- The Washington Times - Wednesday, April 24, 2002

Democrats, facing the ban they supported on unregulated "soft" campaign money, have formed a fledgling "donor network" to take advantage of a loophole in the new law.
The Progressive Donor Network held its inaugural strategy meeting in Washington two weeks ago. Its president and co-founder is political consultant Michael Lux, who was a top fund-raising official for the 1996 Clinton-Gore campaign and served as an aide in the Clinton White House.
Mr. Lux told the conference that the network is designed as "a force to compete with right-wing money." But watchdogs say the group will be walking a fine line to avoid the new law's prohibitions against coordinating with the Democratic Party and individual candidates.
"People misunderstand what we're trying to do," Mr. Lux said in an interview. "We can talk to [candidates] about the issues we care about. I don't think anybody is trying to coordinate with candidates or parties."
Sen. John McCain, Arizona Republican and prime sponsor of the campaign finance law, said he wasn't aware of the network. But he added, "There's always unintended consequences" to new laws.
The Progressive Donor Network's strategy includes using groups who are viewed as "outside, nonparty messengers" to promote Democrats' agenda. Mr. Lux said those groups include the Sierra Club and the National Abortion and Reproductive Rights Action League (NARAL).
"The Democrats are doing what they can to make sure they're not at a disadvantage," said Larry Noble, executive director of the Center for Responsive Politics, which tracks money in politics.
Democrats have been more competitive at raising "soft" money donations to political parties that often are used to buy TV or radio advertisements that promote candidates indirectly.
The new law, which takes effect after the November elections, bans those donations and places more importance on "hard" money contributions to individual candidates. Hard dollars will be limited to $4,000 per donor per election cycle, and Democrats traditionally have trailed Republicans in raising hard dollars.
Sen. Barbara Boxer, California Democrat and a featured speaker at the Progressive Donor Network conference, said the group will be vital for liberal candidates because of the new campaign finance law.
"It's more important now than ever because there's no soft money," Mrs. Boxer said. "You need grass roots to make up for the money you're not going to be able to raise in soft money."
The donor network is encouraging its members to get involved in 23 House races and the Senate race in North Carolina, where conservative Republican Sen. Jesse Helms is retiring.
Sen. Mitch McConnell, Kentucky Republican and chief opponent of the new law, called the group's actions "perfectly permissible."
"Frankly, I'm in favor of loopholes," Mr. McConnell said. "They're gearing up to raise money for outside groups who will then go out and do their bidding for them in the election."
The group's D.C. conference included Democratic National Committee Chairman Terry McAuliffe; Ralph Neas, president of the liberal watchdog group People for the American Way; Kate Michelman, president of NARAL; Ellen Malcolm, president of Emily's List; House Minority Leader Richard A. Gephardt, Missouri Democrat; former Clinton administration officials James Carville, Paul Begala and Joe Lockhart; former Gore 2000 campaign manager Donna Brazile; and representatives of several labor unions.
Mr. Noble said the group represents "one of the avenues that soft money is going to take after campaign finance reform."
He said the Federal Election Commission is likely to decide case by case whether such organizations run afoul of the law's restrictions against coordinating with political parties.
"These are people who have been close to the heartbeat of the Democratic Party," Mr. Noble said. "The question will be: 'How much can they coordinate on a day-to-day basis?' Even if they are kept at a short-arm distance, there's still a tremendous amount they can do."
Mr. Lux said Republicans have been successful for years by "moving money" to groups such as the National Rifle Association and the Christian Coalition.
The Progressive Donor Network's goals also include forming "rapid-response teams" to plant news stories critical of Republicans and the Bush administration. Its leaders cited several negative news stories recently about the collapse of Enron, the Texas-based energy giant with ties to the White House.
House Majority Leader Dick Armey, Texas Republican, said Republicans have employed rapid-response teams for years.
"We have a rapid-response team because what they put out there is lies," Mr. Armey said. "We put out the truth. I don't know how you put together a rapid-response team to respond to the truth. But if anybody can figure out how to do it, they will."
Mrs. Boxer said the organization's real value for Democratic candidates could come from its grass-roots efforts.
"They can help get out the vote, organize, register," she said. "Progressives need to have, just as conservatives have, a really good grass-roots network. And I think we've fallen down on that job.
"The progressive network, if they take the issue of prescription drugs and they take the issue of the Superfund being cut in half and they go out for raising the minimum wage, and they take those issues out to the people who are progressive, and tell them that they should connect the dots between who's here [in Washington] and those issues, it means a lot."

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