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The wreck of Ol’ 527 

A hideously incomplete primer on the 527 groups, like Swift Boat Veterans for Truth.

527' ED:
  • 527' ED:
If political advertising by presidential candidates these days can be described as dirty fighting, then ads from 527 groups like the Swift Boat Veterans for Truth are the equivalent of a brick lobbed from a dark alleyway. Loopholes in the tax code and cloudy rulings by the Federal Election Committee have turned 527s — originally intended as “Get Out the Vote”-style non-partisan groups — into the political Wild West, all but unrestricted as to how they raise their money, where it comes from, and how they can spend it to attack a candidate running for federal election. Championed as a way for the people to make their voices heard, the fewer restrictions placed on 527 groups have seen them transformed into a sleazy new low: another way to try and buy democracy right out from under us. Given how disruptive the worst of these groups are — particularly those like the Swift Boaters, which purposefully lead the campaign away from the issues that should matter — it’s kind of hard to believe that most people don’t have a better understanding of what they are and how they work. Hard to believe, that is, until you try and wrap your arms around the tar baby that is federal election law — and the corresponding sections of the Internal Revenue Code. I’m now convinced that both are included in the nightstand of every motel room in Hell. Named after the section of the IRS code which affords them tax-exempt status, 527s are defined by the FEC as “issue advocacy” groups, allowed to spend money to influence federal elections while not supporting any party or candidate. Though 527s are restricted as to their cheerleading for a particular ticket — so-called “express advocacy” — that doesn’t mean they can’t use their “issue” ads to tear the other guy down. This hyper-critical model of the 527 group appeared during the 2000 election, when “Republicans for Clean Air” went after Republican candidate John McCain for his environmental record. (To be fair, though the anti-Kerry Swift Boat Vets are getting all the press these days, anti-Bush 527s are actually spending the most money by a wide margin. According to IRS filings listed at opensecrets.org, 527 groups lumped under “Democratic/Liberal” have spent more than $131 million this election cycle, compared with a little more than $18 million for those listed as Republican/Conservative. Of course, the election isn’t over yet.) Because they’re supposedly not rooting for any one candidate — unlike the classic political committee, which the Federal Election Campaign Act of 1971 classifies as a “group of persons which receives contributions or which makes expenditures aggregating in excess of $1,000 during a calendar year,” with “expenditure” meaning “anything of value (expended) for the purpose of influencing any election for Federal office” — the 527s are not subject to the strict limitations on contributions ($5,000 per donor), the extensive disclosure of where the money came from, and similarly extensive questioning about where it went. But wait a second, you say. Given that 527 groups have taken in and spent over $101 million during the 2004 presidential election, with six-, seven- and even eight-figure donations from some individual donors, shouldn’t your average 527 group be defined as a “political committee” and therefore subject to the same fund-raising restrictions? Sure, if we weren’t talking about the Bizarro World of campaign finance law. In taking up the 527 issue, the Supreme Court has ruled that a 527 group will not fall under the definition of “political committee” — and therefore will be able to raise and spend all the money it wants to, from virtually any independent source — unless the group’s “major purpose” is to influence a federal election. The problem is, nobody seems to know how to define “major purpose.” So far, the Federal Election Commission hasn’t been much help in plugging the dike in that regard. In recent “clarifications,” the FEC has only ruled that as long as a 527 group doesn’t contribute directly to a particular candidate, doesn’t take marching orders from a campaign and treads lightly in the area of “express advocacy,” then they’re pretty much home free. In short, the FEC has created something akin to leaving your windows rolled down and your Rolex on the dashboard: a situation that invites dishonesty, with no hard-and-fast way to determine who’s in the wrong. Sure, it helps level the financial scales for the Democratic Party, which often finds itself playing catch-up to the Republicans’ bulging war chest. And don’t get me wrong: God bless George Soros, Americans Coming Together, Moveon.org, and the rest. If Kerry gets elected in November, it will be due in large measure to the anti-Bush 527 groups like those. The problem is, you can’t get the snakes out of this particular cornfield without burning it all. And unless we want the Democratic candidate stuck with a rerun of the Swift Boat Liars for Bush nonsense in every election from now until doomsday, we’ve got to get a handle on it here and now. Though we’re mostly getting the good end of the stick this go-round, next time — or the next, or the next — the story might be different.
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