley, Norman Eisen)

Our second panel addressed solutions at the federal and state level.  Here, Fred Wertheimer, the founder and President of Democracy 21 is saying that, “We are going to have major scandals again and we are going to have opportunities for major reforms. With this corrupt campaign finance system it is only a matter of time before the scandals really break out. The American people are clearly ready for a change. The largest national reform movement in decades now exists and it’s growing rapidly.”

Our third and final panel explained why the time for reform is now. John Sarbanes, Member of the U.S. House of Representatives (D-MD) argued that fixes are in political reach. He explains, “If we can build on the way people feel about [what] they’re passionate on and lead them that way to this need for reform, then we’re going to build the kind of broad, deep coalition that will achieve success ultimately.”

(L-R in each photo, John Sarbanes, Claudine Schneider, Zephyr Teachout)

Reinforcing John’s remarks, Claudine Schneider, Member of the U.S. House of Representatives (R-RI, 1981-1991) pointed out that “we need to keep pounding the media with letters to the editor, with editorial press conferences, with broad spectrum of media strategies where we can get the attention of the masses. Because once the masses rise up, I believe that’s when were really going to get the change, from the bottom up and the top down.”

Grace Abiera contributed to this post.

We can be sure that the 2016 presidential candidates, whoever they are, will be in favor of promoting opportunity and cutting poverty. The question is: how? In our contribution to a new volume published today, “Campaign 2016: Eight big issues the presidential candidates should address,” we show that people who clear three hurdles—graduating high school, working full-time, and delaying parenthood until they in a stable, two-parent family—are very much more likely to climb to middle class than fall into poverty:

But what specific policies would help people achieve these three benchmarks of success?  Our paper contains a number of ideas that candidates might want to adopt. Here are a few examples: 

1. To improve high school graduation rates, expand “Small Schools of Choice,” a program in New York City, which replaced large, existing schools with more numerous, smaller schools that had a theme or focus (like STEM or the arts). The program increased graduation rates by about 10 percentage points and also led to higher college enrollment with no increase in costs.

2. To support work, make the Child and Dependent Care Tax Credit (CDCTC) refundable and cap it at $100,000 in household income. Because the credit is currently non-refundable, low-income families receive little or no benefit, while those with incomes above $100,000 receive generous tax deductions. This proposal would make the program more equitable and facilitate low-income parents’ labor force participation, at no additional cost.

3. To strengthen families, make the most effective forms of birth control (IUDs and implants) more widely available at no cost to women, along with good counselling and a choice of all FDA-approved methods. Programs that have done this in selected cities and states have reduced unplanned pregnancies, saved money, and given women better ability to delay parenthood until they and their partners are ready to be parents. Delayed childbearing reduces poverty rates and leads to better prospects for the children in these families.

These are just a few examples of good ideas, based on the evidence, of what a candidate might want to propose and implement if elected. Additional ideas and analysis will be found in our longer paper on this topic.

The U.S. is the only advanced country without a paid leave policy, enabling workers to take time off to care for a new baby or other family member. At least two Presidential candidates, Hillary Clinton and Marco Rubio, have been talking about it, making it likely that it will get attention in 2016.

The idea has broad appeal now that most two-parent families and almost all one-parent families struggle with balancing work and family. Polls show that it is favored by 81 percent of the public—94 percent of Democrats, 80 percent of Independents and 65 percent of Republicans. Three states, California, New Jersey, and Rhode Island, have each enacted policies that could become models for other states or for the nation.

Paid leave promotes inclusive growth

Overall, paid leave is good for workers, good for children, and possibly even good for employers because of its role in helping to retain workers. It is also a policy that encourages inclusive growth. Studies of European systems suggest that paid leave increases female labor force participation and that the lack of it in the U.S. may be one reason for the decline in female labor force participation since 2000 and the growing female participation gap between the U.S. and other countries, adversely affecting our absolute and relative growth. The policy would make growth more inclusive because it would disproportionately benefit lower-wage workers.

The devil is in the design

The major issues in designing a paid leave policy are:

1. Eligibility, and especially the extent of work experience required to qualify (often a year);
2. the amount of leave allowed (Clinton suggests three months; Rubio four weeks);
3. the wage replacement rate (often two-thirds of regular wages up to a cap), and
4. financing.

Legislation proposed by Rep. Rosa DeLauro (D-CT) and Sen. Kirsten Gillibrand (D-NY) calls for a 0.2 percent payroll tax on employers and employees. Most states have made paid leave a part of their temporary disability systems. Senator Rubio proposes to finance it through a new tax credit for employers. 

Getting it right on eligibility, length of leave, and size of benefit

My own view is that a significant period of work experience should be required for eligibility to encourage stable employment before the birth of a child. This would not only encourage work but also insure that the subsidy was an earned benefit and not welfare by another name (but see below on financing).   

Leave periods need to be long enough to enable parents to bond with a child during the child’s first year of life but not so long that they lead to skill depreciation and to parents dropping out of the labor force. Three months seems like a good first step although it is far less generous than what many European countries provide (an average of 14 months across the OECD). That said, the Europeans may have gone too far. While there is little evidence that a leave as long as 6 months would have adverse effects on employment, when Canada extended their leave from six months to a year, the proportion of women returning to work declined.

A replacement rate of two-thirds up to a cap also seems reasonable although a higher replacement rate is one way to encourage more parents to take the leave. Among other things, more generous policies would have positive effects on the health and well-being of children. They might also encourage more fathers to take leave.  

How to pay for it

On financing, social insurance is the appropriate way to share the putative burden between employers and employees and avoid the stigma and unpopularity of social welfare. It would, in essence, change the default for employees (who are otherwise unlikely to save for purposes of taking leave). Some may worry that imposing any new costs on employers will lead to fewer employment opportunities. However, many economists believe that the employer portion of the tax is largely borne by workers in the form of lower wages. Moreover, in a study of 253 employers in California, over 90 percent reported either positive or no negative effects on profitability, turnover, and employee morale. Reductions in turnover, in particular, are noteworthy since turnover is a major expense for most employers. 

Will paid leave cause discrimination against women?

Another worry is discrimination against women. Here there is some cause for concern unless efforts are made to insure that leave is equally available to, and also used by, both men and women. This concern has led some countries to establish a use-it-or-lose-it set aside for fathers. In the province of Quebec, the proportion of fathers taking leave after implementation of such a policy increased from 21 to 75 percent and even after the leave period was over, men continued to share more equally in the care of their children.

Will Congress enact a national paid leave policy in the next few years? That’s doubtful in our current political environment but states may continue to take the lead. In the meantime, it can’t hurt if the major candidates are talking about the issue on the campaign trail.