Why did the Democrats lose the House in 1994 after 40 years of rule?

[IMGCAP(1)]One can make a case that the early stumbles of the Clinton White House, including the excruciating delay in enacting an economic plan along with the failure to get health care through, created a backlash against ineffective one-party government. One can make a case that former Speaker Newt Gingrich’s (R-Ga.) long-term plan to nationalize the Congressional elections, culminating in the “Contract with America,— finally provided a coherent and attractive alternative. But a critical element in the public backlash against the status quo in Congress was the populist anger at the elitism and corruption that the public saw engulfing Washington, D.C.

The first eruption of that populist anger came in 1989, with a pay raise for federal officials that had been endorsed by outgoing President Ronald Reagan, incoming President George H. W. Bush and all Democratic and Republican Congressional leaders from Speaker Jim Wright (D-Texas) to the aforementioned Gingrich. But that broad bipartisan support meant nothing to average voters struggling with a sluggish economy and stagnant wages.

I remember vividly going to board the train at Union Station to attend the House Democrats’ retreat at the Greenbrier resort — the location itself was a public relations nightmare akin to auto executives flying private jets to D.C. to beg for public money. We had to run a gauntlet of angry protesters holding signs and hurling epithets.

That was followed in 1992 by the House Bank brouhaha, revealed by Roll Call, which showed that a slew of House Members had overdrawn their accounts at the House Bank. It did not matter that the “bank— was not a bank in the traditional sense, but a repository for Members’ paychecks until they could be deposited in other accounts, and that the only money in the bank was from the lawmakers themselves; the story created a firestorm emphasizing that Members of Congress played by a different set of rules than the rest of us, exempt from the constraints or fines that we face. Many superb lawmakers lost their next elections (or retired prematurely) as a direct consequence.

The next train wreck was predictable. For some good reasons related to separation of powers issues, Congress exempted itself from regulation by the Occupational Safety and Health Administration, the Environmental Protection Agency and other executive agencies. But to the public (and to the minority party), this was another clear case of an imperial, insulated, pampered and arrogant Congress applying onerous laws to others while exempting itself.

Throughout 1993 and 1994, I went regularly to the leaders in the House importuning them to act to solve this problem. The answer was easy: create an independent office within the legislative branch to enforce the laws where applicable to Congress, avoiding separation of powers issues. Tom Mann and I worked with Reps. Christopher Shays (R-Conn.) and Dick Swett (D-N.H.) to come up with a bill creating an Office of Compliance. Early passage would signal a Congress ahead of the curve, moving to reform itself.

But the leaders did not think it was that big a deal and waited until the last days of the 103rd Congress to pass the bill — too late to avoid the surge in anger or to defend the indefensible, and they went into the 1994 election looking like they acted only after getting caught red-handed.

I raise all this history because it is déjà vu all over again. The populist anger is back, and not just in the United States — the reaction in Britain to parliamentary expense abuses is directly reminiscent of the reaction to the House Bank. So far, it has not been directed at Congress, in part because the 111th Congress has been so remarkably productive, in part because of the popularity of President Barack Obama, in part because of the ineptitude of the minority party leadership. But one can see the train wreck coming.

Some of the seeds go back to former Rep. William Jefferson (D-La.), preceded by Jack Abramoff and former Reps. Duke Cunningham (R-Calif.), Tom DeLay (R-Texas), Bob Ney (R-Ohio), Jim Traficant (D-Ohio), et al. Of course, some of the cases contributed mightily to the Republican loss of Congress after 12 years of rule, but all underscored a continuing public sense that Congress was more concerned with feathering its own nest than with the problems facing average Americans in their everyday lives.

Throw in Illinois’ former Gov. Rod Blagojevich (D) and Sen. Roland Burris (D), a case getting more and more putrid. Add the Congressional bailouts of banks and their executives and the auto industry, amplified especially by the American International Group bonuses. The scapegoats now are AIG and auto and bank executives, but that can switch in an instant to politicians.

Now throw in the PMA Group and Reps. John Murtha (D-Pa.) and Peter Visclosky (D-Ind.). The Murtha case, of course, goes well beyond PMA, to include throwing sensitive national security-related earmarks with abandon to companies in his district that were inept or corrupt and to rewarding or punishing companies that used the right lobbying firm or did the right business with Murtha’s relatives. Include also executive officials in the Defense Department and elsewhere giving no-bid contracts to companies with ties to Murtha and his family members to curry favor with the powerful lawmaker. I can’t sort out from this vantage point what is illegal or not, but it all stinks to high heaven.

Simply asking whether the ethics committee is investigating the issue is not enough. I hope the committee is acting, and I believe that the leadership of the panel, under Chairwoman Zoe Lofgren (D-Calif.) and ranking member Jo Bonner (R-Ala.), is finally functional. I also am truly encouraged by the start of the new Office of Congressional Ethics, also with top-flight leadership.

But if Congress wants to avoid the kind of public anger that engulfed the political process in 1994 and 2006, it needs to go much further. The leadership needs to avoid any sense that it is protecting Members because of their personal ties to them. And Congress needs to enact further reforms to make the earmarking and contracting process work better.

The House might start with Rep. Jeff Flake’s (R-Ariz.) idea to delink earmarks from campaign contributions. My own idea to create independent commissions to rank needs and projects in Congressional districts akin to Senators’ judicial selection panels would help. And addressing the issue of contracting — which is what Cunningham did, getting bribes in return for steering sensitive defense and intelligence contracts to the corrupt companies offering the bribes — is critical for reform.

Every contract issued by the federal government needs to be put online before the contract takes effect, with a special scrutiny for every no-bid contract. There must be guidelines for making sure the process is above-board and sanctions for those who award contracts that do not meet the guidelines.

The current Democratic Congress is comparatively well-regarded by the public for its performance. Democrats are certainly in no immediate danger of losing their majority or even losing many seats in 2010. But public opinion is fragile here, and it would not take much to ignite that populist outrage. Acting now is smart politics — and very good policy.

Norman Ornstein is a resident scholar at the American Enterprise Institute.