
Republicans Jump on "527" Bandwagon
by Kay Guinane, 6/1/2004
Within days of the Federal Election Commission's (FEC) May 13 decision to delay action on its proposed rule expanding regulation of independent political committees (often referred to as 527 groups), Republicans began calling for aggressive fundraising for groups sympathetic to them. By the end of May some Republican Members of Congress were stretching the limits of the Bipartisan Campaign Reform Act of 2002 (BCRA) by agreeing to appear at fundraisers for groups like the Leadership Forum.
Before the FEC action made it clear rules would not change in this election cycle, Republicans in Congress and the Bush administration strongly criticized 527s focused on defeating President Bush this November, saying they were violating campaign finance laws by accepting substantial donations of unregulated [soft] money. After the FEC decision, BCRA sponsor Rep. Chris Shays (R-CT) joined House Speaker Dennis Hastert (R-IL) and Republican Congressional Committee Chair Rep. Tom Reynolds (R-NY) in a statement accusing groups sympathetic to the Democrats of operating "with no regard for the law" and predicting that groups sympathetic to Republicans would emerge. This was seen as a signal to Republican donors, including corporations, who had been waiting to see what action the FEC would take, to give to groups like the Club for Growth and Progress for America.
Bush-Cheney campaign chair Marc Racicot and Republican National Committee (RNC) Chair Ed Gillespie issued a statement predicting "The 2004 elections will not be a free for all." The Hill newspaper reported that the Republican switch began before the FEC decision, when Ken Mehlman, manager of the Bush-Cheney campaign, met privately with lobbyists on May 11 and predicted an immediate fundraising push by 527 groups sympathetic to Republicans. One attendee joked, "On Friday, don't pick up your phone because they're going to be asking for money."
Two major Republican leaning groups, the Leadership Forum and Progress for America, are stretching the limits of what is allowed under BCRA since the FEC decision. According to The Hill the Leadership Forum, run by the former chief of staff to House Majority Leader Tom Delay (R-TX), will feature House Speaker Hastert and Senator Rick Santorum (R-PA) at events this summer. BCRA prohibits federal officeholders from raising soft money, but FEC rules allow them to appear and speak generally without making a fundraising pitch.
Progress for America, a 501(c)(4) organization, announced plans to become a 527 group so that it can engage in more election-related activity. They plan on purchasing advertising praising Bush in 18 battleground states, and have hired a direct-mail specialist, Tom Synhorst, who is a partner in a firm that has done $1.8 million in business with the Bush-Cheney campaign. The firm, Feather, Larson & Synhorst, said Synhorst will work in "silo", and not participate in the firm's work for Bush or the RNC.
The Club for Growth was operating prior to the FEC decision, sponsoring ads praising President Bush in five battleground states. They have raised $9 million so far, and plan to spend $10 million on issue ads in the presidential race. Americans for Tax Reform President Grover Norquist announced plans to create a separate segregated fund with a goal of raising $6 million by election day. Americans for a Better Country also announced ambitious fundraising plans, but reportedly has not raised any money yet.
The overall impact of the Republican effort to promote 527 groups is unclear. The party has encouraged contributions of hard money to the RNC or Republican candidate committees, and has been very successful. By mid May Bush had raised $100 million more than the Kerry campaign, outspending it by a 3-1 margin. However, the effect has been moderated by liberal 527 groups' spending of $86 million on anti-Bush ads.
