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Jewish World ReviewMarch 7, 2001/ 12 Adar, 5761

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Consumer Reports

Congress: The real pros at quid pro quo -- WHILE the House Government Reform Committee was picking through the increasingly rotten carcass of the Marc Rich case last Thursday, looking for what Chairman Dan Burton called the "quid pro quo" of "money for pardons," one block away on the floor of the House, another, even more glaring, example of the disturbing link between political donations and political decision-making was on display.

But no Congressional committee is trying to uncover the quid pro quo in H.R. 333, the first major piece of legislation to come out of the 107th Congress. Passed by a vote of 306 to 108, the bill will make it harder for consumers to declare bankruptcy. It will also, not coincidentally, add billions of dollars to the bottom line of banks and credit card companies.

That's the quid. And here's the pro: The credit card and finance industries doled out $9.2 million to federal candidates and the Democratic and Republican parties in 2000, more than doubling the $4.3 million they donated in 1996. During the same period, contributions from commercial banks jumped from $16.6 million to $28.5 million.

"We're trying to uncover whether or not there was any quid pro quo," Rep. Bob Barr said of the pardon investigation. And as possible evidence, we were told that Denise Rich's contributions spiked shortly after Team Rich first broached in e-mails the idea of enlisting the fugitive's ex to plead for the pardon.

I wish there were a committee just as zealously looking at the spike in the political contributions from MBNA, the world's largest credit card issuer, right before the effort to convince Washington to toughen the bankruptcy laws began in earnest. MBNA's political donations increased from $741,904 in 1996 to $3.5 million during the 2000 election.

And the credit giant was the largest individual contributor to George W. Bush's presidential campaign. Also on the top-10 list of Bush donors were Citigroup and Morgan Stanley, the nation's second- and third-biggest credit card issuers.

Although we can't prove a legislative quid pro quo any more than we can prove that there was a connection between the Rich Wing of the Clinton Library and the pardon, both Rich's and the credit card companies' largess were handsomely rewarded.

It's estimated that MBNA alone will reap an additional $75 million in profits thanks to the new legislation. You've got to admit, there is a poetic symmetry at play when the No. 1 contributor gets the No. 1 bill. "This is literally bought and paid for," said Rep. William Delahunt, D-Mass., of the bill's passage.

Maybe we should subpoena the private e-mails of the House's top 25 recipients of finance and credit card company donations - 23 of whom, including six Democrats, voted for the bill. Who knows what incriminating morsels we'll uncover: "100 grand from MBNA to the president's inauguration fund. He says he's leaning toward signing it. Any chance of letter of support from Nader?"

The pardons of Rich, Vignali, Braswell, et al - as loathsome as they are - won't affect average Americans, beyond further increasing their cynicism. But this one-sided bankruptcy bill will affect hundreds of thousands of people, especially those who find themselves strapped with unmanageable debt due to illness, divorce and, increasingly, layoffs.

When poorly managed utility companies or savings and loans find themselves drowning in red ink, time and again our government rides to the rescue. But when small-time debtors get in over their heads, it's sink or swim. In Washington, personal responsibility clearly does not apply to companies that may not be able to balance their books but know how to open their checkbooks.

Indeed, no one is holding the credit card companies responsible for their irresponsible marketing, especially to college students. At the same time as they are putting the squeeze on those seeking bankruptcy relief, they are aggressively trolling for new customers. The industry flooded mailboxes with an astounding 3.3 billion credit card come-ons in 2000, an increase of more than 400 million from 1999.

One of the ways they've been luring consumers is by sweetening the pot with ever-expanding lines of credit. Another is by resisting amendments calling for comprehensive disclosure rules.

And more and more Americans are taking the bait - with consumer debt now at $531 billion. It's small wonder that credit card company profits have gone through the roof, increasing by nearly 50 percent since 1998.

In a perfect world, the Government Reform Committee would be holding hearings not just on the Rich pardon but on the bankruptcy bill, collecting testimony and reconstructing the sequence of events that led to its passage.

But since the media are unwilling to turn their spotlight on stories that do not include a billionaire villain, a temptress in strapless gowns or a sleazy cigar-sucking lawyer-in-law, can't we at least make the connection between cash for pardons and cash for policy?

The members of the Government Reform Committee, busy searching for the exotic pardon quid pro quo, should stop and take stock of the garden-variety trade-offs that brought us this bankruptcy bill.

Want to find some quid pro quo, Congressman Burton? You're soaking in it.


© 2001, TMS