of 527 Groups Provokes Debate
By Benjamin Dangl
In many ways, this election year has served as the testing
ground for a newly popular political phenomenon: so-called 527 committees.
Named after the tax code they fall under, "527s" operate as shadow
political campaigns working indirectly for or against a particular candidate.
They coordinate voter outreach and education, ad campaigns, and fundraising
efforts. Leading 527s include the anti-Bush organizations Media Fund, America
Coming Together, and anti-Kerry groups like Swift Boat Veterans For Truth
and the Progress for America Voter Fund.
Their position is as precarious as it is effective.
Prominent think tanks and campaign finance reform lobbyists say 527s are "illegal
loopholes" that enable the privatization of political campaigns.
Spokespeople for 527s describe their organizations as
harnessing political enthusiasm for this year's election through canvassing,
registering people to vote and persuading more citizens to get involved in
the political process.
The popularity of such groups is an ironic byproduct
of the 2002 McCain-Feingold campaign finance law. Mark Glaze, Director of
the Government Ethics Program at The Campaign Legal Center in Washington,
DC, explained, "The point of the McCain-Feingold court decision was to
get corporations, labor unions and large donors out of campaigns."
Glaze said now that such entities can no longer give
to political parties, they give to 527s instead, since 527s can accept unlimited
amounts of money as long as they do not coordinate their efforts directly
with any particular campaign.
For instance, America Coming Together reaches out to
undecided voters in a canvassing campaign focused on criticizing the Bush
administration's policies in health care, education and the economy. Meanwhile,
through television ads, the Swift Boat Veterans for Truth attack the way John
Kerry has portrayed his service in Vietnam.
Glaze believes 527s are illegal. "Under federal
election law, any organization that has a purpose of influencing elections
is also a political committee," he said. "We've asked the Federal
Election Committee [FEC] to rule on this and they won't." Glaze believes
527s should register with the FEC as political committees and submit themselves
to the same regulations. "America Coming Together, the Swift Boat Veterans
-- if you look at what they are doing, their prime motive is to influence
a federal election."
As political committees, those groups currently classified
as 527s would have to "disclose all donors, amounts and addresses of
donors to the FEC," Glaze adds. "They would also be subjected to
If the 527s were to register as political committees,
they would be forbidden from accepting contributions from corporations and
unions. Additionally, they could only accept up to $5,000 per year from any
one individual and they would have to disclose information about how they
spend their money.
Instead, 527s enjoy remarkable freedom, and the FEC
does not plan to take action on this issue of 527s until after the elections
in November, Glaze said.
Not surprisingly, the 527s dismiss critics like Glaze.
"They don't understand the law or they are misleading," said Sarah
Leonard, a spokeswoman for America Coming Together, in response to accusations
that her organization's actions are illegal. "[America Coming Together]
has always and will always follow the letter of the law."
Many 527s see themselves as grassroots organizations
that offer a way for interested citizens to participate in this year's campaign.
They say they do not perceive their existence as the product of a loophole
in campaign finance law meant to eliminate precisely the role they serve.
In response to suggestions that America Coming Together
and other 527s should register as a political committee and submit to regulation
by the FEC, Leonard said, "They're entitled to their opinion, but the
president and Congress passed a campaign reform bill that allows America Coming
Together and other organizations to participate in the political process in
the manner that we are."
The groundswell of interest in this year's election
has empowered 527s with thousands of volunteers and paid staff. In an effort
to sway voters away from Bush, America Coming Together has mobilized canvassers
to knock on doors in swing states across the country. Through their outreach
efforts, the group has pledged to contact more than seventeen million swing
voters by Election Day 2004.
"We have thousands of people in fifteen states
asking people to take this election seriously," Leonard explained. "The
goal is to increase voter participation in this election. Hundreds of thousands
of voters have been registered so far. In some states, America Coming Together
encourages neighbor-to-neighbor interaction and there are some organizational
meetings on the local level. The goal of the meetings is to organize the neighborhood
to help elect progressive candidates in all levels of government."
Craig Holman, the legislative representative of the
Washington, DC-based think tank, Public Citizen, said the image of 527s as
grassroots phenomena is outdated. "That image of a 527 only applies to
MoveOn, which was started up by funding from Peter Lewis and George Soros,
but now relies heavily on small, individual donations."
Through MoveOn, advocacy groups are developed around
such issues as the environment, media consolidation and war. MoveOn then helps
facilitate meetings, letter-to-the-editor campaigns, petitions and marches
around the specific issues. Claiming a network of over 2,000,000 online activists,
MoveOn has helped register tens of thousands of new voters.
Other 527s, including America Votes and the New Democrat
Network have been reaching out to youth and Hispanic voters, in an effort
to bring them more directly into the political process. EMILY's List mobilizes
young women voters to help elect progressive candidates. The group also recruits
and funds women candidates and helps them run an effective campaign.
Holman says that 527s like America Coming Together,
the Media Fund and the Swift Boat Veterans for Truth are not grassroots organizations
because they are all "relying heavily on money from rich individuals,
corporations and unions."
By operating outside the regulations of campaign finance
reform and allowing wealthy individuals, corporations and unions to donate
large amounts of money, Holman believes the 527s are subverting the democratic
"We turn into a system where we select representatives
and president based on money," he said. "The wealthy individuals
and organizations choose who gets elected. It's not a system based on one
person, one vote."
But according to Leonard, her group, America Coming
Together, is a grassroots organization. She said more that $80 million has
been donated "by more than 100,000 contributors at all levels, from five
dollars on up."
According to the non-partisan Center for Responsive
Politics, which based its analysis on records released by the IRS, funding
for America Coming Together has also come from international financier George
Soros, who donated $5 million, and from the Joint Victory Campaign, to the
tune of $13 million. The Joint Victory Campaign acts in part as a fundraising
tool for America Coming Together and the Media Fund, which runs anti-Bush
ads in swing states. The IRS reported that the Joint Victory Campaign has
received nearly $8 million from Peter Lewis, Chair of the Progressive Corp.,
an automobile insurance company, and $4.5 million from George Soros.
Mike Russell, a spokesman for the Swift Boat Veterans
for Truth, said his group relies heavily on small donors as well. "The
Swift Boat Veterans have received $6.7 million, much of it from individual
contributions," he said. "We're made up of citizens and supported
by citizens around the country."
According to a report filed with the Federal Elections
Commission disclosing the funding sources for $1.9 million of the group's
money, the largest contribution to the Swift Boat Veterans was made by Boone
Pickens, the founder of Mesa Petroleum, the largest independently run gas
and oil producer in the US. He donated $500,000. Aubry McClendon, also in
the oil industry, contributed $250,000. The majority of donations listed in
the disclosure were $1,000 or more.
Another criticism of 527s is that they are collaborating
directly with candidates' campaigns. Though it is very difficult to prove
that an organization is illegally coordinating its efforts with the official
organizers of a political campaign, there are some very close ties between
both Bush and Kerry's campaigns and key 527s.
Perhaps the most infamous example of such relationships
is the connection between the Swift Boat Veterans for Truth and the Bush campaign.
Benjamin Ginsberg, who worked as outside counsel for the Bush campaign and
the Swift Boat Veterans resigned amidst controversy and accusations that the
Swift Boat Veterans were coordinating with the Bush campaign.
According to Russell, "Ginsberg chose to step down
from the Bush campaign because he didn't want this to be a distraction for
the Bush campaign." Ginsberg continues to work for the Swift Boat Veterans.
News organizations and critics of the Kerry campaign
have been quick to point out ties between 527s and the Democratic ticket as
well. For instance, Harold Ickes, a previous Clinton aide and member of the
Democratic National Committee, runs the Media Fund.
During the height of the Swift Boat controversy, Bush,
while refusing to condemn the specific actions of the Veterans working on
his behalf, called for a cessation of 527 activities. But for reform activists
like Holman of Public Citizen, Bush's condemnations rang hollow. "The
majority of 527s are pro-Democratic party," he said. "If they were
pro-Republican, you wouldn't hear them complain."
for more articles by Dangl
© 2004 The
to go home