Soft-Money Rules a Hard Row to Hoe

Five years ago, a conservative analyst named David M. Mason penned a critique of the campaign reform movement titled “Why Congress Can’t Ban Soft Money.” Earlier this year, as lawmakers sought to prove him wrong, he attacked elements of their reform bill as “unworkable or unenforceable.”

But now, as chairman of the Federal Election Commission, Mason is responsible for enforcing the new law that soon will prohibit national political parties from collecting the unlimited donations known as soft money. Despite his own skepticism, Mason promises to follow the will of Congress.

“What the rule of law means is that the law governs behavior and personal opinions don’t,” Mason said. “It will be our job to enforce the law that’s passed. I don’t really see that as being a difficult intellectual or moral proposition.”

Other commissioners interviewed in recent days said they too will strive to carry out the broadest changes to federal campaign law in nearly 30 years.

But the FEC, created in 1974 after the Watergate scandal of the Nixon administration, has long been belittled for taking what critics call a hands-off approach to campaign regulation.

In fact, FEC decisions over the years helped lead national parties to pursue huge soft-money donations from corporations, labor unions and wealthy individuals. Taking advantage of gaps in the law, many of those checks were hundreds of times larger than what was allowed under the system of limits Congress created to reduce the potential for political corruption.

For example, an individual could give a candidate no more than $1,000 per election cycle but could give a national party committee $1 million or more, which could then be used to influence a specific election. Such unlimited donations to the national parties will become illegal Nov. 6 unless federal courts intervene.

As the FEC begins to set in motion the law enacted late last month, critics fear that the agency may carve out new pathways for big money to enter politics. Some even propose replacing the FEC, whose six commissioners are evenly divided between Republicans and Democrats, with an agency that has greater enforcement powers and more autonomy from Congress and the parties.

Historically, the FEC has been a restrained watchdog; critics would say muzzled. While the agency is widely praised for keeping the public records that disclose donors to federal campaigns, its investigative and enforcement powers are sharply limited by statute, budget and politics. A two-thirds majority vote of the commission is required for any action, meaning that at least one of the six commissioners must cross party lines. On high-profile cases, those bipartisan majorities can be elusive.

“It’s understaffed, it’s underfunded, it’s under-backboned,” said Trevor Potter, a former FEC commissioner who has advised Sen. John McCain (R-Ariz.), the leading proponent of the new campaign law. “It is a weak enforcement agency. One of the reasons we’re in [this] soft money situation is that the agency has not enforced existing laws.”

McCain has said his next goal is reforming the commission.

McCain’s chief foe, Sen. Mitch McConnell (R-Ky.), has replied, however, that the FEC should not be allowed to become “a Gestapo trying to quiet the voices of American citizens.”

McConnell contends that the new campaign finance law is unconstitutional and has filed suit here in federal court to overturn it. That means that the Supreme Court eventually will rule on the legislation, which cleared Congress only after years of debate and received merely grudging approval from President Bush.

For now, however, it’s up to the FEC to interpret and implement the law. It must issue new regulations on soft money by late June and on many other campaign finance matters by year’s end.

These regulations--and subsequent FEC decisions on the scope of the law and whether to pursue alleged violations--will ultimately shape how candidates, political professionals and interest groups respond to whatever mandate is upheld by the Supreme Court.

In the complex realm of campaign finance, where parties vying for power inevitably push the legal envelope, details matter.

“How some of the particulars are applied, given different circumstances, will really determine the long-term effectiveness of the [new] law,” said Anthony J. Corrado, a campaign finance expert at Colby College in Waterville, Maine. “That’s really the principal lesson of the last round of reforms” in the 1970s.

Mason points out several provisions of the new law that pose interpretive challenges.

For example, Congress told the FEC to write new rules establishing when parties or politicians have “coordinated” activities with labor unions, corporations or interest groups. Under the law, any political advertisement sponsored by such outside groups must be paid for with funds raised under federal contribution limits--if the ad was coordinated with a party or a candidate.

But defining “coordination” is tricky. Some FEC members have argued that the term should be strictly defined as a formal arrangement between a candidate and an outside group. Congress, however, asked the commission to establish a broader definition. In the end, such subtleties as whether a candidate and an outside group shared a consultant or vendor might determine whether an ad could be funded with unregulated donations or not.

In another section of the law, Congress banned certain forms of political advertising by interest groups during the weeks before an election. But it made exceptions for news media, candidate debates and “any other communication exempted under such regulations as the [FEC] may promulgate” as consistent with the intent of the law.

Still another provision will require the FEC to track how much personal money candidates spend to get elected. Under a complex formula, opponents of wealthy, self-financed candidates would be eligible for special exceptions to the federal contribution limits. But applying the formula in the hectic days before an election and ruling which candidates are eligible for how many breaks will not be easy.

“It’s not a bill I’d have voted for had I been in Congress,” Mason said. “I really wish there had been an opportunity to engage Congress more on some of these detail-level issues so they could produce a bill that would be easy for us to implement and enforce.”

Yet Mason, a Republican and former Heritage Foundation analyst, pledged to do his best. So did Bradley A. Smith, another Republican commissioner, who has written a book titled “Unfree Speech: The Folly of Campaign Finance Reform.”

Both were appointed by President Clinton to fill Republican vacancies, Mason in 1998 and Smith in 2000. Clinton, who declared himself an advocate of campaign reform even though he led the Democratic Party during a time of fund-raising abuses, was forced to bargain over the appointments with GOP congressional leaders. His nominees were confirmed by the Senate.

Commissioners, who oversee a staff of about 350 and an annual budget of $43 million, say they are likely to need more money to implement the biggest campaign overhaul in a generation. Whether Congress will help is unclear. Historically, lawmakers have kept the FEC on a tight fiscal leash. What’s more, any discussion of funding is likely to generate debate about overhauling the commission itself.

Smith lamented that “supporters of the bill have immediately turned to attacking the commission rather than saying, ‘OK, what do you need to do the job?’ ”