FEC Looks Into Regulating 527s-Campaign Finance Reform Thread

The Federal Election Commission last week issued an advisory opinion that said any ads which promote, support or attack a specific candidate must be paid for with hard money. The move could threaten the ability of political interest groups known as 527s to use soft money to campaign against President Bush.

The opinion is not a law, but the FEC is expected to issue a formal rule-making on the issue by mid-May.

The opinion is the first-step in determining how 527s--co-called because of their tax standing with the IRS--can raise and spend money under McCain-Feingold. Laws regulating soft money would limit contributions to such groups from individuals and political action committees to $5,000 per year.

Groups such as MoveOn.org, America Coming Together and the Media Fund are expected to play a prominent role in the election. Philanthropist George Soros has contributed several million dollars to both ACT and MoveOn. If the FEC rules in May that these groups must adhere to campaign finance limits, it would prevent a single person like Soros from contributing millions to one group.

Meanwhile, the Media Fund has been talking to shops such as Berlin Cameron/Red Cell in New York, Goodby, Silverstein & Partners in San Francisco and Wieden + Kennedy in Portland, Ore., about preparing issues ads aimed at defeating Bush in November, sources said. It is believed some agencies, including Goodby, met last week with Media Fund officials. A Wieden rep said the agency did not make presentations and has chosen "not to participate."

Media Fund rep Jim Jordan said his group planned to announce its ad "team" this week. As for the FEC, Jordan said, "There is certainly a chance the rules we are operating under may change this spring, but that doesn't affect our planning."

And more
527s: Clear as mud
Confusion reigns in wake of FEC soft money ruling
By Alexander Bolton
http://www.hillnews.com/news/022404/527s.aspx

Potential donors and fundraisers have been thrown into confusion by last week’s opinion from the Federal Election Commission on how to treat newly active advocacy groups.

The uncertainty among both Republicans and Democrats comes as a network of liberal groups is preparing to launch a multimillion-dollar advertising campaign to compete with a nearly $100 million funding advantage held by President Bush over Sen. John Kerry (Mass.), the presumptive Democratic nominee. The groups in question are known as 527s, after a section of the Internal Revenue Code that governs them.

Nevertheless, a consensus seems to be emerging among both Republican and Democratic election lawyers to the effect that the ruling will restrict one of the largest and most successful liberal 527s: Americans Coming Together. The group had raised nearly $13 million by Dec. 31.

On the other hand, several other major liberal soft-money groups, such as the Media Fund, with a projected budget of $95 million this year, and the MoveOn.org Voter Fund, will not be similarly affected.

The Media Fund, headed by former Clinton adviser Harold Ickes, has been a major disappointment, say Democratic strategists, because it had raised only $3 million in soft money through the end of last year, despite a goal of $95 million.

Some Democrats blame the shortfall on fears that GOP operatives have sown in the minds of donors as to the legality of such contributions in the face of the McCain-Feingold campaign finance law that severely restricts soft money.

“We all hoped that our large Democratic donors would immediately turn their soft dollars to these 527s the way the other side has always been able to fund auxiliary projects,” said Wayne Marshall, a Democratic consultant and fundraiser who formerly served as the deputy finance director of the Democratic National Committee.

But to Democrats’ chagrin, “some wealthy people are skeptical. Nobody wants to get slapped with an [Federal Election Commission] investigation,” Marshall added. “The Republican machine has been very good at throwing those doubts in the media and keeping them out there.”

Even Wall Street securities analysts are scrambling to project how the FEC’s opinion will affect the bottom lines of television and radio stations that were expected to collect nearly $1 billion in political ad money during the current election cycle.

“There’s complete confusion on Wall Street over what it means and how it will affect the broadcasters,” said Hooper Stevens, a media and broadcast securities analyst for Bank of America.

Immediately after the commission handed down its opinion last week, Ed Gillespie, the chairman of the Republican National Committee, asserted: “Today’s ruling effectively shuts down illicit 527 groups that operate in the shadows by using unregulated soft money to influence federal elections.”

As a result, “there was a lot of confusion in the media in reporting the decision,” said Joe Sandler, a Democratic election law attorney.

The Washington Post reported last Thursday that the FEC “decided yesterday that many of the political committees raising ‘soft’ money to campaign against President Bush are subject to regulation,” quoting Gillespie early in the story.

But Sandler said Gillespie mischaracterized the opinion.

“In general, there are a lot more 527s that don’t have federal accounts than do have federal accounts,” he noted.

Lawyers for both parties, as well as members of the FEC and campaign finance reform advocates, say the narrowly tailored opinion only affects 527 groups that raise a portion of their funds in the form of regulated “hard” money and are registered with the commission. These groups, such as Americans Coming Together, must pay for any ads that promote or attack a federal candidate with hard money.

Ads that mention federal and state candidates must be paid for with a mixture of hard and soft money that reflects the amount of time given to those candidates, a ruling that requires certain 527s to follow the commission’s complex spending allocation formulas.

One reason why the opinion caused wide confusion was its intended target: Americans for a Better Country, a GOP-allied group that requested the commission’s ruling on its proposed activities. As one election law expert said, the narrow request for guidance and opinion provided only one piece of the 527 puzzle.

“The truth is that the commission’s decision on this and discussion on this was not the paradigm of clarity,” said Ken Gross, a former commission official who is now an election lawyer for several for-profit corporations.

Gross said that was part of the reason that major media outlets “walked away with two very different takes [on the opinion].”

“We’re going to have some follow-up discussion with the FEC because I do have 527s implicated on both sides of the aisle,” he added.

Democrats charge that Americans for a Better Country (ABC) is a sham organization created by Republicans to legally undermine the liberal-leaning America Coming Together, which has a projected budget of close to $100 million.

As evidence, Democrats note that ABC asked the election commission about personnel it does not have and operations it is unlikely to carry out. The request for guidance did, however, almost exactly match the planned operations of the liberal group, leading Democrats to believe it was an attempt to force the commission to prohibit their activities before formal rules are set later this year.

Hugh & Series, Critical & Pulled by JimRob
Special to FreeRepublic | 17 December 2003 | John Armor (Congressman Billybob)

This is nothing like the usual whine by someone whose post was pulled. JimRob pulled my previous thread for a good reason. "If direct fund-raising were permitted on FR, it would soon be wall-to-wall fund-raising."

So, let's start again correctly. This is about civil disobedience to support the First Amendment and challenge the TERRIBLE CFR decision of the Supreme Court to uphold a terrible law passed by Congress and signed by President Bush.

All who are interested in an in-your-face challenge to the 30- and 60-day ad ban in the Campaign Finance "Reform" Act, please join in. The pattern is this: I'm looking for at least 1,000 people to help the effort. I will run the ad, and risk fines or jail time to make it work -- AND get national support.

But there should be NO mentions of money in this thread, and not in Freepmail either. This is JimRob's electronic home, and we should all abide his concerns.

Put your comments here. Click on the link above, and send me your e-mail addresses. I will get back to you by regular e-mail with the practical details.

This CAN be done. This SHOULD be done. But it MUST be done in accord with JimRob's guidelines.

Fair enough?
http://www.freerepublic.com/focus/f-news/1042394/posts

Update
I've already tested the idea of my in-your-face challenge ads, first in the print media and then deliberately illegal on TV, with certain editors I have a long relationship with. I could trust these two gentlemen, one in the print media and the other in the broadcast media, with a "heads up" on what I am planning. Both said they wanted to know, in advance, when I am about to do this.

The bottom line is clear. If I am willing to put my neck on the line, with the possibilities of a fine and jail time, THAT effort will put CFR back on the front page in all media. And that is part of the point. There's not much value of going in-your-face against the enemies of the First Amendment unless the press takes up the story and spreads the word. It is now clear they will do exactly that.

Update 2
QUICK PROGRESS REPORT, ANSWERING A SUPPORTER'S QUESTION:
We have about 15% of the needed 1,000 sign-ups.

Spread the word, direct folks to the front page link on my website.

Google-bomb the phrase "anti-CFR" directing readers to that page and link. (We're already #2 and #4 on Google.)

Target date is now August, since the NC primary looks to be put back to September. (Remember, the ad isn't illegal until the 29th day before the election.)

Cordially,

John / Billybob

Note if you are interested in more on this please contact Valin or Congressman Billybob

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