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Legacy Content / RULES OF THE GAME

Independent 527 Groups Yet To Justify Buzz

Republicans Have High Hopes For A Bevy Of New Advocacy Groups, But History Is Not On Their Side

May 10, 2010

There's been quite a buzz lately over a GOP fundraising blitz that could pull tens of millions into conservative advocacy and so-called 527 groups this year.

"This is the first cycle that I've seen where there is at least the potential for Republicans to build on the model that the Democrats have done so well," declared GOP lawyer and organizer Steven J. Law at a political law conference organized last week by the Bureau of National Affairs.

The president of American Crossroads, a new GOP-friendly 527 group that has set out to collect some $60 million for the 2010 election, Law predicted "an increasing role for these third-party groups" in the coming election.


It's not the first time that a GOP-backed group has billed itself as the Republican answer to

Law and a coterie of veteran GOP operatives, including former Republican National Committee Chairman Ed Gillespie, are raising big money for a new crop of conservative advocacy and 527 groups, National Journal recently reported.

These groups could sweep up cash from corporations that face fewer restrictions under the Supreme Court's Citizens United v. Federal Election Commission ruling. American Crossroads and its allies also offer an alternative to GOP donors fed up with the embattled RNC and its controversial chairman, Michael Steele.

But for all the excitement among GOP organizers energized by the prospect of big gains in 2010, Republican fundraisers are embarking on a risky experiment. The post-Citizens United fundraising landscape remains uncertain, and well-organized Democrat-friendly groups, particularly labor unions, may be its biggest beneficiaries. Historically, moreover, GOP 527 groups have struggled to match their liberal counterparts.

Whether they lean right or left, it's not clear that the Citizens United ruling will even affect non-party political groups all that much. After all, such groups were free to spend millions on little-regulated issue advocacy even before the ruling, much of it in the form of thinly-veiled campaign ads.

The impact of Citizens United "will be more qualitative than quantitative," acknowledged Law at the BNA conference. "It will simply allow for a somewhat sharpened message. But the players are not likely to change dramatically, nor is the amount of money involved."

It's also not clear whether 527 groups, which made a big splash in the 2004 presidential race but which have since spent far less, are much of a political silver bullet. Democrat-friendly 527 groups spent close to $400 million in 2004, funded by big donors such as financier George Soros and led by such aggressive players as America Coming Together, the Media Fund and the Voter Fund.

But Democratic nominee John Kerry lost the election anyway, souring some liberal donors on the 527 model. Said one Democratic political consultant: "Big donors woke up the day after the election and said, 'What do we have to show for our money?' And the fact was, it wasn't a lot."

The FEC went on to fine several 527s, including the top liberal groups and the pro-Bush Swift Boat Veterans and POWs for Truth. Since then a string of Democrat-friendly 527 groups have disbanded, including America Coming Together and the Media Fund. And no longer operates a 527, instead running a 501(c)4 advocacy group and a political action committee. In 2008, President Obama explicitly asked donors to stay away from such groups, helping prompt one progressive 527, the Fund for America, to close its doors.

"Oftentimes the bluster and the flash and sizzle of attack ads gets overblown as compared to the value of direct voter contact," said Greg Speed, executive director of America Votes, one of the few pro-Democrat 527 groups still around from 2004. America Votes, which coordinates national and local progressive groups, has always stressed field operations and door-to-door contacts over big ad buys, Speed said.

It's also not the first time that a GOP-backed group has billed itself as the Republican answer to Examples include Americans for a Better Country, which GOP political operatives launched in 2003 with pledges to outspend liberal 527s, but which later fizzled. At bottom, issue-based groups with members and track records do better raising cash than election-specific partisan groups, some Democrats argue.

"The right is looking at this as large, multimillion-dollar, corporate-funded expenditures," said Speed. "The response on the progressive side is legions of organizations that work at the grassroots, year in and year out, on issues, on elections, et cetera."

To be sure, Republican-friendly 527 groups have stepped up their fundraising firepower in the last couple of years. In 2008, the five top-grossing 527 groups included only one pro-GOP organization, according to the Center for Responsive Politics.

This year, three conservative groups are among the top five. And the top-grossing group by far in 2010 is Newt Gingrich's American Solutions for Winning the Future, which has collected $17 million. That's well more than twice the $6.4 million collected by the second-ranking 527 group, the Service Employees International Union.

As for the much-talked-about American Crossroads, the group reported $250,000 in receipts to the Internal Revenue Service in March, its most recent filing. It's a start. But it remains to be seen whether this time, GOP 527 groups will live up to their hype.

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