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April 6, 2006
A Step In The Right Direction

The House passed a bill slamming the lid on 527 advocacy groups of the kind that proliferated in the last presidential election and removed the limits for national parties to coordinate funds with specific candidates. The measure passed on a party-line vote, 218-209:

The House approved campaign finance legislation last night that would benefit Republicans by placing strict caps on contributions to nonprofit committees that spent heavily in the last election while removing limits on political parties' spending coordinated with candidates.

The bill passed 218 to 209 in a virtual party-line vote.

Lifting party spending limits would aid Republican candidates because the GOP has consistently raised far more money than the Democratic Party. Similarly, barring "527" committees from accepting large unregulated contributions known as "soft money" would disadvantage Democrats, whose candidates received a disproportionate share of the $424 million spent by nonprofit committees in 2003-2004.

The 527 committees, named for a section of the tax law, are tax-exempt organizations that use voter mobilization and issue-based ads to influence federal elections. They grew in importance after the 2002 McCain-Feingold campaign finance law barred federal candidates and national parties from accepting unlimited donations from individuals, unions and corporations.

Joe Gandelman at the Moderate Voice objects to this and calls it an example of why we need divided government (between the two parties):

So much for meaningful reform that tries to seriusly fix the system in general. Instead we get yet another demonstration about why one-party rule has proven to be a disaster in terms of authentic problem solving and biparitsan solutions.

I disagree with Joe on this issue. The eruption of 527s did not reform the system at all. Even Joe acknowledges that this offshoot of the BCRA allowed millions of dollars to pour into campaigns from single benefactors such as George Soros. It laughably treated this money as somehow more pure than that going to political parties, even though its use was at least as partisan as any given directly to Democrats. Even worse, it put that money in the hands of people who have no accountability in the political process and allowed the parties and candidates to wash their hands of the messages it produced.

It's this kind of mischief that occurs when people try to create artificial categories for cash and attempt to impose limits on its collection and usage. The 527s have mostly gone away in favor of other tax-exempt structures that do the same thing, so simply kneecapping the 527s would have had little effect on the corruption that the BCRA has created. The companion effort to remove the limits on party spending and collection are much more important for reversing this problem in the McCain-Feingold "reform". The parties can be held accountable for their messages and their positions, and the candidates will have no excuse to ignore the worst of the abuses in their advertising.

The only problem with this bill, as far as I can see, is that it doesn't go far enough. We need to ensure that all contributions go to organizations with built-in accountability for their message. If George Soros wants to buy his own advertising, or if he wants to fund an organization that wants to advertise, that's fine -- but it shouldn't be exempt from taxation. If we remove the artificial limits set on political campaigns over the past three decades and instead require immediate and full disclosure of all contributions, the money will naturally flow back to the candidates and the parties, where voters can impose their own sanctions for misbehavior and undue influence. This measure starts that process and should be expanded to undo all of the damage done by the BCRA on free speech and the Byzantine process of campaign funding it helped create.

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Posted by Ed Morrissey at April 6, 2006 7:02 AM

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Tracked on April 6, 2006 8:30 AM


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