Democracy in action, Southern-style.
Alabama Senate Should Keep Their Promise to Ban PAC-to-PAC Transfers
February 20, 2009
Viewpoints by Gary Palmer
Just because something is legal does not mean it is ethical. In Alabama, it is legal to engage in political money laundering so it’s no wonder the state ranks 49th in the nation for campaign finance disclosure. Overall, Alabama gets a grade of ‘F’ on the latest report card on state disclosure laws published by the Campaign Disclosure Project. The grade and ranking are well justified.
In Alabama, no voter can really be certain who is really influencing the candidates on the ballot on Election Day. Supposedly, state campaign finance laws require full disclosure of the source of contributions to political candidates. But because the state also allows unlimited transfer of political contributions among political action committees (PACs), millions of dollars are being invested in political candidates by big money special interests completely out of sight of Alabama voters.
PACs in and of themselves are not the problem. In fact, PACs serve a useful purpose. Small business owners or individuals who can not make sizeable contributions to help elect good people to office can form a PAC which allows hundreds or even thousands of people to pool their contributions so their voices can be heard.
The problem with PACs under Alabama’s current campaign finance laws is that wealthy individuals and powerful special interests that care nothing about good government have established literally hundreds of PACs for the purpose of selecting candidates who are beholden to them and hiding their campaign contributions from Alabama voters. Powerful special interests such as Alabama Education Association and gambling interests disguise contributions by passing money through other PACs with names that give no hint to the voter as to the real source of the money behind a candidate or the agenda behind the money.
For instance, in 2006 the Gannett News Service reported that Alabama gambling kingpin Milton McGregor gave $603,000 to the Alabama Voice of Teachers for Education (A-VOTE) which is the education union PAC run by Paul Hubbert. A-VOTE then passed $603,000 to another education union PAC, the Fund for Alabama’s Children and Education, which then sent $503,000 to Alabamians For a Better Plan.
In 2008, Hubbert ran education union PAC money through several other PACs in an attempt to defeat two Republican State School Board candidates who had both supported ending the corrupt practice of “double dipping” – legislators holding jobs or contracts with the two-year colleges while also being paid for serving in the Alabama Legislature. Some estimates indicate that in the primary and general election, Hubbert and the education union may have run over $500,000 through other PACs in an attempt to stack the State Board of Education with pro-double dipping members.
Clearly, hiding the source of campaign contributions from voters is wrong. In fact, the issue is so obviously wrong that during the 2006 election both the Democrats and Republicans promised that banning PAC-to-PAC transfers would be a top priority. Yet, going into the third legislative session since that election, the Democrat-controlled State Senate has killed every attempt to pass any legislation that would truly ban the despicable practice of shuffling campaign contributions through transfers.
In the current legislative session, the Democrats and Republicans in the Alabama House of Representatives have once again kept their campaign promise to ban PAC-to-PAC transfers by passing Rep. Jeff McLaughlin’s (D-Guntersville) bill by a vote of 98-0. They passed a similar bill in both the 2007 and 2008 legislative sessions only to see the Democrats in the State Senate substitute another bill that, for intents and purposes, legalized a different form of the practice of hiding the money from voters.
The substitute bill would have allowed transfers to political parties and principle campaign committees with no limit on the number of principle campaign committees and no requirement for full disclosure of the identity of individuals and/or interest groups providing the money.
While the Senate Democrats’ substitute bill would have banned transfers between PACs, it would not have banned transfers to PACs from political parties or from principle campaign committees. In reality, this bill would open the door for hundreds of new organizations to form, in addition to the 600-plus PACs that already operate in Alabama.
Given that Alabama is now ranked fourth in the nation in public corruption, you would think that Alabama politicians would have some motivation to lower the ranking by bringing real transparency to our elections. One step in the right direction would be the passage of a ban on all transfers of political money that conceal the identity of the contributor.
The people of Alabama have a right to know who is funding candidates for office because knowing who is funding the candidate will tell us who is really influencing our state government.
Gary Palmer is president of the Alabama Policy Institute, a non-partisan, non-profit research and education organization dedicated to the preservation of free markets, limited government and strong families, which are indispensable to a prosperous society.
February 20, 2009
Note: This column is a copyrighted feature distributed free of charge by the Alabama Policy Institute. Permission to reprint in whole or in part is hereby granted, provided that the author and API are properly cited. For information or comments contact: Gary Palmer, Alabama Policy Institute, 402 Office Park Drive, Suite 300, Birmingham, Alabama 35223, (205) 870-9900, e-mail garyp@alabamapolicy.org. To subscribe or unsubscribe to this column, please e-mail joannel@alabamapolicy.org.
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