National Center for Policy Analysis

MONTH IN REVIEW

Government

February, 1996

WHAT HAPPENS TO THAT $3 CAMPAIGN CHECK-OFF?

Remember that little box on the federal tax form which asks if you want $3 of your taxes to go to the Presidential Election Campaign Fund? It started as a $1 check-off, but Congress increased it, first to $2 and then $3. The 13 percent of taxpayers who check "yes" are actually diverting millions from the Treasury to an entitlement program for politicians.

• Five-time presidential candidate Lyndon LaRouche has received millions of dollars from the fund for his campaigns -- even the one he ran in 1992 from federal prision after his conviction for fraud.
• Since LaRouche is President Clinton's only primary opponent in most states this year, Clinton could receive over $15 million to vanquish LaRouche in the Democratic primaries.
• Three-time presidential candidate Lenora Fulani, of the "New Alliance Party," has received $3.5 million from the taxpayers for her campaigns.
• The fund will also pay out nearly $25 million this election year to subsidize the Republican and Democratic conventions.

Source: Senator Mitch McConnell (R-KY), "Don't Waste Your Money," USA Today, February 16, 1996.

CONSERVATIVES AREN'T WINNING

Conservatives have not won, although they have made a start. The education of the next generation, from kindergarten to graduate school, is still controlled by the political left.

In academia, there is no hesitation in applying ideological litmus tests to everything from faculty hiring to the rewriting of history, nor in using everything from grades to expulsion to punish politically incorrect students. These ideologues place their causes above their professional integrity. Thus, for example:

• A few years ago, a historian who exposed and documented fraud by another historian seeking to promote leftist conclusions was denounced by many other academics for jeopardizing a young scholar's career.
• The American Library Association sponsors a fraudulent "Banned Books Week" which includes books objected to as violent, ridiculing religion or sexually graphic.
• The National Education Association routinely votes "politically correct" resolutions on noneducational issues ranging from immigration to environmentalism.

While the left recognizes the importance of institutionalizing any momentary political advantages, as they did with New Deal agencies still with us today, Republicans have not even been willing to get rid of the National Endowment for the Humanities or the Legal Services Corporation, both of which have been shock troops for the counterculture.

Source: Thomas Sowell (Hoover Institution), "The Dirty War," Forbes, January 22, 1996.

FANNIE MAE AND FREDDIE MAC PLAY POLITICS

The Federal National Mortgage Association (FNMA) and its brother, the Federal Home Loan Mortgage Corporation ( FHLMC), are quasi-governmental institutions chartered by congress. That is, they are government-sponsored enterprises that make loans implicitly guaranteed by the federal government.

So what, observers ask, are they doing playing politics?

• They have contributed more than $100,000 to an ad campaign to attack presidential candidate Steve Forbes' flat tax plan.
• The money was transferred to an organization called the Coalition to Preserve Home Ownership -- whose other members are the National Association of Realtors and the National Association of Home Builders.
• The Coalition has so far spent more than $270,000 for what some critics call "hysterical" commercials in Iowa and New Hampshire attacking the flat tax because it would eliminate the tax deductibility of home mortgage interest payments. According to a Heritage Foundation paper the ads weren't even accurate. For example, they over-estimated by 30 percent the average marginal tax rate that homeowners face. Observers are also calling attention to other questionable "charitable donations."
• In 1994, FNMA and FHLMC gave more than $10.5 million to such public policy and advocacy organizations as the Brookings Institution, the Urban Institute and the Center for Policy Alternatives.
• They also gave nearly $240,000 to the Children's Defense Fund -- a favorite of first lady Hillary Rodham Clinton.

Many are questioning the propriety of such contributions by even quasi-governmental institutions.

Source: Editorial, "Public funds, Private Agendas," Investor's Business Daily, February 23, 1996.