More ‘soft money’ used in election

Tax-exempt pro-Democratic groups raising big checks for this year’s election collected almost twice as much money as their Republican rivals in the presidential race, a study shows. The financial advantage comes in addition to record fundraising by Kerry, the unsuccessful candidate, and the Democratic Party.

In all, nonparty political groups, known as 527s because of the tax code section that covers them, raised about $534 million and spent roughly $544 million in the 2003-04 election cycle, the analysis by the nonpartisan Political Money Line campaign finance tracking service found.

The prolific fundraising is a sign that such groups, many of which debuted in the 2004 election season, will have no problem surviving the competition for contributions, Kent Cooper, co-founder of Political Money Line, said yesterday. Fundraising drives over websites and through e-mail helped several become political players very quickly, he said.

“I think it shows you that with the Internet, anyway, your lines of communication can be large pipelines for quick money,” Cooper said.

The presidential race drew most of their attention. Groups supporting John Kerry or opposing President Bush raised $266 million. Those opposing Kerry or backing Bush collected $144 million, the Political Money Line said. The study was based on a review of the organizations’ postelection campaign finance reports to the Internal Revenue Service.

Democratic activists began forming such groups soon after a law took effect in November 2002 that banned national party committees from collecting “soft money” — corporate or union contributions in any amount and unlimited donations from any source.

Leading groups such as the Media Fund and America Coming Together, jump-started by multimillion-dollar donations from wealthy businessmen such as George Soros, focused on advertising and get-out-the-vote operations. That eased pressure on the national Democratic Party, which was prohibited from raising six- and seven-figure donations to finance such expensive activities. The outside groups’ similarities in objective to party committees prompted campaign finance watchdogs to characterize them as “shadow parties.”

Republicans, relying in part on their long-standing advantage over Democrats in collecting donations in modest amounts such as $10 or $20 as well as checks up to the new individual donor of $25,000 per year, initially held off on formation of their own 527 groups.

Instead, they argued that the pro-Democratic organizations violated the new law’s broad ban on the use of soft money to influence federal elections. The Federal Election Commission failed to curb the groups’ activities, however, and GOP activists decided last spring to forge ahead with their own outside groups.

The new Republican groups quickly raised millions from wealthy Republicans such as Texas homebuilder Bob Perry. His donations helped fund the anti-Kerry group Swift Boat Veterans for Truth, whose allegations that Kerry exaggerated his decorated Vietnam War service record monopolized attention in the campaign for weeks last summer. Their late start limited their impact on the presidential race.

The anti-Bush groups, meanwhile, had millions of dollars on hand by the time Kerry wrapped up the Democratic primaries last winter. They spent big on TV ads that kept Kerry’s side on the air as he worked to rebuild his campaign fund.

In addition to the pro-Democratic outside groups’ financial advantage over their pro-Bush counterparts in the presidential race, the Democratic National Committee out-raised the Republican National Committee by several million dollars during the two-year election cycle.

Although Bush raised an all-time presidential record of $273 million from private contributors, Kerry was not far behind. He collected a Democratic-record $249 million after veering from party tradition and becoming the first Democratic nominee ever to skip public financing and its spending limits during the primaries, as Bush did in 2000 and 2004.