GOP Allies Play Catch-Up on 527s

Posted May 14, 2004 at 6:36pm

Top Republican campaign officials will begin meeting today to lay the groundwork to raise and spend $50 million or more on a soft-money advertising and get-out-the-vote blitz in support of President Bush and other Republican candidates, according to strategists involved in the efforts.

Republican activists Craig Shirley, Frank Donatelli and George Terwilliger will meet today to determine the best way for the GOP to run a shadow campaign countering the well-oiled effort that Democrats began last year.

“If we do our job right, we are going to Hoover up every Republican dollar between now and November,” said Shirley, the founder of Americans for a Better Country, a 527 that has yet to begin raising money.

Other pro-Republican groups will begin discussions later this week. Ben Ginsberg, the national counsel to the Bush-Cheney campaign, will help advise the group or groups.

It remains to be seen whether Republicans will form a new 527 designed to be the main conduit for these donations or simply convert a pre-existing group, but those discussions are under way, according to knowledgeable Republican sources.

The two major Republicans 527s — Leadership Forum and ABC — have done little to no fundraising so far this cycle.

A third entity, Progress for America, was formed in 2001 and touted by Republican operatives as the preferred recipient of soft-money donations.

It is, however, a 501(c)(4) membership committee which severely restricts the amount of direct advocacy it can do for specific candidates.

Brian McCabe, the newly installed president of PFA, said there have been “no discussions” about converting the group into a 527, which would allow it to more directly advocate for the election or defeat of federal candidates.

GOPers admit privately they are well behind Democrats structurally and unlikely to reap significant soft-money checks from the same U.S. businesses that have been their most loyal source of campaign cash in years past.

The decision “does not change a thing for us,” said one Republican lobbyist. “The FEC’s postponement is irrelevant,” added another corporate lobbyist. “Businesses remain very reluctant to contribute to independent expenditure committees.”

What’s more, several corporate lobbyists said their Washington offices eliminated their budgets for soft money after Congress banned soft-dollar checks to the national political parties.

Instead, the groups hope to steal a page from the Democratic playbook by cultivating a new class of wealthy individuals who can bankroll their electoral efforts.

“As a result of the FEC’s decision yesterday, Republicans would be well served by finding their own George Soros,” said Republican lobbyist Dan Mattoon, referring to a pledge by Soros, a billionaire financier, to contribute $10 million to Democratic causes.

Several other well-connected Republicans noted that without a wealthy “sugar daddy” or two to provide seed money, these organizations may still struggle to raise the necessary funds.

But efforts to find individuals willing to bankroll these groups may be hamstrung by an aggressive public relations campaign led by Republican National Committee Chairman Ed Gillespie and other GOP leaders aimed at spooking potential donors.

“The problem is that Republican lawyers have done such a good job at scaring the donor base and are they going to do as good a job about telling them they were wrong,” said one knowledgeable Republican strategist.

Shortly after the FEC decision, several top Republican officials changed their tune about the role 527s can and will play this cycle.

House Speaker Dennis Hastert (Ill.), National Republican Congressional Committee Tom Reynolds (N.Y.) and Rep. Christopher Shays (Conn.), the leading Republican proponent of campaign finance reform, issued a letter Friday subtly endorsing the creation of GOP soft-money organizations.

“Because of the FEC’s ruling it would not be surprising if new 527 groups emerged to counteract the one-sided onslaught from the current 527 groups,” the Members wrote.

The Leadership Forum, a group run by ex- Rep. Bill Paxon (R-N.Y.) and Susan Hirschmann, raised roughly $100,000 in the first three months of 2004 after bringing in $235,000 in 2003. Americans for a Better Country raised no money as of March 31, according to filings with the Internal Revenue Service.

The most active conservative-aligned 527 to this point has been the Club for Growth, which has raised $9 million already and could double that total now that the FEC has made it clear that such 527 organizations are legal.

“We have been having problems with donors who were reluctant to give because they didn’t know if this was possible or permissible,” said David Keating with the Club for Growth. “The decision definitely helps us because it clears the way.”

The relative lack of success on the Republican side stands in stark contrast to the universe of pro-Democratic 527s groups — known collectively as the “shadow Democratic Party” — that has collected millions of dollars to bolster the efforts of Sen. John Kerry (Mass.), the party’s presumptive presidential nominee.

Republicans expressed confidence that in spite of their late start they would have little trouble raising the necessary money.

“On our side the donors had really been chilled,” said McCabe. “Across the board whether it was a 501(c)(4) or 527 people were in ‘wait and see’ mode.”

“Now it’s all guns going,” McCabe added.

According to PFA’s 2002 tax return, the most recent available, it reported revenue of $413,000.

“We have PFA all teed up,” said one informed GOP strategist. “All we have to do is get the money and press a button.”