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Political Groups Rake in Funds « The Washington Independent

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Sen. John McCain (R-Ariz.) and Sen. Barack Obama (D-Ill.) (WDCpix)

Hoping to maintain their campaign-finance-reforming personas, both Sen. Barack Obama, the likely Democratic nominee, and Sen. John McCain, the likely Republican nominee, have asked supporters to forego contributions to independent political groups and instead channel dollars directly to them.

Donors from both sides, however, are clearly ignoring these messages.

Through June of this year, total fund-raising by “527″ organizations — tax-exempt groups that participate in elections but can’t advocate for or against specific candidates — is up roughly 24 percent compared to four years ago, according to the Center for Responsive Politics, a non-partisan campaign-finance watchdog group. While the bulk of those dollars are now focused on state and local elections, millions are also being funneled to federally focused groups, created to sway the presidential race.

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Illustration by: Matt Mahurin

The strategy played an important role during the 2004 contest, when a conservative 527, the Swift Boat Veterans for Truth, helped torpedo the presidential chances of Democratic Sen. John Kerry (Mass.) by airing dubious charges against his Vietnam War record. Since that episode, campaign finance reformers have sought to rein in these groups, while new 527s regularly pop up in hopes of becoming the next Swift Boat Veterans. While election experts all agree that these “issue-advocates” will have an effect on this year’s race, no one knows beyond speculation what that effect will be.

“The 527s and the independent groups can say things that the candidates can’t,” said Robert M. Stern, president of the Center for Governmental Studies, a Los Angeles-based non-profit research group. “They’re going to have some role this year, but the role is unknown. We won’t really be able to evaluate it until after the election.”

The potential influence of 527s is difficult to gauge for a host of reasons. First, most 527 spending in 2004 came late in that election season, and experts anticipate a similar trend this year. Some organizations may not have yet even been fully formed, waiting until the election gets closer before they emerge and pounce on an issue. “Groups in ’04 waited until the fall to ramp up their spending,” said Paul Ryan, FEC program director at the Campaign Legal Center. “We’re really in a wait-and-see posture.”

In addition, because these 527s are not regulated by the Federal Election Commission, much of their activity can go unnoticed until elections have passed. That’s because 527 reports are due quarterly, as opposed to the monthly filings required under FEC election rules. “There won’t be a lot of good information until it’s already too late,” said Laura MacCleery, deputy director of campaign finance at New York University Law School’s Brennan Center for Justice.

Clouding the predictions, 527 fund-raising is not always the best indicator of potential influence. Groups need an issue that resonates with the public. Consider that the Swift Boat Veterans spent less than $23 million in 2004, according to the CRP — a healthy sum, but still only a fraction of the roughly $78 million spent by America Coming Together, a liberal get-out-the-vote organization. The controversy swirling around the Swift Boat campaign, however, made the group the focus of countless news stories. And, more important in this process — many voters bought their message.

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“They actually didn’t spend a lot,” Richard Briffault, a campaign finance expert at Columbia University Law School, said of the Swift Boat Veterans. “They just got a ton of free publicity.”

Hoping to make a similar impact on this year’s presidential contest, donors from both the left and right are opening up their pocketbooks to these groups. Indeed, conservative, federally focused 527s took in roughly $43 million through June, CRP says — more than twice what they had at the same point four years ago. Highly energized liberal donors, meanwhile, have contributed about $92 million to federally focused 527s over the same span, CRP says. That’s less than they gave by that juncture in 2004, but more than double what similar conservative groups have amassed.

Furthermore, when state and local groups are factored in, contributions to liberal 527s are rising this election cycle at almost precisely the same clip as four years ago, up to $171 million through June (versus $175 million in 2004). Nationwide, conservative 527s have raised $98 million, nearly double their take in 2004.

It wasn’t supposed to play out this way. At least on the surface, both presidential candidates have sought to discourage such donations. In May, Obama spokesman Bill Burton told The Washington Post, “If people want to support our campaign, they should do it through our campaign.”

Charles R. Black, a senior campaign adviser to McCain, echoed that. “Obviously,” he told The Post, “McCain would prefer that people give money to him and the RNC [Republican National Committee] and let us run our own campaign.”

Ostensibly, those requests were designed to lend the candidates greater command over their own campaign messages. Many experts, however, question whether the presidential hopefuls were ever sincere in their opposition to 527s. After all, these “independent” groups can get away with attack ads that the campaigns probably cannot. In a tight election year, the desire to win the White House could easily trump a principled stand on an obscure campaign-finance issue. Stephen Weissman, associate director for policy at the Campaign Finance Institute, characterized the candidates’ positions on these independent groups as “ambiguous.”

“They want to win,” Weissman said in an email, “and if these groups are useful they will not repudiate them.” Or maybe repudiate them after they have proved effective.

Neither Obama’s nor McCain’s campaign office responded to requests for comment.

Another factor involves the eagerness of the FEC to go after potential 527 violators. In the wake of the 2004 election, the FEC concluded that the Swift Boat Veterans, along with a handful of other organizations, some of them liberal, had abused their 527 status. The group declined to fight the ruling and paid a $300,000 fine. Unfortunately for the Democrats, it was then December of 2006.

Many campaign finance groups say the FEC needs to get more aggressive with potential 527 impersonators. Otherwise, there is little to discourage some groups from breaking campaign finance rules when it matters most.

“Well-funded 527s might be prepared to just push ahead and pay a fine,” said Massie Ritsch, communications director for the CRP.

In a move that’s gained a great deal of attention, T. Boone Pickens, a billionaire oil tycoon who contributed heavily to the Swift Boat Veterans as well as other GOP causes in 2004, has seemingly abandoned his partisan cheerleading this election cycle to promote a comprehensive energy plan, with wind power as a big component. “I’m totally non-partisan,” Pickens told reporters last week during a press call urging a national energy debate.

Experts cautioned, however, not to interpret Pickens move away from the 527 business as a sign that a larger national trend is at hand.

“He’s got his own pet issue,” said Jan W. Baran, a campaign-finance expert with the law firm Wiley Rein. “Obviously, it’s got nothing to do with boosting the campaign of either candidate.”

“It’s a mistake,” said Briffault of Columbia, “to generalize based on any one individual.”

Indeed, the Pickens exodus has made little difference in a frenzied campaign environment where 527s have already raked in more than $300 million.

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