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Special interests abided for Obama’s second inauguration

President accepts donations this time

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After President Obama lays his hand on a Bible and takes the oath of office for a second White House term next month, he will be surrounded by pomp, circumstance and celebration bought and paid for by the very special interests he once vowed to disenfranchise from Washington politics.

Mr. Obama's decision to accept unlimited-size corporate donations for his second inauguration is a stark departure from his first celebration four years ago, when he banned such contributions and limited individual donors to $50,000 each.

And it will mark the fourth time since 2007 that a champion of campaign finance reform has backtracked on his various pledges to lessen special interests' grip on Washington.

Just six months ago, Mr. Obama and his inner circle agreed to let the Democratic Party accept millions in corporate cash for his nominating convention in Charlotte, N.C., after his hand-picked Democratic National Committee chairwoman, Rep. Debbie Wasserman Schultz, had vowed not to do so just a year earlier.

And it follows earlier reversals by Mr. Obama on super PACs (he gave his tacit approval for Democrats to embrace the free-spending groups in 2012) and public election financing, which he abandoned for both his 2008 and 2012 campaigns after originally promising to stay inside a taxpayer-financed campaign system that would have imposed spending limits.

His record of flip-flops has longtime supporters of campaign finance reform disillusioned as Mr. Obama prepares to begin a second four years in office.

"President Obama's decision to accept unlimited corporate contributions for the next inaugural continues the shift away from past pledges to curtail special-interest influence in Washington," said Sheila Krumholz, the head of the nonprofit Center for Responsive Politics.

"It may well save taxpayers big money in a tight economy, but it's also yet another sign of how far removed we are from Obama's promise to end the pay-to-play culture in Washington that made up the backbone of his 2008 campaign," she added.

The advocacy group Public Citizen has begun an online petition urging Mr. Obama to reconsider accepting corporate donations. As of this week, more than 32,450 Americans had signed it.

Kent Cooper, who served as Federal Elections Commission disclosure chief in the early days after Watergate when Congress imposed election-spending and contribution limits, said Mr. Obama's decision to accept corporate inaugural donors allows special interests who bet on the losing candidates in the last election to try to curry favor.

"When you are a major player in politics and recently backed the candidate who has lost, you need to quickly reassert yourself as a friend of the winner and try to regain a seat at the insiders' negotiating table where regulations and legislation are discussed," he said. "For corporations and large donors who backed Mitt Romney, you would think it would be hard to rebuild that relationship; but it's as easy as writing another check.

"Although President Obama thought your money was buying influence before the election, apparently it's fine now to pay for the inauguration parties," he added.

Taxpayers pay a portion of the inaugural festivities, such as the formal swearing-in ceremony, security and the traditional parade down Pennsylvania Avenue. But the rest of celebration, including any inaugural balls and other festivities like concerts, celebrations and parties, are financed with private money.

In 2009, Mr. Obama raised $53 million in private money for his inauguration, when a record 1.8 million people braved the winter chill to see him take his place in history as America's first black president.

The amount dwarfed the $40 million George W. Bush raised for each of his inugurations or the $30 million Bill Clinton raised for his second inauguration in 1997.

This time around, with the economy still sputtering out of the worst downturn since the Great Depression, Mr. Obama is scaling back the celebrations a bit.

The official activities will span three days, starting with a National Day of Service on Jan. 19 and culminating on Jan. 21 with the swearing-in, the parade and the balls. Last time, it was four days of events.

But the biggest change is opening the spigot for corporate donations.

In 2009, the presidential inaugural committee capped individual donations at $50,000 and banned all donations from corporations, lobbyists and political action committees. Back then, Mr. Obama and his team didn't just impose the rule, they went out of their way to send a message to Washington that its pay-to-play culture was about to change.

The corporate ban "will underscore their commitment to change business as usual in Washington," the president-elect's team boasted four years ago in an announcement.

This time around, there's no such ban. White House officials refused to discuss the change, except to say that the president will still ban contributions from registered lobbyists, political action committees and companies that still owe the government bailout money.

In his rise to power, Mr. Obama has vacillated between bold populist pledges to lessen the influence of corporate and special-interest money in Washington and making pragmatic decisions to abandon those pledges when it served his political interests.

As a freshman senator in 2007, Mr. Obama championed several ethics and campaign finance reforms in Congress. And as he geared up for his first run for the White House, he filled out a questionnaire for the Midwest Democracy Network promising to agree to spending limits and public financing if he reached the fall presidential election.

"My plan requires both major party candidates to agree on a fundraising truce, return excess money from donors, and stay within the public financing system for the general election," Mr. Obama wrote in his response in September 2007.

But a few months later when it became apparent he had assembled an unprecedented fundraising team, Mr. Obama reneged and became the first major party presidential candidate to opt out of the public-financing system. He ultimately raised a record-breaking $700 million plus for his 2008 bid.

After he won, Mr. Obama returned to his populist rhetoric on campaign finance, imposing the ban on corporate donations for his inauguration. And when the Supreme Court ruled that corporations and individuals couldn't be constrained in their election spending, he used his State of the Union Address to chastise the justices sitting in front of him and urged Congress to create new limits.

"With all due deference to separation of powers, last week the Supreme Court reversed a century of law that I believe will open the floodgates for special interests — including foreign corporations — to spend without limit in our elections," Mr. Obama lamented in January 2010. "I don't think American elections should be bankrolled by America's most powerful interests, or worse, by foreign entities."

A few months later during his weekly Saturday radio and video address to the nation, Mr. Obama cited Republican President Theodore Roosevelt in pressing for campaign finance reform. Roosevelt "warned of the dangers of limitless corporate spending in our political system. He actually called it one of the principal sources of corruption in our political affairs," Mr. Obama said.

The president also began criticizing the formation of free-spending groups known as super PACs that wanted to take advantage of the new spending free-for-all. But by the time his 2012 re-election rolled around, Mr. Obama had given the go-ahead for Democrats to form their own big money groups. In fact, two of his former top White House aides formed one of the Democrats' most successful super PACs in the last election to try to keep pace with Republicans who had embraced the idea much earlier.

And Democrats selected Charlotte for their nominating convention host city, Mrs. Wasserman Schultz imposed a ban on corporate contributions.

"This convention will be different," she said last year. "We will make this the first convention in history that does not accept any funds from lobbyists, corporations or political action committees. This will be the first modern political convention funded by the grass-roots, funded by the people."

But when fundraising lagged, the Democrats reversed course. The Washington Guardian reported recently the DNC convention committee accepted at least $5 million in corporate donations and drew down another $8 million in a loan from Duke Energy, a big utility with more than a dozen coal-fired plants still in operation that face regulation by the Obama administration.

Some may argue that Mr. Obama's broken campaign finance promises don't matter much. After all, accepting corporate donations is legal and Republicans have done it for years.

But for those voters who embraced the change that Mr. Obama heralded in 2008, the spectacle of his 2013 inauguration will be a cogent reminder that little has changed in the political money game: Corporations and big donors will have their latest chance in January to curry favor with Washington's political elite in ways average Americans can't.

"The inauguration parties are not civic public events," said Mr. Cooper, the former FEC official who now runs the Political MoneyLine website that studies campaign finances. "They are private parties paid for by people who want to gain favor with the winner and people in power."

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