Examiner Editorial: Campaign-finance fakery

Rep. Chris Van Hollen, D-Md., is chairman of the Democratic Congressional Campaign Committee. Lately, Van Hollen has been bemoaning the “shadowy organizations” (aka 527 groups) that he claims are skirting campaign-finance laws and unfairly targeting Democratic candidates nationwide with “an unlimited amount of unaccountable money.”

But when the Democrats’ top fundraiser complained recently to the Washington Times that Freedom’s Watch, one of those 527s, is just “the NRCC [National Republican Congressional Committee] in exile,” he left out the most important part of the story.

The nonpartisan Campaign Finance Institute at George Washington University reported that 527s aligned with Democrats raised $55 million in 2007, primarily from labor unions and trial lawyers. That’s almost three times as much as the $20 million raised by 527s aligned with Republican candidates. One of those Democrat 527s was MoveOn.org, which was originally funded by George Soros, who has donated some $5 billion in unaccountable money to a shadowy network of left-wing groups during the past decade.

The essential context here, of course, is John McCain-Russ Feingold campaign-finance reform, which was supposed to eliminate the corrupting power of money in federal elections by establishing strict limits on campaign contributions. But the growing clout of (mostly Democratic) tax-exempt 527s points to how ineffectual so-called campaign-finance reform has been in achieving its stated purpose. Such regulatory regimes are always doomed to failure, as the loophole users on the campaign trail are always a couple of steps ahead of the loophole closers in the bureaucracy. That fact is also why regulation tends over time to become more complicated and harsh.

On the other hand, McCain-Feingold has succeeded in limiting freedom of speech for individuals supporting traditional advocacy groups that are prohibited from either publicly supporting or calling for the defeat of any particular candidate 60 days prior to a general election.

Meanwhile, 527s can and do raise unlimited amounts of money to spend as they please — so long as they do not expressly advocate the election or defeat of a particular candidate or fund campaigns themselves. But voters never know who’s really behind these supposedly independent expenditures.

To his credit, Van Hollen voted against McCain-Feingold, but his party was first to move aggressively to take full advantage of the tax-code loophole that gave rise to 527. So it’s a tad hypocritical for Van Hollen to complain about a 527 that obliquely targets Democratic candidates without mentioning similar groups that are doing the same thing to Republicans, and doing so with three times more unaccountable cash.

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