How do we fix our broken political system and our government?

I saw Senator Evan Bayh of Indiana on TV the other night and he was asked why nothing is getting done in Congress these days and why it is so divided.  His response was very honest and eye opening.

In the House, it is caused by the jerrymandering of the congressional districts and how few competitive congressional districts that exist.  The result is that most districts are either structured to be strong for one party or the other.  Hence very few moderate or middle of the road congressmen/congresswomen get elected.

He stated that until this method changes, we won't see different results.

In the Senate, he stated that Big Money was the problem and until that gets fixed, we won't see different results.

I have two ideas that would go a long way to fix these issues:

1.  For House Congressional districts and other (state, local) legislative districts, etc. we can simply remove the political influence in the jerrymandering process and make all districts fair plus competitive by using a random lottery to pick the election districts that make up a congressional or legislative district. 

For those who don't understand the current process, it is triggered every ten years by the census and the need to make all these districts nearly equal in population for equal representation.  The problem is who chooses the makeup of these districts and presently it is either done by the state legislature and governor or by a politically appointed commission - hence the political or partisan influence. Now what would be the consequences of such a change:  it would ensure that an elected official gets a whole new district every ten years; a diverse population from all over the state/county, etc.; and would remove the need for term limits since the redrawing every ten years would change the voter base and thus reduce the chances of longevity in elected office.  It would mean that an elected official must be moderate enough to represent a diverse population - extremists from either end of the political spectrum would be rare.

2.  To address the Big Money issue in all of politics, we need to revisit the campaign finance law and eliminate all Corporate, Union, and Special Interest money from elections.  In fact only voters/citizens of a legislative district can make a contribution to any candidates within their district and the amount would not be able to exceed some nominal limit (say $2500).  No outside money or other resources (e.g., outside manpower) would be allowed to be accepted in an election.

What do you think or do you have better ideas, let's hear them?

Thanks.