Six months ago, activist groups appeared poised to play a decisive role in the presidential race, much as notorious outside players such as Swift Boat Veterans for Truth had in 2004.

But a funny thing happened on the way to Election Day. So-called 527 groups, along with politically active nonprofits, are raising and spending far less than initially predicted. At least one liberal powerhouse has suspended plans for a major political ad campaign. And the two presumptive presidential nominees, Barack Obama and John McCain, have asked donors or campaign workers to give these groups the brush-off.

The latest signal that activist groups have fallen out of favor came on May 28, when Sens. Joe Lieberman, I/D-Conn., and Lindsey Graham, R-S.C., announced that they would be stepping aside from a pro-defense nonprofit dubbed Vets for Freedom. The group had just run two Internet ads attacking Obama for failing to support or even visit American troops in Iraq.

Under fire for his ties to lobbyists, McCain now has a policy that bars anyone with a title or position in his campaign from participating in a 527 group “or other independent entity” that delivers public messages supporting or opposing a presidential candidate. Due to those guidelines, the two senators and McCain boosters wrote in a letter [PDF] to Vets for Freedom, “we must request a leave from our positions” as honorary members of the group’s policy board of advisers.

Ironically, Vets for Freedom is hardly on a par with some of the big labor- or casino-backed organizations that could influence the race. The grassroots group spent a mere $4,000 on its Internet ads, and even those were funded by its modest political action committee, which is fully regulated. Still, appearances are everything these days. Vets for Freedom chairman Pete Hegseth acknowledged that donors have gotten skittish.

“I think there’s some hesitation, both because of the signals that the campaigns have sent, and also because of the fear of litigation,” Hegseth said. “They want to be very careful that nobody drags them through the mud.”

Of course, 527 and tax-exempt groups could still surge. Though 527 organizations netted only $76.9 million last year, according to the Campaign Finance Institute, compared with $424 million in the 2004 election cycle, such organizations do tend to raise most of their money late in the race. In the previous presidential election, moreover, deep-pocketed groups such as the Swift Boat veterans didn’t surface until the campaign’s final stages.

“They can form quickly, have a big impact, and may often wait until the 11th hour to get active,” said Sheila Krumholz, executive director of the nonpartisan Center for Responsive Politics.

Still, several factors may be lessening the appeal of controversial outside groups. Fines levied by the FEC against several 527 groups after the last election may be making organizers more cautious. Some liberal mega-donors who underwrote 527s in the 2004 race may still be smarting that their efforts didn’t win them the White House. And negative signals from Obama and McCain may also be playing a role.

Candidate criticism “potentially is going to have its most effective impact on donors, as opposed to political operatives,” noted Fred Wertheimer, president of the pro-reform advocacy group Democracy 21. “That’s the place to watch.”

One group that appears to be responding to its candidate’s disapproval is Progressive Media USA, a liberal 501(c)4 group headed by journalist David Brock. In early April, media reports circulated that the group was gearing up for a $40 million anti-McCain media blitz. But after the Obama campaign asked donors to stay away from activist groups, Progressive Media USA abruptly announced that the ad campaign was off.

Brock declined to be interviewed, but said in a terse statement that “we have announced that we are not running an advertising campaign” but will continue to promote progressive causes.

The heft of two other leading activist groups, the liberal Fund for America, a 527 group, and the conservative nonprofit Freedom’s Watch, may also have been overblown.

Freedom’s Watch was once heralded as the conservative answer to MoveOn.org, and reportedly entered this election with at least $200 million to burn. Freedom’s Watch has spent some $30 million on ads and other projects, but has struggled with leadership turnover and lately has kept a low profile. The group also faces an IRS complaint from the Democratic Congressional Campaign Committee, which alleges that Freedom’s Watch should be registered as a political committee and not a nonprofit.

The complaint is “bogus and without merit,” said Freedom’s Watch spokesman Ed Patru. He added: “We have been primarily focused on issues and haven’t delved much into politics.”

The Fund for America, which primarily doles out money to like-minded liberal groups, has raised more than $11 million since the start of this election cycle, IRS records show. It’s a substantial sum, but still a far cry from the $100 million to $200 million that early reports suggested the group would spend. Activist organizations may still have nasty surprises in store. So far, however, their bark appears worse than their bite.