`Soft money' criticized as an abuse of campaign-finance laws

The Michael Dukakis campaign says one of its fund-raising goals is $30 million to $50 million in a controversial form of indirect political contributions. The contributions are ``soft money,'' that is, money not donated or expended according to the rules of the Federal Election Commission (FEC).

Soft money takes a hard knock in a recent analysis by the Center for Responsive Politics, a public-interest group. The center decries a much used method of political giving - which allows corporations to pump money into politics - as an abused legal loophole.

``Lying just below the surface are untold millions of additional dollars unaccounted for by the Federal Election Commission,'' says Ellen S. Miller, executive director of the nonprofit, bipartisan group, which examines campaign trends.

Corporations and unions are prohibited by federal statute from making direct contributions to federal races from their general treasuries, except to defray the administrative costs of corporate political action committees (PACs).

They can, however, give money for political activities to state and local party committees in 30 states. The cap on individual contributions to such committees varies according to state law.

The center maintains that certain political activities at the state and local level, such as voter-registration and get-out-the-vote drives, enable these corporate funds to seep into the federal election system and indirectly influence contests.

The Dukakis campaign, however, says that the soft money it hopes to raise will benefit the Democratic Party and the whole political process - not simply the candidate.

In August 1987, Joan Kroc, heiress to the McDonald Corporation fortune, gave $1 million to the Democratic National Committee (DNC) - the largest single contribution to the party in history. Of that figure, $980,000 could be used only in soft-money accounts, as $20,000 is the federal individual contribution limit to a national party in a single calender year.

The money is to be used for ``party-building activities,'' says DNC spokeswoman Julie Anbender. Ms. Anbender says the soft money raised by the Dukakis campaign will be put to the same use.

``We got calls from all over,'' after Mrs. Kroc's donation, says an FEC official. ``Critics claim [soft money] works its way up to the federal elections. I don't know if the commission has ever bought that.''

Common Cause, the ``citizens' lobby,'' took the FEC to federal court over the soft-money issue. The court didn't accept the ``trickle-up'' theory either, but the judge ordered the commission to take a closer look at its rules to determine if soft money should be reported in certain cases. The commission solicited public comment and is awaiting a report from its general counsel.

Mark Braden, the Republican National Committee's top lawyer, says public-interest groups are making too much of soft-money contributions. He bristles at the analysis by Center for Responsive Politics.

``They should be renamed the Center for Irresponsible Politics,'' Mr. Braden says. ``Our books are open. The highest we've ever raised in soft-money contributions is 7 percent of our funds. We want to raise hard dollars because it very difficult to find ways to spend soft money.'' Hard dollars are contributions subject to FEC limits and disclosure laws.

In its study, conducted in California, Colorado, Florida, Missouri, and Washington State, the center found $3.3 million in soft-money contributions. The report says that lack of federal disclosure laws makes it impossible to determine whether any of the money was actually used to influence federal elections.

An FEC official says the argument can be made that soft-money contributions can facilitate a type of bookkeeping shell game. He notes that sometimes the money is deposited in hard-money accounts, freeing up funds collected under the FEC rules for use in federal initiatives.

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