Ballot Boxes Go High Tech From touch screens to digital 'frogs,' technology to make voting more secure is tricky, but it's coming

The Florida election debacle in 2000 brought us face to face with some bad news: common voting technology can be untrustworthy. Many state and local election officials were already moving toward what they thought was the answer: sleek electronic touch-screen voting terminals where confusion would be eliminated by confusion-free ATM-like technology. Congress sped up the process by passing the Help America Vote Act in 2002, which partly pays for the machines. Now the devices, made by major election suppliers like Diebold and Sequoia, are in 30 states (the only way to vote in Georgia and Maryland), and will be used by about 28 percent of the country in the November elections. But in recent months, computer scientists and security experts have uncovered weaknesses in these gizmos. Many now claim that it's entirely possible to hack an election--deleting electronic votes as if they were misspellings in a word processor, or doing a cut-and-paste from one candidate to another--without anyone's knowing it. That's because there's no way to ensure that the choices punched on the screen will actually be reflected in the final tally. Many experts are concluding that touch screens, the alleged voting technology of the future, are... untrustworthy.

A new set of players in the election arena--computer scientists and cryptographers--are now developing systems to let--people know that their votes have actually counted. It's a tricky task. The bedrock requirements of any decent voting system are security strong enough to prevent fraud and the anonymity of a secret vote. This makes verification a challenge, because using a simple digital audit trail to re-create what happened on Election Day would mean revealing who voted for whom (violating the principle of secret ballots). But election geeks are finding ways to help solve these puzzles.

The most-talked-about scheme was first conceived in the early 1990s by a graduate student named Rebecca Mercuri. It's now called verified voting (to the dismay of those with alternate ideas, who note that their schemes involve verification, too). The system is a kind of truth serum for touch-screen systems. After a ballot is cast, the choices are not only summarized on the screen but printed out on a piece of paper. The voter looks at the printout and has an opportunity to verify that the choices are actually the ones he or she cast. If so, the vote is approved, and the paper goes into a locked ballot box. (The voter isn't allowed to leave the booth with the printout in hand--it's displayed behind a transparent barrier--to prevent someone from running a vote-buying scheme.) If there's a recount, or if officials want to check the accuracy of the touch screen, the paper ballots are counted. One variation, the VoteMeter, replaces the printout with a readout on a palmtop device that stores ballots securely.

The Mercuri scheme has picked up a lot of momentum. Last year Rep. Rush Holt of New Jersey introduced a voter-verification bill that is now bottled up in committee. Just two weeks ago New York Sen. Hillary Clinton and Florida Sen. Bob Graham unveiled a similar bill in the Senate. And California's secretary of State recently mandated that by 2006 all touch-screen systems should include printers that generate ballots for verification. Six other states have jumped on the paper-trail bandwagon, spurred in part by a campaign on the Internet called "The Computer Ate My Vote." Mercuri herself, who's now at the Kennedy School of Government, is concerned that the scheme might not be implemented correctly, and is now advocating that the actual count should be made not from the computers but from the printed-out ballots. "It's a case of 'Be careful what you wish for'," she says. "I asked myself, 'If these ballots are used to verify the results of machines we don't trust, why not use the ballots as the actual votes?' "

In 1999 a trio of computer scientists suggested a different method. It involves a doodad called a frog, for no particular reason other than that the term has no association with elections. A frog in this sense is a cheap form of digital storage that records votes. It might be a business-card-size piece of plastic with a bit of digital memory. After proving you're eligible to vote, you get a frog from an election official, who initializes it with the ballot appropriate to your precinct. (Bonus: there's no reason you can't get your home ballot if you're at some other location. It's possible to store information on a single CD that could generate any ballot in the country.) If you like, you could get the frog well in advance of Election Day, and use any computer you like to enter the votes. On Election Day itself, you take your frog into the booth and insert it into the official voting terminal, which reads the frog's content and displays your choices on the screen.

Then comes an "Is that your final answer?" moment: if you're happy with the selection, you press a button to make your vote official. If for some reason the readout did not reflect your choice, or you change your mind, you can reprogram the frog. (This ability to alter the frog means that no one can give you a preprogrammed frog with the assurance that you'll stick with the choices.) After the vote is formally cast, the frog, well, croaks--the memory freezes, and the device takes no changes. You'll leave it behind in case a recount is necessary, but it couldn't be used to revote. Though no one has yet identified many warts in the system, the frog idea seems like a long shot. "It's an attractive method, but no one's picked up on it yet," says co-inventor David Jefferson.

The most sophisticated systems deliver verifiability without a cumbersome, possibly vulnerable, set of printed-out ballots (or discarded frogs). With clever cryptographic algorithms and innovative viewing devices, it's possible to envision a process that provides specific proof after the fact that your vote was included in the total--without --compromising the privacy of your selection.

Cryptographer David Chaum, who wrote the first papers on computer-based anonymous voting in the early 1980s, has been experimenting with such schemes. (He's behind the aforementioned VoteMeter.) His latest iteration is Votegrity, involving a device in addition to standard technology (like a touch screen). When you cast your vote, this device generates three images, or "stripes"--bar-code-like objects with encoded information. Each stripe contains your vote in encrypted form, but by some form of mathematical magic, when overlaid on top of each other, the stripes display your selections in plain language. As you vote, this readable output is projected on a small screen inside the voting booth so you can check it for accuracy. Then the paper is divided to separate the stripes, and voters may choose which one to take with them. That same image is stored digitally, and officials will use it to register the actual vote. The decryption process involves techniques to ensure that the votes counted are the same ones the voters saw in the booth.

Where's your verification? The codes are all posted to the Web, and using the encoded receipt and a serial number also printed on the paper, you can go online to check that your encrypted vote was tallied. (Of course, since the image is encrypted, no one can know how you voted.) "The Chaum system is the better ballot box," says Mercuri. "It's the first solution that proves to someone that his or her vote counts."

A similar system sold by software vendor VoteHere provides citizens who want to verify their votes with a tracking code that essentially does the same thing; CEO Jim Adler says that he's working with Sequoia to implement the system, and it's possible that it will be in use in some California counties this November.

Some say that the final frontier of elections is Internet voting. About 46,000 participants in this year's Michigan primary actually pulled virtual levers from cyberspace to cast their votes. But another much publicized venture, the Department of Defense's SERVE program (which would have allowed up to a million armed forces members and expats to choose a president via a Web browser this year), was put on hold after a formal study by top computer scientists pretty much outlined the reasons that the Internet isn't nearly as good a place to vote as it is to buy books or Google one's blind date: the security is dicey, votes aren't secret (computers aren't closed off like voting booths) and, in a pinch, someone could screw up an Internet election by a denial-of-service attack. Most computer scientists interested in voting think that the foreseeable future still lies in polling places.

Now that the academics and propeller- heads are devoting brainpower to the voting problem, there's a possibility of some even more unconventional tech appearing in the ballot box. MIT Media Lab associate professor Ted Selker--a key designer of the ThinkPad laptop while at IBM--has been giving a lot of thought to problems like clearer interfaces, including those that might ensure that newer systems won't exclude blind voters. He's even brainstorming an idea where modified Sony PlayStations could be used as low-cost voting machines.

It's encouraging to see geeks using their brainpower to devise systems that deliver privacy, security and verification. But it's already too late to massively implement these ideas in time for what prom-ises to be another nail-biting general election in November. The die is cast (and the frog is frozen) on a combination of the traditional worrisome technology and the new, even more suspect, unverified touch screens. Here's hoping we're not moving from chad to worse.

Attack of the Super PACs! A secretive new breed of spending groups is changing the way campaigns are being lost and won

ELECTION 2012

The Republicans

At the moment, Mitt Romney's worst nightmare is an earnest former aide to Newt Gingrich named Rick Tyler, who sits on a $5 million pile of cash that he plans to turn into a negative ad campaign aimed at the former Massachusetts governor.

Tyler runs Gingrich's super PAC--a theoretically independent committee of affluent Newtniks who have been working since last month to help the former House Speaker win the GOP nomination. Arriving just in time for the 2012 race, thanks to a landmark Supreme Court decision, super PACs are outraising and outspending the campaigns, supposedly without any coordination with the candidates.

Even Tyler finds this situation absurd.

Super PACs, he admits, are "a horrible abomination for a freedom-loving people in a constitutional republic." So are campaign-finance rules that allow his organization, Winning Our Future, to purchase an anticipated $3.4 million in South Carolina television time in the coming weeks to cast Romney as a corporate raider who profited from firing people. Doing this while maintaining a measure of independence from Gingrich, as the rules demand, requires what Tyler calls "a big shell game."

The game works like this. The Supreme Court says unlimited campaign contributions from corporations, unions and billionaires are potentially corrupting. This is why casino king Sheldon Adelson, owner of the Venetian and a longtime Gingrich friend, is allowed to give only $2,500 to Gingrich's 2012 primary campaign. But a series of court rulings in 2010 created another option: Adelson can write a seven-figure check to Tyler, Gingrich's ally and friend, who will spend the money as Gingrich wants it spent. The catch? Tyler, who worked for Gingrich a few months ago and still considers him "like family," is barred from speaking with his candidate or the campaign directly about the ads or his spending strategy.

But this is hardly an impediment. "I follow my lead from Newt Gingrich," Tyler explains. "I watch what he says on TV. I read about him in the newspaper." A few weeks ago, when Gingrich was running a positive campaign in Iowa, Winning Our Future spent hundreds of thousands of dollars on largely positive ads. But when Gingrich signaled a new negative tone, Tyler's group pivoted too, first recirculating an old 2008 ad attacking Romney and later purchasing a short documentary about the underbelly of Romney's business success, called King of Bain: When Mitt Romney Came to Town.

And then Gingrich seemed to endorse those purchases in public. Asked in a recent debate to demand that Tyler stop the anti-Romney campaign, the candidate dodged. "I hope that it's totally accurate," Gingrich says instead of the movie, "and then people can watch the 27½ minutes of his career at Bain and decide for themselves."

The new rules have turned presidential politics into a house of mirrors: while most people still contribute up to $2,500 to campaigns directly, the nation's richest people and corporations now have an outsize way to help candidates by funneling their money through new shadowy organizations that operate out of lobbying firms or post-office boxes and often identify their donors only after the votes have been counted. (The Lawrenceville, Ga., mailing address for Winning Our Future also serves as a mail drop for companies that market skin creams, house painters and wall coverings.)

Not since before the post-Watergate reforms of the 1970s have wealthy individuals, unions and corporations had so much freedom to affect elections with large sums of money. Old rules that prevented these outside groups from directly advocating the election or defeat of a candidate as they wished are simply no longer in effect. "More special-interest contributions are coming in this election than in any previous election in this nation's history," explains Paul Ryan, a lawyer for the Campaign Legal Center, which supports stricter regulation of money in politics.

Gingrich isn't the only one to benefit; all of the candidates have super PACs, each distinguished by an unobjectionable-sounding, vaguely patriotic name. There are Make Us Great Again (Rick Perry); Red, White and Blue (Rick Santorum); and Our Destiny (Jon Huntsman). A group called Restore Our Future, run by former Romney aides out of Clark Hill, a Washington law and lobbying firm, outspent the Romney campaign on television in Iowa with a slew of biting attacks against Gingrich. The group is poised to do the same in South Carolina. Rather than keep his distance, Romney has legally appeared at fundraisers for the group, and he has effectively endorsed its efforts, which so far have consisted almost entirely of negative ads targeting Gingrich. "I know the people there," Romney said in a recent radio interview. "Of course, I helped raise money for it." When asked by a New Hampshire voter about a $1 million donation given to the group by an old Romney friend, the candidate mischaracterized it as a donation to his campaign. "He gave to me," Romney said. "He's given to me before."

Romney's confusion is easy to explain. The Federal Election Commission rules that are supposed to ensure the independence of outside groups are so narrowly drawn as to border on meaningless. For instance, under the law, Romney is barred from asking for money in excess of $5,000 for Restore Our Future, but he can speak at a fundraiser for the group and then stand next to a former aide who asks for a $1 million check. "The legal definition of coordination," says Ryan, "is completely divorced from reality." And there is little to restrict advisers from floating between a campaign and a super PAC. Bill Burton, a former White House aide who was a spokesman for Barack Obama's 2008 campaign, has established a pro-Obama independent group for the general election that is expected to raise as much as $100 million this year. The Perry effort is led by Mike Toomey, a longtime adviser who owns land in New Hampshire with Perry's campaign strategist David Carney and whose offices are in Austin across Congress Street from the Perry campaign. Last summer, Fred Davis, the lead adman for the Huntsman campaign, left it to join the Huntsman super PAC. The first ad he cut at his new job echoed the central themes of the Huntsman candidacy and even cited the same favorable Wall Street Journal editorial that Huntsman often cites. The close ties between candidates and groups taking million-dollar donations in their names are now so taken for granted that no one even tries to hide them. Officials from both the Gingrich and the Romney efforts have admitted that their super-PAC proxy armies are gearing up for a probable winner-take-all showdown in South Carolina. And while some campaign aides grumble that they would rather be in control of all the funds, there is no doubt that they welcome the extra help in the costliest part of campaigns--television advertising.

This domination of the political landscape by super PACs has left the Supreme Court's decision that created them looking a bit naive. The Justices ruled at the time that "independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption." The court reasoned that this was the case because the candidates' independent groups were actually independent, thus alleviating "the danger that expenditures will be given as a quid pro quo for improper commitments."

Even the candidates have dispensed with paying homage to this argument. Instead, it's commonplace to complain that the other fellow is calling the shots at his super PAC, even if he is following the letter of the law. In early January, Gingrich described Romney as the CEO of Restore Our Future: "This is a man whose staff created the PAC. His millionaire friends fund the PAC. He pretends he has nothing to do with the PAC. It's baloney." Romney responded by pointing out that he had no direct input on the ads.

The situation is such a mess that many involved argue that Congress should just drop the pretense of independence and allow campaigns to accept unlimited checks directly. "What I will grouse about is the complete absurdity of a law that allows us to campaign to help one candidate but prohibits us to talk to our candidate," says Whit Ayres, a veteran Republican pollster who is running the pro-Huntsman effort, which spent $2 million on ads in New Hampshire.

But that will be a fight for another campaign cycle. For now, Tyler, the former Gingrich aide, is the one with the biggest pile of cash heading into South Carolina. "The money in the super PACs is so dominant that the candidates

themselves hardly have a chance to break through," he says. And when candidates have friends like super PACs, they hardly need to.

PAC Mania

Many of the new outside groups, called super PACs, have outspent the candidates they support, blanketing early-voting states with ads funded by wealthy individuals and corporations

MITT ROMNEY

SUPER PAC: Restore Our Future

A montage of Gingrich admitting past mistakes ends with a question: "Haven't we had enough mistakes?"

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $6.0 MILLIONRestore Our Future SUPER PAC $8.9 MILLION

NEWT GINGRICH

SUPER PAC: Winning Our Future

A documentary attacking Romney's success at Bain Capital claims, "Nothing mattered but greed."

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $1.2 MILLIONWinning Our Future SUPER PAC $1.9 MILLION

RICK PERRY

SUPER PAC: Make Us Great Again Perry is portrayed as the outsider who claims, "Washington elites are wrecking America."

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $6.3 MILLIONMake Us Great Again SUPER PAC $3.4 MILLION

RON PAUL

SUPER PAC: Revolution

Romney and Perry are called a "pretty boy" and a "plastic man," while Paul is a "statesman."

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $5.0 MILLIONSanta Rita and Revolution SUPER PACS $0.4 MILLION

JON HUNTSMAN

SUPER PAC: Our Destiny

Romney is a "chameleon" who will "say anything," while Huntsman is the "consistent conservative."

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $70,000Our Destiny SUPER PAC $2.1 MILLION

RICK SANTORUM

SUPER PAC: Red, White and Blue

In contrast to his rivals, Santorum is cast as "a true conservative we can trust."

TOTAL RADIO AND TV SPENDING

By campaigns and their largest supporting super PACs

CAMPAIGN $0.5 MILLIONLeaders for Families and Red, White and Blue SUPER PACS $0.8 MILLION

TOTAL ADVERTISING SPENDING

Iowa $16.5 MILLIONSouth Carolina $9.0 MILLIONFlorida $6.2 MILLIONNew Hampshire $5.4 MILLION

Give Ballots To Felons? UNDER THE STOPPED-CLOCK PRINCIPLE--EVEN a stopped clock is right twice a day--let the record show that Sens. Barbara Boxer and Hillary Clinton and Rep. Stephanie Tubbs Jones, Democrats from California, New York and Ohio, respectively, have a tenuous hold on a piece of a point in their election-reform bill that is, however, generally dreadful and, in parts, patently unconstitutional.

The Count Every Vote Act, which might better be called the What's a Little Fraud Among Friends? Act, reflects monomania--the idea that anything that increases the number of ballots cast is wonderful. So the act would make Election Day a federal holiday--and would require states to have Election Day registration, which is an invitation to fraud.

The act would further erode federalism by stripping states of their traditional rights to regulate elections. States would be required to have no-excuse absentee voting and to conform to new federal standards regarding mandatory recounts, provisional ballots, poll workers, early voting, voter waiting times and many other matters.

Liberals have a certain versatility of conviction regarding states' prerogatives. They celebrated stripping states of their right to set abortion policy, but concerning a constitutional amendment barring same-sex marriage, they insist--correctly--that setting marriage law is traditionally the states' prerogative. Now comes the Boxer-Clinton-Jones bill, which is endorsed by a slew of liberal groups. It would override all states' disenfranchisement laws by giving felons the right to vote.

The bill stipulates that there are 4.7 million felons--one in 44 adults--disenfranchised to various degrees under state laws. All states except Maine and Vermont prohibit inmates from voting. Some states ban voting by felons on probation or parole or even those who are no longer under any supervision by the criminal-justice system.

In some cities, more than 50 percent of young African-American men are under such supervision. A large number of prison inmates are African-Americans. Twelve percent of all African-American men in their 20s are incarcerated. More than a third of the 4.7 million disenfranchised felons are African-Americans. In four of the states with lifetime bans for felons, a quarter (Virginia, Iowa) and a third (Florida, Alabama) of all black men are ineligible to vote.

Sentimentalism and cold calculation combine to make felons' voting attractive to liberals. They know that criminals often come from disadvantaging circumstances and think such circumstances are the "root causes" of criminality. As for the calculation, it is indelicate to say but indisputably true: most felons--not all; not those, for example, from Enron's executive suites--are Democrats. Or at least were they to vote, most would vote Democratic.

But courts have been unreceptive to "disparate impact" arguments, absent a showing of invidious motives. So there is no violation of the 14th Amendment guarantee of "equal protection of the laws" when all felons, black or white, are disenfranchised for their decisions to break laws. Furthermore, that amendment specifically sanctions felon disenfranchisement laws. It forbids states to deny the franchise "except for participation in rebellion, or other crime." (Emphasis added.)

Here is a question for liberals who, eager to have Congress lessen the sanctions states have chosen to attach to state crimes, would have Congress overturn felon disenfranchisement laws: Would you want Congress to overturn state laws that say felons can never again own or use guns?

Although there is no constitutionally respectable argument to justify Washington's forcing states to enfranchise felons, there are two conservative arguments for states to stop, or at least severely limit, disenfranchisement. One is a limited government argument: there is something troubling about criminal penalties that never completely end. The other argument is pru-dential, although not very plausible: enfranchisement, by diminishing the lingering stigma of a felony conviction and by encouraging a civic connection with the community, might combat recidivism.

Jones's and Boxer's involvement in this issue is understandable. In December they collaborated in delaying for two hours the certification of George W. Bush's Ohio electoral votes to protest alleged Election Day voting problems in that state. But why is Clinton consorting with such firebrands? She seems interested in political metamorphosis; she seems to be in the chrysalis stage, about to flutter forth as a butterfly of gorgeous moderation. Association with this legislation cannot be helpful.

Two years ago Clinton sought, and got, a seat on the Armed Services Committee; she has distanced herself from her party's chairman and other crazies regarding Iraq; she seems to be trying to wean her party away from talking reverently about abortion as some sort of sacrament. But when voters hear her and other Democrats fretting that too few felons vote, and planning to further expand Washington's micromanagement of everywhere else, what are those voters apt to say about Democrats? Something like: "There they go again."

PHOTO (BLACK & WHITE)

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By George F. Will

I Do What I'm Polled Politicians use polls to advise them on policy. Why shouldn't I? - The Awesome Column – By Joel Stein

I am not a great decider in chief even though I have only one person to decide for. After college I sent a résumé to a magazine merely because I thought the editor was hot and wound up working for Martha Stewart for a year. I once dated a girl because five minutes into my conversation with her, a pet rat emerged from her bosom. Now my make-out résumé has an entry I remember only as Rat Girl. Also, whenever I get sick, I worry it's bubonic plague.

So I crowdsource as much of my life as possible. My lovely wife Cassandra gets furious because I follow her advice only after five other people say the same thing. Though, to be fair, I didn't start doing this until she bought me mandals and told me to wear them to the office.

But what I long for is the accuracy that politicians get from polls. They know how to feel about gay marriage, Social Security and immigration on the basis of precise numbers and can gauge how popular they will be if they express those opinions in different ways. So I was very excited when Toluna, a marketing-survey company, offered to let me poll its 1.5 million North American active users. I had a lot of things to ask America, but Toluna president George Terhanian told me America gets bored after 15 questions. So I edited my list down to the crucial topics, such as my career, raising my son and what to do about my massively receding hairline. In six hours, 1,000 people signed up online to answer questions about me, for which Toluna would charge $2,000. I could have just asked a list of my friends for free on Toluna, except that I know my friends are not at all representative of real America. I know this from Republican speeches.

America answered questions I had been needlessly torturing myself over for decades. Fifty-five percent did not want me to write columns about politics. But then I looked more closely at the results and realized that this was a key issue dividing our nation. Male America thought I should write more about politics, but female America thought I should focus on my family, followed by celebrities. Conveniently, my family contains a celebrity. I'm talking about me. And while a plurality of both men and women thought I use the word penis the exact right amount in my column, the valuable 18-to-34-year-old demographic wanted me to mention penises three times as much as people over 55 did.

Americans of all demographics wanted me to send my 3-year-old son Laszlo to public school rather than private school and nearly everyone thought I should get Laszlo music lessons over swimming, art or ballet--though the old people picked swimming over music by a narrow 0.7%. At first I thought this was because old people love swimming, which I know is true from Cocoon. But then I realized that old people just hate music because you can't understand a damn thing they're singing anymore.

But 11% of all respondents thought Laszlo should take a class in "other." I'm not a fan of including "other" in polls, since I never get to pick "other" in real life. There's no "other" on a menu or my income-tax forms. Cops never ask you if you want to take a Breathalyzer, go down to the station or "other." When the rabbi asked if I promised to love Cassandra in sickness and in health, if I had said, "Other," I'm pretty sure the wedding would not have proceeded.

Living according to poll results seemed easy: public school is free; Laszlo was excited about music classes; my editor said she thought TIME readers need my page as a break from political coverage; and penis. But I was a little nervous when I saw the responses to this question: "I am losing hair from the front of my head. Should I …" First of all, 30% said to shave my head--not realizing that when I did that once for a story, my lovely wife Cassandra said it made me look like "an accountant named Murray." Far worse, 48% said to "keep my same hairstyle and ignore it." Losing your hair is not something you can ignore like calls from the credit-card company, or your children.

But if America wants to see the top third of my head, America is going to see it. I can't go back to making decisions based on the vagaries of my blood sugar, level of sleep deprivation, what my friends are doing and penis. Sure, if my goal were to please myself or follow a code of honor, then making my own decisions would make sense. But the point of everything I do is to make other people like me. Except for old people. They don't read this magazine, right?

All the King's Media

KING GEORGE IS GOIG DOWN--AND TAKING HIS PRESS COURTIERS WITH HIM.

Amid the smoke and stench of burning careers, Washington feels a bit like the last days of the ancien régime. As the world's finest democracy, we do not do guillotines. But there are other less bloody rituals of humiliation, designed to reassure the populace that order is restored, the Republic cleansed. Let the perp walks begin. Whether the public feels reassured is another matter.

George W. Bush's plight leads me to thoughts of Louis XV and his royal court in the eighteenth century. Politics may not have changed as much as modern pretensions assume. Like Bush, the French king was quite popular until he was scorned, stubbornly self-certain in his exercise of power yet strangely submissive to manipulation by his courtiers. Like Louis Quinze, our American magistrate (whose own position was secured through court intrigues, not elections) has lost the "royal touch." Certain influential cliques openly jeer the leader they not so long ago extolled; others gossip about royal tantrums and other symptoms of lost direction. The accusations stalking his important counselors and assembly leaders might even send some of them to jail. These political upsets might matter less if the government were not so inept at fulfilling its routine obligations, like storm relief. The king's sorry war drags on without resolution, with people still arguing over why exactly he started it. The staff of life--oil, not bread--has become punishingly expensive. The government is broke, borrowing formidable sums from rival nations. The king pretends nothing has changed.

The burnt odor in Washington is from the disintegrating authority of the governing classes. The public's darkest suspicions seem confirmed. Flagrant money corruption, deceitful communication of public plans and purposes, shocking incompetence--take your pick, all are involved. None are new to American politics, but they are potently fused in the present circumstances. A recent survey in Wisconsin found that only 6 percent of citizens believe their elected representatives serve the public interest. If they think that of state and local officials, what must they think of Washington?

We are witnessing, I suspect, something more momentous than the disgrace of another American President. Watergate was red hot, but always about Richard Nixon, Richard Nixon. This convergence of scandal and failure seems more systemic, less personal. The new political force for change is not the squeamish opposition party called the Democrats but a common disgust and anger at the sordidness embedded in our dysfunctional democracy. The wake from that disgust may prove broader than Watergate's (when democracy was supposedly restored by Nixon's exit), because the anger is also splashing over once-trusted elements of the establishment.

Heroic truth-tellers in the Watergate saga, the established media are now in disrepute, scandalized by unreliable "news" and over-intimate attachments to powerful court insiders. The major media stood too close to the throne, deferred too eagerly to the king's twisted version of reality and his lust for war. The institutions of "news" failed democracy on monumental matters. In fact, the contemporary system looks a lot more like the ancien régime than its practitioners realize. Control is top-down and centralized. Information is shaped (and tainted) by the proximity of leading news-gatherers to the royal court and by their great distance from people and ordinary experience.

People do find ways to inform themselves, as best they can, when the regular "news" is not reliable. In prerevolutionary France, independent newspapers were illegal--forbidden by the king--and books and pamphlets, rigorously censored by the government. Yet people developed a complex shadow system by which they learned what was really going on--the news that did not appear in official court pronouncements and privileged publications. Cultural historian Robert Darnton, in brilliantly original works like The Literary Underground of the Old Regime, has mapped the informal but politically potent news system by which Parisians of high and low status circulated court secrets or consumed the scandalous books known as libelles, along with subversive songs, poems and gossip, often leaked from within the king's own circle. News traveled in widening circles. Parisians gathered in favored cafes, designated park benches or exclusive salons, where the forbidden information was read aloud and copied by others to

pass along. Parisians could choose for themselves which reality they believed. The power of the French throne was effectively finished, one might say, once the king lost control of the news. (It was his successor, Louis XVI, who lost his head.)

Something similar, as Darnton noted, is occurring now in American society. The centralized institutions of press and broadcasting are being challenged and steadily eroded by widening circles of unlicensed "news" agents--from talk-radio hosts to Internet bloggers and others--who compete with the official press to be believed. These interlopers speak in a different language and from many different angles of vision. Less authoritative, but more democratic. The upheaval has only just begun, but already even the best newspapers are hemorrhaging circulation. Dan Gillmor, an influential pioneer and author of We the Media, thinks tomorrow's news, the reporting and production, will be "more of a conversation, or a seminar"--less top-down, and closer to how people really speak about their lives.

Which brings us to the sappy operetta of the reporter and her influential source: Scooter Libby, the Vice President's now-indicted war wonk, and Judith Miller, the New York Times's intrepid reporter and First Amendment martyr. What seems most shocking about their relationship is the intimacy. "Come back to work--and life," Scooter pleaded in a letter to Judy, doing her eighty-five days in jail. "Out west, where you vacation, the aspens will already be turning. They turn in clusters, because their roots connect them." Miller responded in her bizarre first-person Times account by telling a cherished memory of Scooter. Out West, she said, a man in sunglasses, dressed like a cowboy, approached and spoke to her: "Judy, it's Scooter Libby."

Are Washington reporters really that close to their sources? For her part, Miller has a "tropism toward powerful men," as Times columnist Maureen Dowd delicately put it. This is well-known gossip in court circles, but let's not go there. Boy reporters also suck up to powerful men with shameful deference, wanting to be loved by the insiders so they can be inside too (shades of the French courtiers). The price of intimacy is collected in various coins, but older hands in the news business understand what is being sold. The media, Christopher Dickey of Newsweek observed in a web essay, "long ago concluded having access to power is more important than speaking truth to it."

The elite press, like any narcissistic politician, tells a heart-warming myth about itself. Reporters, it is said, dig out the hard facts to share with the people by locating anonymous truth-tellers inside government. They then protect these sources from retaliation by refusing to name them, even at the cost of going to prison. That story line was utterly smashed by this scandal. Reporters were prepared to go to jail to protect sources who were not exactly whistleblowers cowering in anonymity. They were Libby and Karl Rove--the king's own counselors at the pinnacle of government. They were the same guys who collaborated on the bloodiest political deception of the Bush presidency: the lies that took the country into war. So, in a sense, the press was also protecting itself from further embarrassment. The major media, including the best newspapers, all got the war wrong, and for roughly the same reason--their compliant proximity to power. With a few honorable exceptions, they bought into the lies and led cheers for war. They ignored or downplayed the dissent from some military leaders and declined to explore tough questions posed by anyone outside the charmed circle. The nation may not soon forget this abuse of privileged status, nor should it.

Leaks and whispers are a daily routine of news-gathering in Washington. The sweet irony of President Bush's predicament is that it was partly self-induced. His White House deputies enforced discipline on reporters and insiders, essentially shutting down the stream of nonofficial communications and closing the informal portals for dissent and dispute within government. This was new in the Bush era, and it's ultimately been debilitating. It has made reporters still more dependent on the official spin, as the Administration wanted, but it has also sealed off the king from the flow of high-level leaks and informative background noises that help vet developing policies and steer reporters to the deeper news.

The paradox of our predicament is that, unlike the ancien régime, US citizens do enjoy free speech, free press and other rights to disturb the powerful. In this country you can say aloud or publish just about anything you like. But will anyone hear you? The audible range of diverse and rebellious voices has been visibly shrunk in the last generation. The corporate concentration of media ownership has put a deadening blanket over the usual cacophony of democracy, with dissenting voices screened for acceptability by young and often witless TV producers. Corporate owners have a strong stake in what gets said on their stations. Why piss off the President when you will need his good regard for so

many things? Viewers have a zillion things to watch, but if you jump around the dial, with luck you will always be watching a General Electric channel.

How did it happen that the multiplication of outlets made possible by technology led to a concentration of views and opinions--ones usually anchored by the conventional wisdom of center-right sensibilities? Where did the "freedom" go? Where are the people's ideas and observations? Al Gore, who found his voice after he lost the presidency, recently expressed his sense of alarm: "I believe that American democracy is in grave danger. It is no longer possible to ignore the strangeness of our public discourse." The bread-and-circuses format that monopolizes the public's airwaves is driven by a condescending commercial calculation that Americans are too stupid to want anything more. But that assumption becomes fragile as other voices find other venues for expression. This is an industry crisis that will be very healthy for the society, a political opening to rearrange access and licensing for democratic purposes.

For the faltering press, the bloggers will keep sharpening their swords, slicing away at the established order. This is good, but the pressure will lead to meaningful change only if the Internet artisans innovate further, organizing new formats and techniques for networking among more diverse people and interests. The daily feed of facts and bile from bloggers has been wondrously effective in unmasking the pretensions of the big boys, but the broader society needs more--something closer to the democratic "conversations and seminars" that Gillmor envisions, and less dependent on partisan fury and accusation.

As an ex-Luddite, I came to the web with the skepticism of an old print guy. Against expectations, I am experiencing sustained exchanges with many far-flung people I've never met--dialogues that inform both of us and are utterly voluntary experiences. This is a promising new form of consent. Democracy, I once wrote, begins not at election time but in human conversation.

Establishment newspapers like the New York Times face a special dilemma, one they may not easily resolve. Under assault, do editors and reporters align still more closely with the establishment interests to maintain an air of "authority," or do they get down with folks and dish it out to the powerful? Scandal and crisis compelled the Times to lower its veil of authority a bit and acknowledge error (a shocking development itself). But while the Times is in my view the best, most interesting newspaper, it always will be establishment. For instance, it could be more honest about its longstanding newsroom tensions between "liberals" and "neocons." What the editors might re-examine is their own defensive concept of what's authoritative. It is not just Bush's war that blinded sober judgment and led to narrow coverage. In many other important areas--political decay and global economics, among others--the Times (like other elite papers) seems afraid to acknowledge that wider, more fundamental debate exists. It chooses to report only one side--the side of received elite opinion.

Readers do understand--surprise!--that the Times is not infallible. A newspaper comes out every day and gets something wrong. Tomorrow, it comes out again and can try to get it right. In essence, that is what people and critics already know. They are more likely to be forgiving if the newspaper loosens up a bit and makes room for more divergent understandings of what's happening. But as more irreverent voices elbow their way into the "news" system, the big media are likely to lose still more audience if they cannot get more distance from throne and power.

What will come of all this? Possibly, not much. The cluster of scandals and breakdown may simply feed the people's alienation and resignation. The governing elites, including major media, are in denial, unwilling to speak honestly about the perilous economic circumstances ahead, the burgeoning debt from global trade, the sinking of the working class and other threatening conditions. When those realities surface, many American lives will be upended with no available recourse and no one in authority they can trust, since the denial and evasion are bipartisan. That's a very dangerous situation for a society--an invitation to irrational angers and scapegoating. It will require a new, more encompassing politics to avert an ugly political contagion. We need more reliable "news" to recover democracy.

On Sale: Your Government Why Lobbying Is Washington's Best Bargain

Two weeks ago, along a marble corridor in the Rayburn House Office Building in Washington, I watched about 40 well-dressed, well-coiffed men (and two women) delivering huge value for their employers.

Except that we, the taxpayers, weren't employing them. The nation's banks, mortgage lenders, stockbrokers, private-equity funds and derivatives traders were.

They were lobbyists--the best bargain in Washington. And even amid a popular revolt this year against the moneyed interests they represent, they delivered huge returns.

On September 18, 1793, President George Washington laid the cornerstone for the U.S. Capitol. While the silver trowel and marble gavel used for the ceremony are still displayed, repeated efforts to locate the cornerstone itself have been unsuccessful.

At times, policymaking seems as shrouded in mystery as the location of the Capitol's cornerstone. That's why you need an experienced partner to help you unravel the mystery.

That's the pitch you'll find on the website for Capitol Tax Partners, one of 1,900 firms that house more than 11,000 lobbyists registered to operate in Washington. Last year, according to the Center for Responsive Politics (CRP), firms like Capitol Tax were paid a total of $3.49 billion for unraveling the mysteries of the tax code for businesses involved in everything from health insurance to defense contracting to international trade. According to Capitol Tax co-founder Lindsay Hooper, in the case of his firm, this meant providing "input and technical advice on various tax matters" to such clients as Morgan Stanley, 3M, Goldman Sachs, Chanel, Ford and the Private Equity Council, which is a trade group trying to head off a plan to increase taxes on what's called carried interest, a form of income enjoyed by the heavy hitters who run venture-capital and other types of private-equity funds. (Time Warner, the parent company of TIME magazine, is also a current client of Capitol Tax Partners.)

Here's what a bargain lobbying is: Since 2009, the Private Equity Council has paid Capitol Tax, which has eight partners, a $30,000-a-month retainer to keep its members' taxes low. Counting fees paid to four other firms and the cost of its in-house lobbying staff, the council reported spending $4.2 million on lobbying from the beginning of 2009 through March of this year. Now let's assume it spent an additional $600,000 since the beginning of April, for a total of $4.8 million. With other groups lobbying on the same issue, the overall spending to protect the favorable carried-interest tax treatment was maybe $15 million. Which seems like a lot--except that this is a debate over how some $100 billion will be taxed, or not, over the next 10 years.

And what did the money managers get for their $15 million investment? About $10 billion in lower taxes. While lawmakers did manage to boost the taxes of hedge-fund managers and other folks who collect carried interest as part of their work, they agreed to a compromise (tucked into a pending tax bill) that will tax part of those earnings at the regular rate and another part at a lower capital-gains rate. The result? A tax bite about $10 billion smaller than what the reformers wanted. That payoff is all the more remarkable when you realize that this tax break is going to some of the wealthiest Americans and that all the reformers wanted originally was for those folks to pay the same graduated income-tax rate that normal wage earners do. And there was even a parting gift from Congress: with a little-noticed, lobbyist-inspired tweak in the proposal--making it effective in 2011 instead of the proposed 2010--Capitol Tax and the others achieved an immediate, additional tax savings for their clients of about $2 billion.

A Lobbyist's Super Bowl  

The battle over that carried-interest provision was dwarfed by the real action this year--the massive financial-regulatory-reform bill hammered out by a House-Senate conference committee and targeting what the White House says were the causes of the economy's near meltdown in 2008. The legislation, which would bring more change to

Wall Street than anything else enacted since the New Deal, was a Super Bowl for lobbyists. But with the legislation, unlike the Super Bowl, where there's one winner and one loser, every yard the lobbyists gained bought handsome returns for their clients, even as the final score that dominated the headlines was that major financial reform had passed and Big Business had lost. This is the story of how they grind out those yards.

The 40 people I saw in that Capitol Hill corridor in mid-June were part of an army of approximately 2,000 monitoring the two-week-long conference committee between Senators and Representatives trying to reconcile their different versions of the bill. In the past, these sessions have been good government's Bermuda Triangle, a black hole of backroom deals. The lawmakers usually worked out the differences between the bills in secret, often inserting entirely new and undebated provisions provided at the last minute by lobbyists. The full House and Senate would then have to vote up or down on the final result, often without having had time to read, much less consider, those changes.

This time the process was more transparent. Massachusetts Congressman Barney Frank and Connecticut Senator Christopher Dodd, whose committees largely wrote the two bills, agreed to televise their meetings and publish any proposed new language in advance of the conference's consideration of it. But most of the real action came on the nights and mornings between the televised sessions, when the always witty, often acerbic Frank and his House colleagues would decide what they would offer the Senate in the way of language to reconcile the two bills. The more avuncular Dodd and his Senate colleagues would then frame their responses, with some input from the Republicans because they still needed at least one GOP vote to pass the whole thing. The public part of the meeting consisted mostly of announcements of the two sides' offers and acceptances, all of which had been hammered out earlier behind closed doors. The exception was on the final day of bargaining, June 24, when committee members and their staffs, lobbyists and reporters spent 20 hours crowded into a large Senate hearing room, where last-minute deals were made on the fly until 5 o'clock the next morning.

The Weapons of Modern Warfare  

In the '80 s, when lobbying was a cottage industry com pared with what it is today, so many lobbyists swarmed the corridors like the one outside the conference room that the press dubbed the halls Gucci Gulch in honor of lobbyists' preferred footwear. Now they usually work more efficiently and less conspicuously: most of the 2,000 lobbyists who registered this year to lobby for the financial industry (that's almost four for every member of the House and Senate) were on the phone or exchanging e-mails or text messages back at the office. Having downloaded the day's proposed language changes, they could watch the conference proceedings live and launch surgical strikes.

Just outside the House Financial Services hearing room, two dark-suited, slightly graying men madly BlackBerrying look up and blanch at my press credential as if they'd been caught passing a bag of money to someone. After being promised anonymity, they explain that they've been dispatched by their boss, as one puts it, "to grab one of the senior staff on the Republican side and give him an idea about how to reword something in the Volcker rule."

The Volcker rule, named for former Reserve chairman Paul Volcker, who was one of those who first suggested it, would prohibit banks from putting their own money into risky ventures such as private-equity or real estate deals. It's a restriction that its advocates believe could prevent the next financial implosion. Bankers hate it, but their lobbyists have been unable to fight it off. Instead, they have been chipping away at it--suggesting provisions that would allow some percentage of those funds to go into high-risk deals, delay the rule's implementation or exempt some big players.

The two lobbyists I encounter in the hall are working on a narrower Volcker-rule carve-out. They're representing "some green-energy interests," one says. What's that got to do with the Volcker rule? He explains that Washington is encouraging green-energy investments by granting tax credits, but only investment entities like banks that make consistent profits have predictable tax liabilities and therefore can make use of such tax credits. For $20,000 a month, Capitol Tax's Hooper is pushing to get the same carve-out for the members of the American Wind Energy Association. If he doesn't, he says, it could slow down billions in investments that the Obama White House has been championing. "Much of what good lobbyists do," he says, "is work with legislators and staff to avoid unintended consequences of well-intended proposals."

"Unintended consequences" is a refrain I will hear often when asking lobbyists about their work. But seasoned Hill staffers will tell you that innocent-looking carve-outs sometimes become gaping loopholes.

By the time the bill was finished, lobbyists seeking Volcker-rule carve-outs had won complete exemptions for most mutual-fund companies and a provision allowing banks to manage funds and still make investments of up to 3% of their capital and to take up to seven years to sell off the investments they already had. Another highly technical tweak allowed banks to define their capital differently from what was originally proposed, meaning that 3% limit on how much they could invest suddenly got lots higher. And the clean-energy troops won a provision tucked into a paragraph on page 670 that, depending on how the implementation rules get written, might allow exceptions for investments in small or start-up businesses that "promote the public welfare."

Complexity is the modern lobbyist's greatest ally. The House bill was 1,615 pages; the Senate version 1,565. The final bill weighed in at 2,319 pages. And on almost every page there were dozens of phrases--typically framed in near unintelligible legalese--whose wording could mean millions or billions to some company or industry. Depending on which side you believe, they could also mean better protection--or a worse economy--for the rest of us. The bill requires, for instance, that most mortgage companies that sell off their mortgages in repackaged securities keep at least a 5% interest so that they still have skin in the game. Will this prevent another housing bubble, or will it dry up 5% of the credit we need to revive the housing market?

Three lobbyists showed me three different proposals for rewording what may be the bill's biggest-money section: a provision in the Senate version that would force the five major banks that do most of the country's trillions of dollars of trading in derivatives--and make nearly $23 billion a year doing so--to spin off those operations. Even holding the dueling paragraphs side by side by side, I found it difficult on first read to appreciate the differences. But on closer inspection and with some pointers from the lobbyists, it was clear that billions in profits depended on the variations in this nearly impenetrable language. In the wee hours of the final morning, the conferees resolved the issue largely along the lines of one of the versions I saw that divided up derivatives into different categories: banks were allowed to keep certain types of trading operations while being forced to shed others.

"Complexity is our enemy," says Elizabeth Warren, chair of the congressional panel overseeing the Troubled Asset Relief Program, who conceived one of the legislation's marquee provisions--a consumer-protection agency to regulate mortgages, credit cards and other financial products. "The more complex these bills are," she complains, "the more they can outgun us."

The Grease in the Machine  

This all sounds pretty terrible. President Obama at least acts as if he thinks so. He's barred lobbyists from working in his Administration and used some language to describe them that he hasn't used on BP. The press seems to agree; news outlets routinely use influence peddler as a synonym for lobbyist.

So why does Dave Wenhold of the three-person lobbying firm Miller/Wenhold Capitol Strategies have "LOBYIST" for the license plate of his Mustang convertible? "Because I am proud of what I do," he says. "I think lobbyists provide input that makes the system work better. And in my case," he adds, "I'm often David going against Goliath."

Wenhold, a graying, sharp-dressing 42-year-old, serves as president of the American League of Lobbyists, a group that claims to speak--and sometimes lobby--for lobbyists. He points to one of his clients to illustrate the constructive role his profession can play. It's a trade association of small telephone-answering services, the kind whose operators pick up the phone when you call a plumber on the weekend. The answering services have chipped in to pay Wenhold's firm $4,000 a month because they're afraid that the way a single sentence might be drafted in a pending Federal Communications Commission rule could put them out of business. It has to do with a fee all telephone companies pay into a fund to support rural phone service. It's so complicated that while Wenhold's argument that the big companies are trying to have their way with his little guys sounds right, it's hard to know for sure.

But that's Wenhold's point: these mom-and-pop answering services need a lobbyist who can spot an arcane issue like this and explain it to regulators and the legislators who oversee them. Wenhold should not be embarrassed to tell his

kids what he does all day. Nor should Hooper of Capitol Tax Partners, a soft-spoken tax lawyer and accountant who spent five years as a senior staffer on the Senate Finance Committee, perhaps the most professional committee on Capitol Hill. He is, he says, a "nuts-and-bolts substantive lobbyist, not a door opener."

The Constitution is squarely on Wenhold's and Hooper's side. The First Amendment explicitly protects our right to "petition the government"--more explicitly, in fact, than it protects many of the rights the courts have given me as I report and publish this article. Why shouldn't that answering-service operator, or the CEO of Goldman Sachs, be able to hire someone to help do that, especially when what they are petitioning about is so complex?

With that in mind, the President should be the last to complain about lobbyists, and lobbyists should be the last to complain about him, whatever his rhetoric. For the age of Obama has brought an explosion of complexity to Capitol Hill. In addition to the 2,319 pages of financial reform, the Administration's health care bill was 906 pages, and the economic-stimulus measure weighed in at 407 pages. The 1914 law establishing the Federal Trade Commission--with its sweeping commerce and antitrust regulations--was eight pages. The 1935 Social Security Act, which also included unemployment compensation, child-welfare services and a complex allotment to states for aid to dependent children, was 28 pages.

It's no surprise then that the $3.49 billion spent on lobbyists in 2009 was a record, more than twice the figure for 2001. There was a lot of mystery to unravel.

In preparing a story, a reporter is best served by listening to those on all sides so that he can weigh their best arguments. A good legislator does the same thing with lobbyists, says Congressman Frank. "I feel better about a position when I can hear both sides … You use them to inform you," he adds, "as long as they know that if they lie, they lose. They will never be allowed to come back to this office." In fact, lawmakers turn to lobbyists to stage the debates. "I help my boss the most when I can play the good lobbyists off each other, just the way a judge or a jury hears all the evidence and the lawyers' arguments and then decides," says a Senate-committee lawyer who played a key role in drafting some of the most arcane but big-money provisions of the reform bill.

Lobbyists describe their role in stronger terms. "If you banned all lobbying tomorrow, the legislative process would grind to a halt," says Wenhold. "You can call us special interests, but the ones who are especially interested are the ones who can explain the consequences of writing a bill this way or that way. We make the system work." A financial-services trade-association executive, who says lobbyists provide not only crucial policy input but also what he calls critical "technical assistance" (which more cynical observers would call drafting the legislation), puts it more bluntly: "Most members [of Congress] may know one or two issues well, if that. Then you have a 26-year-old kid, maybe he's even 30 and went to a good law school, who's on the staff working 10 hours a day and is supposed to tell his boss how to do derivatives regulation or credit-card reform. Are you kidding?"

What adds weight to that argument is that lately those kid staffers are working shorter stints before departing for jobs at double or triple their government salaries at, yes, lobbying firms, where the top people can earn $1 million to $4 million a year. There are important exceptions--senior staffers, especially on important committees like those dealing with taxes, who seem to have caught the public-service bug long-term and are able to weigh the lobbyists' arguments knowledgeably and independently. But according to Jock Friedly of LegiStorm, which tracks congressional-staff assignments and salaries, the average tenure for congressional staffers is now about two years. "Over the past 20 years, people have moved much more quickly into the lobbying world," he explains. Of the approximately 2,000 lobbyists working on financial reform last month, more than 1,400 had been congressional staffers or worked in the Executive Branch, and 73 had been members of Congress, according to a report issued jointly by the CRP and the Congress Watch unit of Public Citizen, a self-styled public-interest group.

War of the White Papers  

Depending on those staffers turned lobbyists to provide a courtroom-like balanced debate also ignores the imbalance of forces storming the Hill. Except for the fight over one key provision--a measure to limit what banks can charge retailers to process debit-card payments, an issue pitting major retailers against the banks--lobbyists for the banking and financial-services industries simply outgunned lobbyists for consumers. "We have three lawyers total working on

this [entire bill]," says Travis Plunkett, the legislative director for the Consumer Federation of America, a lobbying and education organization representing 280 nonprofit groups. "They can have three people working on a paragraph."

The imbalance can be measured not just in bodies but also in the unending flow of alternative-language proposals and extravagant "white papers" that the heavy hitters churned out. My favorite white paper this season was the Private Equity Council's "study" of how taxing those who run these funds at the same rates that everyone else pays for earned income would be disastrous for the economy. It was 15 dense pages, elaborately footnoted, colorfully graphed and full of intimidating calculus formulas that purported to show how higher taxes paid by people who manage equity funds would dry up investments because their after-tax income would be lower and therefore they wouldn't want to take on as much risk. This is gibberish posing as scholarship. The 20% fee that fund managers get from the fund's profits (that's the famous "carried interest" that Capitol Tax Partners was trying to protect, and it often amounts to tens or hundreds of millions of dollars) has nothing to do with any investment-risk calculation they make, because they are not risking or investing a penny to get that slice. They get those fees (plus typically a guarantee of 2% of all the money they manage, whether they invest it successfully or not) simply for showing up every morning and managing the fund. It's risky only in the sense that the average worker risks not getting a bonus if he doesn't perform well. The so-called limited partners whom the fund managers rely on to actually invest in their funds are the ones making the risky investments, and their favorable tax rates would not go up under the proposed reform. "I have trouble with that logic myself," concedes one of the funds' lobbyists when asked about the white paper, "but when you publish something like this, it gives a staff person or member who wants to help you something to hang his hat on … It helped us get the compromise," he adds, referring to the resulting rate (now tucked into a broader tax bill that awaits a final vote) that is between the regular tax rate and the lower capital-gains rate.

Beyond the resources lobbyists can deploy, there's the campaign money they can supply. The average winning congressional campaign in 2010 is likely to cost about $1.5 million, requiring the incumbent to raise roughly $15,000 a week. Lobbyists not only contribute on their own but are the most important fundraisers in the money grind, because they serve as lawmakers' links to the most promising donors: those with business interests related to each member's committee assignments. So it was no surprise that as the financial-reform conference began its deliberations, the CRP reported that since 1989 the 43 members of the committee had received $112 million from donors associated with the finance, insurance and real estate industries. "You can say that lobbyists on the Hill are like lawyers in the courtroom and that the advocacy system produces the best result," says David Arkush, the director of Congress Watch. "But in court you don't have the lawyers and clients donating to the jury."

The Fights You Can't See  

Yet it would seem that for all their advantages, the high-powered lobbyists lost big, assuming the financial-reform bill wins the necessary votes in the Senate. Everything that Goliaths like the Chamber of Commerce (which alone spent $144.5 million last year lobbying for business interests) fought--the new consumer-financial-protection agency, derivatives regulation, restrictions on banks' adding risk by trading on their own accounts, regulation of debit-card fees--made it into the final version approved by the conference. So what's the problem? "The more important an issue is to the public," says Congressman Frank, "the less important the lobbyists are … The one thing politicians care more about than money is votes. So when an issue catches the public interest, lobbyists and contributions will almost always take a backseat--unless the politician is a crook."

And so, amid deep public bitterness over the financial meltdown and the bailout that followed, financial reform became a wave no army of lobbyists could hold back. "I've been doing this for 25 years and have spent most of my career tinkering at the margins but losing the war," says the Consumer Federation's Plunkett, who calls the final version of the bill's new consumer-financial-protection bureau "pretty much a complete win … What I saw this time was that every once in a while the public can win and money doesn't triumph because the public is really paying attention."

Nonetheless, there were all kinds of compromises in which the lobbyists tamed what they couldn't kill. Some were highly visible. For example, to many reformers, the obvious way to deal with too-big-to-fail banks was simply to break them up; instead, a "systemic risk council" was established to monitor them, and a scaled-back Volcker rule was enacted to limit them. And in another highly visible retreat by legislators, car dealers, whose businesses are

located in every congressional district--making their lobbyists "more powerful than bankers'," says Frank--won an exemption from new regulations on consumer loans. But most of the compromises were nearly invisible--tweaks in definitions, changes in who would be covered, delayed start dates for new regulations. It was here that the lobbyists earned their money.

For example, an important though unheralded issue in financial reform was the extent to which various provisions governing bank reform would override state laws or regulations on the same questions. If a state has a tougher set of regulations governing, say, bank loans, would those rules be set aside by the new federal regulations? There are good arguments on both sides, with the banks coveting what is called federal pre-emption and consumer groups, backed by the White House, fiercely opposing it. One lobbyist told me of how--using the two essentials of successful lobbying, personal relationships and money--he got a boost from two Democrats in the House "who wanted to help us and whom we knew well through prior associations and have helped raise money for." They provided important support for pre-emption even though they vocally backed the overall reform bill. "They said, 'I can't be with you on the bill,'" he continues, "'but show me where I can help you out and then give me some backup'"--which came in the form of a white paper on pre-emption, prepared by the American Bankers Association. The result was a compromise allowing limited federal pre-emption.

This kind of chipping away behind the scenes has only just begun. In fact, if and when the bill is finally approved, the action is going to become even less visible, moving from Capitol Hill to the bowels of the Washington bureaucracies. Officials at multiple agencies, including some new ones that have to start from scratch, will need to write all kinds of regulations to implement it, using an elaborate process of drafts, hearings, public-comment periods and all kinds of other red tape. Referring to a provision that requires banks to set "reasonable rates" when charging retailers for debit-card transactions, a top lobbyist for the credit-card industry says, "When it comes down to it, there are all kinds of definitions of reasonable and of cost … Those are the real trenches for us," he continues, adding almost gleefully that he has a list of "more than a hundred provisions" that will require elaborate rulemaking, with billions in bank fees at stake.

A Better Way?  

Some of the lobbyists' behind-the-scenes victories, whether on the Hill or at a bureaucrat's drafting table, might in fact prevent the unintended consequences for the economy that became the lobbyists' mantra this spring. But the point is that their influence almost always exceeds the power of their arguments. Is there any way to fix an imbalance that will once again hold sway when public attention shifts elsewhere?

Disclosure is usually thought to be a good solution, but as Wenhold (the guy with the "LOBYIST" license plate) points out, "We are already the most regulated, open-book industry in the world. We have to file public quarterly reports of all the money we get, from whom, and whom we lobby." But there could be improvements--like requiring members of Congress to disclose their contacts with lobbyists the way lobbyists now have to sign in to a public log when they go to meetings with many regulators and other Executive Branch officials. And reporting of these contacts could be done in real time and be posted on the Internet. But disclosure has yet to embarrass legislators out of meeting with and taking campaign contributions from the private interests whose fates they legislate.

The emergence of groups like CRP--a savvy corps of policy wonks with obvious technical expertise--has increased accountability. CRP crosses lobbyists' registration reports with campaign-finance filings to produce pungent press releases, like one spotlighting Congressman Joe Barton's reliance on oil-industry contributions just hours after Barton apologized to BP for how it had been treated by the White House. It won't be long before CRP, Congress Watch and other groups churn out real-time contribution breakdowns within minutes of key votes--useful information for voters and good fodder for lawmakers' opponents.

Dan Geldon is a staffer who worked for Elizabeth Warren as she pushed her idea for a consumer agency to regulate financial products. Propelled by her relentless and highly effective television appearances, her agency survived pretty much intact despite hurdles thrown in the way by legions of business lobbyists. It was a process that Geldon says was "shell-shocking." His solution is a tax on lobbying that would finance a new research arm of Congress, akin to an expanded version of the highly regarded Congressional Budget Office, that would provide unbiased advice on

pending legislation to balance the lobbyists' input. Arkush, of Congress Watch, says his and like-minded groups have a more radical plan in the works. His idea, inspired by the January Supreme Court decision banning limits on corporate campaign contributions as a violation of First Amendment rights, is a constitutional amendment stripping for-profit corporations of First Amendment rights. Corporate political contributions could then be banned, as could the hiring of lobbyists. Goldman Sachs CEO Lloyd Blankfein could hire a lobbyist with his own money, but Goldman couldn't. This might appeal not only to progressives like Arkush but also to Tea Party sympathizers and others frustrated with how our democracy has become a game for insiders.

But let's remember that New York Times v. Sullivan, the Supreme Court case that set the course for press protections from libel-law abuse, involved corporate speech (an ad in the Times). And however limited Congress's appetite for passing an amendment like this might be, it would also require the votes of three-quarters of the country's state legislatures, which are corporate-lobbying playgrounds that make Capitol Hill seem pristine.

Even if Arkush and his colleagues could make lightning strike, would we really want those mom-and-pop telephone-answering services prohibited from hiring Wenhold? Then again, whether it's the big banks or big oil, can we afford to keep the system we have, especially when we have to assume that the players with all the money will continue to double down on their investments in what may be Washington's only bargain? The idea of a representative democracy is that we elect smart, good people to decide issues--like Volcker-rule carve-outs or who can trade derivatives with whose money--that are too complex for the rest of us to decide directly. But when those issues are so complicated and when those representatives are so reliant on private interests not only for information but also for campaign money, that can't be a good bargain for the rest of us.

Here's a simpler idea that might keep Wenhold in business while tempering the influence of the heavier hitters. It would be combined with fuller, faster disclosure; more restrictions on the revolving door between members of Congress and their staffs and the lobbying firms; and something like Geldon's souped-up policy-research unit. And it doesn't require a pie-in-the-sky constitutional amendment. The Senate and House could adopt their own rule, as they have done regarding other ethics issues, prohibiting any member of Congress from accepting contributions from firms that lobby them. In other words, the lobbyists could continue to argue their cases, but they would have to stop contributing to the jury.

Lobbyists, who would save a ton of money and time now spent going to endless fundraisers, might even favor it. And it would be fun to read the white paper arguing against it.

Lobbyists

They say legislation would grind to a halt without them  

Lindsay Hooper  

FIRM: Capitol Tax Partners LLC

CLIENTS: Goldman Sachs, Ford, Apple and 55 others

FIRM LOBBYING FEES 2009-10: $14.2 million

During the financial-reform debates, Hooper, representing clean-coal, wind and other energy outfits, pushed back against proposed investment bans--specifically one on proprietary trading--to facilitate green-energy financing

Dave Wenhold  

FIRM: Miller/Wenhold Capitol Strategies

CLIENTS: Association of TeleServices International, Modular Building Institute and nine others

FIRM LOBBYING FEES 2009-10: $406,349

As president of the American League of Lobbyists, Wenhold helps "those especially interested in a bill" exercise their right to petition the government

David Arkush  

FIRM: Public Citizen's Congress Watch

POSITION: In-house lobbyist for the consumer-advocacy group founded in 1971 by Ralph Nader

FIRM LOBBYING FEES 2009-10: $250,000

Arkush advocated for consumer protection, advised breaking up the largest, too-big-to-fail banks and addressed other industry-structure issues, while investigating the financial sector's myriad ties to the government

Travis Plunkett  

FIRM: Consumer Federation of America

MEMBERS: AARP, Consumers Union, National Consumers League and 277 others

FIRM LOBBYING FEES 2009-10: $170,000

Plunkett pressed, successfully, to include a provision that creates an independent board with broad authority to protect consumers from unfair and deceptive financial practices--often at the hands of big banks

CLOGGING THE HALLS OF GOVERNMENT? Lobbying reform, as both a campaign battle cry and focus of action in post-election Washington. is near the top of the agenda--and with good reason. No sooner had President Clinton announced his intention to reform health care than lobbyists of all types and from all walks of life--from grandmothers to megacorporations--began to deluge the new administration and lawmakers with phone calls, letters, faxes, and personal appearances. Hillary Clinton went so far as to convene "secret" health-care hearings to avoid what she claimed would be undue influence.

Meanwhile, the centerpiece of the president's economic plan--his five-year, $70 billion BTU tax--was stripped out of the Senate version of the bill following a sophisticated $2 million lobbying effort by a coalition representing business groups, farming interests, oil concerns, manufacturers, and taxpayer organizations. The lobbying campaign included television, radio, and newspaper advertisements and focused on two key Democratic members of the Finance Committee, using time-honored techniques of "inside" lobbying and "outside" grass-roots organization to defeat the measure. The result: The BTU tax did not even make it out of the Finance Committee.

Certainly these two situations have left a bad taste in the president's mouth, but Clinton's dislike for high-powered lobbying started long before he entered office. During the 1992 presidential campaign, Democrat candidate Clinton and Independent Ross Perot specifically attacked Washington lobbyists and their profession as part of "the problem" in Washington, which they promised to reform by "giving government back to the people."

In their view, Washington's insiders regularly got together in dark, high-priced restaurants to pass campaign contributions to lawmakers in exchange for special considerations--tax loopholes, regulatory loopholes, and the like--all the while passing on the costs to an unsuspecting and innocent public. (Republican George Bush, by virtue of his incumbency--and the fact that several of his top campaign aides were high-profile Washington lobbyists--was decidedly handicapped in his ability to attack the governing status quo.)

To look at public opinion polls, this line of attack stood Clinton and Perot in good stead. Lobbyists--regularly portrayed as fat, cigar-chomping stewards of sleaze, more interested in lining their own pockets and their clients' balance sheets than in doing what is "right"--generally rank lower even than members of Congress in public approval.

Lobbying supporters are at odds with the stereotypes, claiming that lobbyists play an important role in government. Critics say that the situation in Washington is out of hand and only an overhaul of current lobbying legislation can clean it up.

In early May, the first major lobbying-reform legislation in almost a half century passed the Senate--by the staggering margin of 95-2, indicating that lobbying reform ranks with motherhood and apple pie-and action is expected in the House later this year. But is it too little too late or will attempts at reform only create new problems?

A BROAD DEFINITION

Loosely defined as attempts to influence government policies or actions on behalf of one's own clients or interests, lobbying has been around for millennia. In the English-speaking world, the first lobbyists were the barons who forced King John of England to sign the Magna Carta in 1215; with his signature, they were given the ability to petition him to protest any violations of their newly won rights. In the founding of the American republic, this right carried over in the First Amendment to the Constitution, which states that citizens shall have the right "to petition the Government for a redress of grievances."

According to Jeffrey Birnbaum, author of The Lobbyists: How Influence Peddlers Get Their Way in Washington, the term lobbying first came into common usage in the United States in 1829, when "privilege seekers" in Albany were referred to as "lobby agents"--named after their practice of waiting for legislators in the lobbies outside the legislative chambers. Shortly thereafter, the term was shortened to "lobbyist" and was used mostly with opprobrium.

Today in Washington, there are an estimated 80,000 lobbyists, each with his own specialized area of influence, engaged in what is, by some estimates, a $2 billion per year industry. Some are experts who know the ins and outs of a particular issue cluster. Others are generalists who know little of the issues; they know the pressure points in the power structure, however, and have the contacts to bring leverage to bear. Others simply have personal connections to a few powerful members of Congress and trade on their ability to gain access for a client.

Lobbyists are organized in a variety of ways: There are almost 3,000 trade associations and unions, representing tens of millions of businesses and workers around the nation. Roughly 1,500 individuals represent the nation's top corporations, each working out of separate offices--most often, downtown, on the power corridor, K Street. Others are organized into policy think tanks and special interest groups. Each has a single goal in mind: influencing government policy and action to benefit his clients' interests.

OUTDATED REGULATIONS

Currently, lobbying in Washington is regulated under two laws: the 1938 Foreign Agents Registration Act (FARA) and the 1946 Federal Regulation of Lobbying Act (FRLA). The 1938 law, which mandates registration with the Justice Department of those who represent a foreign government or individual, was passed in response to reports of Nazi and fascist propaganda efforts in the United States.

The 1946 law, which extended the reach of the federal government's regulatory efforts to include all lobbyists who worked to influence federal legislation or regulation, required lobbyists to register in Congress and report the amount and sources of their lobbying income. It also required lobbyists regularly to report to Congress the contacts they made, both directly and indirectly, with members of Congress on behalf of their clients.

But Supreme Court decisions in the 1950s, cousin pled with increasingly sophisticated grass-roots organizational and communications techniques, have created huge loopholes and rendered the two laws largely ineffective. Even as the laws and the techniques changed, so did Congress itself: Over the last generation, a dispersion of power has occurred and staff sizes have increased massively. The result: Laws written to regulate lobbying when it was largely personality-driven--and a few score lobbyists had the lion's share of the business lobbying a few score influential members of Congress--no longer work in the changed congressional environment.

Of the estimated 80,000 Washington lobbyists, fewer than 6,000 are registered. But given the ways the laws are written and interpreted, the other 75,000 are not necessarily in violation of the registration requirements.

Neither law currently requires reporting of any contact made with a member's staff or with the increasingly powerful committee staffs. This worked fine 50 years ago, when staffs were small and only served to support the legislators. But in today's environment, with the well-known time pressures members face, more and more decisions are being made at the staff level, only to be given cursory approval by the members. Thus, for many lobbyists, influencing the staffs of the committees and key members is their focus; indeed, many lobbyists operating in Washington peddle themselves not as players with access to individual members themselves but as lobbyists who know the key staffers.

The current FARA requires registration at the Department of Justice; FRLA requires registration with the clerk of the House. But in addition to requiring the filing of disclosure reports only by those individuals who make direct contact with members of Congress, the laws exempt from reporting requirements those individuals who meet with members of Congress but do not lobby them on a specific piece of legislation.

A lobbyist registered with the Justice Department to represent the government of Mexico would be required to report a meeting with a member to urge his support for the North American Free Trade Agreement (NAFTA). An analyst with a think tank who met that same afternoon with that same member, who did not speak specifically of NAFTA but instead spoke somewhat more broadly of the vast benefits of free trade between the two countries, would not have to report the meeting Neither would a lobbyist for a U.S. corporation that stood to gain huge profits from moving its manufacturing operations to Mexico have to report a meeting with that same member's legislative assistant responsible for the issue.

REFORM ATTEMPTS

In an attempt to remedy this ambiguous situation, Sens. Carl Levin (D-Michigan) and William Cohen (R-Maine) have cosponsored the Lobbying Disclosure Act (LDA) of 1993. The LDA--which passed the Senate in early May by a lopsided 95-2 vote--seeks to toughen reporting requirements for lobbyists. At its core are provisions ensuring that all lobbyists are registered and file semiannual disclosure statements listing whom they represent, on which issues, whom they contact, and how much money they spend. An Office of Lobbying Registration and Public Disclosure would be established at the Department of Justice to administer the new law.

On the House side, a similar measure will be marked up later this year. It is cosponsored by Reps. John Bryant (D-Texas) and George Gekas (A-Pennsylvania), the chairman and ranking member, respectively, of the House Judiciary Committee subcommittee on administrative law and government relations.

President Clinton also has gotten into the act. During the transition, he announced that his administration would enact the toughest measures yet seen to end the so-called revolving door, in which high-ranking officials leave government service to accept lucrative lobbying contracts to trade on their expertise and contacts, sometimes even for foreign governments. (Reportedly, 98 senior government officials left their federal jobs after last year's elections to take Washington lobbying jobs.)

Clinton announced that appointees to his administration would have to agree not to lobby anyone in the executive branch of government for a full five years after leaving government service, extending the Bush administration's ban by four years. Moreover, Clinton appointees would have to agree never to lobby for a foreign political party or government.

The day after the Senate passed its lobbying-reform measure, Clinton announced tough new restrictions on lobbyists in his own campaign finance package, which cleared the Senate in June. Under his proposal, corpo rations would lose the deduction for lobbying expenses they currently enjoy, valued at approximately $175 million annually.

In addition, lobbyists would be barred from contributing for one year to any member they lobbied personally and would be barred from lobbying personally any member to whom they made a contribution. Lobbyists who regularly augment their influence with members of Congress by directing affiliated political action committee (PAC) contributions to targeted members would see their tools dulled by a major reduction in the amount of PAC contributions allowed.

CREATING NEW PROBLEMS?

Critics of the reform measures point to several problems. The president's plan, they say, is too tightly drawn. Only 1,100 of his 3,000 appointees will be affected by his self-imposed strictures.

The plan does not take into account the changed political environment. An individual lawyer who lobbied a member would be barred for one year from contributing to his reelection campaign, but the lawyer's partners would not be barred, and, if the law firm had a PAC, the PAC would not be barred from contributing

If the law passed in its current form, further specialization would likely occur: Harry and Tom would go into partnership together. Harry, who would lobby members all the time, would never give a dime, leaving that task to Tom, who would never lobby but would raise lots of money. Members of Congress would know who's who and who is giving what to whom.

Because the reform measures target only individual lobbyists--and not their firms or their clients--they will be easily exploited, and money will simply be rechanneled. Besides, some critics point out, the focus on ending lobbyists' contributions is much ado about nothing. During the 1989-90 election cycle, less than 2 percent of congressional contributions came from lobbyists.

Moreover, no provision is made for contributions to challenger candidates or open-seat candidates; any lobbyist could contribute freely to such a candidate--even after the election, before the newly elected member is sworn in--and not fall afoul of the regulations.

In the House version of the reconciliation bill--which contains the repeal of the deduction for lobbying expenses, and which has already been signed into law--the repeal of the deduction for expenses only applies to expenses incurred for lobbying on legislation, not to expenses incurred for lobbying on the regulations written by federal agencies charged with implementing the legislation. As any lobbyist in Washington knows, most of the big-money lobbying is done to finagle favorable regulations from the implementing agencies.

While the reformers are hard at work trying to recast America's lobbying regulation laws, they would be well-advised to remember the law of unintended consequences. Many of the problems they are attempting to address--principally, a public perception that too much money in Washington is spent on behalf of special interests, at the cost of the public good--came about largely as a result of earlier reform attempts.

PACs, for instance, were created in the 1970s as a direct by-product of the campaign finance reform legislation that followed Watergate; the ability to successfully lobby staffs came about as a result of the increased size and influence of staffs that followed the dispersal of congressional power in the 1970s, away from senior party leaders and committee chairmen and toward younger, more junior members of Congress. As the president and Congress stumble ahead trying to make things better, they should keep in mind the doctor's oath: First, do no harm.

PHOTO (COLOR): Power chasers: Lobbyists for the National Endowment for the Arts wait for legislators outside the Senate chambers.

PHOTO (COLOR): Staying in touch: Sen. J. James Exon (D-Nebraska) attends to the concerns of constituents inside the Capitol.

~~~~~~~~

By Bill Pascoe

Bill Pascoe is a columnist for the Washington Times

SIZING UP LOBBYING Pro

Access. Lobbying is a time-honored tradition that allows constituents the opportunity to express their opinions and needs to their representatives in Washington.

Communication. Washington lobbyists do speak for the common man by representing trade associations and unions, agriculture, and industry, thus guaranteeing jobs.

Experience. Many lobbyists were previously in government; their unique access to the movers and shakers allows the voice of Joe American to be heard.

Regulation. The lobbying acts of 1938 and 1946 tightly supervise the practice, like requiring lobbyists to report contacts made on behalf of their clients.

Reform. In May the Senate passed the Lobbying Disclosure Act of 1993, the first significant reform effort in nearly 50 years. A House version is expected soon.

Con

Hired guns. The 80,000 lobbyists in Washington can more easily petition on behalf of their paying clients than can folks back in the home state or district.

Corruption. Lobbyists use an end justifies the means approach, showering legislators with perks or campaign contributions that unfairly influence their decisions.

Revolving door. What about ethics? Public service? Ninety-eight senior government officials have taken Washington lobbying jobs since last year's election.

Loopholes. Supreme Court decisions in the 1950s, coupled with changes in the way congressional staffs operate, have rendered the two laws largely ineffective.

Unintended consequences. Many of the problems legislators are trying to address were actually caused by previous, poorly thought out attempts at reform.

Time for a Third Party? POST PERSPECTIVE

With few exceptions, the U.S. has been a two-choice nation for most of its existence. Is it time for a change?

IN THE PAST YEAR we've watched Washington, D.C., freeze into paralysis. The wheels of government have nearly ground to a halt as Congress barely even agreed to provide the money for spending already required by laws it had earlier passed. And the inhabitants of the two sides of the political aisle bitterly blame each other. Ask Republican Congressman Allen West who's at fault, and he says the Democrats who have "a vicious propaganda machine. It espouses lies and deceit." Ask Senate Majority Leader Harry Reid, and it's entirely the Republicans who stop all progress with "obstructionism on steroids." Ask the American people, and they agree with both; according to at least one recent poll, they blame the two parties equally. There seems to be something fundamentally wrong with our two-party system.

In fact, passing the buck seems to be the only thing the parties can agree on right now. They each agree that the other party is broken. So it's hardly surprising that there is serious talk of a third-party presidential candidacy this year. Ron Paul, the libertarian Texan, has suggested he may run on his own if he doesn't win the Republican nomination, and an outfit called Americans Elect has worked quietly but diligently to make sure the paperwork has been done to assure that some third-party candidate can run in all fifty states. Almost everyone is fed up with Democrats and Republicans.

Are we on the verge of the collapse of the two-party system? You might think so, but it has been amazingly resilient, surviving through catastrophes as great as the Civil War and the Depression. The last time a president was elected who wasn't a member of today's Democratic or Republican party was in 1848. "E Pluribus Unum" says the motto on the Great Seal--"Out of many, one." Maybe that should be "Out of many, two." A recent Gallup poll found that 31 percent of Americans identify themselves as Democrats and 27 percent as Republicans. Considerably more--40 percent--are independents, disdaining both parties. But that leaves only 2 percent to belong to any other party out there.

How did it get this way? Can it really last much longer? And what, at bottom, do the two parties stand for?

At the very beginning, the founders didn't want parties, yet we've had them almost always since. There seems to be something basic to both human nature and our political system that makes us split along either/or lines. Those either/or lines have shifted and drifted over the centuries, but they've almost never not been there.

The electoral college elected the first president, George Washington, in 1788 unanimously. He was so indisputably the right choice that no other candidate was even imaginable. Yet by the time he delivered his farewell address in 1796 near the end of his second term, national unity had so ruptured into two battling sides that he felt compelled to warn of "the alternate domination of one faction over another… a frightful despotism" that would bring "disorders and miseries." Thomas Paine, on the other side of the new political divide, responded that "the world will be puzzled to decide whether you are an apostate or an impostor, whether you have abandoned good principles, or whether you ever had any." And that was George Washington he was talking about. The parties have been at each other's throats since the very start.

At the heart of that gulf, then just as today, lay a tension between wanting a relatively big, active government and wanting a small, unthreatening one. Washington and Alexander Hamilton, his first secretary of the treasury, were among the champions of a nation of strong, well-enforced laws that actively worked to encourage banking and manufacturing and trade. On the other side, Thomas Jefferson idealized a land of free, independent farmers whom government would touch only with the lightest hand. Hamilton's side became known as Federalists, Jefferson's as Democratic-Republicans. In 1796, in the first contested presidential election, Jefferson faced off against the Federalist John Adams. The law then stated that whoever got the second-most votes became vice president, so Jefferson had to end up awkwardly serving as his political enemy's second-in-command.

In 1800 Jefferson won the top job, and in his inaugural address he expressed the hope that the two-party system could become a thing of the past, saying, "We are all Republicans. We are all Federalists." No such thing happened. However, the Republicans had the upper hand for quite a while, winning the next five presidential elections. The Federalists came to seem elitist, and by 1828 they appeared to be withering away. But in the election that year the Democratic-Republicans split into two factions, creating what became the two parties of the next several decades. Andrew Jackson won in 1828 under the banner of a new Democratic party. He was frontier-born and a war hero, a man of the people, a strong upholder of individual liberties against institutions such as a national bank--and the farthest cry yet from the kind of Virginia aristocracy that George Washington had personified. Jackson's party grew into the Democratic party we still know today. The other party, the Whigs, was the remnant of the Federalists and less populist Democratic-Republicans.

That pairing lasted until the 1840s when the issue of slavery poisoned everything. Think there's a lack of civility in politics today? Emotions about this issue grew so violent that when Senator Charles Sumner of Massachusetts angrily denounced slave owners in 1856, Representative Preston Brooks of South Carolina beat him almost to death right on the Senate floor. The Whig party split apart and crumbled in the 1850s. After a flurry of short-lived parties with names like Free-Soil and Know-Nothing flared up and died, a new anti-slavery party emerged: the Republicans. It elected its first president, Abraham Lincoln, in i860, and it survives as the Republican party of today.

And so the two parties we still know--Andrew Jackson's Democrats and Abraham Lincoln's Republicans--were already in place 150 years ago. They have evolved and changed continually, though. Throughout the rest of the nineteenth century, the Republicans were the party of business and of relatively strong centralized government power, partly because the opponents of slavery had tended to be prosperous citizens of the industrialized, urban North. Meanwhile the South became overwhelmingly Democratic, in opposition to the party that had risen from the antislavery movement. The Democrats were the party not only of the white-dominated South but also of states' rights and small government and rural interests.

From time to time events shifted the two parties and their relative power. At the turn of the twentieth century a "progressive" movement grew up that sought to clamp down on big business. A Republican progressive, Theodore Roosevelt, served as president from 1901 to 1909, and the Democrats elected their own progressive, Woodrow Wilson, in 1912. But in the boom years of the 1920s, old-fashioned business-friendly Republicans took charge again--until the crash of 1929 and the Depression.

By 1932 Republicans had held the White House for 11 straight years, but the Republican-led boom had turned into a Republican-led bust, and in the depths of the Depression the nation elected a Democrat, Franklin D. Roosevelt, who would serve until his death in 1945. There would be a Republican in the White House for only eight years between 1933 and 1969. Roosevelt won all but two states in 1936, and the Republican Party appeared to be all but dead.

As the nation fought a world war and climbed out of the economic depths, however, the Republican party slowly healed its wounds. It almost won the White House in 1948 when the Chicago Tribune ran its infamous mistaken "Dewey Defeats Truman" headline. It did take the presidency in 1952, electing the greatest military hero of World War II, Dwight D. Eisenhower. It barely lost to John F. Kennedy in i960.

The 1960s were a time of tumult for the two parties just as they were for America as a whole. The Vietnam War drove a Democratic president, Lyndon B. Johnson, to announce that he wouldn't run for reelection in 1968, and the agonies of the Civil Rights movement, which he had championed, led many white Southern politicians to abandon the Democratic party just as they had swept into it a century before. From 1969 to 1993 there would be a Democratic president for only four years, during the single, luckless term of the last of the powerful Southern Democrats, Jimmy Carter.

Today the same two parties still dominate the political world in the U.S. The Republicans are broadly seen as the party of business and of less rather than more government action and regulation. The Democrats remain the standard-bearers for organized labor and the entitlements that grew up with Franklin D. Roosevelt's New Deal. The Democrats are generally considered the stronger party among blacks and other minorities as it has been since the Civil Rights

movement of the 1960s (and it had been gaining ground among those minorities earlier), but since race is a much smaller part of our national politics than it once was, that is less of a defining difference now than in the past.

Why are the parties getting along so terribly right now? It hasn't always been this bad. They have sometimes seemed especially polarized and antagonistic but sometimes quite similar and cooperative. They grew somewhat alike during the progressive era; they were bitterly opposed during the presidency of Franklin D. Roosevelt and the New Deal. They had much in common during much of the late twentieth century when Republican Richard Nixon carried on some of the Civil Rights initiatives of Democrat Lyndon Johnson and when Democrat Bill Clinton realized some of the welfare-limiting and budget-balancing dreams of Republican Ronald Reagan. Basically, they have tended to move closer together when economic times are good and there is less to drive them apart. Since the Great Recession began in 2008 and economic times turned bad, they have been as sharply divided as ever.

What lies at the base of all their differences, beneath all the individual policy matters they face off about such as abortion and immigration policy and tax breaks for the wealthy and so much else? And what has made them endure for so long? Why do we have two parties instead of three or four or more? There is probably just one answer to all these questions: The parties, at bottom, represent fundamentally opposed basic concepts of government. They stand for government as either essentially good or essentially bad. Americans who believe that government can and must be a powerful force for good tend to be Democrats. Americans who believe that government gets in the way more often than it helps, that it should be as limited and small as possible, tend to be Republicans. Before Franklin D. Roosevelt, Democrats were more the small government party and Republicans the big government one; Roosevelt's New Deal and the rise of the broad government programs we have had ever since turned that around. The shift of the South from Democratic to Republican in the 1960s and 1970s cemented that change.

However, as dangerously and S irreconcilably divided as the parties seem right now, they're almost certainly not about to crumble. In fact, the sharpest rift right now may be within one of the parties, the Republicans. Since the rise of Tea Party power in the 2010 elections, the Republicans in the House of Representatives have been embattled among themselves, with speaker John Boehner struggling endlessly--often hopelessly-- to get them to agree on anything. Similarly, the lead-up to the 2012 Republican primaries has been marked by a stubbornly unyielding polarity between staunchly conservative and Tea Party-favoring candidates like Michele Bachmann and more moderate ones like Mitt Romney. It may be that the Republican party will soon redefine itself, as both parties have so often done in the past, but there's nothing happening to suggest that we'll soon have three or four major parties.

Why? Because so much of what people disagree on comes down to that basic tension between big, strong government and small, limited government. And that tension can probably never be finally resolved, at least in a nation that is based on free enterprise and individual liberty and initiative--and that is also based on equal opportunity and equal rights and fairness for all. The division between left and right will probably be with us always. In fact, it has become so central to our national psyche that I'd suggest another way of looking at the great divide, by seeing us all as a great American family with a timeless family dynamic.

If indeed we are in any sense a national family, then maybe, just possibly, in an abstract sense, within that family Republicans are our father and Democrats are our mother. I mean this: Your stereotypical father protects the home fiercely but also expects his children to be strong and resilient and self-reliant and to learn by tough love and end up looking out for themselves, just as Republicans are stereotypically strong on defense and weak on coddling. Your stereotypical mother builds the nest and is nurturing and gives everyone their meal and wants all the children to embrace love and fairness, just as Democrats focus more on supporting workers and striving to lift up the poor and the struggling. It's no coincidence that it's mostly Republicans who attack "the nanny state" and Democrats who warn, "Big Brother is watching you." These are of course clichés, both about mothers and fathers and about Democrats and Republicans. But doesn't every cliché contain a grain of truth?

And if there is a grain of truth here, then I'd add that just as the traditional ideal of a strong family has two parents, a mother and a father, then perhaps also our nation does best with two parties, Democratic and Republican. They may fight noisily from time to time, but who would have it any other way? Who wouldn't want to have both kinds of love and care and moral passion? We need them to balance each other and show us the whole range of love and support.

The system, like any marriage, and even the institution of marriage itself, may be far from perfect, but what else could possibly be better?

Not gonna take it: Launched as a tax protest, the Tea Party movement grew into a position of influence in the Republican Party and is poised to break out on its own.

Populist uprising: Occupy Wall Street protesters made the "99 percent" slogan notorious. Protesters gathered at Zuccotti Park on Wall Street in November.

~~~~~~~~

By Frederick Allen

Frederick Allen is the leadership editor at Forbes magazine.

Time for a Third Party Why voter discontent may set the stage for an independent run

When it comes to major national issues such as slavery, Prohibition, the federal deficit, and civil rights, as well as energy policy and the environment, third parties have long served as an important outlet for moving political debates forward. As we've repeatedly seen in American history, even when a third-party candidate loses, sometimes his ideas win. Political scientist Daniel Mazmanian points out that "usually after a strong showing by a minor party, at least one of the major parties shifts its position, adopting the third party's rhetoric if not the core of its programs." This may be the least obvious, but possibly most important, element of a third-party run for the White House in 2008. We tend to think of elections as zero-sum games--and usually for good reason. But when it comes to a third-party candidate, a genuine opportunity exists for an independent to dictate the issues that come to the fore, not only on the campaign trail but also after the election is over and governing begins.

The American people have become convinced that government in its current form is simply not working. We have not been able to defeat al Qaeda, catch Osama bin Laden, or develop a comprehensive plan to fight terrorism or to extricate ourselves from Iraq--much less develop a comprehensive policy for the region. Domestic problems also appear to present a daunting challenge for which we have no answers. We have no clear plan to pay for our children's education, our own healthcare or retirement, or to provide for our aging parents. We are presented with partisan rhetoric and attack politics instead. And the American people are yearning for, even demanding, an end to the divisiveness and the development of policies that produce real results, not just sound bites.

Centrist. There is a segment of the electorate that I have called the Restless and Anxious Moderates, or the RAMs, who I believe will decide the election. They include most of the independents and a fair number of Democrats and Republicans as well. These voters are practical and nonideological and unabashedly results-oriented. They eschew partisanship and want the parties to come together to confront the difficult challenges America is facing. Indeed, it is my argument that the RAMs could become the Restless and Anxious Majority if a credible third-party candidate emerges. The RAMs make up roughly 35 to 40 percent of the American electorate. RAMs are ordinary, average Americans. They go online, they watch the news, and they are interested, but they are not the political activists of the blogosphere or the evangelical right. They are centrist, middle-aged, middle-class, practical people who believe in consensus solutions to problems. When they look at politics in Washington, they are aghast.

In America's recent political history, there have been a number of times when the RAMs have been strongly motivated to vote for what they saw as nonpolitical alternatives. Dwight Eisenhower in 1952 and 1956 was able to rally the country as a common-sense centrist who pursued moderate social policies that enhanced and protected the New Deal, moved inexorably to address civil rights, and developed the Cold War consensus promoting a strong stance against Soviet expansion. In 1964, RAMs coalesced strongly in reaction to Barry Goldwater and voted overwhelmingly for Lyndon Johnson. Following the divisive campaign of 1968, Richard Nixon was able to rally the RAMs with his own appeal to the people he came to call "the silent majority."

In 1976, a healthy percentage of RAMs saw Jimmy Carter as the alternative to the failed policies and dishonesty of the Nixon and Gerald Ford administrations. Similarly, in 1980 and 1984, Ronald Reagan was able to make the case to a solid majority of the RAMs that America needed limited government, a more optimistic worldview, and a stronger and more assertive foreign policy. In 1992, it was very clear that with the nation in recession and George H. W. Bush's policies having failed, the electorate was looking for change. However, with a divisive nominating process on the Democratic side and the lingering questions about Bill Clinton's personal life and draft status, there was a wide opening for third-party candidate Ross Perot. The RAMs became close to a majority of the country during that election.

The goal of the work that Mark Penn and I did with President Clinton was to get the Restless and Anxious Moderates back into the Democratic column in 1996. By talking about fiscally conservative issues in terms that Americans understood--not only balancing the budget but at the same time standing up for clean air and water, education for all,

and medical care for the elderly and for the poor--Clinton spoke to commonsense values. As soon as he found his voice, the Restless and Anxious Moderates swung dramatically in his direction.

In 2000, George W. Bush won back a healthy number of the RAMs with his support for "compassionate conservatism" and appeared to be poised to govern in a centrist, inclusive manner. Bush was aided by Al Gore's break with Bill Clinton's electoral strategy and his advocacy of a neopopulist "people vs. the powerful" strategy, which clearly cost the vice president the 2000 election. But instead of building on his 2000 campaign rhetoric, President Bush let his coalition fray.

History has shown repeatedly that third-party movements have their greatest influence when three basic conditions are met. First, when voters are dissatisfied with the state of the country. Second, when the two major political parties are unpopular and when the electorate is polarized. Third, when voters are experiencing the stress and dislocation of economic uncertainty. Make no mistake: We have arrived at a historic moment.

Tools. The greatest challenge facing a third-party candidate is creating a strategy that will lead to victory in November. It will depend initially on the candidate's ability to mobilize millions of Americans on his or her behalf. But there are now methods and tools to channel that discontent that did not exist in prior elections. The Internet has created a more level playing field when it comes to grass-roots organizing and fundraising.

In 1992, 19 million Americans, or almost 19 percent of the electorate, voted for Texas billionaire Ross Perot. It was the best showing by a third-party candidate since Theodore Roosevelt in 1912. I believe that had he not temporarily dropped out of the race in July and had he run his campaign differently, he would have had a chance at winning the White House. For all his faults--and they were many--Perot was able to tap into a growing sense of voter disenchantment. Today, that voter disenchantment is at least as high.

Any discussion of a third-party strategy must begin with an examination of the places in which Perot did the best--states in which he was able to exceed 20 percent of the vote. This provides a baseline of states where realistically a third-party candidate could do well enough to win. Don't forget, in a three-way race for the White House, a viable third-party candidate only needs to garner 34 percent of the vote in a state to win that state's electoral votes. Perot did his best in Maine, where he won 30 percent of the vote, narrowly edging out President Bush. He cracked 20 percent in New Hampshire, Vermont, Connecticut, Rhode Island, and Massachusetts. In the Far West, he won 20 to 25 percent of the vote in California, Washington, Wyoming, Idaho, Alaska, Oregon, Utah, Colorado, Arizona, and Nevada. He also scored between one fifth and one quarter of the vote in the Plains states, including Nebraska, Oklahoma, Kansas, Missouri, North Dakota, and South Dakota, and the Upper Midwest, Minnesota and Wisconsin. The challenge for any third-party candidate comes in the South, the Midwest, the border states of the old Confederacy, and the lower Northeast (New York, Pennsylvania, and New Jersey).

Besides the Perot voters, one must look at those places where third-party or centrist candidates have scored success in nonpresidential elections. For instance, Minnesota voters supported the 1998 long-shot bid of wrestler turned politician Jesse Ventura. Although he ran as a Republican, Gov. Arnold Schwarzenegger impressed California voters as a centrist, post-partisan candidate. In the 2006 election, which nationally featured an overwhelming Democratic victory, Schwarzenegger polled 56 percent of the vote. In New York City, Mayor Mike Bloomberg has taken a similar approach. Although he ran for the mayoralty as a Republican, his positions lay pretty firmly in the Democratic Party tradition, from his position on gun control to those on abortion and gay marriage.

Obviously, crafting an electoral strategy and achieving it are two very different things. Certainly, the odds are against it. It would be foolish, however, to assume that such a candidate couldn't, at the very least, have a significant and far-reaching impact. In 1912, Theodore Roosevelt's candidacy under the Bull Moose banner helped give rise to the progressive reforms that would come during the presidency of Woodrow Wilson. Although he lost in 1968, George Wallace highly influenced (many would argue negatively) the national debate on civil rights. His antigovernment rhetoric would serve as a template for a generation of conservative politicians, led initially in 1972 by Richard Nixon. In 1980, John Anderson scored only 6 percent of the vote but raised the profile of such critical national issues as fiscal restraint, environmentalism, Social Security reform, and energy independence. I have a clear and unambiguous sense

that the most important person in the 1996 election was Ross Perot. The balanced-budget initiative, on which Clinton beat the Republicans, was fundamentally a repackaging of the Perot message for the mainstream.

I believe a third-party candidate in 2008 could have the same effect. In America, we've never countenanced the notion of a coalition government, but a third-party candidate could force such a situation, positioning him- or herself as a kingmaker. If no candidate receives 270 electoral votes, an independent candidate could use his or her electoral votes either to force attention to specific issues or to bargain with each of the two major parties for a role in the government. In 2004, an independent who carried Ohio, New York, or Florida would have prevented either major candidate from winning a majority.

Deep pockets. There are a number of people who are obvious candidates, but the one thing that we have seen in America, from Anderson, Perot, Howard Dean, and now Barack Obama and Fred Thompson, is that credible candidates become known very quickly. They can raise money and build support using the media and the Internet in ways we never thought possible. Still, the challenges and costs in making Americans aware of a third-party candidate in a national race are enormous. Clearly, money is a key consideration. In some ways, it is easier to raise money than ever before, but of course a candidate with deep pockets starts in a much more advantageous position.

The most obvious name for the head of a third-party ticket would be that of New York Mayor Mike Bloomberg (a former client of mine). Bloomberg has deep pockets: He has spent over $150 million on two races for mayor. He has reasonably strong name recognition, both as a hugely successful entrepreneur and as a very effective and popular mayor of New York. I have spoken to Bloomberg personally about the '08 race, and he made clear to me as he had to others that, as of the summer and fall of 2007, he was not planning a presidential campaign--though he dangled enough hints that it was clear his denial was not absolute and unequivocal. Sources directly familiar with Bloomberg's thinking say that he will indeed reconsider his options once both parties' nominees become clear. Kevin Sheekey, Bloomberg's top political aide, said that he would wait until March 5, after the Texas primary, when the nominees from the two major parties presumably will have been chosen, to assess the situation once and for all.

Others who might be considered include prominent business people such as Bill Gates, Steve Jobs, and Jack Welch, and even former newscaster Tom Brokaw or current CNN commentator Lou Dobbs. At first glance it may not seem politically likely that any of them would run, but after the polling I have done and with 30 years of experience, I can say that a credible businessman, running on a platform of change, would be able to instantly gain political credibility and political support. The system is more open now than at any other time in history. Unhappiness with politics is at a record high, while the technology is in place to allow a third-party candidate to make his voice heard and to get on the ballot. At the very least, an independent could have a fundamental impact on the policy agenda and change for the better the politics of our country and the politics of Washington. l

Excerpted from Declaring Independence by Douglas Schoen. Copyright (c) 2008 by Douglas Schoen. Reprinted by arrangement with the Random House Publishing Group.

By Douglas Schoen