Over the past four months, Sen. John F. Kerry (D-Mass.) has raised more money than the Bush campaign and substantially eroded the president's once-huge cash advantage.
Now, President Bush and his GOP allies have suffered another serious setback: Independent pro-Republican groups that recently vowed to challenge pro-Democratic organizations for supremacy in spending unregulated or "soft" money on campaign ads and voter mobilization are getting their clocks cleaned by their rivals.
One of the most heavily publicized pro-GOP groups, Progress for America, raised $2.3 million in the second quarter of this year, most of it from three of Bush's major fundraisers, according to new filings with the Internal Revenue Service. Another, the Leadership Forum, backed by some of Washington's most prominent Republican lobbyists and the GOP congressional leadership, raised $15,719.
The two top pro-Democratic groups, the Media Fund and America Coming Together, raised nearly nine times as much in the past quarter, or a combined $20 million, according to IRS filings.
The partisan fundraising war was started on May 13 when the Federal Election Commission decided against regulating "527s." The independent groups, named for a section of the tax code, have become the new vehicle of choice for pumping unregulated money from corporations, unions and the wealthy into federal elections after the 2002 McCain-Feingold law barred the political parties from raising and spending such funds.
The new pro-Democratic 527s began raising soft money in 2003. Altogether, they have collected more than $68 million. The organizers have created what amounts to a "shadow" Democratic Party that is performing such basic functions as organizing a massive get-out-the-vote drive in the battleground states, and running anti-Bush ads during the period when the Kerry campaign was short of cash.
Republicans in late 2002 and early 2003 tried to emulate the Democrats but could not get their 527s off the ground. One major problem has been business leaders' reluctance to engage in controversial political activities after the Enron, Tyco and other corporate scandals.
Such major Democratic donors as financier George Soros and the American Federation of State, County and Municipal Employees have shown no such reluctance. Soros has given more than $11 million to pro-Democratic 527s. AFSCME gave the Media Fund $2 million in April and May.
When Republican operatives could not build their own network of independent groups, the Republican National Committee and the Bush-Cheney '04 Committee sought to have the activities of the pro-Democratic 527s declared illegal by the FEC. On May 13, that effort failed when the FEC declared that it would not try to regulate the 527s during the current election cycle.
Since May 13, the GOP has reversed field again, and the leaders of Progress for America and the Leadership Forum have tried to build enthusiasm among soft-money donors.
"It's time for Republicans to step up to the plate and participate in 527s," said Bill Paxon (R-N.Y.), Leadership Forum vice president and former House member, in a May 25 news release. "Sitting on the sidelines any longer is not possible in the face of the liberal Democrat 527 actions of the past months." Brian McCabe, president of Progress for America, announced that "conservatives across America can finally take hope that help is on the way."
Yesterday, they were more cautious. "We have a long way to go," McCabe said, adding that after running ads in Nevada and New Mexico, "we expect to be more successful." Susan B. Hirschmann, president of the Leadership Forum, said, "We are behind the Democrats in our fundraising. The good news is that the money and pledges are starting to come in; people now realize that giving is very important."
Almost all the money raised by Progress for America, $2 million, was given by three contributors, all of them already major fundraisers for the Bush-Cheney '04 campaign: A. Jerrold Perenchio, chairman of Univision Communications Inc., who gave $1 million, as well as Carl H. Lindner, chairman of the American Financial Group Inc., and Paul Singer of Elliott Capital Advisors LP, who each gave $500,000.
Perenchio's Univision was granted permission in 2003 by the Federal Communications Commission to merge with the Hispanic Broadcasting Corp. to become the dominant Hispanic media conglomerate in the United States.
Almost all of the money raised by the Leadership Forum was a $15,000 contribution from the American Spirit Fund, a PAC associated with former senator Jesse Helms (R-N.C.).
ACT and the Media Fund receive support from the Joint Victory Campaign Committee, which yesterday reported raising $1 million from New York philanthropist Lewis B. Cullman; $505,000 from AgVar Chemicals President Agnes Varis; and $250,000 from Slim-Fast Foods Co. President S. Daniel Abraham.