The Wall Street Journal
Group's Ads Lauding Clinton Stir Discord Over Rules
By BRODY MULLINS and T.W. FARNAM
February 25, 2008; Page A4
A fight over political spending by outside groups flared up over the weekend when backers of Democratic presidential candidate Sen. Barack Obama sought to shut down a round of television advertisements launched by supporters of rival Sen. Hillary Clinton. Supporters of Mr. Obama mailed a complaint to the Federal Election Commission charging that the organization funding the advertisements lauding Mrs. Clinton is violating election law. At issue: The complicated rules for spending by outside political organizations on elections -- and an effort by one such group to spend millions on advertisements that praise Mrs. Clinton before primaries next week in Texas and Ohio.
Subodh Chandra, a lawyer in Ohio and a backer of Mr. Obama, says the new organization allows Mrs. Clinton's backers to "cheat the system" by paying for their own ads for Mrs. Clinton even through they have already donated the maximum $2,300 allowed by law to her campaign. Karen Getman, an attorney for the pro-Clinton group, the American Leadership Project, says the organization complies with the law and accused Mr. Obama's supporters of using "over-the-top threats" to scare off potential donors. The claim had "no factual basis," said Ms. Getman, an attorney with Remcho, Johansen & Purcell LLP.
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It is unlikely the Obama supporters will get what they want from the complaint anytime soon. It took three years for the FEC to settle similar complaints lodged against independent political entities operating in the 2004 election. There is also no evidence in the complaint that the pro-Clinton organization is breaking the law. And the rules themselves are unclear and evolving. Even people who have studied the campaign-finance law for years disagree about what exactly the rules say and how the FEC will interpret the law in the 2008 campaign.
The debate centers on federal rules for political activity by so-called 527 organizations. Such political groups, named for a section of the tax code, are a popular legal structure for political spending in part because donations aren't limited. Unlike traditional campaign entities, 527 organizations can raise and spend millions of dollars in unlimited donations as long as they don't coordinate their activities with candidates and meet two general conditions: They can't run ads directly calling for the election or defeat of candidate. And they can't solicit large donations with the purpose of campaigning for or against a specific candidate. To comply with the law, many 527s run ads in support of candidates that are disguised as campaigns to promote issues, rather than candidates. For example, a television spot produced by the pro-Clinton organization doesn't call on people to vote for Mrs. Clinton. Instead, it praises Mrs. Clinton's work on economic issues and asks voters to "tell Hillary to keep working on those solutions for the middle class."
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However, the printed materials the founders of the organization send to prospective contributors don't mention Mrs. Clinton. A fund-raising pitch reviewed by The Wall Street Journal say the purpose of the group is to "raise issues that may influence voters in the 2008 presidential election." Jason Kinney, the chairman of the organization said: "No officer or agent of this committee has ever said or implied to any prospective donor that we intend to support any candidate's candidacy or influence the outcome of any election because we don't."
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http://online.wsj.com/article/SB120380878248188549.html (subscription)
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