The Hindu : Campaign fund-raising

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Saturday, Dec 13, 2003

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Campaign fund-raising

By Glen Justice

Republicans and Democrafts are squaring off for a new fight over the ways campaign finance can be raised in the U.S.

A DAY after its Supreme Court upheld the largest overhaul of the United States' campaign finance law in three decades, strategists from both parties were preparing for a new fight about how campaign money is raised, with Republicans — not Democrats — doing most of the complaining this time.

While the Republican National Committee and its counterparts in the House and the Senate have solidly out-raised their Democratic rivals this year, the Democrats have attracted millions of dollars through fund-raising organisations outside the party. The Democrats have done so well, they say, that Republicans are now trying to disrupt the flow of money to those organisations by asking the Federal Election Commission to intervene.

The Supreme Court's decision on Wednesday ended the argument over whether political parties can accept large checks from companies, labour unions and wealthy individuals by upholding a ban on these "soft money" contributions. But the decision also raised questions about the role in next year's election of the fund-raising groups that operate outside the parties, and which are still allowed to collect soft money.

A group of Republicans has asked the Commission to issue a legal advisory stating what these groups — called 527 committees after the section of the tax code that created them — may do under the new law.

"It's clear that these kind of groups are in a position to do things that the parties used to be able to do," said George Terwilliger, a Republican lawyer who was involved in the request before the Commission. "The question is what precisely they can do and when they can do it."

It is not clear how much Republican and Democratic groups have raised because reports showing committee finances are not due until next year for most organisations. Yet campaign finance experts say that the Democrats have an edge.

Experts say that Republican donors, particularly from the business community, are more comfortable giving money to the parties, Republican candidates or trade associations affiliated with their industry. An outside organisation with no official ties to the party or to federal officials is a tougher sell. "Republican money right now is on the sidelines," said Craig Shirley, a GOP communications consultant who is also involved in the request.

By contrast, the Democratic groups have drawn attention by bringing in several multimillion-dollar contributions from donors who are interested in putting Democrats back in control of Congress and the White House.

Democratic strategists created several new 527s this year as an answer to the Republicans' superior party fund raising. The Democratic 527 committees were intended to run advertisements, register and mobilise voters and otherwise press Democratic causes. Though not all have raised large amounts, the efforts drew attention when a group called America Coming Together began to attract millions of dollars from wealthy donors.

Run by Ellen R. Malcolm, the president of the influential fund-raising group Emily's List, and Steve Rosenthal, the former political director of the AFL-CIO, America Coming Together hopes to spend its money mobilising thousands of Democrats in next year's races.

George Soros, the financier and philanthropist, and Peter B. Lewis, the chairman of the Progressive Corp., an insurance company, each pledged $10 million.

Those contributions drew a response from Republicans, even though they operate similar groups. Initially, they called for campaign finance watchdog groups to increase their scrutiny of the Democratic organisations.

Later, a Republican 527 committee — called Americans for a Better Country — filed a 17-page request with the Federal Election Commission, asking for a ruling on a number of legal questions about what the committees are allowed to do.

This Republican committee is run by Mr. Terwilliger, Mr. Shirley and Frank Donatelli, a Republican lawyer and consultant. Mr. Terwilliger said the organisation was simply seeking guidance on what is legal, not attacking Democratic groups.

The three sent a letter to about 100 Democratic donors warning them to be careful about contributing to 527 committees because of "legal gray areas and traps" in the new campaign finance law.

Democrats accused the group of pressure tactics.

Though most 527 committees are subject to the advertising restrictions under the new law and coordination with candidates is restricted, several of the groups plan to spend millions on large-scale efforts to register and mobilise voters.

Questions such as how they can fund these efforts, what types of materials they can use and what these materials can say are all left to be answered. — New York Times News Service

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