Orrin Hatch

Mr. HATCH

Mr. HATCH. It basically corrects language in the amendment. It basically allows proportionate share with regard to the unions, and also with regard to corporations. I think it applies both ways. But I wanted to make sure.

Mr. HATCH. That brought tears to my eyes. Mr. President, McCain-Feingold does not say if the contract workers are employees of the State party, or regular, full-time employees. Those details are left to regulators. The amendment amends the FECA act so that the FEC would administer this and all existing FEC enforcement laws and regulations, as well as penalties that would apply. I know what is going on. It is wonderful to argue for what helps your side. McCain-Feingold, to their credit, is trying to get a more honest system that is equal both ways. But if you read the provision on the Beck decision, it basically obliterates it. It basically narrows it so much that it has no meaning. I have to say there are those on the other side of the floor who will never allow the Beck Supreme Court decision, the ultimate law of the land, to be enforced, or to be applied, because it would even things up, and it would allow 40 percent of the union membership in this country to have some say on how their dues are being spent in the political activity. That is all I am trying to do. I think it is a reasonable thing. I think it is the right thing. I think it is the intelligent thing. If we don't do this, then are we really trying to have a bill that is going to correct some of the ills of our society? I have no illusion. I suspect that many, if not all, on the other side will vote against this amendment because it does basically even things up. It does what the distinguished Senator from Massachusetts said we ought to do back in the early 1990s, but today is indicating, if we do it, that it has to be done in such specificity that it would be the most specified language in the history of legislative achievement. Amendment No. 134, As Modified Mr. President, I send a modification to the desk and ask for its immediate consideration.

Mr. HATCH. Senator McCain said he doesn't. He is naturally being humorous, as he always is. Let me just say this. I acknowledge that it is difficult to devise a manner in which this should be done, but I think we should work together and do what the distinguished Senator from Massachusetts said in the early 1990s ought to be done. We ought to get those big special interests in the corporate world to have to conform to certain disclosures. This is an important matter for hard-working Americans. If my colleague thinks stockholders should be treated similarly, that is what I am trying to do in good faith. I think I am doing it pretty well. Just so we get rid of this argument that every detail has to be written into legislation--heck, everybody around here knows that isn't the case ever. I myself think sometimes we ought to be a little more specific and not just let the bureaucracy run wild, but that is not the way things work in this Federal Government. Just think about it. I think the argument of the distinguished Senator from Massachusetts is very insufficient in the details with regard to what legislation is all about. Let me give an illustration. The Federal Communications Act simply tells regulators to regulate the airwaves in the public trust. I am sure the distinguished Senator from Massachusetts would love to have three or four thousand pages defining what that means--or maybe 150,000 pages defining what that means. But it works. It works as long as we have honest people in the bureaucracy. Think of this one. There is a level of detail in all legislation that is left to administrators and regulators. The McCain-Feingold bill that is so magnificent, triumphed by the distinguished Senator from Massachusetts, requires State parties to use hard money to pay the salary of a State party worker if they spend more than 25 percent of their time on Federal election activities. That is pretty broad to me. Nowhere does McCain-Feingold state how State parties are to track these people's time--nowhere. We will leave that to the regulators. I could go down each paragraph in the McCain-Feingold bill and shred it alive, if the argument of the distinguished Senator from Massachusetts has any merit, which, of course, it does not. But that doesn't stop bombastic argument, nor should it. I love them myself. I love to see the distinguished Senator from Massachusetts get up there, and everybody is almost positive he is going to blow a fuse before he is through. But the fact is, he has a right to do that. I admire him for doing it. I admire the way he supports his special interests. I do not know of anybody who does it better. We don't have anybody on our side who can do that as well. (Applause in the Galleries.)

Mr. HATCH. He is fighting for his special interests, and I don't blame him. He gets 100 percent support from union activity and union money. It has kept him in office for years. I have to say it is not just the liberal side of the union movement. My goodness, it is almost every liberal special interest group in this country. We all know when the distinguished Senator from Massachusetts speaks, he speaks for every liberal special interest group in this country, and you had better pay attention if you are on the Democratic side of the aisle, because if you don't, you are going to have a primary in the next election. I respect that kind of power. And I love my colleague as very few in this body do. (Laughter.)

Mr. HATCH. These poor little picked-on people who basically have no say in their lives, unless they have the protection of the distinguished Senator from Massachusetts, among others. But to come here today and tell me I have to write every detail of regulation into a statute that I know the FEC can do is almost an insult. It comes close.

Mr. HATCH. It is a technical correction.

Mr. HATCH. I can't stay here and let the Senator from Massachusetts get away with this. Here we go again. I acknowledge he represents a State that is highly unionized. I don't know if he ever worked for a union or belonged to a union, but I have. I spent 10 years in the building construction trade unions. I have a lot of respect for the union movement. I would fight for the right of collective bargaining. But, unlike my colleague from Massachusetts, I do not believe I have to champion everything that one cause wants over everybody else. I should not say everybody else, but over anybody who is not one of the most liberal special interest groups in our country. I do not need a lecture from the distinguished Senator from Massachusetts on how to write legislation. Nor do I need a lecture from the distinguished Senator from Massachusetts on what the Beck decision means. The Senator and many on the other side of the aisle will spend every ounce of their beings to make sure that union members have no say with regard to how their moneys are spent in political activities. By the way, with all due respect to my friend from Massachusetts--and everybody knows he is my friend; that is why I think my words may have a little more impact than some others' --the idea to include corporations and treat them in a manner comparable to labor organizations, as I recall, came from the distinguished Senator from Massachusetts himself. That was in the early 1990s when I offered amendments requiring disclosure of the money spent by labor organizations, money of hard-working American men and women. As I recall, one of the principal arguments of my friend from Massachusetts was that corporations were not treated similarly--those big, massive, powerful corporations compared to these little, tiny, ``difficult to maintain freedom for the union members'' unions. We all know what is going on here. There are people on that side who will fight to the death because, although 40 percent of all union members are Republicans, virtually 100 percent of all union political money is used to elect Democrats. I can recall many years when some of the most liberal Republicans who always supported labor, and when a Democrat who supported labor ran against them, that Democrat got labor support. If I have to cite anybody, I will cite Jacob Javits of New York. I know what is going on here. They will fight to the death to make sure that those 40 percent of Republicans who work in the unions, who believe in Republican principles, will never have any say on how the totality of the money is spent in the political arena. Oddly enough, I respect my friend from Massachusetts because he has been the No. 1 champion of these unpowerful trade union organizations.

Mr. HATCH. I don't think the distinguished Senator from Massachusetts is wrong in what he is saying. I don't think you are wrong in your interpretation of the language, but the bill treats the union members and their dues in the separate context of shareholders and their value in a corporation. The regulations will have to be set by the Federal Election Commission pursuant to this amendment. It is equal in treatment because what we are trying to do is give the shareholders in the case of corporations a right to have some say in how the assets of a corporation are used, in proportion to their shares in a corporation. Naturally, these situations are not analogous, and for the union member, how the dues of the union member are spent by the unions. The Senator's characterization of the McCain-Feingold language is inaccurate, and I think I more than indicated that in my opening remarks with regard to the Beck case. Actually, the McCain-Feingold language narrows the Beck case.

Mr. HATCH. What are we talking about?

Mr. HATCH. We are talking about violations of the Federal Election Campaign Act. The FEC would have the job of determining the regulations applicable under the circumstances. The amendment is quite clear what we are trying to get after; that is, trying to give stockholders and union members a right to have some say in the way unions spend, in the case of unions, and corporations, in the way corporations spend on behalf of shareholders.

Mr. HATCH. My amendment would cover the stockholders who existed on the day the request for the expenditures was made.

Mr. HATCH. My amendment covers every corporation. There are a lot of private corporations, but they are still corporations. Let's face it. The major thrust of my amendment is towards public corporations which has been complained of from time to time by Senators on both sides of the aisle. I am trying to cover both unions and corporations so we have an equal protection program.

Mr. HATCH. Will the Senator yield so I can answer his question?

Mr. HATCH. Nowhere did they count these dues-paid political operatives. I read a report a number of years back--I think it was the Congressional Research Service, if my recollection serves me correctly--where they estimated that the unions spend about a half billion dollars--that is with a ``B''--a half billion dollars every 2 years in local, State, and Federal politics. This money is spent on dues-paid political operative activities that never show up in these figures. Let me tell you, I am not against their right to do that. I think they should have a right to do that. I respect them. I will fight for their right to do that. The fact that it is all one-sided, even though 40 percent of union members are Republicans, I can live with that. But what I cannot live with is shutting down the party, the only way we can compete, where the unions do all these things for Democrats but nothing for Republicans. The fact is, the Democrats will continue to count on the unions to get out their vote. But why do we have McCain-Feingold shutting down the rights of Republicans to compete to get out the vote, to have voter identification, voter registration, mass mailings, phone banks, TV advertisements, radio advertisements, magazine advertisements, newspaper advertisements, outdoor advertising and leafleting, polling, volunteer recruitment and training, and full-time political operatives? The fact is, this is all done for Democrats. Their party does not have to do it. They can live with the hard money limitation that this bill would impose upon them. But the Republican Party would have no soft money. All this is soft money on the unions' part--all working for Democrats, all one sided. And the Republican Party does not have the same opportunities. Talk about imbalance. Again, let's go back to what my amendment does. My amendment does not say: Stop that. You members of the unions are not allowed to do that. It does not say that at all. It does not say you can't get out the vote for Democrats, and does not say you can't do voter identification for Democrats. It does not say you can't do voter registration for Democrats. It does not say you can't do mass mailings or phone banks or TV advertisements or radio advertisements--although for those two, with the 60-day requirement, McCain-Feingold does do something; but it is unconstitutional on its face--it does not say you can't do magazine advertisements and newspaper advertisements and outdoor advertising and leafleting and polling, and volunteer recruitment and training. It does not say you can't have union-salaried, full-time political operatives-- the best in the business, all over the country in every State in the Union that counts, in every large city that counts. They can do all of that. I am not arguing against that. All my amendment says is that they need to disclose to their members something that in this computer age they can do without--

Mr. HATCH. I do not know a corporation that does not have stockholders, whether they be private or public.

Mr. HATCH. It applies to every corporation.

Mr. HATCH. Mr. President, I suggest the absence of a quorum.

Mr. HATCH. I send an amendment to the desk and ask for its immediate consideration.

Mr. HATCH. Madam President, I rise today to say a few words on the task at hand, namely reforming our campaign finance laws and doing it within the contours of the First Amendment of our Constitution. I fully appreciate that the issue of campaign finance is of growing concern to the American electorate and has already played an important role in the recent election. And I commend my colleagues, Senators McCain and Feingold for their bold leadership in an effort to address the public perception that our political system may be corrupt. At this time, I will simply explain the limitations we all face in this endeavor. Limitations imposed by the cherished First Amendment of our constitution. During the course of the coming days, I will more specifically address the underlying legislation, and where in my analysis of the law it falls short of meeting minimal constitutional requirements. There are some bright lines drawn by the Supreme Court on this issue and I will get to that. The Founders of our country certainly understood the link between free elections and liberty. Representative government--with the consent of the people registered in periodic elections--was--to these prescient leaders of the new nation--the primary protection of natural or fundamental rights. As Thomas Jefferson put it in the Declaration of Independence, to secure rights ``Governments are instituted among Men'' and must derive ``their just Powers from the Consent of the Governed.'' That freedom of speech and press was considered by Madison to be vital in assuring that the electorate receives accurate information about political candidates was demonstrated by his vehement arguments against the Alien and Sedition Acts in 1800. The Sedition Act, of course, in effect, made it a crime to criticize government or government officials. Its passage was a black mark on our history. Although the exact meaning or parameters of the First Amendment are not clear, a thorough reading of Supreme Court jurisprudence provides constructive guides for us in Congress. Political speech is necessarily intertwined with electoral speech, particularly the right of the people in election cycles to criticize or support their government. Indeed, the form of government established by the Constitution is uniquely intertwined with freedom of speech. The very structure of the Constitution itself establishes a representative democracy, which many observers, including myself, find to be a form of government that would be meaningless without freedom to discuss government and its policies. To get to the heart of the matter being discussed today, I want to turn to the seminal Supreme Court case of Buckley v. Valeo. In short, Buckley and its progeny stand for the following propositions: (1) money is speech; that is, electoral contributions and expenditures are entitled to First Amendment protection; (2) contributions are entitled to less protection than expenditures because they create the appearance of corruption or quid pro quos; (3) express advocacy is entitled to less deference than issue advocacy; (4) corporate donations and corporate express advocacy expenditures may be restricted; (5) political party independent expenditures may not be restricted at least if not connected to a campaign; and (6) restrictions on soft money are probably unconstitutional because soft money does not create the same problem of corruption from quid pro quos that contributions bring. I will explain these further. To understand why certain recent campaign finance reform measures, such as the well-intentioned McCain-Feingold bill, infringe on free speech and free elections, it is necessary to survey the Supreme Court's decisions on campaign finance reform and the problems it brings to free speech. The granddaddy of these cases is Buckley v. Valeo, 424 U.S. 1 (1976). Buckley established the free speech paradigm in which to weigh the competing campaign reform proposals. As my colleagues know well, two decades ago, in the wake of the Watergate scandal, Congress passed the Federal Election Campaign Act, or FECA. The Act imposed a comprehensive scheme of limitations on the amount of money that can be given and spent in political campaigns. FECA capped contributions made to candidates and their campaigns, as well as expenditures made to effect public issues, including those that arise in a campaign. The Act also required public disclosure of money raised and spent in federal elections. The Supreme Court in Buckley upheld against a First Amendment challenge the limitation on contributions but not the limitations on expenditures. The Court reasoned that contributions implicated only limited free speech interests because contributions merely facilitated the speech of others, i.e., candidates. Crucial to the Court's analysis was its belief that limiting contributions was a legitimate governmental interest in preventing ``corruption'' or the ``appearance of corruption'' because such limitations would help prevent any single donor from gaining a disproportionate influence with the elected official--the so-called ``quid pro quo'' effect. A similar interest justified mandatory public disclosure of political contributions above minimal amounts. But Buckley reasoned that expenditures of money by the candidate or others outside the campaign did not implicate the same governmental interests because expenditures relate directly to free speech and are less likely to exert a quid pro quo. Therefore, to the Court, limitations on expenditures could not be justified on any anti- corruption rationale. Nor could they be justified by a theory--popular in radical circles--that limitations on expenditures, particularly on the wealthy or powerful, equalize relative speaking power and ensure that the voices of the masses will be heard. The Court viewed such governmental attempts at balance as an abomination to free speech and held that this justification for restraints on expenditures was ``wholly foreign to the First Amendment.'' It seems to me that such ``balance'' is, in reality, a form of suppression of certain viewpoints, a position that flies in the face of Justice Holmes' notion that the First Amendment prohibits suppression of ideas because truth can only be determined in the ``marketplace'' of competing ideas. Significantly, the Supreme Court in Buckley held that any campaign finance limitations apply only to ``communications that in express terms advocate the election or defeat of a clearly identified candidate for federal office.'' As we have heard before, a footnote to the opinion elaborated on what has later been termed ``express advocacy.'' To the Court, communications that fall under FECA's purview must contain ``magic words'' like ``vote for'' or ``elect'' or ``support'' or ``Smith for Congress'' or ``vote against'' or ``defeat'' or ``reject.'' Communications without these electoral advocacy terms have subsequently almost always been classified by courts as ``issue advocacy'' entitled to full First Amendment strict scrutiny protection. One important underpinning of the Buckley Court's view of the relationship between the freedom of speech and elections is that money equates with speech. The Court in a fit of pragmatism recognized that effective speech requires money in the market place to compete. But beyond looking at the purpose of campaign finance laws, it is clear that restrictions on political spending have the result of limiting the amount and effectiveness of speech. Let me borrow Professor Sullivan's example of a law restricting the retail price of a book to no more than twenty dollars. To Justice Steven such a law is about money and not about a particular book. But does not such a law limit the amount and effectiveness of speech because it creates a disincentive to write and publish such books. The Supreme Court has, as Professor Sullivan pointed out, repeatedly held that financial disincentives to specific content-based speech, just as much as direct prohibitions on such speech, trigger strict First Amendment review. And I must emphasize that restrictions on campaign contributions and expenditures cannot be justified as content neutral regulation. The Buckley Court rejected the example given by defenders of the regulations at hand that spending and contribution limits are similar to limiting the decibel level on a sound truck and do not stop the truck from broadcasting. The Court rejected that analogy because, to the Court, decibel limits aim at protecting the eardrums of the closest listener, not at preventing the sound truck from reaching a larger audience. To the Court, unlike decibel limits, limits on campaign expenditures and contributions do restrict the communicative effectiveness of speech. The Court was right. Buckley's other key underpinning is its ``strict scrutiny" justification of the restrictions on direct contributions to campaigns as needed to combat ``corruption'' and the ``appearance of corruption''--in other words ``quid pro quo'' exchanges. This has been criticized by the congressional reformers not as over-inclusive, but ironically as under-inclusive. I believe the underlying bill goes much further than Buckley. If Buckley v. Valeo established the skeleton of First Amendment protection of the electoral process from onerous regulation, Buckley's progeny filled in the flesh. Let me mention a few of the main cases. In First National Bank v. Bellotti, decided in 1978, the Supreme Court reaffirmed its view in Buckley that expenditures for issues are directly related to expression of political ideas and are, thus, on a higher plane of constitutional values requiring the strictest of scrutiny. Bellotti found a Massachusetts law that prohibited ``corporations from making contributions or expenditures for the purpose of . . . influencing or affecting the vote on any question submitted to the voters'' unconstitutional because it infringed both (1) the First Amendment right of the corporations to engage in issue advocacy and, (2) the First Amendment right of citizens to ``public access to discussion, debate, and the dissemination of information and ideas.'' Bellotti did not involve restrictions on corporate donations to candidates. The Court distinguished between portions of the law ``prohibiting or limiting corporate contributions to political candidates or committees, or other means of influencing candidate elections''--which were not challenged-- and provisions ``prohibiting contributions and expenditures for the purpose of influencing . . . questions submitted to voters,'' i.e., issue advocacy. The Court explained that the concern that justified the former ``was the problem of corruption of elected representatives through creation of political debts'' and that the latter ``presents no comparable problem'' because it involved contributions and expenditures that would be used for issue advocacy rather than communication that expressly advocate the election or defeat of a candidate. In Citizens Against Rent Control/Coalition for Fair Housing v. Berkeley, the Court once again gave full panoply of protection to expenditures linked to communication of ideas. In this case the Court invalidated a city ordinance that limited to $250 contributions to committees formed solely to support or oppose ballot measures submitted to popular vote. The Court held that it is an impairment of freedom of expression to place limits on contributions which in turn directly limit expenditures used to communicate political ideas, without a showing of the ``corruption'' element laid out in Buckley. In Federal Election Commission v. National Conservative Political Action Committee, the Court once again relied on Buckley's distinction between expenditures and contributions, with the former receiving full first amendment protection. The Court invalidated a section of the Presidential Election Campaign Fund Act which made it a criminal offense for an independent political committee or PAC to spend more than $1000 to further the election of a Presidential candidate who elects to receive public funding. The Court held that the PAC's independent expenditures were constitutionally protected because they ``produce speech at the core of the first amendment.'' One year later, in Federal Election Commission v. Massachusetts Citizens for Life, Inc., decided in 1986, the Supreme Court clarified the distinction between issue and express advocacy, holding that an expenditure must constitute express advocacy in order to be subject to FECA's prohibition against the use of corporate treasury funds to make an expenditure ``in connection with'' any Federal election. In this case, the Court held that a publication urging voters to vote for ``pro-life'' candidates, that the publication identified, fell into the category of express advocacy. But the Court refused to apply FECA's prohibition in this case to MCFL--Massachusetts Citizens for Life, Inc.--because the organization was not a business organization. The Court noted that ``[g]roups such as MCFL . . . do not pose . . . danger of corruption. MCFL was formed to disseminate political ideas, not to amass capital.'' Just 5 years ago, the Supreme Court, in Colorado Republican Federal Campaign Committee v. FEC addressed the issue of whether party ``hard money'' used to purchase an advertising campaign attacking the other party's likely candidate, but uncoordinated with its own party's nominee's campaign, fell within FECA's restrictions on party expenditures. A fractured Court agreed that applying FECA's restriction to the expenditures in question violated the first amendment. A plurality of the Court--Justices Breyer, O'Connor, and Souter-- based their holding on the theory that the expenditure at hand had to be treated as an independent expenditure entitled to first amendment protection, not as a ``coordinated'' expenditure or express advocacy, which may be restricted. It is significant to note that Justice Thomas, joined by Chief Justice Rehnquist and Justice Scalia, concurred in the judgment, but would abolish Buckley's distinction between protected expenditures and unprotected contributions, believing that both implicated core expression central to the first amendment. As a plurality of the Court noted, because any soft money used to fund a Federal campaign must comport with the contribution limits already in place, soft money does not result in the actuality or the appearance of quid pro quo ``corruption'' warranting intrusions on core free speech protected by the first amendment. In any event, it is my view that such soft money activities such as voter registration drives, voter identification, and get-out-the-vote drives, as well as communication with voters that do not fall within express advocacy, are protected by the first amendment's freedom of association--the right to freely associate with a party, union, or association--as well as by free speech. Finally, there is the very recent case of Nixon, just last year. I remember that when this case was decided, proponents of so-called campaign finance reform gloated that this case supported their positions. In my view, all the case did was extend Buckley's restrictions on contributions to State campaign finance laws. The Court rejected a challenge to Missouri's contribution restriction as too limited because it did not take into account inflation. The Court held that Buckley demonstrated the dangers of corruption stemming from contributions and that there was sufficient evidence in the record to support the conclusion that Missouri's campaign contribution limit addressed the appearance of corruption. The case did not address the issues of independent expenditures, issue advocacy, or soft money expenditures. As I noted at the outset, Buckley and its progeny stand for the following propositions: No. 1, money is speech; that is, electoral contributions and expenditures are entitled to first amendment protection; No. 2, contributions are entitled to less protection than expenditures because they create the appearance of corruption or quid pro quos; No. 3, express advocacy is entitled to less deference than issue advocacy; No. 4, corporate donations and corporate express advocacy expenditures may be restricted; No. 5, political party independent expenditures may not be restricted at least if not connected to a campaign; and, No. 6, restrictions on soft money are probably unconstitutional because soft money does not create the same problem of corruption from quid pro quos that contributions bring. I am concerned that the practical result of the limitation on contributions is that candidates must seek contributions from a larger set of donors. This means that candidates are spending a greater amount of time raising money than would otherwise be the case. This is aggravated by the need for a lot of money in general to compete in American elections, given our large electoral districts, statewide elections, and weak political parties, which require candidates to fund direct communications to the electorate. The rising costs of elections are further aggravated by the rising importance of expensive televison advertising and the use of political consultants, with their reliance on polling and focus groups. Elections have become a money chase. Ironically, this is the major complaint of the reformers. Their initial FECA reforms have caused the problems they are now complaining about. First, PAC money, and now soft money, are the result of limitations on contributions. Let's not kid ourselves. Like pressurized gas, money will always find a crevice of escape. In other words, money will always find a loophole. All that the FECA and courts have accomplished is to encourage the substitution of contributions to candidates for contributions and expenditures made to and by organizations such as political parties or advocacy groups. These organizations are less accountable to the voter. The net result is the growth of yet another huge government bureaucracy to police an inherently unworkable scheme. Furthermore, if one believes, as I do, the efficacy of Justice Holmes' free speech model of a ``marketplace of competing ideas,'' it is impermissible to drown out or even ban corporate speech or the speech of the wealthy, as some advocate. If the remedy for ``bad'' speech is not censorship, but ``more'' speech, then the remedy for corporate speech is likewise not censorship, but more noncorporate speech. It should be obvious that in the electoral sphere the wealthy and powerful have no monopoly over speech. This is not analogous to Turner Broadcasting System, Inc. v. FCC, where the Court in part upheld the congressional requirement that cable operators carry a certain percentage of local broadcasting of local programs on their lines because cables' monopoly power choked the broadcast competitors. Unlike the open access rule in that case, limitations on contributions offer no guarantee that the market power of speech will be redistributed from the wealthy to the poor. Such spending limits will not stop wealthy candidates like Ross Perot from spending personal wealth or the rich from influencing mass media through direct ownership or through the purchase of advertisements. Surely, no one would advocate that we attach an income test to the first amendment. The wealthy will always have substitutes for electoral speech. Moreover, the success of the labor unions and voluntary associations as competitors in the market place of ideas demonstrate that limitations on contributions from the wealthy and on corporate speech are unnecessary. In my view, a far better, though, admittedly not perfect, solution-- one that I believe is both workable and is consistent with the dictates of the first amendment--is a campaign system that requires complete disclosure of funds contributed to candidates or used to finance express advocacy by independent associations, political parties, corporations, unions, or individual in connection with an election. A system of complete disclosure would bring the disinfectant of sunshine to the system. The Democrats will audit the Republicans and the Republicans will scrutinize the Democrats. And outside public interest groups and the media will police both. The winner will be the public. They will be able to make their own assessments. As I have said before, one man's greedy special interest is another man's organization fighting for truth and justice. To the extent that our campaign finance laws require updating, we need to find a constitutionally sound manner of doing so. We need to proceed with care and caution when acting on legislation that would have the impact of regulating freedom or of placing government at the center of determining what is acceptable election speech and what is not. And, we need to pass legislation that, above all, keeps the power of American elections where it rightfully belongs--in the hands of the voters themselves. Let me again commend my friends, Senators McCain and Feingold, for their leadership on this issue. Without their efforts and tenacity and pushing this issue, we probably would not be discussing this important matter. They deserve a lot of credit. Even though I disagree and have done so very publicly, I still have a lot of respect for my two colleagues. It is important to publicly air these issues, especially given the unfortunate perception of the problems in Washington. We can achieve needed reform here. Such reform lies in expanded disclosures. With free and open disclosure of contributions, the public will be fully able to decide for itself what is legitimate. I look forward to helping my colleagues in achieving reforms that will be constitutional and effective. Today, I rise to introduce an amendment as a substitute to section 304 of the McCain/Feingold campaign finance reform bill of 2001. Thomas Jefferson, in 1779, wrote that ``to compel a man to furnish contributions of money for the propagation of opinions which he disbelieves and abhors, is sinful and tyrannical.'' That was true then, and it remains true today. As I will discuss later, section 304 of the McCain-Feingold bill that purports to be a ``Beck'' fix is wholly inadequate. Thus, I rise today to protect the rights of working men and women in this country to be able to decide for themselves which political causes they wish to support. Some will choose to make this a complicated issue by arguing the intricacies of the Supreme Court Case, Communications Workers of America v. Beck, but it is really quite straight forward--it's about fairness. In certain states, as a condition of employment, there are requirements to join or pay dues to a labor organization. Let me make clear at the outset that I am a strong supporter of collective bargaining when employees voluntarily choose to be represented by a labor organization. But I seriously doubt that even one of my colleagues would suggest that the Government should force any American to speak in favor of causes in which he or she does not believe. Yet, we as Members of the U.S. Senate, currently stand by and allow our friends and constituents to be forced into speech because of their compulsory financial relationship with a union. I would like to know which of my colleagues would support any provision of law that would mandate an individual's financial involvement in a practice that was fundamentally at variance with their own beliefs. I dare say that there would not be many Members from either side of the aisle who would advocate the arbitrary usurpation of fundamental freedoms like that of speech. But this is exactly what happens to our union members and dues paying non-members. Individuals who belong to or are represented by labor unions financially commit themselves to causes and candidates that may be completely against their own. We force individuals to subvert their rights of political expression to those of the unions. My amendment is quite simple and straightforward. It has two parts: Part one requires a labor organization to obtain ``separate, prior, written, voluntary authorization'' before assessing ``any dues initiation fee, or other payment if any part of such dues, fee, or other payment will be used for political activities''. Part two requires that a labor organization disclose to its membership how it has allocated and spent the portion of a members or nonmembers dues and fees that went to political activity. Nothing can be more fair than to inform working men and women which causes they are supporting. It is just that simple. Let me also point out to my colleagues that this amendment also covers individuals who are shareholders in a corporation. It requires that a corporation gain prior consent from its shareholders before spending resources from the corporation's general treasury on political activity. It also requires that a corporation disclose to its shareholders which political activity it contributes to. This amendment places corporations and labor organizations on equal ground and levels the playing field. I feel that it is important to note that there is a fundamental difference between the compulsory way that a labor organization assesses its dues and fees from members and nonmembers and the completely voluntary manner a shareholder opts into purchasing stock. But in past debates, my colleagues from the other side of the aisle have cried foul and claimed that treating labor and corporations differently wasn't fair. Well we now have an amendment that takes care of that particular concern. It is simply imperative and pretty basic that union should obtain consent to use the funds they receive prior to any use other than for collective bargaining, contract administration, or grievance adjustment. After all, if consent is to mean anything, then it must be received before the money is spent. After the fact is simply too late and means no consent was given for the ``activity.'' Let me state it again because I think this fact is vital to creating a fair and meaningful fix to this problem--effective consent must be given before the funds are used. My amendment is a commonsense solution to an important problem pertinent to the lives of many Americans. The solution--consent before spending. I said that real consent is prior consent. Let me give you an example. The Electronic Signatures in Global and National Commerce Act of 1999--better known as the Digital Signature Act--legalized digital electronic contracts. The act allows an individual to enter into a binding contract without ever having to leave the comfort of his home through the use of a so-called digital signature. When the Digital Signature Act was first introduced, many of my Democratic colleagues had serious reservations about it. They argued that the bill lacked basic, but extremely important, consumer protection provisions. They argued that the bill must include effective consumer consent provisions. Critics of the bill worried that an unsuspecting consumer might receive an unsolicited e-mail with the inclusion of an electronic signature therefore making the contract legally enforceable. To prevent this sort of unwanted solicitation of business, many of my Democratic colleagues advocated that a consumer must first consent to receive the contract electronically. My amendment seeks to extend similar rights to workers that the Digital Signature Act granted consumers. We should allow workers the same fundamental rights that my Democratic colleagues demanded be granted to individuals who enter in a contact over the Internet. We must allow America's working men and women these very fundamental rights. American workers should have the right to have meaningful and informed consent over the expenditure of their dues, fees, or payment made to their union. Without these rights we are in essence creating different classes of society--those who are free to determine which political groups they will support and those who are not. I hope that my colleagues will agree with me that the standards for meaningful and informed consent we extended to consumers under the Digital Signature Act must also be provided to workers and shareholders. We must allow workers to consent to the use of their union dues on any expenditures other than collective bargaining, contract administration, or grievance. This consent must be provided in a manner that verifies the workers or shareholder's capacity to access clear and conspicuous information of their rights, receive regular disclosures of these expenditures, and maintain the right to revoke their consent at any time. Let me pause to ask a couple of questions. If your friend wants to borrow your car, shouldn't he ask beforehand? If he doesn't, then it's a crime. Wouldn't it be odd to have a system in place that requires you to lend the car and then file a form for its return? Why should the unions be allowed to take from the people who pay dues without getting their consent first? By adopting this amendment, we can help all Americans. It is fairer and more equitable to obtain consent before the dues are spent. That is the right way of doing things. Unions have the right, like any other organization, to spend the dues and fees it collects for purposes such as campaigns, issue ads, and a host of additional political and other activities. I support their right. What is disconcerting about the current situation is that many employees who are effectively forced to pay dues and fees may disagree with the positions taken and not wish to support them. Now some have suggested that section 304 takes care of the so called Beck problems and codifies Beck. Unfortunately, the proposed section 304 of the McCain-Feingold bill does not require prior consent. Nor does it codify the Beck decision, as it purports to do. Section 304 is far narrower than the holding in Beck. The Supreme Court clearly held in Beck that any expenditures outside of collective bargaining, contract administration, or grievance adjustment must be returned to the non-union employee upon request of the objecting employee. However, section 304 only prohibits unions from using non-union employee dues for ``political activities unrelated to collective bargaining''--an ambiguous phrase that is not defined in that section. Because section 304 is so narrowly drafted, it would allow unions to use non-union dues for soft money non-collective bargaining expenditures, such as get-out-the-vote campaigns and other political activities, by simply avoiding the label ``political.'' By masquerading the activity as one for ``educational purposes,'' a union could use dues for blatantly political activities such as informing union members on what pro-union stand political candidates take. Again, I recognize the unions' right to engage in any political activity that they find appropriate. The more political speech the better as far as I'm concerned. But, we need to protect the fundamental right of the workers to know that activities and what type of issues their money is being used for, and the ability for them to decide if they wish to support the activity. Mr. President, the American worker faces a hidden tax at just the moment the worker cannot afford it. And the American worker has less say in where his money goes to than just about any group. In fact, an argument can be made that section 304 of the McCain-Feingold bill actually does the exact opposite of what its intentions are. Under current law, dues paying non members may object to the use of portion of their dues that is spent for purposes other than or non- essential to collective bargaining. If the McCain-Feingold bill were to pass, those same dues-paying-non-members would only be permitted to object to use of the portion of their dues spent only for ``political purposes unrelated to collective bargaining.'' This difference might sound subtle but is anything but. Mr. President, my amendment is a modest measure of fundamental fairness. It embodies a very simple concept--fairness. American's men and women work hard every day. They have earned the right to know how their money is being spent for certain political purposes, causes, and activities. The disclosure and second part of this amendment does nothing more than require a report by labor organizations to be filed with the Federal Election Commission and given to workers represented by unions, showing how much of their union dues and fees are being spent on the political process. I have to say that this amendment does not impose overly burdensome or onerous requirements on the unions. This is basic information, and it should be freely provided. I cannot believe that the union leadership have a legitimate interest in keeping secret what political causes and activities employee dues and fees are being spent to support. If employees learn how their money is being spent in the political process, unions will enjoy an even greater confidence level in their decision making. With the addition of this amendment to the McCain-Feingold bill we will ensure that every American is treated equally under the law and extended the rights and freedoms that are fundamental under the Constitution. I urge my colleagues to thoughtfully consider this amendment and vote for its passage. I reserve the remainder of any time I may have remaining.

Mr. HATCH. I ask unanimous consent the reading of the amendment be dispensed with.

Mr. HATCH. Mr. President, my modification is at the desk. I ask unanimous consent that my amendment be so modified.

Mr. HATCH. Mr. President, this amendment is simple, and straightforward. It does not attempt to codify the Beck case that we debate year-after-year on the Senate floor. There is nothing complex or legalistic about it. Frankly, like the section 527 bill we passed last year, we simply require disclosure. This is a modest measure of fundamental fairness. It is a simple right-to-know amendment. The right of American workers and shareholders who pay dues and fees to unions and corporations that represent them, to know how their money is being spent for certain political purposes, causes, and activities. It does nothing more than require a report by labor organizations and corporations to be given to the shareholders and workers represented by unions. This shows how much of their money is being spent in the political process. As we all know, part of the debate here has been the use of these types of money that never have to, because of the loophole in the Federal election laws, be seen on the reports or be reported by those who received benefits from union expenditures. I have to say this amendment does not impose overly burdensome or onerous requirements on corporations or unions. This is basic information, and it should be freely provided. I cannot believe that either union or corporate leadership has a legitimate interest in keeping secret what political causes and activities employee dues, fees, or earnings are being spent to support. If employees or shareholders learn how their money is being spent in the political process, unions and corporations will enjoy an even greater confidence level in their decisionmaking. On the other hand, if employees and shareholders might not like what they see, is that any reason they should not see it? Is it too onerous? No. After the numerous paperwork burdens that this Congress has freely imposed on small businesses and all taxpaying citizens, how can any of us object to ensuring that workers, teachers, janitors, electricians, and others are informed about how their dues are being spent on the most fundamental of all American activities, the political process? I doubt anyone would suggest that unions, even at the local level, do not keep these records anyway. How else can an organization that represents employees be effective and accountable, if it does not even know how the dues and fees collected from the employees it represents are being expended? Should we have the same requirements also be applied to corporations that give this type of information to their shareholders? There is not the same problem there, but why not, if that is what my colleagues think is fair? My amendment therefore covers not only labor unions but also corporations for this simple disclosure requirement. This amendment represents only one simple, straightforward question: Should an employee be left in the dark on how his or her union dues and fees are being spent in the political process? This amendment is the most modest of beginning steps we can take to bring common sense or reform to our campaign laws. Finally, let me add one more important point. Everyone knows that the corporate world represents shareholders and not individual dues-paying members. Everybody knows the corporate world does not do the collateral campaign work that the unions do with dues-paid money. It is hardly the same situation. That most likely is the reason why some of my colleagues did not vote for the preceding amendment. But the distinguished Senator from Massachusetts has in the past raised a fair point. If we include the unions, why should we not include the corporations? These are not reporting requirements that are onerous or burdensome. This amendment is about basic fairness, and I hope all my colleagues will support it. Basically, it allows individuals that are shareholders or members of a labor organization the right to know how their money is spent in the American electoral process. I think this is a fair amendment, it is a decent amendment, it is fair to both sides. It just requires simple disclosure. Why not? I yield the floor.

Mr. HATCH. Mr. President, I suggest the absence of a quorum.

Mr. HATCH. Because then you get into the NAACP, and we have already had the Supreme Court say that is unconstitutional.

Orrin Hatch

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