'Soft money' battle brewing

Millions raised; attack ads set

Email|Print|Single Page| Text size + By Scott Helman
Globe Staff / April 6, 2008

Four years ago, wealthy Republicans bankrolled two influential, loosely regulated political organizations that helped President Bush win reelection with TV ads invoking the 2001 terrorist attacks and maligning the Vietnam War record of Democratic nominee John F. Kerry.

Now, some of the same GOP donors and operatives are planning a similar independent group to help the party hold onto the White House this fall, according to Republicans familiar with the discussions.

The organization is one of several independent groups aligned with both Democrats and Republicans that are busy arming for the general election, in a year that could see record activity by such outside entities. They are plotting strategy, crafting ad campaigns, and raising millions in "soft money" - largely unrestricted contributions from wealthy individuals, corporations, and labor unions.

The new GOP group is still in embryonic form, Republicans strategists say, but it is being led by operatives who ran the 2004 Republican group Progress for America, and will probably be funded at least partly by "alumni" of the Swift Boat Veterans for Truth, the group that used TV ads four years ago to challenge Kerry's well-documented heroism in Vietnam.

One Republican strategist familiar with the plans said Republicans expect Senator Barack Obama, who leads rival Hillary Clinton in the Democratic race, to be their opponent and have begun assembling material to turn voters against him.

"They're beginning to put the book together on Obama," said the strategist, who discussed the effort on condition of anonymity.

Campaign finance rules limit individual donations to candidates to $2,300 per person, per election, and the candidates must publicly disclose their contributors. But loopholes in the law allow independent groups to operate more freely, permitting unlimited donations to the 527 organizations, named for a section of the tax code, and to 501(c)4 entities, tax-exempt nonprofits that can engage in some political activity if their primary mission is "social welfare."

It is too early to get a complete picture of third-party spending planned for 2008, in part because many of the groups keep their intentions and activity cloaked from public view. But in a presidential race that is already breaking fund-raising records, 527s, nonprofit organizations, and unions appear poised to spend at least $500 million combined to help swing the election to the candidates they favor, according to analysts and news accounts.

Early indications suggest a greater level of activity this cycle than in 2004, when independent spending - led on the right by the Swift Boat group and Progress for America, and on the left by organizations called America Coming Together and the Media Fund - was a major force. Four years ago, 527 groups raised $424 million, according to the Campaign Finance Institute, a nonpartisan organization affiliated with George Washington University that studies money in politics.

Such 527 groups raised $13 million more in 2007 than they did in 2003, the last off-year before a presidential race, the institute found in an analysis it released Thursday. "Soft-money groups in the 2008 election are off to a strong start," the analysis said.

Election law prohibits 527 groups from coordinating their activities with a candidate's presidential campaign or expressly advocating a candidate's victory or defeat. But critics of the soft-money loophole say it is easy for third-party organizations to evade these restrictions and still have great sway on Election Day.

A host of organizations are active on the Democratic side, which have historically raised more money than their Republican counterparts. One of the biggest Democratic groups this cycle is the Fund for America, which formed last year to funnel money to progressive causes. Funders of the group, which is expected to raise $100 million, include left-leaning financier George Soros and the Service Employees International Union, each of whom have contributed at least $2.5 million.

Late last year, the Fund for America gave $1 million to the Campaign to Defend America, a 501(c)4 nonprofit organization registered in Washington, D.C., that ran a TV ad in Pennsylvania last month seeking to link Senator John McCain, the presumptive Republican nominee, to the policies of President Bush, such as "tax cuts for millionaires."

"We need a new direction, not the 'McSame' old thing," the ad's narrator says.

Other active Democratic organizations include the Campaign for America's Future, a non-profit that calls itself the "strategy center for the progressive movement";, the liberal activist group that reportedly plans to spend $30 million this year; and Patriot Majority for a Stronger America, a 501(c)4 that is an offshoot of a 527 that ran ads to help Governor Deval Patrick of Massachusetts win election in 2006. The latter group launched a new website,, to attack Bush and McCain on military readiness and other issues, and its leaders say they may run TV ads.

"We've had policies for the last seven years that have weakened America," said Craig Varoga, president of the Patriot Majority group. "We will all be poor patriots if we don't talk about that, but also about ways to fix it."

On the Republican side, strategists say that the offspring of Progress for America, whatever form it takes, will probably be a major player. In 2004, the group raised $45 million to help Bush and attack Kerry, according to the Center for Responsive Politics, which tracks campaign finance activity. It ran a powerful TV ad called "Ashley's Story," which showed Bush embracing Ashley Faulkner, the teenage daughter of a woman killed in the Sept. 11, 2001, terrorist attacks, at an event in Ohio.

Progress for America was run by executives of a Washington-based consulting firm called DCI Group, which has close ties to Karl Rove, Bush's longtime political strategist. The chairman and founding partner of DCI Group, Tom Synhorst, is helping lead the new third-party effort this year, according to GOP strategists familiar with the plans. Synhorst was not available for interviews last week, a company spokesman said.

One of Progress for America's biggest donors was T. Boone Pickens, a Texas oilman who gave it $2.5 million and who also gave $3 million to the Swift Boat group. Pickens will be part of the new effort, the strategists said. He did not return a call seeking comment.

Another big donor to Progress for America was A. Jerrold Perenchio, the former chairman of Univision, an influential Spanish-language broadcast network, and a leading fund-raiser for McCain. Perenchio, who gave $4 million to Progress for America, does not give interviews, his office said.

Another new conservative group active this year is Freedom's Watch, a nonprofit created to be a Republican answer to It reportedly aims to raise as much as $250 million, though some Republicans say there is growing skepticism in the party about whether the group will be as influential as many had hoped.

"We plan to have a strong presence this year advocating for issues that conservatives care about," said spokesman Jake Suski.

Part of what's driving Republicans' interest in independent groups this year is the tremendous fund-raising advantage the Democratic presidential candidates have. Obama and Clinton raised nearly as much in March as McCain had overall through February.

"There's a spreading fear of what that might mean in November," said Jan Baran, a leading Republican election lawyer in Washington.

Groups aligned with both parties are mindful of the six-figure fines the Federal Election Commission slapped on Progress for America and America Coming Together for violating, during the 2004 cycle, the rules against helping specific candidates win elections. At the same time, analysts note that the FEC, because of a congressional fight over appointments to its six-member panel, is largely toothless with just two commissioners.

"You've got a completely emasculated FEC going into what's going to be a mega-year in terms of money," said Philip A. Musser, a Republican strategist in Washington.

The leaders of organizations planning major investments in the general election season say that they feel compelled to charge ahead despite not knowing the Democratic nominee. Even though Obama and Clinton would run different races in the fall, activists say, the stakes are too high to wait for clarity.

"It is really important for people to get active even now, and that's one of the reasons we wanted to get the Fund for America going," said Anna Burger, secretary-treasurer of the SEIU. "Waiting until the Democratic primary [ends] is too late."

Scott Helman can be reached at

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