How Washington’s Political Scandals Could Harm Nonprofit Groups

Philanthropy’s reputation has already been tarnished by well-publicized scandals, but the charges surrounding Rep. Tom DeLay, majority leader in the U.S. House of Representatives, now threaten to inflict further damage.

Nonprofit organizations have been accused of sponsoring junkets for members of Congress, and allowing lobbyists to pay for the lawmakers to attend — which might violate House ethics rules. Some organizations have also been accused of accepting large donations solicited by Washington influence peddlers to help their clients gain favor with powerful officeholders, such as Mr. DeLay.

Not surprisingly, champions of improving integrity in public life are already calling for an end to such ties between philanthropic groups and politicians. But before heeding them, lawmakers ought to look carefully at why these practices developed in the first place and what might happen if they were curtailed.

As reports of Mr. DeLay’s problems have helped remind the public, numerous nonprofit groups run tours and seminars for government officials or take money from people seeking to influence them, not only in Washington, but in state capitals.

What’s more, prominent lawmakers from both political parties have been involved, including Nancy Pelosi, the top-ranking House Democrat, and Iowa Sen. Charles E. Grassley, who has been spearheading Congressional inquiries into the conduct of nonprofit groups and their donors. In addition, many federal judges have attended legal seminars at universities and research centers that were sometimes partially underwritten by businesses facing regulatory problems.

And at least four dozen members of Congress have established foundations or charities, according to Roll Call, a publication that covers Capitol Hill. Some have used their personal or family wealth to create foundations, while others get their supporters to do so.

Part of the reason for all this activity is the spate of new rules restricting political contributions. Campaign-finance laws, for example, prohibit businesses from giving money to candidates for federal office — unless the companies create political action committees supported by their employees. As a result, companies that want to make a separate corporate donation to a politician have no recourse but to find a suitably connected nonprofit group to support.

Similarly, ethics laws enacted in the mid-1990s placed strict limits on what officeholders can take from lobbyists. According to House and Senate rules, lobbyists can neither pay travel to conferences for government officials nor run them, but nonprofit groups can. And as long as underwriters take care not to earmark their donations for activities benefiting any officeholder in particular, they can contribute and come to rub shoulders with the powerful.

Campaign-finance rules have also been a boon for politically connected foundations and other nonprofit groups. Since politicians are no longer allowed to use unspent campaign contributions for races for other offices or for personal expenses (as they once were), they now often use surplus funds for charitable activities.

In 2002, for example, Evan Bayh, Indiana’s junior senator, created the Evan Bayh Family Foundation with close to $660,000 of donations left over from his gubernatorial runs. While many people and organizations in need of financial aid will eventually benefit, none of the donors gave their money for that purpose.

Of course, government officials have long helped raise money for charities. Franklin D. Roosevelt used his position to build support for the National Foundation for Infantile Paralysis (now the March of Dimes). Today, countless philanthropic groups rely on officeholders to speak at dinners or other events, donate mementos for auctions, endorse fund-raising appeals, and otherwise help out financially.

Questions have always arisen about the motives behind such efforts and the reasons contributors respond to them. But much giving involves mixed motives, including the desire to win the gratitude of well-known and influential people, such as government officials. The real question is whether those making the gifts expect to receive political favors in return, an issue the House of Representatives’ Ethics Committee will examine in connection with Mr. DeLay. If not, neither public nor philanthropic integrity would seem to be compromised.

Moreover, apart from the fancy dinners and golf games sometimes included, seminars and trips sponsored by philanthropic groups for politicians usually entail serious purposes.

The largest supporter of Congressional travel, for example, is the Aspen Institute, a liberal think tank, known for holding valuable, if overly earnest, discussions of the works of Aristotle, Sophocles, and other classical thinkers, not to mention in-depth examinations of current policy issues in fancy surroundings.

In recent years, leading Senate Democrats have attacked several programs for judges, but the ones that have attracted controversy involve long seminars on “the dismal science” of economics, a subject central to many court cases, but one that generally receives short shrift in law schools.

While not all programs run by nonprofit organizations may be as weighty, those that are certainly do not violate federal laws and Congressional rules, and provide useful ideas and information to the government officials who participate. That the viewpoints shaping them are apt to be in line with the preferences of underwriters of the sponsoring organizations should not be surprising, nor troubling to an experienced politician accustomed to being the object of favor seekers.

Yet, as a result of the revelations about the dealings of Mr. DeLay and his associates — as well as others who have benefited from their ties to nonprofit groups — such programs are now suspect. Ironically, restricting them and the ability of officeholders to raise funds for charities or take part in their activities may wind up doing more harm to the interests of philanthropy than to politicians.

Leslie Lenkowsky is professor of public affairs and philanthropic studies at Indiana University and a regular contributor to these pages. His e-mail address is llenkows@iupui.edu.