Letter to the President of the Senate and to the Speaker of the House Transmitting Proposed Election Reform Act of 1966.

Dear Mr. President: (Dear Mr. Speaker:)

Public confidence in the elective process is the foundation of public confidence in government. There is no higher duty of a democratic government than to insure that confidence.

Public participation in the political process is the foundation of that process. There is no clearer responsibility of a democratic government than to advance that participation.

Yet for decades we have tolerated the growth of seeds of cynicism from the underbrush surrounding our present method of financing political campaigns.

Despite regular rhetoric about citizen involvement, we have done nothing in fact to encourage public support for the nomination and election of public officials.

And despite the soaring expense of political campaigns, we have done nothing to insure that able men of modest means can undertake elective service unencumbered by debts of loyalty to wealthy supporters.

We have laws dealing with campaign financing. But they have failed. Too narrow in their scope when passed, now they are obsolete. Too narrow in their purpose then, now they are inadequate. They are more loophole than law. They invite evasion and circumvention. They must be revised.

In my State of the Union Message I said:

"As the process of election becomes more complex and costly, we must make it possible for those without personal wealth to enter public life without being obligated to a few large contributors.

"Therefore, I will submit legislation to revise the present unrealistic restrictions on contributions--to prohibit the endless proliferation of committees bringing local and state committees under the act-to attach strong teeth and severe penalties to the requirement of full disclosure of contributions-and to broaden the participation of the people, through added tax incentives, to stimulate small contributions to the party and to the candidate of their choice."

I enclose for your consideration the proposed Election Reform Act of 1966. This measure is designed to achieve four broad purposes:

First it would for the first time make effective past efforts to achieve complete public disclosure of campaign funds. The bill would require all candidates and all committees supporting them for federal office to report, clearly and promptly, the sources of all their funds and how these funds are spent.

Second, it would also require disclosure by members of Congress of gifts and income.

Third, it would revise existing law and for the first time make effective the ceilings on the size of contributions.

Fourth, this proposal seeks a goal not even contemplated by earlier laws--the active encouragement of widespread public participation in the financing of political campaigns through tax deductions.

I.

Campaigns are not merely a periodic political pageant. They are an unparalleled instrument of public education in the issues of the nation and of the community.

The need for such campaigns, and the need to finance them, are hardly evils. The more people reached by a campaign, the closer we approach the democratic ideal of full participation in the decisions of government.

Yet the more people reached, the more funds required. It is here that there is a potential for danger--the possibility that great wealth can be used to achieve undue political influence.

It is that danger to which Congress responded with the Federal Corrupt Practices Act 41 years ago and with the Hatch Act 26 years ago. These measures sought to insure that a tide of funds from the few did not engulf the interests of the many:

--By limiting the total amount a candidate or political committee could spend;

--By limiting the total amount an individual could contribute to a campaign;

--By requiring public disclosure of campaign funds.

These are surely valid aims. But they have not been achieved. Under present law, for example, national political committees can raise and spend no more than $3,000,000 in any year. But the law does not limit the number of national political committees, nor does it apply at all to committees active in only one state.

Similarly, while present law limits Senatorial candidates to expenditures of $25,000 and House candidates to $5,000, it does not limit the number of committees that can raise and spend money on behalf of those candidates.

In the light of the accelerating cost of political campaigns, it is hardly surprising that such supporting committees have proliferated. Legal ceilings on expenditures enacted when the possibilities of radio were only faintly glimpsed--and when there was no television--can have small relevance today.

The loophole through which committees have streamed, is matched by the loophole in the limitation on individual contributions.

The Hatch Act limits contributions to $5,000 to a single federal candidate or to any single political committee supporting that candidate. But it does not limit the number of $5,000 contributions an individual or single interest can make--to each national committee established for a candidate or party--and there is no limit to the number of such committees.

Neither does present law limit spending by state committees for federal candidates. And it does not require these committees to submit any reports, thwarting the aim of full disclosure at the outset.

Even in the case of national committees and candidates who do report, the disclosure may not be sufficient to identify the giver or the particular candidate benefitting from a contribution.

A further, major defect in present law is that it specifically excepts primaries. In many cases primary contests are decisive. In most cases, they are financially burdensome. They remain, however, entirely outside the law.

II,

The proposed Election Reform Act of 1966 seeks, completely and systematically, to correct these omissions, loopholes and shortcomings. It would do so through eight provisions, both corrective and positive.

COMPLETE PUBLIC DISCLOSURE

1. Not only every candidate, but also every committee--state, interstate, or national-that supports a candidate for federal office would be required to report in detail on every contribution and expense item over $100.

The treasurer of every political committee would be required to submit complete reports, on standardized forms, four times during the year and on the fifteenth, tenth, and fifth days before an election.

For the first time, candidates for President and Vice President would be included under this disclosure provision.

2. The present unrealistic exclusion of primaries from the coverage of the law would be ended. This Act would bring primary campaigns and convention nomination contests under the disclosure law.

There is a similar omission concerning primaries in connection with criminal laws against vote-buying and vote-selling. These offenses are adequately dealt with when they occur in general or special federal elections. But they are not covered in federal primaries. There is no reason for this distinction and the Election Reform Act would make these laws fully applicable to primaries as well.

3. The Election Reform Act would require all gifts of over $100 received by members of the legislative branch of the Government for themselves, their wives and minor children, and all income from personal services received by such member or on his behalf to be reported annually. Appropriate criminal sanctions would be provided for failure to comply.

In the executive branch, the acceptance of gifts of more than nominal value is already strictly forbidden by Executive Order 11222 of May 8, 1965.

For such reports to be made by members of the legislative branch can do much to demonstrate that wealthy interests are not permitted to affect--or even appear to affect-the conduct of government through their largesse.

EFFECTIVE AND REALISTIC LIMITATIONS ON CAMPAIGN FINANCING

I. Beyond making political financing public lies the equally demanding task of making it democratic. The Act thus would limit to $5,000 the total amount that could come from any single source to the campaign of any candidate. The present $5,000 limit could no longer be evaded by putting the maximum amount into different pockets in the same suit.

2. At the same time, the Act would repeal present ceilings on total expenditures by candidates for federal offices. As we have learned from experience, artificial limits breed artificial disclosures. And as we have learned, the present limits on total campaign expenses are decidedly artificial.

The cost of campaigning varies from year to year and from state to state, depending on the size of the district and the heat of the campaign. More important, spending limitations defeat the essential purpose of disclosure: to allow public opinion to exert the controlling influence on how much a candidate spends.

3. The Act also would extend the present prohibition against political contributions by government contractors to fully cover corporate contractors.

Under present law, all government contractors other than corporations are barred from making political contributions at any level of government. But corporations with government contracts are barred only from contributing to federal candidates.

Consistency and good sense require that corporations also should be forbidden to make contributions at the state and local level--where finances are, inevitably, related by party to national political campaign finances.

ENCOURAGING WIDESPREAD CITIZEN PARTICIPATION

These first six steps are essentially corrective, altering or refining present inadequacies. The parallel goal never before established by federal law is to enlarge the base of widespread financial support for political campaigns.

This is a necessary goal for a practical reason-to meet the financial burdens of modern political campaigning without inviting the undue influence of large contributors.

But widespread support is a worthy goal for a still more important reason--the infusion and involvement of large numbers of citizens into the election process. We propose two steps to expand participation by the great majority of American citizens.

1. We recommend a special tax deduction, in an amount up to $100, for contributions to any candidate or to any organizations supporting a candidate, in any election campaign or primary, federal, state or local.

This deduction would be allowed in addition to the standard deduction and would not be limited to those who itemize their deductions.

There would be a separate line on every tax return for this deduction.

2. As another means of expanding participation, the Act would permit the sale of campaign souvenirs at prices not exceeding $5. These would become the only items of any kind--including advertising--that any candidate or committee would be allowed to sell.

Broadened financial support is sound for all candidates. For candidates who are not themselves wealthy, it can mean the difference between running and not running.

Finally, one area not covered by the legislation I forward today is the solicitation of political contributions from federal employees by other federal employees.

This is not a matter for which legislation is needed. Congress has already passed the laws. I am asking the Attorney General, in consultation with the Chairman of the Civil Service Commission, to conduct a thorough review of all the regulations and memoranda issued pursuant to those laws to make certain that those regulations are sufficiently comprehensive to carry out not only the letter, but the spirit of the laws passed by Congress.

III.

There is far more at stake in the proposals I submit today than who wins and who loses a particular campaign. The essence of our democratic system is the clash of ideas between differing men and differing parties.

If lack of funds results in an abridged campaign, the public is deprived of the opportunity to hear all viewpoints fully expounded.

If lack of freedom from ties to wealthy interests discourages able men from seeking elective service, both they and the public are deprived of necessary leadership.

If lack of clear disclosure results in skepticism about the entire political process, the public loses the benefit of its own involvement in and respect for that process.

This Election Reform Act of 1966 seeks to avert those dangers.

It seeks honest, straightforward disclosure.

It seeks fair restriction on the exercise of mighty influence by the rich.

It seeks to promote the exercise of widespread influence by the many.

It seeks, in short, to enlarge democracy, and I urge its prompt enactment.

Sincerely,

LYNDON B. JOHNSON