Justices Aim for Early Resolution to ‘Soft Money’ Fight

The Supreme Court agreed Thursday to an early hearing of legal challenges to the McCain-Feingold election-funding reform law, which sharply limits campaign spending by corporations, labor unions and other interests.

The justices will hear arguments over four hours on Sept. 8, four months before the 2004 campaign season moves into high gear.

Normally, the court term opens on the first Monday in October.

By speeding up the schedule, the justices hope to resolve the dispute over the campaign funding rules before the next election season.

The task will not be easy.

Last year, a panel of three federal judges took up the case, and its members spent months fighting among themselves.

In May, the judges issued three separate opinions that ran to nearly 1,700 pages and resolved little.

At issue are new rules on how political parties and outside interest groups can raise and spend money to influence congressional and presidential elections.

In 1907, President Theodore Roosevelt championed a ban on corporate funding of federal campaigns. In the late 1940s, Congress also banned labor unions from funding candidates.

The Watergate scandal of the 1970s led to limits on donations from wealthy people.

But the limits on big-money donations broke down in the 1990s. Politicians -- including President Clinton and Sen. Bob Dole of Kansas, the 1996 Republican standard-bearer -- realized they could circumvent restrictions on large donations to candidates by funneling money through their national parties.

The parties in turn used this “soft money” for campaign-style “issue ads.”

For example, the Democrats touted Clinton and Al Gore as defenders of Social Security, and the Republicans said they were strong on crime.

Reformers, led by Sens. John McCain (R-Ariz.) and Russell D. Feingold (D-Wis.), said this unrestricted soft money made a mockery of the law.

Their measure, the Bipartisan Campaign Reform Act, says individuals may give up to $2,000 a year to individual candidates and as much as $25,000 a year to campaigns for federal offices.

Beyond that, however, the new law strictly limits money flowing into the political system. It says political parties “may not solicit, receive or spend any funds” outside these limits.

In addition, corporations and labor unions are barred from spending money for “electioneering communications.”

Since the law already forbids corporations and unions from directly funding candidates, the reformers said they should not be permitted to do the same indirectly by funding campaign-style ads.

The challengers range from the National Rifle Assn. and the American Civil Liberties Union to the U.S. Chamber of Commerce, the Republican National Committee and the California Democratic Party.

All the challengers say the restrictions violate their 1st Amendment rights to freedom of speech.

Bush administration lawyers find themselves in the odd position of defending a measure that is strongly opposed by most Republicans.

U.S. Solicitor General Theodore B. Olson, representing the Bush administration, is charged with defending the law.

The soft money ban should be upheld, he says, because Congress has the power to prevent the “real or apparent corruption” that would arise if politicians had to depend on contributions from a few wealthy people or business interests.