Finally, gentlemen, I find no criticism of this measure is more unjustified, it seems to me, than the charge that it is Government interference with free speech. Rather, it represents a guarantee of free speech. The freedom of speech which our Nation's founders fought to preserve was more than the right of a peddler on = Boston Common to hawk his oysters without restraint. It was the right of public discussion of political issues. Their devotion to it was not to an abstract right, but born of conviction that full discussion of alternatives was prerequisite to an intelligent choice between them. The same conviction motivates the sponsors of this bill. They propose only to insure the free access to the means of communication which will permit that discussion to take place in the full view of all of our citizens. So I would urge the Congress to say to the political parties and the television = industry:

"We reclaim for a few hours every 4 years the public airwaves. We owe it to our system of government to give the voters-now numbering more than 100 million and beyond the physical reach of any candidate-a chance to hear the issues discussed and make their choice with knowledge of the facts."

If I may, I should like to conclude with a quote from the article I wrote last winter that the chairman referred to in his opening remarks, an article written out of a feeling of importance and anxiety to get a further public consideration of this matter, and I am happy to say that this public consideration has now taken place.

"Television," I said, "today is the most powerful medium available to candidates for public office. Such a useful means of mass communication must be conserved for the improvement of the democratic dialogue, not allowed to encourage its debasement. During the 1956 campaign I was urged by some of my advisers to challenge President Eisenhower to a debate. I did not, for I feared the challenge would be misunderstood, would be taken as a gimmick. What I am proposing now is no gimmick; it is the establishment of what I hope will become a national institution, a great debate for the Presidency.

"I don't mean a debate in the literal collegiate sense of that word; I mean rather a sustained discussion. Only television can establish such a forum any longer. I propose that it provide a quadrennial clearing of the air by the use of the air.

"Such sustained serious discussion on all networks would reach all of the people directly. It would require effort on their part, mental effort, and I know of no better cure for apathy. It would end the financial problem that TV now presents to the parties. It would end the tendency to reduce everything to assertions and to slogans. It would diminish the temptation of politicians to entertain, to please, to evade the unpleasant realities. It might even help to restore what we seem to have lost-our sense of great national purpose."

I ended, then: "For in the long run it may turn out that the direction we give to political television is one of the great decisions of the decisive decade of the 1960's.

Thank you, Mr. Chairman, and members of the committee for your patience.

PREPARED STATEMENT OF HON. HUGH Scott, a U.S. SENATOR FROM THE STATE OF PENNSYLVANIA

Mr. Chairman, I appreciate this opportunity to comment on legislation regarding the important matter of financing political campaigns.

At the outset, I want to congratulate the distinguished Chairman of this Committee for promptly scheduling hearings on various proposals designed to help political parties and candidates meet the high costs of their election campaigns. This is a serious matter that requires prompt attention.

I feel, however, that the Senate would be derelict in its duties if it were to deal with the matter of election costs alone. We should be considering the problem of political campaigning in a broader context which encompasses the matter of election reform as well.

That matter is pending before the Senate Committee on Rules and Administration in the form of several bills including S. 1880, the Administration's Election Reform Act of 1967, and S. 596, my own Election Reform Act of 1967. Speaking as one member of the Rules Committee, I earnestly hope that my Committee will follow the example of this distinguished Committee by promptly scheduling hearings on these measures. Having the benefit of the expert recommendations of both Committees, the Senate can then proceed to deal with the twin problems of elec tion costs and election reform together.

By following this approach, the Senate could show the American people that it is earnestly taking steps to insure the integrity of our electoral processes. The need for legislation to help finance election campaigns is urgent. Equally urgent, however, is the need for election reform legislation that requires full disclosure and publicity of campaign contributions and expenditures.

The Congress of the United States has been undergoing a crisis of confidence in the eyes of many citizens. Restoration of public confidence in Congress depends to a significant degree on our response to the public's expectation of effective election reform legislation to accompany a measure designed to eased the financial plight of our political parties and candidates.

Turning now to the issue confronting your Committee, I have, as you know, introduced S. 786, a bill to allow an income tax credit for political contributions. My bill would permit a taxpayer to take one-half of the total contribution to a political campaign as a credit on his annual Federal income tax up to a maximum credit of $100. Contributions could be made to the national or State committee of a political party whose candidates for President and Vice President get on the ballot in at least 10 States.

I am not wedded to the language of my bill. This distinguished Committee may feel that the credit permitted by my bill is too high, or it may prefer giving the taxpayer a choice between a credit and a deduction as recommended in 1962 by the President's Commission on Campaign Costs. I am more concerned with establishing the principle of tax incentives for political contributions than I am with the details of its implementation.

The provision of tax incentives for political contributions can achieve three desirable results. First, it will broaden the base of financial support of political parties and thereby lessen their dependence on wealthy individuals and interests. Second, and flowing directly from the first, it will encourage more widespread citizen participation in the political process. Voter interest usually follows voter contributions, however, small, and an individual will take an active interest in an enterprise in which he invests. Last, but not least in importance, it will better enable political parties to finance their campaigns.

In view of the improved nature of the perfecting amendments proposed in S. 1883 to the Presidential Campaign Fund Act of 1966, the need for direct public support of the costs of presidential election campaigns must also be considered carefully, but not, in my view, from the standpoint of an exclusive or total subsidy at the expense of a properly controlled citizen financial participation. The President's Commission on Campaign Costs suggested in 1962 that the tax incentive approach be adopted on an experimental basis to last for a period covering at least two presidential campaigns. Perhaps we should first ascertain whether the tax incentive approach can ease the financial strain on a party in presidential and other Federal elections. If it proves inadequate, we can then take a fresh look at the direct subsidy as contemplated in S. 1883.

I am also wary of adopting an approach with undetermined consequences for the traditional character of our system of political parties. My opposition to the 1966 Act rested in large part on the belief that it opened the way to centralizing campaign fund-raising in the national committees and was subject perhaps to the domination of party standard bearers which would involve strong controls over State and local party organizations. Either form of control would be contrary to the decentralized character of our political party system.

I reiterate my belief that the 90th Congress must take constructive steps to insure the integrity of our electoral processes. It can do this by enacting election reform and campaign financing legislation. The time for action is past due.

PREPARED STATEMENT OF HON. JACK R. MILLER, A U.S. SENATOR FROM THE STATE OF IOWA

Mr. Chairman and members of the Committee, I wish to thank you for your cordial invitation to comment on political campaign financing reform, and the Presidential Election Campaign Fund Act of 1966.

I would like to say at the outset that I agree with the objectives of the Presidential Election Campaign Fund Act, even though I do not agree with all of the means which are proposed to achieve the objectives.

Democracy has been facing a communist challenge in the twentieth century which perhaps has no parallel in history. It is a challenge between two ideologies which are designed in theory to achieve the greatest possible advantages for all people. Perhaps for the first time a great competition has developed where real

emphasis is upon how best to improve the lot of mankind, as opposed to raw power and parochial interests. This competition has increased in intensity with each decade, until now, I believe, it is approaching a crisis where, within twenty-five years or so, it could be substantially resolved, one way or the other, with fundamental effects that could last for centuries.

This challenge of communism is basically ideological, not military. It is a battle for men's minds. It can be accelerated or retarded, but it cannot be resolved, by force of arms.

I believe fervently that democracy is the only insurance that government will remain responsive to the needs and welfare of the governed. I am not expressing any views about the relative advantages of capitalism and socialism because this is an entirely different question which will be decided by future generations, despite any views I may have on the subject.

However, it is a different question with respect to democracy, for here we are talking about the means whereby government responds to the interests and needs of the governed-not what the specific needs are. The communists claim to know what those needs are-and we should be mindful that they may have some points in their favor. So far they have been engaged in cataclysmic competition with the free world, where it has been to their advantage to detect and respond to basic human needs. But would they be equally dedicated to the welfare of humanity if they won the competition, and they enjoyed unchallenged power? Or would they be corrupted by it—indeed, have they not already been corrupted by it in some instances; as in the case of Stalin? I believe history shows that no government can, in spite of initial good intentions, isolate itself for an extended period from the sanctions of the governed without ultimately disregarding their interests. This is the reason I shall always be adamantly opposed to communism. It transcends by far my views concerning capitalism, or any other issue.

It is regrettable that so much emphasis has been placed on capitalism vs. communism, when in reality the significant and crucial issue for future generations is whether or not democracy will survive. I advocate that we unburden our case for democracy and that we not permit our adversaries the luxury of criticizing us for any doctrine save the old and simple one, that the people shall govern themselves. In this respect the communists have nothing to offer. Such moribund institutions as they have patterned after the democracies are not designed to express the will of the governed. Much less are they designed to exert the sanctions of the governed. On the contrary, they are used specifically to express the views and the will of the government.

If, as I believe, our most potent weapon in the struggle with communism is the democratic process itself, we must be constantly mindful of its functioning effectiveness. It is, besides, simple justice that we do this.

One claim that has traditionally been made by communists about us is that we who are elected to office do not represent all of the people, that we are the representatives of property owners, the rich, and the privileged. We members of Congress know, perhaps better than anyone else, the falsity of that claim, and of the vitality of democracy and the pervasive dedication to democratic principles which exists in our government, differ though we may in individual philosophy and viewpoint..

But there is room for improvement, and one area is the financing of political campaigns. It is an unfortunate fact of political life that campaigns for public office have been financially dependent upon private, and oftentimes confidential sources. Furthermore, a relatively few contributors may sometimes supply the bulk of a campaign fund. Some large contributors may even make it a practice to contribute to opposing candidates in the same campaign. The influence which campaign contributors may have upon the selection of candidates, and upon the views of the candidates themselves, both before and after they are elected to office, is obvious. The democratic process should be freed from these capricious and invisible forces, but a practical and effective way must be found to do it.

There are many complexities in making basic reforms, not the least of which is the difficulty in foreseeing all of the results. There may be ramifications which are totally unintended, and the more basic the reform, the more serious can be the undesirable ramifications. I am therefore perhaps more cautious with respect to campaign financing than some of my colleagues, although I am most anxious that we make a beginning—a beginning which will be expanded as we gain experience in the future and which may ultimately result in the elimination of undue pressure on candidates for public office to raise money for their political campaigns.

I believe that financial assistance from the Federal Treasury to presidential and vice-presidential candidates in the dimensions envisioned by the Presidential

Election Campaign Fund Act of 1966 is going too far too fast. Estimates of the funds which would be available to each party range as high as $30 million. Likewise, it would require an audit of 80 million income tax returns, a Herculean undertaking for the Internal Revenue Service. Neither do I advocate direct appropriation from the Treasury of funds of this magnitude. A further objection to direct appropriation is the fact that it deprives the public of any participation in deciding what will be given and how much. The evils of complete dependence upon private contributions is obvious. But there is also an argument on the other side which was well expressed in a recent editorial in the Čedar Rapids (Iowa) Gazette entitled "Billing Us for Blarney" and which is as follows:

"It would amount to taxing the people to pay for information they can get as much of as they want, for no extra charge whatsoever, by reading or listening to straight news in any medium they like. To tax the people for campaigning would be like charging TV watchers for commercials or assessing readers for the ads that come with news and entertainment content in the printed media.

"Disgust among the voters with regard to present practices in high-pressure campaigning, we suspect, would only grow to nausea with the realization that they themselves, have been billed for the hokum they're hearing. Some other answer like less political preoccupation with high-priced messages would smell & lot better.

"To reconstruct a famous Harry Truman phrase about the heat in the kitchen: If you can't afford the fertilizer, don't spread it.'

I therefore propose, as a beginning, that we revise our income tax law to provide for a deduction of up to $100 from taxable income for cumulative contributions to any candidate or candidates for elective office or to any committee or bona fide political party supporting candidates for public office. This is a modest beginning. It would preserve the participation of individuals in the decision of which candidates and parties are deserving of financial support. At the same time it constitutes, in effect, a federal contribution to the expense of political campaigns. Finally, it encourages small contributions of $100 or less. I believe that this proposal is an appropriate beginning which would be acceptable to those who resent in principle the use of public funds to finance political campaigns. At the same time it would be an opening wedge in an area where I believe reform is highly desirable, if not crucially necessary.

I wish also to mention the matter of television in political campaigns. Television is now recognized as perhaps the most important single media in large political campaigns. At the same time, the expense is staggering, particularly on a state or nation-wide basis. But federal financing should not be provided without reasonable limitation. The television time used by a candidate or by some individual or group in behalf of a candidate or group of candidates can be controlled, because it can be effectively audited. A reasonable limitation on total amount of television time for each candidate for major office should be established, regardless of how the time is financed. If the limitation is exceeded, it should be at the cost of the election. The television station might be authorized to charge the candidates concerned fifty percent of the regular charge and take an income tax deduction for the other fifty percent. This privilege should, of course, only be extended to political parties and their candidates having substantial support say a party whose candidate for the particular office to which a television time quota is being allocated received at least twenty percent of the vote for that office in the last election. It isn't fair to parties whose candidates often participate in expensive and time-consuming primary elections for these benefits to be extended to parties which can, because of loose local laws, hold a pro forma convention in a small hotel room and put up a candidate whose sole purpose is to receive publicity rather than try to attain public office.

I submit that if this Committee works on these two problems which I have discussed, and makes a modest beginning along the lines I have recommended, there will be a good response from the general public, which is not expecting miracles but is demanding some progress.

PREPARED STATEMENT OF HON. HOWARD H. BAKER, JR., A U.S. SENATOR FROM THE STATE OF TENNESSEE

Mr. Chairman, I deeply appreciate this opportunity to present a statement to the Finance Committee concerning my views of the various proposals for financing political campaigns. I have followed with interest the statements of witnesses

appearing before the Committee and wish to commend you and the other members on the very thorough job which the Committee is doing to examine all facets of this complex problem.

I, too, am concerned that unless some means is found of providing financial assistance to candidates for public office, only candidates with large personal wealth will be able to compete in, much less win, major elections. I am also concerned, however, that some of the proposals before this Committee may create more ills than cures. Three of the proposals, notably those of the Administration, and of the distinguished Senators Long and Gore, frankly scare me. These proposals provide every indication that just around the corner we will find, in depth, federal bureaucratic control of national elections. On the other hand, proposals such as submitted by the distinguished Senator from Kansas, Mr. Pearson, and the Senator from Delaware, Mr. Williams, appear to take a different tack and be far more realistic and practical.

For the benefit of the Committee, let me briefly outline some of my fears of what may result if the Administration, Long or Gore proposals are adopted.

First, each of these proposals raises the specter of fiscal intervention in political campaigns as a result of direct federal subsidy.

Each proposal raises substantive problems regarding the nature of the control and enforcement of the financing program.

Each tends to perpetuate incumbency.

Each requires the establishment of additional bureaucracy.
Each encourages the establishment of splinter parties.

Each ignores the fact that often substantial, and sometimes determinative, campaigns are waged at the primary level and the convention level. No provision is made for the encouragement of voluntary assistance in campaigns on the primary and convention levels in any of the three proposals.

And, finally, the proposals withhold from the citizenry the right to contribute to the party or candidate of his choice.

The proposals of Senators Pearson and Williams do not create these problems. Instead they provide a system which does not require an expanding federal bureaucracy to administer it nor does it prevent the exercise of the "freedom of choice" which I believe is an essential component of our political campaign system.

Mr. Chairman, again let me express my appreciation for the opportunity to present my views, and I hope that they will contribute to your deliberations.

PREPARED STATEMENT OF JOHN M. BAILEY, CHAIRMAN OF THE DEMOCRATIC NATIONAL COMMITTEE

I welcome this opportunity to present to the Senate Finance Committee my views on the important and timely subject of financing Presidential election campaigns.

I present those views as one who has been deeply involved in the practical workings of the American political system for almost three decades. For 20 years I have been Chairman of the State Democratic Party of Connecticut. For the past six years I have had the honor to serve as Chairman of the Democratic National Committee. I have been intimately connected with the problems of campaign financing in the past two presidential elections-in 1960, with President John F. Kennedy, and in 1964 with President Lyndon B. Johnson.

That experience has brought me into direct involvement with the mechanics of one of the most compelling present-day political realities—the financing of Presidential campaigns.

That experience also leads me today to urge your adoption of the principles set forth by the President, two weeks ago, in his message on the Political Process in America.

The proposals in that message go to the heart of the process of democracy in this country.

Their purpose is clear to liberate political campaigns from the tyranny and torture of soaring costs.

Their effect will be to remove the long shadow-in appearance and reality-of the influence and power of wealth.

Those proposals, in my judgment, accomplish two purposes:

They bring Presidential campaingn financing out of the Stone Age into the 20th Century world, where modern technology provides unparalleled opportunity to bring the issues before the public-at unparalleled costs.