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At Midnight Nov. 5, Reforms Take Effect
But Bans on Party Use of 'Soft Money' May Only Send It Elsewhere
 Listen to Peter Overby's report.
From left: Senators Russ Feingold (D-WI) and John McCain (R-AZ)
Photo courtesy U.S. Senate
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"In a display of unity against McCain-Feingold, both parties have already asked the Federal Election Commission for permission to raise and spend money under the old rules, for this year's recounts and run-offs."
NPR's Peter Overby
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McCain-Feingold timeline -- and some methods to circumvent the law
• Nov. 6, 2002
Soft money ban -- The national party committees can no longer raise soft money -- the unlimited contributions from corporations, unions and the rich. Soft-money contributions for the 2002 races are expected to hit the half-billion-dollar mark. Activists have formed shadow committees outside the party structures, and, they hope, outside the reach of McCain-Feingold. Interest groups also hope to benefit as some soft money donors look for new outlets. This kind of soft money will face fewer disclosure requirements than old party-committee soft money.
• Nov. 6, 2002
Limits on TV and radio "electioneering" ads -- Advocacy groups can no longer use corporate or union money to run ads targeting specific candidates within 60 days of an election, or 30 days of a primary. Other donors of $1,000 or more must be disclosed. But the law still permits "electioneering" ads financed with individual contributions or with limited contributions from political action committees. It also permits the use of corporate and union funds for direct mail, phone-banking, get-out-the-vote and other "ground war" efforts.
• Jan. 1, 2003
Raising individual contribution limits -- Individuals will able to give a candidate $2,000 per election, up from $1,000. Limits on individuals' contributions to party committees, and on their total dollars given per cycle, are also raised. This is is likely to increase the clout of current $1,000 donors -- many of them can probably afford to double their contributions. A reelection committee for President Bush should prosper. In the 2000 primaries, running as a non-incumbent, he raised an astonishing $100 million using the $1,000 cap. Some analysts say that as a sitting president, he could now raise $250 million. That in turn could pressure the Democratic nominee to join him in opting out of public financing, which good government advocates have considered the linchpin of post-Watergate reforms.
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Nov. 5, 2002 -- The campaigns of 2002 appear to be the most lavishly financed congressional elections in U.S. history, says NPR's Peter Overby. But starting at midnight tonight, all of that is supposed to change: Tough provisions of a new campaign finance reform law take effect. The impact, says Overby, is anyone's guess.
The 2002 campaign "has been a nasty, snarling affair" replete with viciously negative attacks on TV, Overby says. "But tonight at 12:01, those kinds of stink bombs are supposed to get as scarce as Cinderella's carriage." That's because their funding is supposed to be cut off. The party committees pay for those ads with what's called soft money -- unregulated checks from corporations, well-off individuals, interest groups and labor unions.
The practice of raising and spending soft money began some 15 years ago, and it transformed national politics. Its hallmarks, says Overby, were "lavish galas where elected officials schmooze with rich donors -- and journalistic exposes linking big soft-money checks with special legislation and ambassadorial appointments." In this final election cycle, where they could do so, the parties raised roughly half a billion dollars in soft money.
Though McCain-Feingold takes effect tonight, critics say the law won't drive big money out of politics -- it will just unravel the political system as we know it. Attorney Cleta Mitchell, who is working on a lawsuit that challenges the law, says all that really will happen is that "political parties will be really chopped up, dismembered, and the money will flow to organizations that are essentially private political parties, private interest groups, splinter groups."
Mitchell and other lawyers in the case file their briefs Nov. 6, the day after the election. And on Dec. 4, a three-judge panel will hear the case, which is expected to reach the Supreme Court early in 2003.
Meanwhile, Overby says, "the rush is on to circumvent McCain-Feingold, by setting up new organizations just outside its reach.'' Paul Herrnson, a political scientist at the University of Maryland, contends that "the same people will be involved" that have been involved in soft money -- "but the focus of the action will shift perhaps, from the national committees to state party organizations and allied interest groups."
Herrnson says the Internal Revenue Service recently received registration statements from soft money committees for Senate Democrats, House Democrats, and Republican state leaders. And interest groups on the left and right are also jockeying to reap a windfall of soft money that can't any longer go to the party committees.
These moves won't go uncontested, says Don Simon, acting president of Common Cause, which was a driving force behind McCain-Feingold. "What we're seeing are efforts to break the law, and I think these efforts are, or are likely to be, illegal," Simon says. "And I think this is the moment when we need real law enforcement."
With so many close races on the Nov. 5 ballot, the prospects of recounts and court challenges loom especially large this year, says Overby -- and candidates and parties will need lots of money to wage those battles. Political scientist Paul Herrnson says that's not a problem. "With this runoff business, and the recounts... there's always money to be had. It's just got to be shifted from one organization or one account to another."
And maybe it won't even come to that, Overby says. "In a display of unity against McCain-Feingold, both parties have already asked the Federal Election Commission for permission to raise and spend money under the old rules, for this year's recounts and run-offs.''
Other Resources
• Common Cause
• Federal Election Commission
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