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Fundraising Records Broken by Both Major Political Parties

Democrats Got More Money Than GOP for 1st Time Since '70s

By Thomas B. Edsall and Derek Willis
Washington Post Staff Writers
Friday, December 3, 2004; Page A07

The GOP and the Democrats broke all previous fundraising records this year, but for the first time since the mid-1970s, the Democratic National Committee raised more money than the Republican National Committee.

The DNC reported yesterday that it raised $389.8 million from Jan. 1, 2003, to Nov. 22, 2004, compared with $385.3 million by the RNC.

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Special Report

Total spending on the presidential campaign from all sources seeking to influence the outcome exceeded $1.7 billion, according to reports filed with the Federal Election Commission and the Internal Revenue Service. At least $925 million was spent in support of Sen. John F. Kerry (D-Mass.) and $822 million in support of President Bush. In the 2000 presidential contest, total spending was just under $1 billion.

One of the major reasons for the sharp increase in overall spending was the decision by the campaigns of Bush and Kerry to reject public financing for their primary campaigns, which would have imposed spending limits. Without those limitations, Bush and Kerry together boosted spending by more than $300 million.

In every previous election cycle since 1976, the year the FEC first began issuing reports, the GOP has decisively trumped the Democrats. In 1999-2000, for example, the RNC raised $377 million, $116.4 million more than the $260.6 million collected by the DNC.

Both major parties defied predictions that the new McCain-Feingold campaign finance law would severely weaken them. Instead, each broke fundraising records in the 2003-2004 cycle. In addition, both the DNC and the RNC have vastly improved the resources available to future candidates, arming themselves with high-tech voter lists and building donor bases that should provide reliable financial support in the future.

RNC Chairman Ed Gillespie acknowledged the accomplishment of the rival DNC. "The parties adapted to the law, and frankly the DNC had a bigger adaptation to go through," he said. "But they broadened their net and were able to get to small donors."

DNC Chairman Terence R. McAuliffe declared: "Even though the pundits called the DNC 'dead' after McCain-Feingold, the American people said otherwise. Thanks to our strong grass-roots support, the Democratic Party surpassed every fundraising goal by a factor of three."

Gillespie asserted that the rise of "527" organizations threatens political parties and the political system because those groups are under little restraint to use responsible tactics. With many reports still to be filed, presidential 527s had reported by yesterday evening raising a total of $277 million.

The 527 committees, named for the section of the tax code governing them, were allowed by the FEC to raise and spend unlimited "soft money" from labor unions, corporate groups and wealthy individuals. These groups, including America Coming Together and the Swift Boat Veterans for Truth, are widely viewed as having played major roles in the outcome of the Nov. 2 election.

In the current cycle, the parties were barred from collecting unlimited "soft money" contributions. The McCain-Feingold law restricted them to "hard money" donations of $25,000 or less from individuals.

Even with this restriction, both parties raised more through Nov. 22 than they had done during the entire 24-month period of 1999-2000, when both hard- and soft-money contributions were allowed.

The DNC tripled its hard-money receipts from 1999-2000, when it raised $124 million in relatively small donations. The RNC's $385.3 million in hard money in this cycle was $182.5 million more than the $212.8 million in hard money it raised four years ago.

Just over two years ago, many top Democratic strategists were predicting that the McCain-Feingold ban on soft money would devastate their party. Instead, the party flourished, raising $389.8 million in hard money, by far the most in its history.

Not only did the parties enjoy huge cash surges, but both presidential campaigns and the new 527 committees exceeded their goals as money flowed into the system in amounts ranging from single-digit gifts over the Internet to multimillion-dollar contributions from such super-rich donors as George Soros on the left and T. Boone Pickens Jr. on the right.

Soros gave at least $27 million to 527 committees. Such Republicans as Pickens, Ronald and Dawn Arnall, and Gus and Faye Spanos each gave $5 million or more.

To deal with the contribution limits set by the McCain-Feingold law, the parties and the candidates sharply intensified efforts to build networks of major fundraisers -- well-connected men and women who could collect many contributions of $2,000 or less for candidates and $25,000 or less for the parties.

Public Citizen, the consumer advocacy group, noted yesterday that Bush has 327 "Pioneers" who each raised at least $100,000, and 221 "Rangers" who each raised $200,000 or more. In addition, the RNC has 105 "Super Rangers" who collected $300,000 or more for the party.

Kerry, in turn, has 266 "Vice-Chairs" who each raised at least $100,000 and 298 "Co-Chairs" who each raised $50,000 or more.

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