Raising donation limit may undo law

March 25, 2002|By Jules Witcover

WASHINGTON -- Amid all the celebrating over enactment of the ban on unregulated "soft" money to the national political parties, a possible unintended consequence could deal campaign finance reform a body blow in presidential primary races.

The peril is in the accompanying provision in the new law raising the individual contribution in regulated "hard" money from the existing $1,000 to $2,000. The intent of this increase is to reduce the fund-raising burden on federal candidates. But it could have the practical effect of encouraging them to opt out voluntarily from the system in which the government pays their campaign expenses in return for accepting a ceiling on spending.

A candidate who turns down the federal subsidy is then free to raise and spend as much as he can. This strategy is exactly the one adopted in the 2000 primaries by then-candidate George W. Bush. With an unprecedentedly effective fund-raising effort, he easily out-raised and out-spent a host of other Republican presidential candidates, driving them out of the race and becoming the nominee.

Mr. Bush's campaign created the Pioneers, a club whose members helped raise an astonishing $100 million for the primaries in $1,000 contributions. The doubling of the contribution limit will be an added encouragement to the fund-raising practice of bundling, whereby one money-raiser gets a number of donors to give the limit and then hands the total over to the campaign for which he's working.

With the new individual contribution limit of $2,000 now scheduled to apply after this November's congressional elections, other 2004 presidential aspirants will be tempted to follow Mr. Bush's example. If so, the trade-off in the new law -- the soft-money ban in exchange for the higher individual giving limit -- could undo the existing means of capping spending in the presidential primaries.

Mr. Bush, who is expected to follow the same plan in 2004 with a much greater ability to raise money as the incumbent, was not the first candidate to shun the federal subsidy for the primaries. Self-financing multimillionaires Ross Perot in 1992 and 1996 and Steve Forbes in 1996 and 2000 did the same, but money couldn't overcome their flaws as candidates.

In 1980, former Democratic Gov. John B. Connally of Texas, by this time a Republican, was the first prominent presidential candidate to eschew the federal subsidy. He raised $12 million in the primaries and got only a single convention delegate for his trouble.

The federal subsidy comes from the $3 check-off that citizens mark on their annual income tax returns. But that fund itself was imperiled in the 2000 election by lack of public participation, confronting the candidates with early shortfalls that further undercut their chances to compete with the flush Bush primary candidacy. In 2004, if there's a question about how much taxpayer money will be available to them, that fact could persuade other candidates to skip the subsidy, resulting in more money raised and spent than ever in the primaries.

In 2000, Mr. Bush's phenomenal fund-raising caused some other Republican candidates to consider foregoing the federal money for which they were eligible up to $40 million, but in the end they took it and were overwhelmed by his dollars.

With Mr. Bush likely to be unopposed for re-election in 2004, the Democrats particularly may find it attractive to raise more on their own than they can get from Uncle Sam in exchange for limiting their spending. The new law banning soft money to the national parties means the eventual Democratic nominee, if he has taken the federal money, won't be able to count on his party to help him after competitive primaries have dried up what he has.

Such a development could deal a death blow to public financing, which many campaign finance reformers believe is the only real way to drive special interest money out of presidential politics. It is at the core of the reforms enacted 28 years ago as an aftermath of the Watergate scandals that helped lay bare the corruptive influence of money in politics.

It would be the greatest of ironies if one of the campaign finance reforms of 2002, included in the bill to pick up a few more votes, were in the end to mean the demise of the limited public financing that was the heart of the 1974 legislation.

Jules Witcover writes from The Sun's Washington bureau.

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