STERLING, COLO. — Unions, corporations and wealthy individuals have pumped nearly $300 million this year into unregulated political groups, funding dozens of aggressive and sometimes shadowy campaigns independent of party machines.
The groups, both liberal and conservative, air TV and radio spots, conduct polls, run phone banks, canvass door-to-door and stage get-out-the-vote rallies, with no oversight by the Federal Election Commission. Set up as tax-exempt "issue advocacy" committees, they cannot explicitly endorse candidates. But they can do everything short of telling voters how to mark their ballots.
Because they can accept unlimited donations from any source, the committees -- known as 527s -- have emerged as the favored vehicle for millionaires and interest groups seeking to set the political agenda.
"It's become the new way to do business in politics," said Pete Maysmith, a national director of Common Cause, a nonprofit that lobbies for more transparency in campaign finance.
Named for a section of the IRS code, 527s have been around for years but became a political force in 2004 after the Bipartisan Campaign Reform Act of 2002 -- also known as the McCain--Feingold Bill -- limited donations to political parties. Groups such as Swift Boat Veterans for Truth on the right and America Coming Together on the left contributed $600 million that year, with a heavy focus on the presidential race.
The cash flow is lower this year because it's a midterm campaign, but 527s and a related type of organization known as 501(c)s have expanded their reach. With the Nov. 7 election days away, the groups are flooding the airwaves in state and local races as well as congressional contests.
By far the largest chunk of unregulated money -- nearly $60 million -- comes straight out of union treasuries and is used mostly to benefit Democratic candidates and causes. Conservatives are fighting back with multimillion-dollar donations from a California TV executive and the Texas developer who financed the Swift Boat ads.
In California, unregulated funds -- mostly donated by New York developer Howard S. Rich -- are bankrolling the campaign for Proposition 90, which would limit the government's ability to seize private property. In Missouri, such money paid for a celebrity-studded TV ad opposing a ballot initiative on stem-cell research.
