Bush Campaign, Lawmakers Win Round in Court Against ‘527’ Groups

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The New York Sun

A federal judge in Washington ruled yesterday that the Federal Election Commission acted arbitrarily in 2004 when it decided not to regulate so-called 527 political organizations, but he declined to force the commission to impose such regulations.


In a 34-page decision, Judge Emmet Sullivan wrote that the commission “failed to consider the relevant factors and its decision does not reflect reasoned decisionmaking.”


In the 2004 election cycle, so-called 527 committees, such as America Coming Together, Club for Growth, and Swift Boat Veterans for Truth, raised more than $400 million while ignoring contribution limits that apply to most federal political committees.


Judge Sullivan ordered the commission either to promulgate a regulation addressing the 527 phenomenon or to explain the commission’s rationale for electing to resolve such complaints on a case-by-case basis.


“Indeed, judging from FEC’s track record in the 2004 election, case-by-case adjudication appears to have been a total failure,” the judge wrote.


The lawsuits seeking to force regulation of the 527 groups were brought by President Bush’s re-election committee and by two lawmakers who have advocated tighter campaign finance controls, Rep. Christopher Shays, a Republican of Connecticut, and Rep. Martin Meehan, a Democrat of Massachusetts.


Messrs. Shays and Meehan were the lead sponsors in the House of the Bipartisan Campaign Reform Act, which Mr. Bush signed in 2002. It banned unlimited donations of so-called soft money to committees run by the national political parties. To avoid that restriction, donors and political activists started up 527 groups, which take their name from a section of the tax code.


In 2004, President Bush called for a crackdown on the 527 groups, many of which paid to air negative television ads against either Mr. Bush or his Democratic opponent, Senator Kerry of Massachusetts.


However, some Republicans argued that the president’s call, in essence, to ban the groups was misguided and ran counter to the traditional conservative opposition to government regulation. Some of the loudest objections to broadening the coverage of campaign finance law came from nonprofit groups at the opposite end of the political spectrum. The liberal organizations said they feared they could have been subject to contribution limits and disclosure requirements under some of the proposals being discussed before the Federal Election Commission abandoned the rulemaking process in August 2004.


The New York Sun

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