After McCain-Feingold, A Bigger Role for PACs

Groups May Be 'Soft Money' Conduits

With the two major parties facing new restrictions on fundraising, some little-known political action committees are preparing to act as surrogates, pitching themselves to wealthy donors as the new conduits for big money intended to elect Democrats or Republicans nationwide.

For years, the two parties have gorged on "soft money," the unlimited contributions that paid for TV ads, mass mailings and other political weapons. That will end on Nov. 6, when the McCain-Feingold campaign finance law prohibits the parties from raising and spending soft money.

But the ban won't apply to independent groups, or PACs. They will remain free to raise as much soft money as corporations, unions or individuals will give them.

And they can spend it aggressively to influence federal elections, provided they operate independently of campaigns, stop short of explicitly calling for someone's election or defeat, and cease airing ads within 30 days of a primary election and 60 days of a general election.

If they follow those rules, independent groups may play substantially bigger roles in the elections of 2004 and beyond. They could raise and spend large sums that previously went to the Republican or Democratic parties.

The independent organizations fall into two basic categories: single-issue organizations, such as those that support abortion rights or gun ownership; and lesser known, partisan-oriented groups that generally support Democratic or Republican goals, even though they have no official links to the parties.

Such groups include the New Democrat Network, established six years ago to elect centrist, pro-trade Democrats. Simon Rosenberg, the group's president, said it is up to organizations such as his to see that soft money still pours into campaigns -- even if they are independently operated -- designed to elect Democratic candidates.

"The question for the Democratic Party is, how do we capture all of this money out there and keep it in the system?" Rosenberg said. "We see this as a responsibility to step up to the plate, and as an opportunity."

Rosenberg, 38, isn't the only partisan activist looking for strategies to funnel soft money to politically active groups, which in some ways can take the place of the Democratic and Republican parties after Nov. 6. Liberal activist Michael Lux has created the Progressive Donor Network, aimed at steering donors toward several groups, including the National Abortion and Reproductive Rights Action League.

Republican-leaning organizations, such as the U.S. Chamber of Commerce and the free market-oriented Club for Growth, also plan to jump into the soft money fundraising vacuum to be created by the new law.

"We do think we potentially come out of this smelling like a rose," said Club for Growth President Steve Moore. "We'll try to go after the people who have given [$100,000 or more] to the party."

If such efforts succeed, it may disappoint reformist groups that had hoped McCain-Feingold would significantly lessen the role of soft money in federal elections.

The push for soft dollars is particularly intense among Democrats, because their candidates have become heavily dependent on such donations. Nearly half of the Democratic Party's $520 million in contributions for the 2000 election came from soft money donations, according to the Federal Election Commission, compared with a third of the GOP's $716 million.

Under the new law, Democratic loyalists will have to rely on groups such as the New Democrat Network to pump big donations to independent efforts that help the party's candidates.

"There's going to be a huge drive to keep this money in the system," said Larry Noble, executive director of the Center for Responsive Politics.

Soft money may indeed stay "in the system," but the national party organizations will no longer decide where it goes and how it is spent. This could profoundly affect elections, for political parties traditionally have served as moderating influences that tend to promote centrist candidates.

Most of the Democratic-oriented outside groups poised to gain influence under the new law -- abortion rights groups, trial lawyers, unions and environmental groups -- are associated with the party's left wing. But moderate groups such as the New Democrat Network are positioned to appeal to businesses, which, according to the Center of Responsive Politics, accounted for nearly three-quarters of the Democrats' soft money donations in the last election.

The New Democrat Network raised and spent about $6 million in the 2000 elections. Former representative Vic Fazio (D-Calif.), who once chaired the House Democrats' campaign arm, advises the group on how to attract more corporate dollars.

The network is "the logical place for business dollars to go," Fazio said. "It's critical for [centrists'] ability to survive, but it's also critical for the Democratic leadership that can't afford the loss of millions of dollars."

Another prominent Democrat -- Joseph J. Andrew, who joined the law firm of Cadwalader, Wickersham & Taft after chairing the Democratic National Committee last election -- has urged some clients to give generously to the New Democrat Network.

"My biggest fear is all of this money is going to go to Republicans if there's not an organized effort to capture this money by centrists," Andrew said.

One of the New Democrat Network's founders, Sen. John Breaux (D-La.), said he and other lawmakers attended the group's recent spring fundraiser so donors could understand where to send large checks once the parties can no longer take them.

Several other organizations are also angling for large contributions under the new regime. NARAL President Kate Michelman said she attended the Progressive Donor Network conference in April to let contributors know her group can still accept soft money and spend it, independently, on elections.

"It's really a matter of educating donors about who's out there and who's doing the work," Michelman said. "We're all becoming more sophisticated in how we reach voters."

State parties, which under the new rules may accept $10,000 from any given donor for get-out-the-vote efforts, also are exploring ways to tap rich donors nationwide. Joe Carmichael, president of the State Association of Democratic Chairs, said he has spoken to veteran political adviser Harold Ickes on the subject and is seeking advice from Steve Rosenthal, political director of the AFL-CIO.

"The states will wind up doing a lot of their own fundraising," Carmichael said.

Architects of the new campaign finance law say that as long as members of Congress do not raise money for the independent groups, there is nothing wrong with it.

"The outside groups are going to be able to raise more money than they have in the past," said Rep. Christopher Shays (R-Conn.). "That doesn't bother me."