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An Orgy Of Soft Money And Business Is Paying For The Party


Washington Outlook

An Orgy of Soft Money--and Business Is Paying for the Party

A year ago, Time Warner Inc. CEO Gerald M. Levin became the most prominent member of a growing band of corporate refuseniks denouncing soft-money contributions to political parties. Campaign-finance reformers, buoyed by Levin's act of corner-office courage, saw it as a sign that Big Business might be shutting off the soft-money spigot.

Fat chance. In the intervening months, a gusher of unlimited donations has poured forth from companies, labor unions, and individuals. The Federal Election Commission on June 5 added it all up: In the first 15 months of the 2000 election cycle, the Republican and Democratic Parties raised a record-shattering $163 million, a 94% increase from the scandal-tainted '96 campaign. And the biggest contributions are still to come. "It'll continue to lurch out of control," predicts Senator John McCain (R-Ariz.), who made a soft-money ban the centerpiece of his failed 2000 Presidential bid.

Four years after the aggressive pursuit of soft money led to a lengthy Justice Dept. probe and 25 prosecutions of fund-raisers and donors, the techniques mastered by the Clinton-Gore campaign of 1996 have become the model--and not a scandal-tinged aberration.

Where's the cash coming from? For Democrats, there has been a boom in backing from white-collar unions such as the American Federation of State, County & Municipal Employees, the Communications Workers of America, the Service Employees International Union, and the two teachers' unions. In 15 months, those five have more than tripled, from $2.6 million to $9.7 million, their '96 investment, according to Common Cause. On the GOP side, top soft-money donors include AT&T, American Financial Group, Amway, and Freddie Mac. Microsoft and its top execs have donated more than $1.1 million, reports the Center for Responsive Politics, nearly evenly divided between the two parties and up from just $77,995 four years ago.

CEOs privately say panic-stricken Capitol Hill Republicans--fearful that they could lose control of the House, and maybe even the Senate--are pressuring them to open their checkbooks. While the GOP's tactics have paid off to the tune of $86 million thus far, congressional Democrats aren't slackers. The Democratic Congressional Campaign Committee's soft-money take has jumped from $3.4 million in the first 15 months of the '96 election cycle to $21.9 million this year--more than a sixfold increase. Senate Democrats raised $16.5 million in soft money, nearly 12 times as much as they did in '96. And an additional $40 million has gone directly to the Democratic National Committee."JUST SAY NO." While the parties are ecstatic about their record haul, Corporate America feels shaken down. Charles Kolb, president of the Committee for Economic Development, a pro-reform business group, says many donors fear legislative retribution. "It's important to take Nancy Reagan's advice," he says, "and just say no."

A bipartisan poll to be released on June 8 finds that 68% of donors worry that the negative campaigning they are funding "undermines democracy." And 71% of donors to business political action committees think campaign ethics have gotten worse over the past 20 years.

On June 7, McCain and Senator Russell D. Feingold (D-Wis.) were set to press forward with efforts to force a floor vote on their controversial measure to ban soft money. But even they acknowledge that they don't have the 60 votes to shut down a threatened Republican filibuster. Sighs McCain: "I think it may require another election cycle [to get it passed]."

Meanwhile, the soft-money flood will continue unabated, even when corporate execs try to turn it off. Since Levin issued his edict, Time Warner agreed to merge with America Online Inc., which has given $333,075 in soft money this cycle. When it comes to soft money, it seems, the more things change, the more they stay the same.By Richard S. Dunham, with Lorraine Woellert; Edited by Paula DwyerReturn to top


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