By Michael Kranish, Globe staff, 09/21/2000

WASHINGTON - Four years after a presidential fund-raising scandal led to intense criticism of "soft money," the two major political parties are on track to raise twice as much of the unregulated funds, with Al Gore working almost nightly to help Democrats match the Republicans' trove.

By the end of the year, the two parties are expected to raise $500 million in soft money, according to the advocacy group Common Cause, with at least $100 million spent on television ads that are barely disguised campaign commercials and are targeted in key states to help either Democrat Gore or Republican George W. Bush. That gusher of spending in the final weeks could play a large role in determining who wins. The pressure on both candidates to continue raising money was newly evident yesterday, when the Republican Party announced that it had taken in another $30 million in regulated and unregulated contributions in August.

The Democratic Party declined to release a corresponding figure, but both parties agree that Republicans are well ahead in the race for cash, as has been the pattern in past elections.

The furious money-raising pace raises the question of whether the many investigations into campaign finance - as well as the lengthy discussion about reform, led by Senator John McCain, during the primaries - has had any significant impact on the parties. The only major difference is that the parties are taking extra care not to illegally raise money from foreign sources, as the Democrats did in 1996.

"They all think they can do it because President Clinton got away with it in 1996," said Fred Wertheimer, president of Democracy 21, a reform advocacy group.

Last week, Wertheimer joined with the Common Cause president, Scott Harshbarger, in a lawsuit against the Federal Election Commission. They allege that the Bush and Gore campaigns are committing a massive violation of the law by raising soft money for the parties, which in turn, they say, use the money to directly help the campaign.

The campaigns deny this, saying the candidates are raising money for party-building.

All of this has a direct bearing on the presidential campaign because the two parties are preparing to use the money raised by Bush and Gore for an onslaught of ads in "battleground" states in the coming weeks. That is similar to what happened in 1996, when the Clinton campaign allegedly worked closely with the Democratic National Committee and state committees to place ads in key states.

Theoretically, Bush and Gore are supposed to have the same amount of money to wage the fall campaign. That, at least, is what Congress intended when it rewrote campaign-finance laws in 1974.

With no fanfare, the US government recently wired $68 million into each of the campaigns. The logic behind this transfer of taxpayer funds is that candidates shouldn't be forced to scramble for cash in the closing weeks of an election and shouldn't be influenced by big contributors.

Indeed, before Bush and Gore cashed in this windfall, they were required to sign a pledge swearing not to raise private funds for their campaign.

Yet, night after night, a campaign-within-a-campaign is taking place. Gore is raising cash for the Democratic Party at star-studded events, from a concert with James Taylor in Boston to extravaganzas at Radio City Music Hall in New York City. Bush is raising money at a slightly slower pace because the GOP is already financially ahead.

It may sound like campaign money, and it may be raised like campaign money - but the campaigns insist it is not a direct campaign contribution. Advocates of campaign-finance overhaul fail to see the distinction.

"There is no pretense any longer that they are even obeying the spirit of the law," said Ellen Miller, president of the advocacy group Public Campaign.

Spokesmen for the candidates denied there is any violation because the soft money doesn't go directly into the campaign.

"They are a regular part of the campaign schedule for all candidates," Bush spokesman Ken Lysaius said, referring to the Texas governor's frequent appearances to raise soft money.

"The funds raised are used in full accordance with the law for party-building," Gore spokesman Doug Hattaway said, adding that the first bill Gore would submit as president would ban soft money.

During the primaries, Democrat Bill Bradley and McCain, a Republican, shook hands and said that if they became the nominees, they wouldn't raise soft money. But they lost, and Bradley last week was a host of a Gore fund-raiser that brought in $1 million for the Democratic Party, much of it the sort of soft money that Bradley has criticized.

"I can't recall presidential candidates being involved in fund-raisers this late in the campaign," said Larry Makinson of the Center for Responsive Politics, which tracks money and campaigns. "They usually talk mostly to human beings after Labor Day. I have a feeling this won't stop until the weekend before the election because it takes time for the checks to move."

This is, in effect, Part Two of the year's fund-raising saga. Bush far outdid Gore in raising primary money, bringing in $104 million compared to $53 million for Gore. But after the conventions, the campaigns switched to general election financing.

But advocates of campaign-finance overhaul say the candidates are effectively exceeding the $68 million in public financing by raising tens of millions in soft money for the parties.

In 1996, according to Common Cause, the two main parties raised $250 million in soft money. That amount is expected to be doubled in the current election cycle, according to Harshbarger, the former Massachusetts attorney general. As of June, the Democrats raised $119 million and the Republicans took in $137 million in soft money. The Republicans had an even bigger lead in regulated "hard money," raising $179 million compared to $103 million as of last March.