GOP Groups Outpace Democrats in Chase for Unregulated Money

Posted August 25, 2010 at 1:12pm

For the first time in eight years, donors are pouring more unregulated money into GOP-affiliated groups known as 527s than their Democratic counterparts, according to the latest filings with the IRS.

These 527 groups have drawn increased attention and criticism over the years because they provide a loophole for individuals, unions, companies and other interests to indirectly help campaigns without having to adhere to contribution restrictions imposed on direct giving to candidates.

As of the end of July, contributors have doled out $113.5 million to Republican 527 organizations so far during the 2010 election cycle — outpacing the $77.5 million given to similar Democratic groups.

The giving reverses a pattern dating back four election cycles when Democratic 527s dominated Republican-based groups. Between 2001 and 2008, Democratic 527s received more than $653.6 million while Republican-based groups received less than $486.9 million, according to CQ MoneyLine.

But the 2010 election cycle is proving to be different, as Republican 527s have received almost 60 percent of funds doled out so far to partisan groups.

These increased donations have paid major dividends for the Republican Governors Association, which has collected $58.3 million so far this election cycle and eclipsed the $49.5 million it received in 2008. Democrats pounced on a $1 million donation to the RGA from News America Inc., the owner of Fox News.

The RGA is chaired by Mississippi Gov. Haley Barbour, a former head of the Republican National Committee and lobbyist who is a savvy political player and fundraiser.

Another conservative group, American Solutions for Winning the Future, led by former Speaker Newt Gingrich (R-Ga.), has collected $20.6 million this election cycle ­— the second most among Republican 527s.

In addition to increasing the bottom lines of longtime GOP 527s, new Republican groups such as American Crossroads are having a strong year.

American Crossroads, a conservative group linked to President George W. Bush strategist Karl Rove, has collected more than $6.7 million since it was created in March 2010.

Health care groups that opposed President Barack Obama’s health care reform plan also are opening their wallets to the Republican groups. The large health insurance company WellPoint Inc. is now the largest corporate donor to Republican organizations, giving more than $1.3 million so far this election cycle. The largest health plan company in the Blue Cross and Blue Shield Association has given $736,500 to the Republican State Leadership Committee and $600,000 to the Republican Governors Association.

Individuals making large donations to GOP-linked groups include Bob Perry, a Houston homebuilder who helped underwrite the Swift Boat Veterans for Truth, a group that attacked the military service of 2004 Democratic presidential nominee John Kerry. Perry, who gave $2 million to 527 groups, is a major donor to Republican causes.

B. Wayne Hughes, the founder of self-storage company Public Storage, contributed $1.5 million to Republican groups, while Trevor Rees-Jones, who is in the oil and gas business, contributed $1.5 million. David Koch, who is also in the oil and gas industry, gave $1 million to GOP groups as did Paul Singer, a New York-based hedge fund manager.

With the election just over two months away, things could rebound for some Democratic organizations, as some of the party’s major donors have not given as much as they have in the past.

The American Federation of State, County and Municipal Employees — a key donor to Democratic 527s — has only contributed $6.4 million so far this election cycle, which amounts to just 47 percent of what it contributed during the 2008 cycle. Similarly, the Service Employees International Union has contributed less than $3 million, which is only half of what it spent on Democratic 527s in the 2008 cycle.

One top Democratic donor, George Soros, has donated only $4,000 to 527s in the 2010 cycle after contributing nearly $30 million during the previous three election cycles.

The top individual donating to liberal groups is Tim Gill, who made his fortune in the computer software business and is active in gay causes. He gave $790,000. Jon Stryker, who is heir to a surgical equipment fortune and is also active in gay causes, gave $715,000.