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Michael Winship | In Summer’s Heat, Washington Seeks Refuge in the Loophole
I spent part of last week in Washington

Michael Winship | In Summer’s Heat, Washington Seeks Refuge in the Loophole

I spent part of last week in Washington

I spent part of last week in Washington, DC, and the heat already was so oppressive I recalled the old story that, during the summer, the British Foreign Service used to classify the capital as a hardship post, allowing embassy employees to go about their official business clad in pith helmets and shorts.

In pre-air conditioning days, the federal government simply shut down so civil servants could escape to some shade and swoon in the sanctuary of a cold drink. But now, the bureaucracy grinds on regardless of the temperature, and even as Congress works its way toward summer recess, its members remain active, or at least maintain the appearance of activity, especially with midterm elections just a little more than four months away.

Believe it or not, there actually is some positive, necessary, progressive law being debated and voted upon, but historically, members cannot resist sticking in a finger to stir, then water down the outcome. In the legislative equivalent of Saint Augustine’s prayer, “O Lord, help me to be pure, but not yet,” even in the early summer heat, the loophole remains more tempting than the swimming hole.

Last Wednesday, the House passed, by a vote of 219-206, the Disclose Act. (In the acronym-sappy world of Capitol Hill, that stands for “Democracy Is Strengthened by Casting Light on Spending in Elections.”) It’s the first Congressional effort aimed at beating back the Supreme Court’s Citizens United decision, the one that unleashed virtually unlimited amounts of corporate and special interest campaign cash. As The New York Times reported, “The bill would ban spending on political campaigns by corporations that have $10 million or more in government contracts as well as by American corporations that are controlled by foreign citizens.” It also includes “a prohibition of corporations and other interest groups in coordinating spending with candidates or political parties, and a mandate that chief executives appear in any advertisement paid for by their companies.”

All well and good. But here’s the loophole: to get the bill passed, Speaker Pelosi and Democratic leadership allowed exceptions for certain tax-exempt and powerful interest groups, including the Sierra Club and primarily, ladies and gentlemen, the National Rifle Association (NRA). “Even on the face of it, this is perverse,” Dennis Henigan of the Brady Campaign to End Gun Violence declared. “The DISCLOSE Act purports to create transparency as a way to attack the influence of special interest money in politics, yet it ensures secrecy for groups in a position to dump the most money into political campaigns.”

This is just the latest loophole engineered out of fear of the NRA’s blunt, but effective, political clout. As the Brady Campaign points out, credit card reform only got enacted when the NRA was allowed to squeeze in the amendment allowing loaded guns in national parks. And the Senate approved a measure that finally allows the District of Columbia to have a voting representative in Congress, but only after an amendment was included that eviscerates DC gun laws.

Then there’s Democratic Sen. Blanche Lincoln of Arkansas. Fresh off her runoff victory against state Lt. Gov. Bill Halter, and running behind her Republican opponent for the November election, Senator Lincoln decided to provide an influential constituent the gift that keeps on giving: a loophole.

The freshly minted financial reform deal, riddled with concessions, includes a provision that grandfathers banks with less than $15 billion of assets from having to follow new, tougher standards for what constitutes capital, an important measure of a bank’s strength and a protection against possible losses from risky investments.

Originally, the exemption was proposed for banks with less than ten billion in assets. Senator Lincoln got it raised to protect a very special friend back home. As reported by Dow-Jones Newswires, without the protection of the grandfather clause, Arvest Bank Group of Bentonville, Arkansas, “could have been forced to raise about $115 million more for its capital cushion.”

Arvest is the biggest bank in Arkansas and the only one that holds between ten and fifteen billion dollars of assets. Arvest is predominantly owned by the most powerful family in the state, the Waltons. You know – the owners of Wal-Mart Stores, the second largest corporation in America and, since 2005, Blanche Lincoln’s second largest campaign contributor – $52,750, according to the nonpartisan Center for Responsive Politics. (Separately, Arvest has contributed another $12,700.)

You do the math.

Yes, compromise is essential to the democratic process and yes, it’s almost impossible to get anything passed in Congress without it. But as Washington melts into the miserable, hazy days of summer, seeing our lawmakers stand up more defiantly for the people and not wilt against these special interests would be a change as refreshing as a plunge into a cool, cool stream.

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