Campaign Finance, Krugman, and the 527 Dispute

Our campaign finance system is a vile, oozing swamp of legalized corruption which needs to be drained and scrubbed clean. Nearly everything that is wrong about the U.S. government ultimately grows out of the manure from this swamp. The system persists because people in position to potentially push for reform are precisely those who have so mastered its dark arts that they can't imagine changing it (think Bill Clinton). Expecting a politician to spend 15+ years in DC and then attack the campaign finance beast is like hoping the Pope will renounce Catholicism. For longtime DC pols, raising gobs of corporate money is what they do.

Obama, too, has brought in substantial money from wealthy donors. But for two reasons, he is clearly the candidate most likely to push for serious campaign finance reform. First, continuing in the footsteps of Howard Dean, he has raised a record number of donations from small donors, and the campaign is on track to have raised donations from half a million Americans by the end of the year, an extraordinary achievement, demonstrating that a campaign can be powered principally by everyday people, rather than the super-rich who can afford to lay down $2300 checks.

Secondly, he has a proven record of achieving campaign finance reform, a mantle he inherited from his mentor, Sen. Paul Simon. As the Washington Post described:

The campaign finance effort came at the initiative of former U.S. senator Paul Simon (D-Ill.). A Republican and a Democrat in each legislative body were tapped to tighten a system that, among other things, allowed politicians to use campaign accounts for personal expenses.

Obama was given the job of representing Senate Democrats ...

"He was very aggressive when he first came to the Senate," said Jones, now president of the state Senate. "We were in the minority, but he said, 'I'd like to work hard. Any tough assignments or things you'd like me to be involved in, don't hesitate to give it to me.' "

Obama favored more ambitious changes in campaign law, including limits on contributions, but nipped and tucked in search of consensus.

"What impressed me about him was his ability in working with people of the opposite party," said Mike Lawrence, director of the Public Policy Institute at Southern Illinois University. "He had definite ideas about what ought to be contained in a campaign finance reform measure, but he also was willing to recognize that he was probably not going to get everything he wanted."

The result, according to good-government groups, was the most ambitious campaign reform in nearly 25 years, making Illinois one of the best in the nation on campaign finance disclosure.

Months ago, I saw an interview with Obama in which he was asked about the campaign finance system. He expressed palpable disgust with the status quo and said, in essence, that he had no choice but to accept large dollar donations for the time being, but that he insisted on absolute transparency and would refuse all donations from lobbyists.

Completely in keeping with these views, he recently criticized the outside groups known as 527s that are running ads promoting Edwards, in clear violation of the spirit of the law. The financing of 527s is often murky, and they essentially allow money to be spent supporting a candidate far above the legal limits. The case raised by Obama involves a shady organization called Alliance for a New America. The only public information about it is what can be found at its sparse website. A quick check reveals that the domain name was registered "by proxy," which is only done to keep the public in the dark as to the identity of the true owner. Ironically, while the website says the group "believes that Washington is broken," it shows its address as a PO Box in Alexandria, Virginia--well within the DC Beltway--which suggests that the organization is being run by a DC political operative.

Today, inexplicably, Krugman attacks Obama for objecting to this. He asks

is Mr. Obama saying that if nominated, he’d be willing to run without support from labor 527s, which might be crucial to the Democrats? If not, how does he avoid having his own current words used against him by the Republican nominee?

As to the first question, I imagine Obama would be very eager to have 527s brought under the umbrella of campaign finance laws and fully subject to their disclosure laws. This is exactly what John McCain, Russ Feingold, and other advocates of campaign finance reform have fought for.

Will his words criticizing 527s be used against him if some 527s end up supporting him in the main election ? Perhaps, but I think Obama is ready to take on that argument. More importantly, why doesn't Krugman ask the same question of Edwards, who has been just as critical of the role of 527s?

According to the LA Times:

On Friday, at a campaign stop in Johnston, Edwards slammed these groups. He has often said they ought to be banned from influencing elections.

And Edwards said,

“I do not support 527 groups. They are part of the law, but let me be clear: I am asking this group and others not to run the ads. I would encourage all the 527s to stay out of the political process.”

Campaign finance reform is a vital issue, and progressives should be doing everything possible to strengthen the candidates' commitment to serious change. Instead, in what looks very much like a hit job for the Edwards campaign. Krugman has done just the opposite, questioning Obama's criticism of the current system, Oh, Paul, where have ye gone?