Texas governor's camp reaps soft money

By John Aloysius Farrell, Globe Staff, 1/24/2000

ASHINGTON - George W. Bush's elite crew of fund-raising ''pioneers'' has won national attention for vowing to raise $100,000 each for the Texas governor's presidential campaign.

But Bush's premier fund-raisers have largely avoided the spotlight for another role they are playing in the 2000 campaign: collecting chunks of ''soft money'' for the national and state Republican parties.

A Globe study of Federal Election Commission records shows that Bush's fund-raisers have worked diligently at raising the unlimited, and virtually unregulated, donations known as soft money for the GOP.

Of the $34 million in soft money collected by the Republican National Committee and its affiliates, some $3.2 million was given by just 41 members of the pioneers, their families, or firms, election commission records show.

And the Republican Party has raised another $5 million in soft money from firms whose officers and employees contributed bundles of more than $10,000 to the Bush campaign, the records show.

Such shared ties between the party and a leading presidential campaign are not surprising, said Bush spokesman Scott McClellan.

''Obviously our leadership team is supporting the Republican Party at the state and national level,'' McClellan said.

But the use of soft money is controversial because it has emerged as the principal loophole in federal campaign finance laws, which were designed to rid US politics of the corrupting influence of big money.

''Soft money is absolutely the worst money in politics today,'' said Common Cause president Scott Harshbarger, the former Massachusetts attorney general. ''It is completely unlimited, virtually unregulated - a way for wealthy corporations, individuals, or unions to get around the law by laundering their money.''

GOP Senator John McCain of Arizona has sponsored legislation that would ban soft money and, along with Democrat Bill Bradley, has promised not to use such funds in the 2000 election should he become his party's nominee.

Bush opposes McCain's proposed ban on soft money because, the governor says, it would hurt Republicans more than Democrats. The Texas governor has instead been a champion of full disclosure. He is the first presidential candidate to post the names and donations of all his contributors on the Internet, and in a searchable format.

But Howard Opinsky, a spokesman for the McCain campaign, said in reaction to Globe findings that disclosure is not enough.

''It's no surprise to us that the major soft money donors, who want to protect the status quo of the campaign finance system that benefits them, are supporting a candidate who is not interested in reform,'' Opinsky said.

After watching Bush raise $67 million in regulated ''hard money'' under a law that limits donations to presidential candidates to $1,000 per individual, Democrats are nervously wondering what the Texas governor's fund-raisers will do if freed of such restraints when collecting soft money.

The November FEC records - the latest available for study - offer glimpses of what could be in store as the pioneers switch from $1,000 donations and begin to collect funds in bigger amounts.

On Nov. 16 the investment firm of Hicks, Muse, Tate & Furst - tied to Texas pioneer Steven Hicks - gave the GOP $25,000. The next day Boston pioneer Herbert Collins gave $20,000 in ''soft money'' to the Republican National Committee, raising his cumulative total in this election cycle to $180,000.

Like Collins, 11 other Bush pioneers or their firms have already made six-figure soft money donations to the GOP, led by Michigan's Michael Kojaian ($300,000) and California's Alexander Spanos ($250,000).

The average soft money donation of the 41 pioneers was about $80,000, according to the reports.

The Bush pioneers' soft money donations are particularly noteworthy because the big soft money season, which traditionally arrives after the primaries are over, is still months away.

McClellan said that the Bush campaign had not yet directed its fund-raisers to shift their focus from hard to soft money, but that the pioneers - as they continue to collect hard money - have a simultaneous goal of raising soft money for Republican Party organizations in the 20 most important states.

Though McCain wants to do away with soft money, he does not refuse hard money contributions from individuals who give soft money to the party.

Several of the firms that donated the biggest chunks of soft money to the GOP - like Microsoft ($230,000) and AT&T ($525,000) - also have employees who contributed to McCain.

But records show that the amount of money that McCain received from corporations like Microsoft and AT&T was modest. The senator does not have 150 or so wealthy individuals like the pioneers, who work exclusively for one candidate, raising soft money for the party on the side.

When McCain does get funds from big soft money sources he generally shares the donor with his fellow candidates.

According to a computerized database run by the Center for Responsive Politics, a Washington-based public interest group, Microsoft employees gave some $29,000 to Bush, $22,000 to Bradley, $16,000 to McCain, and $13,000 to Vice President Al Gore. AT&T employees gave $20,000 to Gore, $9,000 to Bush, $6,000 to McCain, and $3,000 to Bradley.

Though soft money is supposed to be used only for party-building activities, recent court decisions have widened the loophole, and the two major parties now use it to fund massive television advertising campaigns.

''The exemption was made to encourage party-building activities which benefit the political parties ... but not specific candidates,'' said Michael Stewart, a spokesman for the center. ''In reality the loophole has emerged as the parties' primary way to raise tens of millions of dollars from wealthy contributors during the general election campaign when direct contributions to the candidates are prohibited.''

Soft money fueled the Democratic Party's massive TV ad campaign in the spring and summer of 1996.

GOP presidential challenger Bob Dole, caught unaware and momentarily short on funds, never recovered.

In comparison with the GOP's $34 million, the Democrats have raised $24 million in soft money in this election cycle: roughly on par with the 3-to-2 edge that Republicans traditionally enjoy in soft money.

But after the Republicans announced that their fund-raising goal for the 2000 election is $177 million, some Democrats worried aloud that their party's nominee might emerge from a debilitating primary campaign and run into an advertising blitz financed by Bush's leading fund-raisers.

Republican leaders ''assume the same cast of characters will come through for the RNC,'' said Jim Jordan, spokesman for the Democratic Senatorial Campaign Committee. ''Presumably, that is what has encouraged them to construct a $177 million fund-raising plan.''

Jordan, however, said the Democrats will raise enough soft money of their own to keep their candidate from suffering Dole's fate.

''It is clear the Republicans will be on the air heavy with soft dollar party advertising - that is what that budget is for, in large measure,'' said Jordan. ''But as has become increasingly obvious over the last cycle or two, we Democrats have a lot of experience, and you don't need to match your opponent dollar for dollar in advertising.''

The increased role of soft money, and Bush's decision to reject public finance funds and spending limits, causes Harshbarger to worry that the United States is returning to the pre-Watergate days of the early 1970s, when five- and six-figure donations from wealthy interests was seen to have a corrupting influence on American politics.

''The presidential public finance system was to be the real reform in this arena, to make sure the presidential race wasn't on the auction block,'' Harshbarger said. ''Now these pioneers have pioneered a dramatic escalation in the political arms race.

''It creates a real impression in the average person that their vote doesn't count,'' said Harshbarger. ''It creates an apathy and cynicism.''