Transcript

461:

Take the Money and Run for Office
Transcript

Originally aired 03.30.2012

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Prologue.

Ira Glass

From WBEZ Chicago, it's This American Life, distributed by Public Radio International. And today we have a big, big story of money and politics. It begins with a humble voice now.

Eleanor Holmes Norton

This is Eleanor Norton, Congresswoman Eleanor Holmes Norton. I noticed that you have given to other colleagues on the Transportation and Infrastructure Committee. I am a senior member, a 20-year veteran and--

Ira Glass

This is voicemail that Eleanor Holmes Norton, the Democratic congresswoman from Washington DC, left for a lobbyist in the fall of 2010. We don't know who the lobbyist is, but from the voicemail we can infer that he represents a contractor who's working on the new Homeland Security complex being built in Washington DC-- a complex that Eleanor their Holmes Norton, at the time, had a lot of power over.

Eleanor Holmes Norton

I'm handling the largest economic development project in the United States now, the Homeland Security compound of three buildings being built on the old St. Elizabeth hospital site--

Ira Glass

After pointing out that she is in charge of the project that he cares about, she gets to the point.

Eleanor Holmes Norton

I was, frankly, surprised to see that we don't have a record-- so far as I can tell-- of your having given to me, despite my long and deep work, essentially in your sector. I'm simply candidly calling to ask for a contribution. I'm asking you to give to Citizens for Eleanor Holmes Norton, PO Box 70626, DC, 20024.

Ira Glass

This tape first surfaced on the Andrew Breitbart site, Big Government. The source was the lobbyist, and redacted his own name from the beginning of the tape. Eleanor Holmes Norton verified that it was real. She declined to talk to us for this program. This voicemail of a US congresswoman sounding a lot like a telemarketer is a peek behind a curtain that usually we don't get a chance to peek behind. It's a part of our political process that we all know exists-- the money gathering part-- but we usually don't get a chance to witness.

Politicians usually don't like reporters and film crews present when they ask for cash. Most of them never want to talk about it with a reporter. But it is daily life for pretty much every member of Congress, their staffs, lobbyists. Phone I calls like this are happening all day, every day. There are phone banks, literally phone banks, in offices in Washington DC, where congresspeople are making calls like this one, leaving messages just like this one.

And don't just take it from me. Here is the second in command of the US Senate, Dick Durbin, Democrat from Illinois.

Dick Durbin

I think most Americans would be shocked-- not surprised, but shocked-- if they knew how much time a United States senator spends raising money. And how much time we spend talking about raising money, and thinking about raising money, and planning to raise money. And, you know, going off on little retreats and conjuring up new ideas on how to raise money.

Ira Glass

Well, today on our program, we will shock you. Alex Blumberg, from our Planet Money team has joined forces with NPR's Congressional correspondent, Andrea Seabrook, to take us deep inside this world that is hidden in plain sight. The world of lobbyists and money and political fundraising. A world that we all hear about all the time, but most of us never have seen up close.

They talk to the people who need the money, they talk to the people who give the money, and they try to figure out what exactly the money buys. Also, there's this little Supreme Court case you may have heard about, Citizens United. We'll talk about that as well. And we bring the old band back together-- McCain and Feingold, here on the radio. Original cast, no substitutions. Stay with us.

Act One. The Hamster Wheel.

Ira Glass

Act One, The Hamster Wheel. Alex and Andrea start off our hour at the spots where the money actually changes hands.

Andrea Seabrook

The money changes hands in very specific places all over DC. There are townhouses whose sole function is to be rented out as venues for this. Dozens of restaurants do a booming business catering small parties in private rooms.

Alex Blumberg

And if you have an idea in your head of what a political fundraiser is-- I know I did-- get it out. It is not that super fancy, black tie gala event you hear about, like the one Barack Obama went to with the $30,000 a plate dinner and Alicia keys performing. It is not that at all. These are much more mundane.

Andrea Seabrook

Like this one here. Here's an invitation to one for Rep. Tim Bishop. He's a Democrat from New York. It's at a restaurant called Johnny's Half Shell. Costs you between $500 and $2,500 to get in. The time? 8:30 in the morning.

Alex Blumberg

Breakfast. See? Not glamorous. A lot of these fundraisers happen at breakfast. Or at lunch, like this one for a Republican candidate, Steve Daines of Montana. It's at the offices of a big trade group in town. Maybe 15, 20 people munching appetizers in a conference room.

Andrea Seabrook

A congressional watchdog group called the Sunlight Foundation collects these invitations to fundraisers and puts them online. Sifting through them, the same venues come up again and again. Lunch at the Capitol Grille, dinner at Bullfeathers, cocktails at the Monocle, breakfast at Johnny's Half Shell.

Alex Blumberg

Now, occasionally they do get fancy. You'll see fundraisers at golf clubs or hockey games, pheasant hunts-- yes, pheasant hunts-- or at live events. For example, this past week, for $1,000, you could join South Dakota Senator John Thune at a Van Halen concert.

Andrea Seabrook

Now all of these events just happened. Just in the last week actually. Our analysis with the Sunlight Foundation data shows that in peak fundraising months, there are at least 20 events a day. One lawmaker told us, "You could spend every day of the year raising money."

Alex Blumberg

And in fact, some actually do.

Nancy Pelosi

I'm very proud of the fact that this year we've broken all records for our donor contributions to our fundraising efforts. And that enabled us to outraise the Republicans this year.

Andrea Seabrook

This is Nancy Pelosi, the top Democrat in the House. She's also the Democratic Party's number one fundraiser. Pelosi has raised hundreds of millions of dollars over the years. Close to $40 million in this election alone.

Andrea Seabrook

How many fundraisers do you typically go to in a given week, do you think?

Nancy Pelosi

A lot. Yeah. Either on the phone or attending events. But I think they've said this year I attended almost 400 fundraisers in nearly 40 cities.

Andrea Seabrook

That's 400 for the year 2011. That's more than one a day, every day of the year, Saturdays and Sundays included.

Alex Blumberg

Now we know from fundraising numbers and scheduled events that the leadership on the Republican side is working just as hard. We contacted all of them and no one would speak to us.

Andrea Seabrook

Staff for the number two Republican in the house, Eric Cantor, said, quote, "We'll pass." House Speaker Boehner's staff said, quote, "It doesn't sound like a good use of time."

Alex Blumberg

And there's one thing driving all this activity-- a gnawing, relentless, voracious need for cash. To understand that need, consider Walt Minnick.

Andrea Seabrook

Minnick is a conservative Democrat who represented a Republican-leaning district in Idaho. He was first elected in 2008, and after he won, he took just five days off from fundraising. Then, two months before he was sworn in as a congressman, he was back raising money for the next election, two years away.

Walt Minnick

I needed to raise $10,000 to $15,000 a day, and you only do it by elbow grease.

Alex Blumberg

Let's stop and dwell on that statement for a second, shall we, Andrea? $10,000 to $15,000 a day. The typical cost of a congressional race is about a million dollars-- although, if you're challenging an incumbent, you need more. Minnick's goal was even more than that-- $2.5 million-- because he was in such a competitive district.

Walt Minnick

I would spend two or three hours a day as a congressman trying to raise money.

Andrea Seabrook

That's typical for a member of Congress, and most of those hours are spent across the street from the Capitol, in special offices set up by the parties specifically for this purpose.

Alex Blumberg

Special offices because federal law prohibits lawmakers from making fundraising calls from their own congressional offices. Neither party is eager to let reporters into these call centers, but we got a couple Democrats to describe what it's like in there. This is Oregon Congressman Peter DeFazio.

Peter Defazio

If you walked in there, you would say, boy, this is about the worst looking, most abusive call center situation I've seen in my life. These people don't have any workspace. The other person is virtually touching them. Just counters on the wall with telephones and people eight inches away from you, talking on the telephone.

Dick Durbin

We sit at these desks with stacks of names in front of us, and short bios, and histories of giving.

Alex Blumberg

This is Senator Dick Durbin, who says that on the Senate side, they'll have these things called "power hours" several times a week, where a bunch of senators will go into the call center--

Dick Durbin

--and make these calls to people who are our faithful friends and ask them to give money or have a fundraiser. And then, if we're fortunate enough, we end up attending those fundraisers that we begged people to do for us. I mean, that is part of the conversation. And this goes on and on and on.

Alex Blumberg

Where do the names come from? How do you decide who to call?

Dick Durbin

The names come from a history of giving. And many of them-- it's hard for most listeners to believe-- really aren't looking for much. They want their team to win. In this case, the Democratic team. They don't ask for special favors. But there are exceptions. There are some who won't waste any time to tell you what they think is the most important issue in Washington as they talk about their donation. It is part of the reality of the life that I live.

Walt Minnick

It's absolutely the most distasteful thing to do as a congressman, or a senator, or a candidate.

Andrea Seabrook

Again, Walt Minnick.

Walt Minnick

You essentially wear out your friends and you wear out the people who are your natural supporters, because if someone writes you one check or comes to a fundraiser, they get on a list. And three or four months later you call them back again. And the best thing about being an ex-congressman is my friends now return my phone calls.

Alex Blumberg

Your friends started dodging your calls?

Walt Minnick

They do what they can help. They're your friends. But after you've called them three or four times in an election cycle and they've been very generous, they think enough's enough. And it is. I agree with them. And I hated to make those calls.

Alex Blumberg

Now, there is an easier way to relieve some of that pressure and raise money faster. A way that doesn't involve tapping out your friends. Just go to the people who already have big stacks of money set aside to give to politicians-- lobbyists.

Andrea Seabrook

A lobbyist can throw you a fundraiser. A lunch a Johnny's Half Shell or a cocktail reception at Bullfeathers. And so, every week, lawmakers and their staffs work the phones, trying to find lobbyists to organize these events. Jimmy Williams used to get those calls. He was a lobbyist for the real estate industry for many years.

Jimmy Williams

A lot of them would call and say, "Hey, can you host an event for me?" And you never want to say no. Actually, no. You always want to say no. In fact, you always want to say no. But, you could look on your phone with these caller IDs and you would be like, really? I'm not taking that call.

Alex Blumberg

Oh, so you would dodge calls for fundraising?

Jimmy Williams

Oh yeah. Every lobbyist does. Are you kidding? You spend most of your time dodging phone calls. Oh yeah.

Alex Blumberg

This was one of the most surprising things I learned about this whole process. The way most of us generally think about it is absolutely backwards. We imagine the lobbyists stalking the halls of Congress, trying to influence members with cash. But more often than not, it's the reverse-- the member is stalking the lobbyists, saying, "Hey, can I have some of that money?"

Andrea Seabrook

And it's hard to say no, Jimmy says. Especially to a congressman whose work and votes he cared about. So, he'd say yes and then he'd have to round up a bunch of guests.

Jimmy Williams

That's why I call up my buddies down on K Street. From my buddy over at the credit unions, or my buddy over at the insurance company, or my buddy over wherever-- at the home builders. And I say, "Hey, dude. I'm going to do this event for this guy and he sits on the House Financial Services Committee. And do you guys have any money for this person? Is he in your budget?" And the answer was usually, "Yeah, yeah, I got money for that guy." And so, all right. So cool. So we'll come up with a date and then we have this fundraiser. And it's a breakfast or it's a lunch or it's a dinner or a cocktail reception. And everyone comes and they bring their checks or they mail their checks in. And then you have it.

Andrea Seabrook

We're talking thousands of dollars that the congressman will make in just an hour. And imagine what this is like for the lawmaker. For someone like Walt Minnick, who has to pull in $10,000 to $15,000 a day. When his staff comes and says, "We've convinced this group of lobbyists to throw a fundraiser for you," it's a relief.

Walt Minnick

And my answer is, "Yes, I'll be happy to attend." And I get lots of those kinds of events, too. I was on the egg committee, and every egg group in Washington that wanted to host one of those kinds of events, I would be pleased to go to.

And if you walked away with $4,000 or $5,000 from that, that was, a half or a third of what you were supposed to raise that day. And that was easy money. That was a lot fewer phone calls you had to make that afternoon, so.

Andrea Seabrook

We were curious, how exactly does the money change hands? Is it like handing the groom an envelope at a wedding reception? Does someone collect it at the door when you walk in? Are you supposed to be discreet or overt?

Alex Blumberg

The answer is all of the above. Some people pay with plastic. A lot of times, there's actually a space on the invitation to put your credit card number. Sometimes, you'll tell a staffer, "Just put me down for this much," and then you send the money in later. But some, like financial services industry lobbyist, Scott Talbott, prefer a more direct approach.

Scott Talbott

We have a policy that all checks have to be hand-delivered. So we have to go up and eyeball the candidate and talk to them and deliver the check. In rare instances, we can mail the check, but for the most part we want to be there as part of the delivery system.

Alex Blumberg

So you bring it with you. You have it in your pocket.

Scott Talbott

And I have left it in my coat pocket many times. My wife has said, "What is this for, this envelope?" That has happened.

Andrea Seabrook

But why is that better marshalling than just doing an electronic transfer?

Scott Talbott

Well, because it is the ability to help the candidate who is receiving contributions from multiple sources remember you, the industry, et cetera, et cetera. Wouldn't you remember if someone handed you a check, versus just got it in the mail?

Andrea Seabrook

Hell yes.

Scott Talbott

Sure, sure.

Alex Blumberg

Talbot says, typically, there's the person who works for the member of Congress there, who's holding the checks. That person is called a "fundraiser."

Andrea Seabrook

Yup, the event is a fundraiser and that person is called a fundraiser. Jimmy Williams picks it up with what happens next.

Jimmy Williams

You sit around and you have a conversation with the member who's seated at the head of the table or in the center of the table and everyone goes around and says, "I'm Jimmy Williams and I'm a lobbyist for the National Association of Realtors," or whatever it is. And then you go and you say, "We care about keeping big, bad evil banks out of real estate and we care about protecting flood insurance, which is the flood insurance program, which is great for coastal communities."

But everybody does that, so the insurance guy, the lobbyist for the insurance industry, he does that. And the lobbyist for the accounting industry, she does that. By the way, the fundraiser is standing in the room. And the fundraiser has $35,000 in checks sitting in her pocket right now, in her pocketbook. Oh, and we're going to talk about public policy while we take the checks.

Alex Blumberg

Jimmy says that it's not like the check will buy a vote on a bill, or even an amendment. But to get in front of the lawmaker, to make your case at all, you need that check.

Andrea Seabrook

People we talked to in this system said everyone understands the rules. You're going to cut checks from your PAC, your political action committee, to get access to lawmakers. But they tell us the rules are rarely explicit, although there are times, says Jimmy Williams. Like when he took a couple of clients to one Congressman's office.

Jimmy Williams

They open up the door and the chief of staff said, "Can we talk to just you for one second, and then we can bring in the two constituents?" And I said, "Sure, absolutely. Not a problem." Walk in, they shut the door. The congressman is sitting behind his desk. He stands up, he shakes my hand and says, "Hey, Jimmy, it's great to see you." And I said, "Congressman, it's good to see you too." He said, "I have put in two calls to your PAC director and I haven't received any return phone calls. Now why am I taking this meeting?" And he held up a piece of paper with my PAC director's name highlighted in yellow on it, with the dates and the times that he had called her to ask her for a campaign donation. And she hadn't returned his call.

And then I thought to myself, "This is great." Because I've got two of my guys out here that are constituents of this congressman, who are now going to come in here and they're going to make an ask of him to support a specific piece of legislation. And what he has done is he has warned me that if I don't take care of what my PAC director isn't doing, which is contributing to his campaign, then he's not going to help my guys.

Andrea Seabrook

Some members of Congress have a much easier time getting lobbyists and donors to call them back. Members whose positions in Congress give them more sway over powerful interests. A lot of that depends on committee assignments. Here's Jeff Flake, a Republican congressman from Arizona.

Jeff Flake

I can tell you the difference between the fundraising potential when you're sitting on the Ways and Means Committee or sitting on the Science Committee. There's a difference. There's a big difference.

Alex Blumberg

The Ways and Means Committee covers the US tax code. Who gets tax breaks, who pays more. Every corporation in America concerned about the tax code-- which is a lot of corporations-- is suddenly concerned with your candidacy when you're on Ways and Means. The Science Committee can't compete with that. Although, Science isn't the worst. Here's Walt Minnick.

Walt Minnick

Well, I don't know the worst committees. Government Reform, Ethics.

Andrea Seabrook

The leadership of both parties actually ranks each committee according to its fundraising potential. There are lists of the A, B, and C committees with fundraising targets for each one. Those numbers aren't public-- many lawmakers say these lists exist, but no one would give one to us.

Alex Blumberg

So we did our own list, based on publicly-disclosed fundraising numbers. Lee Drutman, a senior fellow at the Sunlight Foundation, crunched data for us, going back to the early '90s. And the math shows the best committee is indeed Ways and Means. Just getting on that committee earns you an estimated quarter million dollars more in donations than the average member of Congress.

Andrea Seabrook

Number two-- no big surprise here-- the Financial Services Committee. It covers banks and Wall Street. It brings in $182,000 more per member than the average. Third best-- Energy and Commerce, which has jurisdiction over the oil and natural gas industries. If you're there, you get a $142,000 boost in fundraising.

Alex Blumberg

And as for the worst-- it's true, Government Reform is bad. As are Education and Natural Resources. They all hurt your fundraising. Members on those committees bring in less than the average. But the very bottom spot belongs to the Judiciary Committee, which covers the federal courts and judicial nominations. Just being on Judiciary costs you $182,000 in donations.

Andrea Seabrook

And then there's leadership. According to the Sunlight data, having a leadership position on any committee-- even a dud committee-- will bump up your fundraising. So, for example, even the chairman of the Government Reform committee does very well, bringing in about a half a million dollars more than the average House member.

Alex Blumberg

And if you become a chairman of a powerhouse committee, an A committee, like Ways and Means or Energy, you pull in over $1 million more. Like Congressman Barney Frank. He became a leader on the Financial Services Committee in 2003 and saw his fundraising skyrocket.

Barney Frank

People would come to see me and pay for the privilege of doing that.

Andrea Seabrook

But there's one catch to getting on a good committee or taking a leadership spot.

Jeff Flake

Where much is given, much is required

Alex Blumberg

Jeff Flake, the Republican from Arizona, says once you get on a good committee or become a chairman, your party's leadership expects you to raise even more money and turn it over to them, so that they can spread it around to members who are less fortunate. Ones in tight races who don't have such an easy time fundraising for themselves. Remember that list of the A, B, and C committees? Flake says leadership makes those targets pretty explicit.

Jeff Flake

We were given dues and assessments. And if you're a senior member on committees that lend themselves to fundraising, and you're either a ranking member or you're the chairman, then you're expected to raise a lot of money.

Andrea Seabrook

Or?

Jeff Flake

Or when you come up every two years to either retain your position or move to another committee, those things are certainly taken into account.

Andrea Seabrook

Do they tell you this?

Jeff Flake

I think that's implied. I think it's pretty well understood.

Andrea Seabrook

Lawmakers of both parties told us that if you're on a good committee, you regularly get called up in front of your party's leaders to go over your fundraising numbers.

Alex Blumberg

And let's say your numbers aren't that good. You know there are other congressmen out there hungry for your spot, trying to prove to the party leadership that they'd do a better job raising money if they were in your position.

Andrea Seabrook

And you can hear this pressure in the voice of Eleanor Holmes Norton. She's the congresswoman who left that voicemail we played at the beginning of the show. This is a part we didn't play earlier.

Eleanor Holmes Norton

I'm simply candidly calling to ask for a contribution. As a senior member of the committee and a subcommittee chair, we have obligations to raise funds and I think it must have been me who hasn't, frankly, done my homework to ask for a contribution earlier. So I'm trying to make up for it by asking for one now, when we particularly need contributions. Particularly those of us who have the seniority and the chairmanships and are in a position to raise funds.

Alex Blumberg

And this brings us to the big question-- what does the money buy? What are corporations and special interest getting in return for the billions of dollars they spend lobbying each year?

Andrea Seabrook

There tend to be two views on this. If you're cynical, you think money buys votes, pure and simple. Washington is owned. Money drives everything.

Alex Blumberg

But lobbyists and politicians will sometimes tell you the opposite. Money has no effect. After all, they say, there's always two sides, and both are giving. Exporters versus importers, bankers versus Realtors, businesses versus unions. The money cancels itself out.

Andrea Seabrook

When we asked Barney Frank about this, he said both of those positions are caricatures.

Barney Frank

People say, "Oh, it doesn't have any effect on me." Look, if that were the case, we would be the only human beings in the history of the world who, on a regular basis, took significant amounts of money from perfect strangers and made sure that it had no effect on our behavior. That is not human nature.

Andrea Seabrook

On the other hand, he says, there are things that influence a politician besides money.

Barney Frank

If the voters have a position, the votes will kick money's rear end any time. I've never met a politician-- I've been in the legislative bodies for 40 years now-- who, choosing between a significant opinion in his or her district and a number of campaign contributors, doesn't go with the district.

And I have had people tell me-- and we talk honestly to each other, we don't lie to each other very often. You don't survive if you do. As chairman of a committee, I'd be lobbying for votes. I have had members say to me, Mr. Chairman, I love you. Barney, you're right. But I can't do that politically because I'll get killed in my district. No one has ever said to me, I'm sorry, but I got a big contributor I can't offend.

Andrea Seabrook

But the fact is, most legislation, your district doesn't care about. The stuff that makes the news is a tiny fraction of what Congress actually does. They're deep in the weeds of tax law and business code and replacing the "and" in subsection b of title one with an "or." Things most voters have no opinions on. The only people who do care, or who even understand what that small print means, are the lobbyists and the industries and interests they represent.

Alex Blumberg

Consider the American Jobs Creation Act of 2004. This was a piece of legislation that lots of multinational corporations spent a lot of time lobbying for because it got them a huge, one-time tax break. Some of the profits-- the profits they made overseas-- would be taxed at just 5%, instead of the normal rate of 35%. A massive windfall.

Andrea Seabrook

This law caught the attention of a tax professor at the University of Kansas, Raquel Alexander. She thought it might help her understand a pretty difficult question she and her colleagues had been considering.

Raquel Alexander

We know that people lobby for a reason, but we haven't really been able to quantify what's the return on their lobbying investment.

Andrea Seabrook

With the American Jobs Creation Act, Alexander and her colleagues finally got something that could help them add up the lobbying costs and benefits.

Alex Blumberg

They simply compared the amount that companies spent lobbying with the amount they saved on their taxes. They came up with a figure. A figure they called "the return on investment for lobbying." Now, for some perspective, money in a regular old savings account, you be lucky to get a 1% return on your investment. On the other end of the spectrum, Bernie Madoff advertised annual returns of just over 10%. If you want to come up with a big, impressive-sounding lie, a 10% return on investment is what you say. The return on investment to lobbying, in the case of Alexander's study--

Raquel Alexander

22,000%. So, for every dollar, on average, that these firms spend on tax lobbying, they receive $220 in tax benefits from this repatriation provision.

Alex Blumberg

Were you expecting it to be that big?

Raquel Alexander

I was not. I was not expecting it to be that big at all. I thought I needed to go back and check my math again.

Alex Blumberg

So after the fifth or sixth time checking, you were like, well, this is the number.

Raquel Alexander

After the 20th time of checking.

Andrea Seabrook

In 2010, there was a total of $3.5 billion spent on lobbying. $3.5 billion. It's hard to imagine that every one of those dollars got a 22,000% return. There are certainly companies out there that spend a lot of money and don't get what they want. They've just lost money.

Alex Blumberg

And it's not to say that the things they're lobbying for are bad public policy. There are lots of people, President Obama included, who think a lower corporate tax rate would benefit the country.

Andrea Seabrook

Barney Frank and lots of others told us straight up, a lot of times, the lobbyist knows much more about your subject than you do as a congressman. You depend on their expertise, and so you listen to their arguments.

Alex Blumberg

The problem is, those arguments are accompanied by a large check. The other side of the issue-- you don't always hear from them. Again, Walt Minnick, the one-time congressman from Idaho.

Walt Minnick

The fact that you get to explain your point of view because you're a big banker executive, and that someone who is just a depositor in the bank doesn't have the time to come into Washington, doesn't have the financial wherewithal. So you may not get that side of the view as well articulated. So you may end up voting the wrong way because you haven't fully understood both sides of the story, even if you do have integrity.

Andrea Seabrook

Is there a time that you accepted a meeting and money with people that, in retrospect, you might not have?

Walt Minnick

I had some meetings I was pretty uncomfortable at with the lender, the payday-loan kind of lender. Some of the folks in that industry were a little unsavory.

Alex Blumberg

And they were funding your campaign?

Walt Minnick

They contributed to my campaign. They're a big political contributor in Washington. And so that's an example of-- there weren't any people who were applying for payday loans that came in to see me. The consumer side of that doesn't contribute a nickel.

Alex Blumberg

When he was talking about this, Walt Minnick told us, "I think I was able to vote in ways I don't regret." That ambiguity, it's built into the system. And now he's on the other side of it. After losing his reelection bid in 2010, he became a lobbyist. And he still has misgivings about the power of money and politics to frame the issues and set the agenda.

Andrea Seabrook

Money in the political system helps explain why oil companies get big subsidies, even while their business is booming. Why the federal government provides flood insurance for rich people to build beach houses in hurricane zones. Why corn syrup that goes in soft drinks gets federal subsidies, and fruits and vegetables don't.

Alex Blumberg

It helps explain why the Defense Department paid two different companies to make engines for the Joint Strike Fighter. Why you can deduct the interest you pay on your mortgage, but not the interest you pay on your credit card.

Walt Minnick

It's why we have a system where, even though we passed a comprehensive health care reform bill, where it's still illegal for the federal government to negotiate drug prices. We pay-- old people, young people, people needing a new cancer drug-- pay eight or 10 times as much in America as they do in any other country. And that is directly a function of the amount of money the pharmaceutical industry has poured into congressional campaigns of members of both parties.

Andrea Seabrook

That's our system. If a congressman went in front of a town hall meeting and said, for $5,000, I'll sit down with anyone of you and have breakfast. You can tell me exactly how you'd like me to vote. He'd be booed off the stage.

Alex Blumberg

But that's the case for pretty much everybody in Congress. They don't even have to say it.

Ira Glass

Alex Blumberg is a producer on our program and on the Planet Money team. Andrea Seabrook is NPR's congressional correspondent. On the internet right now, the Sunlight Foundation and Planet Money crunched numbers from over 13,000 fundraising invitations. Put together an interactive map showing the most popular spots in DC for hosting a fundraiser, charts listing the best and worst congressional committees for fundraising, how many fundraisers over the years have been birthday parties, golf tournaments, and hunting trips. That and more is at Planet Money's website, npr.org/money.

Coming up, how everything that you just heard is now changing. Changing in such a big way to give individual donors and corporations and unions way, way more leverage, thanks to the United States Supreme Court. That's in a minute, from Chicago Public Radio and Public Radio International, when our program continues.

Act Two. PAC Men.

Ira Glass

It's This American Life. I'm Ira Glass. Today on our program, "Take the Money and Run for Congress"-- stories about the moment that money is handed to a politician and what it buys. We've arrived at act two of our program. Act Two, PAC Men.

So everything that we described in the first half of the program-- the fundraisers, the phone banks of congressmen asking for donations-- all of that right now is, at this very moment, changing dramatically. The way that money flows into politics is changing because of the 2010 Supreme Court decision in the Citizens United case. Citizens United lifted a bunch of restrictions on political spending. It opened the door for unlimited political spending by corporations and by unions. And it gave birth to entities called "Super PACs." These funds can take, again, unlimited amounts directly from corporations, unions, millionaires-- anybody-- and spend it on politics. And because of the way the laws are written, Super PAC donors can either temporarily or, sometimes, permanently keep their identities from becoming public. Meaning that people can drop millions into any given race. They can write commercials, they can attack candidates, and voters will never know who they were.

A lot of attention has been paid to what this is going to do to presidential politics, but where it is already having a big effect is Congress. Ben Calhoun tells how.

Ben Calhoun

Here's one pretty good example of how Super PACs are affecting American politics. Affecting the whole balance of money and influence. It starts in Northern California. Starts in the suburban congressional district around Sacramento. And it starts with this guy who was never supposed to win.

Ami Bera

Most folks thought, you know what, Ami? You can't win this race.

Ben Calhoun

Ami Bera is a doctor, a college professor, and when he ran for Congress in 2010, his chances were pretty bleak. He was a Democrat in a midterm election where Democrats took a beating. He was a first time candidate taking on a sitting Republican congressmen named Dan Lungren, and this was in a district that favored Republicans.

Just to give you a sense of how bad it looked, at the beginning of the summer, Ami Bera took a poll.

Ami Bera

When we did that first poll, we saw that we were over 30 points down. So I thought, god, how are we going to overcome 30 points?

Ben Calhoun

30 points. 30 points is a lot. But week by week, Bera got his feet underneath him. He shook hands, he spoke at events, gathered volunteers, asked friends and acquaintances for money. All summer he did this. July, August, September.

Ami Bera

You know, we did a second poll at the beginning of October. I vividly remember when that second poll came in and our pollster called us together for the results. And the one thing she said was, "Single digits, baby." We went from 30 points down to a tight single-digit race. And there was a lot of high-fiving going on, and saying, you know what? We might get this. And then a couple days later, we were in the campaign office making phone calls, fundraising, and one of the younger staffers was on the internet and pulled up The Rothenberg Political Report, which is one of the big political pundits.

Ben Calhoun

Just quickly, when it comes to the art of judging congressional races-- figuring out which ones are really competitive, which seats could change hands, all that stuff-- there's pretty much two people that everybody listens to. There's one guy named Charlie Cook. The other is Stu Rothenberg. So this Bera staffer goes to a computer, looks at The Rothenberg Report.

Ami Bera

And he comes busting out of the room and says, "You know what? Rothenberg moved us to a tossup race." Everyone else had us leaning Republican, and Stu Rothenberg moved us to a tossup. When Rothenberg moved us to tossup, that was external validation that says, OK, game on. We've got momentum on our side, we're moving. The needle's moving in our direction. We can do this.

Ben Calhoun

Soon, Time Magazine and The New York Times were reporting on how competitive the race was. The Times actually ran a piece calling the incumbent, Dan Lungren, "endangered." All of a sudden, more and more people were looking at Bera like he was a possible winner. And people started treating him like one. Donations took off. Everything sort of continued to fall into place until one very specific day.

Ami Bera

It was probably Wednesday or Thursday, right before-- at the end of the third week.

Ben Calhoun

This is the third week in October.

Ami Bera

This is the third week in October. So just as we're getting up to two weeks out of Election Day. And one of our team members says, "You know what? American Crossroads has made a media buy in our media market."

Ben Calhoun

American Crossroads is a Super PAC, put together by some of the country's leading conservative operatives and donors-- most notably, Karl Rove. In the Super PAC world, Crossroads is massive. Moneywise, they raise a ton-- $27 million last year and this year. Their directors are prominent conservative leaders and their donors, who give millions of dollars, are big ones. For example, Bob Perry, the main donor behind the Swift Boat stuff. Perry's given Crossroads more than $8 million.

But anyway, back to Bera, who, after weeks of picking up steam, has just found out that Crossroads is about to spend money in Sacramento. And it was a lot of money-- $682,000. When Bera heard about this, he hoped that at least some of that money was going to be spent going after this other Democrat one congressional district over.

Ami Bera

I hate to wish ill on another person who's running for Congress, but it's like, well, I hope it's going in his direction. So we did some digging around. Folks went to the television stations to see what the buy was like. And they came back a little while later and say, it's all going against you, Ami. It's all a negative Bera buy. So, it's like, you stop there for second and the pit of your stomach falls out.

Commercial Announcer

Not only does Ami Bera support Obamacare, he says it doesn't go far enough? Obamacare's $525 billion in job killing taxes isn't far enough?

Ben Calhoun

This is the commercial that Rove and American Crossroads ran against Bera. Just for the record, Bera thought Obama's Health Care Affordability Act-- aka Obamacare-- he thought it was flawed, needed to be fixed. He did not say what the commercial is saying. And he told this to anybody that would listen, but it was hard to counter Crossroads's ad buy, which was in heavy rotation.

Ben Calhoun

When those commercials were running, what is your most prominent memory of either seeing it at home or talking about it with a friend or your wife? Is there a conversation or something that sticks out in your mind?

Ami Bera

Probably my daughter saying, "Dad, you're on television again. Dad, you're on television again." Because the commercial was running so often.

Ben Calhoun

I know that every TV market is different. What does $680,000 get you in a week in Sacrament? How heavy was it?

Ami Bera

A lot of commercials. Josh, you may know.

Ben Calhoun

This is Bera's campaign manager, Josh Wolf.

Josh Wolf

Yeah, it was about 1600 points, which means that the average viewer will see that commercial about 16 times. Which is a lot.

Ben Calhoun

The average viewer?

Ami Bera

So the average person watching television during that week would have seen that ad 16 times.

Josh Wolf

In just one week.

Ami Bera

So there's a reason why my daughter was saying, "Hey dad, you're on television again. Hey, there's that commercial again."

Ben Calhoun

Day by day, as these ads continued to run, the Bera campaign struggled to respond. Bera sent out emails, sent out press releases, talked to reporters, but what Bera really needed was money. According to him, the campaign had budgeted money for a late rainy day, but it wasn't enough to match $682,000. Eventually, the situation got so dire that Bera tried to bail out the campaign with a $400,000 loan.

Ben Calhoun

And what were your most recent polls showing before those ads hit?

Ami Bera

We were probably down by 8%.

Ben Calhoun

But you actually saw-- you saw the numbers move after those commercials.

Josh Wolf

Oh, absolutely.

Ami Bera

Yeah. I mean, it clearly had impact and drove us backwards. We went from a single-digit race to 14 points down. Now, that's a lot to make up in a single week.

Ben Calhoun

Of course, it's impossible to know if, without the Crossroads ads, Bera could've closed that eight point gap and won the race. Eight points is a lot of ground to make up in two weeks. What is possible to know, though, is that Bera could not compete with $682,000 in TV commercials. I mean, just to put that number in context, during the entire campaign, the Republican incumbent, Dan Lungren, raised and spent about $1.9 million. That means American Crossroads, when it spent about $700,000, it single-handedly increased spending on Lungren's side by more than 30% in a single day.

Ami Bera

I mean, it's like playing a chess game. You lay out your strategy and you're making your moves and so forth. You've taken your opponent's queen and all of a sudden he reaches into his pocket and pulls out another queen and drops it on the table.

Ben Calhoun

I did call Dan Lungren to get his side of all this. As it happens, Lungren's actually the chair of the House Administration Committee, which oversees the enforcement of elections law. So if Bera felt like this whole thing had been unfair, I just wondered what it looked like to Lungren, who had benefited from that big ad buy. I talked to his campaign, talked to his office in DC. After contacting them more than half a dozen times, Lungren never explicitly said he didn't want to talk about any of this. His staff just never responded to any of my requests.

You probably heard little about this because it didn't really get covered, but in 2010-- on both sides of the aisle-- Super PACs we're doing this all across the country. Swooping into congressional races, spending hundreds of thousands-- sometimes millions-- of dollars. affecting who was representing us in Washington. Again, lots of us weren't even paying attention.

This year, we've seen a lot of headlines about this person and that person putting millions of dollars into the presidential race. But Super PACs can throw their weight around more in smaller races, like House races. There, every dollar is more influential. Put $5 million into a presidential campaign-- no matter how flashy that is, you're still ultimately just a drop in the bucket. Put half a million dollars into the right House race, you can change the fate of an entire campaign.

Norm Ornstein

Every potentially vulnerable member of Congress is worried about a late-breaking, enormously-expensive attack campaign used against them.

Ben Calhoun

This is Norm Ornstein. He works at the conservative think tank, the American Enterprise Institute. Ornstein's been living in the world of congressional politics for decades as a journalist, an academic, a columnist. He says these big chunks of Super PAC money that seem to be roaming around have everybody nervous. They've taken the pressure on candidates to raise money and they've turned it up even higher.

Norm Ornstein

Imagine if you've got enough money to take on an opponent, even raise some money for your party, and two weeks before the election, somebody-- and you may not even know who it is, and certainly the voters aren't going to know who it is-- spends $10 million in a blanket television campaign defining you as a scoundrel, an alien, a felon, and a louse. You can't raise the money at that date to do anything about it. You don't have time. So what's happening now is more and more members of Congress are raising a protective war chest, just in case.

Ben Calhoun

Like a rainy day fund.

Norm Ornstein

You could call it a rainy day fund. You could call it an arsenal. A stockpile of nuclear weapons, just in case there's a sneak attack.

Ben Calhoun

If you do the long division of what's happening, it's not hard to see where it's headed. That we're drifting towards a new version of Congress, one where there are people in the House and in the Senate who have had their political existences made or broken by a single entity, one single donor. Norm Ornstein says money, in these kinds of amounts, in some cases, people don't even have to spend it and it can affect what happens in Washington.

Norm Ornstein

I've had this tale told to me by a number of lawmakers. You're sitting in your office and a lobbyist comes in and says, "I'm working with Americans for a Better America. And I can't tell you who's funding them, but I can tell you they really, really want this amendment in the bill." And who knows what they'll do? They've got more money than God.

If somebody disappoints them, the implication becomes clear-- cross them and you're going to get the $20 million alien/predator attack on you and your campaign. And when they leave the office, the lawmaker is sitting there thinking, it's just one amendment, one little thing. And so what's going to happen here is, even without spending the money, in a lot of instances, there are going to be changes in laws that will benefit special interests because of the threat of millions of dollars in undisclosed contributions to bludgeon somebody who thwarts them.

Ben Calhoun

You said that these are conversations that you've already heard of happening at this point?

Norm Ornstein

Yeah. I've had more than one member of Congress-- House and Senate-- tell me about having conversations like this.

Ben Calhoun

In this environment, Democrat Ami Bera and Republican Dan Lungren are going for round two. In some ways, Bera's got the wind at his back. California remapped Lungren's district, made it more Democratic. Bera's also out-fundraised Lungren. But at this house party event I went to with Bera, he took questions from a crowd for about half an hour. And Super PAC spending-- it came up three times.

What everybody seemed to agree on was that this big infusion of outside money-- they were all pretty much counting on it happening again. They talked about it as the new reality, because the role of Super PACs is only getting bigger. Republicans and Democrats are both amassing money. Everyone's planning to do more of this. Last time, Karl Rove's Crossroads group spent $37 million on about 40 different races. This time, including all the races-- presidential, House, Senate-- this time, it's been reported that Crossroads plans to raise and spend more than $300 million. And they're just one of many.

Ira Glass

Ben Calhoun. He is one of the producers of our show.

[MUSIC - "IF YOU'VE GOT THE MONEY, I'VE GOT THE TIME" BY JO STAFFORD]

Act Three. The O.G.s

Ira Glass

Act Three, The O.G.s. In the wake of Citizens United-- it seems like forever ago, but it was only a decade ago, in 2002, that Congress voted to reform how money works in politics when it passed BiCRA, the Bipartisan Campaign Reform Act, better known as McCain-Feingold, after the Republican and Democratic senators who sponsored the legislation, John McCain and Russ Feingold.

Russ Feingold

John, how are you?

John Mccain

Well, I miss you. You're not missing a thing, but I miss you.

Ira Glass

For this last act, we wanted to talk with the two senators who have spent so much of their political lives fighting to lessen the impact of money in the political system. John McCain, of course, was the 2008 Republican nominee for President. He's still in the Senate, representing Arizona. Russ Feingold was swept out of office in the 2010 election. He'd represented Wisconsin there since 1993. He's now teaching at Stanford University. The two men spoke with Alex, Andrea, and Ben. And, listening to this interview, one of the things that stands out most is, well, how angry they sound when they're talking about the Citizens United decision. For example, McCain talking about the part of the Supreme Court ruling that says that candidates are not supposed to coordinate with the Super PACs that support them.

John Mccain

The joke that they are not coordinating with the campaigns, it's beyond ridiculous. People who are part of their campaigns go over to run the PAC-- but they're not coordinating anything, don't get me wrong. Gambling is not taking place in this establishment. I mean, it's beyond belief.

Ira Glass

What Senator McCain is referring to is the fact that the candidate's own staffers are often the ones who leave to run these Super PACs. A pro-Obama Super PAC called Priorities USA is run by President Obama's former deputy press secretary. Carl Forti who is political director of American Crossroads and senior strategist for a pro-Mitt Romney Super PAC called Restore Our Future, used to be Mitt Romney's political director. We'll pick up our interview here where the two senators are talking about what it was like the day they went over to observe the Supreme Court hearing arguments during the Citizens United case.

John Mccain

At first, I was outraged. The day that Russ and I went over and observed the arguments, the questions that were asked, the naivety of the questions that were asked and the arrogance of some of the questioners, it was just stunning. Particularly Scalia with his sarcasm. Why shouldn't these people be able to engage in this process? Why do you want to restrict them from their rights of free speech? And the questions they asked showed they had not the slightest clue as to what a political campaign is all about and the role of money that it plays in political campaigns. And I remember when Russ and I walked out of there, I said, Russ, we're going to lose and it's because they are clueless. Remember that day we were over there, Russ?

Russ Feingold

Absolutely, John. I couldn't agree with you more. It clearly was one of the worst decisions ever of the Supreme Court. The trouble with this issue-- and I think John would agree with this-- is people have gotten so down about it, they think it's always been this way. Well, it's never been this way, since 1907. It's never been the case that when you buy toothpaste or detergent or a gallon of gas, that the next day that money can be used on a candidate that you don't believe in. That's brand new. That's never happened since the Tillman act and the Taft Hartley Act. And so, people have to realize this is a whole new deal. It's not business as usual.

Ben Calhoun

The two of you, given the time and political capital that you put into passing the reform that you did--

John Mccain

We've still got the scars to--

[LAUGHTER]

Ben Calhoun

And given that, when you look at the current situation, I wonder if you feel a little bit like Sisyphus with the rock at the bottom.

John Mccain

I feel a great sense of disappointment and sorrow, because we did see the corruption that existed before. And now you could make an argument that we've gone back further, even, than we had been before. Before there were at least some restrictions-- particularly on corporations and unions-- but now it's just-- it's inevitable as the sun will come up tomorrow. There will be scandals. I don't know exactly what it's gonna be, but I guarantee you, there's too much money washing around the political arena today.

Russ Feingold

I've had conversations with Democratic givers out here in the Bay Area and I'll tell you, you wouldn't believe the requests they're getting. The opening ante is a million dollars. It's not, gee, it'd be nice if you give a million. That's sort of the baseline. This is unprecedented. And, in fact, one thing that John and I experienced was that sometimes the corporations that didn't like the system would come to us and say, you know, you guys, it's not legalized bribery, it's legalized extortion. Because it's not like the company CEO calls up to say, gee, I'd love to give you some money. It's usually the other way around. The politician or their agent who's got the Super PAC, they're the ones that are calling up and asking for the money. So a lot of businesses, I think, are going to help us rebel against this and say, you know, we don't want to be a part of this mess.

Alex Blumberg

You know, Andrea and I and Ben and I have been talking to lots and lots of people who are involved-- politicians, lobbyists, talking to them about the process of fundraising. Most of the people we talked to hate it. They hate making those phone calls, they hate going into that room, they hate going to the fundraisers morning, noon, and night, they hate sucking up to people to give them money to get elected. Why don't more people try to change it?

John Mccain

After this program, I am going to a fundraiser for a guy whose name is Kirk Adams who is running for the US House of Representatives. And I can assure you, I would much prefer to be watching the first round of March Madness. So if I may illustrate your point, it's the system and it's the water in which we swim. And, as you say, I know of no one who likes it, but it is the system. I happen to think--

Alex Blumberg

But why don't more people join you in fighting it? That's what I don't understand.

Russ Feingold

Well, they did. We managed to get-- against all odds, we did get people. It took a lot of hard work. Now the problem is, of course, is people are reticent to do that because they got elected under the system.

Alex Blumberg

So it's just fear of change?

Russ Feingold

Sure. When you win a certain way, your people say to you, hey, this is how we do it and this is how we won. We better not mess with success. I think that's one of the problems in this presidential race, where not only the Republicans, but even my candidate, President Obama, has opened the door to this unlimited money through some of his people. It's hard to get people to change something after they win that way. And that's one of my worries about it.

Ira Glass

Former Wisconsin senator Russ Feingold and his 2002 legislative partner, Arizona Senator John McCain, with Andrea Seabrook, Alex Blumberg and Ben Calhoun. Senator Feingold's the author of the book, While America Sleeps.

Credits.

Ira Glass

Our program was produced today by Ben Calhoun and Alex Blumberg with Sarah Koenig, Jonathan Menjivar, Lisa Pollak, Brian Reed, Robyn Semien, Alissa Shipp, and Nancy Updike. Our senior producer is Julie Snyder, Seth Lind is our production manager, Emily Condon's our office manager. Production help from Matt Kielty. Music help from Damien Graef, from Rob Geddis.

[ACKNOWLEDGEMENTS]

[MUSIC - "MONEY TALKS" BY THE PENGUINS]

Our website, thisamericanlife.org. Life This American Life is distributed by Public Radio International. WBEZ management oversight for our program by our boss, Mr. Torey Malatia, who is very, very concerned about the power of the atheist lobby in Congress.

Norm Ornstein

--and who knows what they'll do. They've got more money than God.

Ira Glass

I'm Ira Glass. Back next week with more stories of This American Life.

Announcer

PRI, Public Radio International.