A campaign-finance landmark

The sweeping reform bill reestablishes a sense of limits while sparking a scramble to widen big-bucks loopholes.

After years of struggle over the issue, Washington is suddenly on the verge of the most sweeping changes in the business of money and politics in a generation.

The campaign-finance reform bill that passed the House yesterday wouldn't end the love affair between lawmakers and big campaign bucks. History shows that party fundraisers may eventually find - and widen - loopholes in any new money restrictions.

But in the short-to-medium term, it could greatly lessen the flow of cash into politics. It might lead to long-term structural change, such as an increase in the importance of state party organizations.

And at the very least, the legislation could reestablish a sense of limits to the pursuit of filling campaign coffers.

"It will be a fairly major change," says Paul Herrnson, director of the Center for American Politics and Citizenship at the University of Maryland.

That change is unlikely to be permanent, however.

"Money is always going to be part of politics," adds Herrnson.

The campaign-finance legislation, which passed the House on a 240-to-189 vote, would greatly restrict "soft money" contributions to the national parties. Ostensibly intended for party-building activities, soft-money donations have become a backdoor method for corporations, unions, and wealthy individuals to channel millions of dollars into politics.

More than half of the Democratic Party's total revenue for the 2000 campaign cycle was soft money. The GOP raised about 45 percent of its 2000 cycle cash via such contributions.

The bill would also restrict electioneering ads by outside groups, banning their appearance within 30 days of a primary and 60 days of a general election. And it would increase the limit on individual "hard money" contributions to candidates from $1,000 to $2,000.

Senate majority leader Tom Daschle (D) of South Dakota has vowed to quickly bring the House bill to a vote in the Senate, which passed similar, though not identical, legislation last year.

If it can survive a filibuster attempt by opponents, campaign-finance reform is likely to pass the Senate, and land on President Bush's desk for a final signature. Given the context of the turmoil over soft-money contributions by the bankrupt Enron Corp., Bush might find it politically difficult to veto the bill.

THUS, some seven years after they first began their efforts, proponents of the sweeping soft-money ban can finally see their goal within reach. Not that they think its passage would represent reaching the reformers' equivalent of the promised land. Even the bill's most ardent supporters recognize it as a temporary fix.

The rise of soft money, for example, was an unintended consequence of the last reform bill, passed in 1974 after the Watergate scandal. But it's also true that the explosion in soft money didn't happen right away. In fact, it was really only during the '94 and '96 election cycles that parties figured out how to use soft money to their advantage in campaigns.

"I don't think anything is permanent," said Sen. John McCain (R) of Arizona, a cosponsor of the Senate version. "Twenty years from now, there will be two other senators, a Democrat and a Republican, arguing for reform."

During the 1994 election cycle, the parties raised a combined total of almost $87 million in soft money. But by the 2000 election, that figure had expanded to nearly $500 million.

As a result, the biggest immediate impact of the soft-money ban is likely to be on the big national party organizations. "It will dramatically change the way parties have been doing things," says Diana Dwyre, a political scientist at California State University, Chico. "The parties will definitely have less money to work with, and less freedom."

Opponents of the bill argue that parties could see themselves largely replaced by special-interest groups - particularly if the provision that bans issue ads by such groups in the days before an election is ultimately struck down by the courts. This could have a negative impact on the democratic process, they say, since such groups promote narrow issues and would be unlikely to use the broader get-out-the-vote tactics that parties employ.

It's also possible that, as the role of national parties diminishes, state parties could rise to a more prominent position - since they can still receive soft money, but in limited amounts.

"Currently, most of the money is raised at the national level and then decentralized and spent at the state and local levels," says Dr. Herrnson. "Now, there may be an effort to gear up the fundraising capacities of the states."

It wouldn't be hard, analysts say, for corporations that once would have donated large amounts of soft money to the national parties, to shift their contributions to multiple state parties.

Candidates may also find themselves spending more time soliciting small contributions, to try to make up for their party's loss in revenue. Although parties are not currently allowed to contribute soft money directly to candidates, they can use it to sponsor issue ads or for get-out-the-vote activities. It would take a lot of $2,000 hard-money donations to make up the difference.

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