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OPEN FORUM Taking Back the Owner’s Box BY FRED LEWIS AVe have a full-blown, Texas-size political scandal underway. Big corporate money from the Texas Association of Business our 2002 elections. The voices of average people in Texasnever heard enough at the Capitol to begin withwere completely drowned out in the 2003 session by moneyed special interests so powerful some dubbed them “the owner’s box.” But it doesn’t have to be this way. Don’t despair and don’t believe the cynical folks who say there is nothing we can do to increase the power of average folks and reduce the leverage of special interests. Often these naysayers have a stake in the current system or they are unaware of reforms in other states that are working. It’s also easy to confuse prior piss-ant Texas reforms that didn’t change the status quo much with fundamental reforms in other states that are making a real difference. The Clean Up Texas Politics Coalition, sponsored by Campaigns for People, supports five major reforms that are working well in other states. These changes will make elections competitive again and enhance the role of smaller donors. They will put the voter back in charge in Texas. These are five fundamental reforms that the Texas Legislature could enact next session to restore government to the people. 1. CLOSING CORPORATE SOFT MONEY LOOPHOLES Tightening Texas’ century-old prohibition on corporate and union cash is an essential reform. Unfortunately, it will only return us to the status quo that existed before the cheating that occurred in 2002. Special interests had way too much power at the Texas Legislature before the 2002 election, and if corporate money is allowed to further flood our state elections, the domination of special interests will get worse, much worse. Even though the current corporate prohibition ultimately may ensnare TAB and TRM, it needs to be modernized and made easier to enforce. The TAB and TRM scandals reveal that four basic corporate prohibition reforms need to be enacted: End sham issue ads such as TAB’s corporate-funded direct mailers. At this point, we’ve all seen these so-called “issue ads” that usually attack candidates right before the election without actually saying vote for his or her opponent. A typical example is the TAB corporate-funded direct mailer sent out in late October 2002 in the East Texas state representative race near Dallas between Republican Betty Brown and Democrat Mike Head. The mailer explained how great Brown would be for the Texas economy and then said: “Texans need a legislator who will vote to keep Texas moving… Betty Brown can help get the Texas economy moving again.” \(Notice there are no “magic words” saying vote for Brown, which TAB contends is the legal The United States Supreme Court has held that corporate money can be prohibited for electioneering ads \(ads intended constitutes electioneering in Texas is disputed \(reformers think circumstances can be considered and TAB says no, only 30 years. This makes stopping corporate-funded sham issue ads much more difficult and costly in Texas than it needs to be. While TAB’s 2002 activities are easier to expose than most casesbecause TAB bragged in its press release that its “issue ads” helped elect candidates \(which is the essence of To get rid of corporate-funded sham issue ads, Texas should adopt a state version of the federal McCain-Feingold law. This law enacts a bright line, easily enforceable test. An ad is electioneeringand corporate and union money is not allowedif the ad is broadcast 60 days before an election, refers to a candidate, and reaches significant numbers of voters in that candidate’s district. The Supreme Court upheld this test for broadcast ads in December 2003 and Texas should enact a similar ban that extends to direct mail pieces as well. Prohibit contributions from slush funds with corporate money. Currently, PACs and party committees send corporate money to out-of-state entities, which then send supposedly legal, non-corporate money to candidates, in what can only be described as money laundering. This appears to have happened when TRM sent $190,000 to the Republican National State Elections Committee, which then sent the same amount several weeks later to seven TRM supportedcandidates. While an indirect transfer of corporate funds is a contribution under Texas law, no one is likely to be as blatant as TRM in the near future. The temptation, however, will remain to launder corporate money and turn felonious funds into legal tender. Texas should ban contributions from out-of-state PACs and parties that accept corporate funds. It is usually difficult to tell if contributions from these entities contain corporate funds because all money is fungible. The solution is to pass laws similar to those that Connecticut has for national political parties: No candidate or PAC can accept any donations from any out-of-state entity that accepts corporate or union money. Tighten the administrative expense exception. Currently the law allows PACs to spend corporate or union money only 10 THE TEXAS OBSERVER 3/12/04