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“˜Soft money’ question remains unsolved

By Colleen Honigsberg

April 15, 2004 9:00 pm

The debate over acceptance of “soft money” in
election campaigns will not be resolved as easily as many had

In 2002, the McCain-Feingold Act was passed with the intent of
cracking down on election contributions known as “soft
money” ““ essentially open-ended donations to a
particular candidate. The bill prohibits the receipt of soft money
by candidates, political parties and political action committees
but does not address its acceptance by third-party groups.

Many political analysts have said this omission has allowed a
new avenue for soft money to be channeled into the election

A number of 527 organizations ““ so named for the section
of the tax code they correspond to ““ have sprung up in the
last two years and are now using soft money contributions to
finance ads opposing a particular candidate.

“It’s a natural reaction when you shut off some
areas of fundraising, but not all, that something like this will
occur,” said UCLA graduate Rick Hasen, who recently wrote a
book on election law.

Hasen also noted that because Republicans receive more hard
money donations they have less of a need for soft money.

Nonetheless, soft money has also been a sticky issue for the
Republican Party, with the National Republican Congressional
Committee recently paying a $280,000 fine for using soft money in
to finance ads on behalf of House incumbents in 1999.

One example of a 527 organization accused of channeling soft
money into the current presidential election is the Media Fund,
which has committed $40 million in TV ads against Republicans. It
is run by Harold Ickes, the former deputy chief of staff to
President Clinton, and Jim Jordan, Sen. John Kerry’s former
campaign manager.

In response to organizations like the Media Fund, Republicans
are now setting up additional 527s of their own in addition to the
conservative ones already set up.

Traditionally, though Republicans receive more soft money than
democrats do, the percentage of Democratic soft money compared to
total funds is significantly higher than the same statistic for
republicans. The 2002 bill was therefore expected to be a greater
hindrance to Democrats than to Republicans.

Under the new regulations, only “hard money”
contributions are allowed. To be classified as hard money, the
contribution must follow regulations including maximum candidate
and PAC contribution limits.

Since 527s are not currently considered to be PACs, but instead
are intended to focus on issues such as voter registration,
individuals can contribute unlimited amounts.

George Soros, a longtime Democratic Party donor, has contributed
over $12 million to different leftist 527s such as

In response, Republicans have filed a complaint with the Federal
Election Commission alleging that 527 groups are spending money
illegally that would benefit presumptive Democratic contender

Hasen said the court’s decision will likely come down to
the 1976 case of Buckley v. Vallejo in which the Supreme Court
ruled that candidates and advocates can spend unlimited amounts of
their own money on political speech.

Under this law, Soros could spend unlimited millions of his own
money to run anti-Bush ads. Since Soros could spend this money
himself, Hasen noted, the FEC might decide there is nothing wrong
with contributing the money to a committee which will accomplish
the same feat.

The FEC finished hearing arguments yesterday and is expected to
rule on the decision on May 13.

UCLA Professor Daniel Lowenstein, who specializes in election
law, noted the irony in that the Democrats, who have traditionally
“moaned and groaned” about the need for campaign
fundraising restrictions, are supporting the allowance of the 527s
as they currently stand, whereas the Republicans are complaining
that some 527s are going against the “spirit” of the
law, even if not the actual word.

The authors of the bill, Sens. Russ Feingold (D-Wis.) and John
McCain (R-Ariz.), have said they feel their law is being
circumvented; McCain has threatened to go to court to force the FEC
to crackdown on the 527 groups.

Even if it is found that the 527s are violating McCain-Feingold,
many say any changes to the law should not be made until after the
2004 presidential election is complete.

“We’re too much into the election cycle to rule on
this now,” said UCLA Professor Adam Winkler, also a
specialist in election law. “If the 527s are a problem, they
can stop it for the next election, but the FEC should not step in
this late in an election.”

For many, the 527s are a legal tool to even out the playing
field between the Democrats and Republicans in terms of

So far Bush has raised over $180 million dollars for his
reelection campaign. Over $50 million of this was raised in the
first quarter of 2004. None of the money was spent until early
March when Kerry was established as the presumptive Democratic

Kerry, on the other hand, mortgaged his town house for $6.4
million to keep his campaign alive.

In the first quarter of 2004, Kerry’s fundraising
increased and he also raised at least $50 million, which is more
than former Vice President Al Gore raised in the entire 2000
presidential election and more than any incumbent has ever raised
in the first quarter of an election year.

The reasons for Kerry’s successful quarter are numerable,
but many people credit the strong support to anti-Bush fervor
rather than to Kerry himself. The closeness of the election is also
often credited to large fundraising turnouts, and is especially
apparent by political advertisements in swing states

As much as the money will affect the election, Larry Sabato, a
noted political pundit and political science professor at the
University of Virginia, said that money will probably not affect
the election the same way this year as it has in some years

“Keep in mind that this is a “˜big issue’ year.
All the spending in the world isn’t going to sway most voters
from their judgements about the economy, Iraq, and the war on
terrorism,” Sabato said.

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Colleen Honigsberg
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