No. 02-1674 & Consolidated Cases 

IN THE 

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———— 

SENATOR MITCH MCCONNELL, et al., 

Appellants/Cross-Appellees, 

v. 

FEDERAL ELECTION COMMISSION, et al., 

Appellees/Cross-Appellants. 

———— 

On Appeal from the United States District Court 

for the District of Columbia 

———— 

BRIEF OF COMMON CAUSE AND AARP AS 

AMICI CURIAE IN SUPPORT OF THE 

CONSTITUTIONALITY OF THE BIPARTISAN 

CAMPAIGN REFORM ACT OF 2002 

———— 

Of Counsel: 

DANIEL B. KOHRMAN 

AARP FOUNDATION 

LITIGATION 

MICHAEL SCHUSTER 

AARP 

601 E Street, N.W. 

Washington, D.C. 20049 

(202) 434-2060 

August 5, 2003 

DONALD J. SIMON * 


SONOSKY, CHAMBERS, SACHSE


ENDRESON & PERRY LLP 

1425 K Street NW, Suite 600 

Washington, DC 20005 

(202) 682-0240 

Counsel for Amici Curiae 

Common Cause and AARP 

* Counsel of Record 

WILSON-EPES PRINTING CO., INC. – (202) 789-0096 – WASHINGTON, D. C. 20001 
TABLE OF CONTENTS 

Page 

TABLE OF AUTHORITIES ......................................... iii 


INTEREST OF THE AMICI CURIAE .......................... 1 


SUMMARY OF ARGUMENT ..................................... 1 


ARGUMENT................................................................. 4 


I. Introduction........................................................ 4 


II. The Court Has Long Recognized That Anti-


Circumvention Measures Serve A Compelling


Purpose in Ensuring That The Campaign


Finance Laws Are Effective............................... 7 


III. Over the Last 25 Years, the Soft Money


System Has Evolved into a Massive Scheme 


for Political Parties, Federal Candidates and


Campaign Donors to Circumvent the Federal


Campaign Finance Laws.................................... 8 


A. 	Phase One: 1978-1988—The creation of 


the soft money system based on the fiction 


that soft money does not affect federal


elections ....................................................... 11 


B. Phase Two: 1988-1996—The integration 


of soft money into the presidential


campaigns .................................................... 13 


C. 	Phase Three: 1996-2002—The expansion


of the soft money system from the “ground


war” to the “air war” .................................... 17 


IV. Congress Crafted BCRA’s Soft Money Ban To


Ensure That It Would End the Circumvention


of the Campaign Finance Laws.......................... 26


(i) 
ii 

TABLE OF CONTENTS—Continued 

Page 

A. 	The total ban on national party soft money


is necessary .................................................. 27 


B.	 The ban on state party soft money for


“Federal election activities” is necessary..... 27 


C. 	The coverage of “voter mobilization”


activities is necessary................................... 29 


CONCLUSION.............................................................. 30 

iii 

TABLE OF AUTHORITIES 

CASES Page 

Austin v. Michigan State Chamber of Commerce, 

494 U.S. 652 (1989)........................................... 9 


Buckley v. Valeo, 424 U.S. 1 (1976)...................... passim


California Medical Association v. FEC, 453 U.S. 


182 (1981).......................................................... 7 


Common Cause v. FEC, 692 F. Supp. 1391 


(D.D.C. 1987) .................................................... 12, 13 


Common Cause v. FEC, 692 F.Supp. 1397


(D.D.C. 1988) .................................................... 13 


FEC v. Beaumont, 123 S. Ct. 2200 (2003) ............ passim


FEC v. Colorado Republican Federal Campaign 


Committee, 533 U.S. 431 (2001) ....................... 1, 2, 7 


FEC v. National Right to Work Committee, 459


U.S. 197 (1982).................................................. 9 


Nixon v. Shrink Missouri Government PAC, 528


U.S. 377 (2000).................................................. 1, 2 


STATUTES, REGULATIONS AND 

AGENCY MATERIALS 

Federal Election Campaign Act of 1971, Pub. L. 

No. 92-225, 86 Stat. 3 ........................................ passim 

2 U.S.C. § 431(9)(B)(viii).................................. 12 


2 U.S.C. § 431(9)(B)(ix).................................... 12 


2 U.S.C. § 431(20)(A)........................................ 29 


2 U.S.C. § 431(20)(B)........................................ 29 


2 U.S.C. § 441a(a)(1)(A) ................................... 9 


2 U.S.C. § 441a(a)(1)(B).................................... 9 


2 U.S.C. § 441a(a)(1)(C).................................... 7, 8 


2 U.S.C. § 441a(a)(1)(D) ................................... 29 


2 U.S.C. § 441a(a)(2)(A) ................................... 28 


2 U.S.C. § 441a(a)(3)......................................... 9 


2 U.S.C. § 441a(d) ............................................. 12, 28 

iv 

TABLE OF AUTHORITIES—Continued 

Page 

2 U.S.C. § 441b.................................................. 4, 9 


2 U.S.C. 441i(b)(2) ............................................ 28 


Bipartisan Campaign Reform Act of 2002, Pub. 

L. No. 107-155, 116 Stat. 81.............................. passim 

§ 101(a) .............................................................. 28 


§ 102................................................................... 29 


§ 307(a)(1) ......................................................... 9 


§ 307(a)(2) ......................................................... 9 


§ 307(b).............................................................. 9 


Federal Election Campaign Act Amendments of


1974, Pub. L. No. 93-443, 88 Stat. 1263 ........... 8, 10 


Federal Election Campaign Act Amendments of


1979, Pub. L. No. 96-187, 93 Stat. 1339 ........... 12 


26 U.S.C. § 9003(b) ........................................... 17 


11 C.F.R. § 104.8(e) (2002)............................... 13 


11 C.F.R. § 106.1(e) (1978)............................... 11 


11 C.F.R. § 106.5 (1991) ................................... 13 


11 C.F.R. § 106.5(b) (2002)............................... 21 


11 C.F.R. § 106.5(d) (2002)............................... 21 


FEC Rulemaking Petition: Notice of Avail-


ability, 50 Fed. Reg. 477 (Jan. 4, 1985)............. 12 


FEC Rulemaking Petition: Notice of Disposi­


tion, 51 Fed. Reg. 15,915 (April 29, 1986)........ 12 


Methods of Allocation Between Federal and


Non-Federal Accounts; Payments; Reporting,


55 Fed. Reg. 26,058 (June 26, 1990) ................. 13 


Response to FEC Advisory Opinion Request 


1976-72 (October 6, 1976)................................. 11 


Response to FEC Advisory Opinion Request 


1976-83 (October 12, 1976)............................... 11 


FEC Advisory Opinion 1978-10 (August 29,


1978) .................................................................. 11 

v 

TABLE OF AUTHORITIES—Continued 

Page 

FEC Advisory Opinion 1979-17 (July 16, 1979)... 12 

FEC Advisory Opinion 1995-25 (August 24, 

1995) .................................................................. 18 

Statement of Reasons of Comm. Scott E. Thomas 

in In the Matter of Dole for President, Inc. et 

al., MURs 4553 & 4671 (FEC May 25, 2000) .. 23 

Statement of Reasons of Comm. Scott E. Thomas 

in In the Matter of Ashcroft Victory Committee 

et al., MUR 4994 (FEC Dec. 19, 2001)............. 26 

LEGISLATIVE HISTORY 

The Final Report of the Senate Select Committee 

on Presidential Campaign Activities, S. Rep. 

No. 93-981, 93d Cong., 2d Sess. (1974)............ 

Investigation of Illegal or Improper Activities in 

Connection with 1996 Federal Election Campaigns: Hearings Before the Senate Committee 

on Governmental Affairs, 105th Cong., S. Hrg. 

No.105-300 (1997).....................................4, 19, 20, 22 

Investigation of Illegal or Improper Activities in 

Connection with 1996 Federal Election 

Campaigns, Final Report of the Committee on 

Governmental Affairs, S. Rep. No. 105-167, 

105th Cong., 2d Sess. (1998)............................. passim 

NEWS ARTICLES 

Brooks Jackson, Bush and Dukakis Presidential 

Campaigns Each Spent More than $100 

Million, Wall St. J., Dec. 11, 1988..................... 15 

Brooks Jackson, Democrats’ Coffers Fill Up as 

Fat Cats Seek Bigger Role in Party, Wall St. 

J., July 19, 1988 ................................................. 14 

8 
vi 

TABLE OF AUTHORITIES—Continued 

Page 

Brooks Jackson, GOP Is Aiming New Fund Drive 

at Big Donors, Wall St. J., Aug. 17, 1988 ......... 14 

Charles Babcock, $100,000 Donations Plentiful 

Despite Post-Watergate Restrictions, Wash. 

Post, Sept. 22, 1988............................................ 14 

Charles Babcock, DNC Diverted Controversial 

Donations, Wash. Post, Apr. 13, 1997............... 21 

Charles Babcock, Fund-Raisers Gear Up for Fall 

Race, Wash. Post, June 27, 1988 ....................... 14, 15 

George Archibald, Banana Baron Peeled off Half 

a Mil; White House Paid Back in WTO Fight, 

Wash. Times, Aug. 25, 1997.............................. 22 

Howard Kurtz, DNC Issue Spot Touts Gore’s 

Medicare Plan, Wash. Post, Jun. 8, 2000 .......... 23 

Howard Kurtz, GOP Launches Its First Salvo in 

‘Issue’ Ad War, Wash. Post, Jun. 11, 2000........ 23 

Ira Chinoy, DNC Donors Also Gave to State 

Groups, Wash. Post, Jan. 26, 1997 .................... 22 

John M. Broder, Democrats Able to Circumvent 

Donation Limit, N.Y. Times Dec. 22, 1999....... 26 

Marc Lacey, House Subpoenas Torrance Businessman, L.A. Times, Nov. 8, 1997................... 

Michael Weisskopf, The Busy Back-Door Men, 

Time, Mar. 31, 1997 .......................................... 22 

Neil A. Lewis, The 2000 Campaign: The Donations; 2 Groups Ask Justice Dept. To Investigate Parties’ Ads, N.Y. Times, Jul. 28, 2000 .... 23-24 

Peter Marks, Some Soft Money to Pay for Gore 

Ad Blitz, N.Y. Times, Jun. 7, 2000 .................... 23 

Richard Berke, Big Money’s Election Year 

Comeback, N.Y. Times, Aug. 7, 1988............... 15 

4 
vii 

TABLE OF AUTHORITIES—Continued 

Page 

Richard Berke, Contributors Help Dukakis by


Avoiding Limits He Set, N.Y. Times, Oct. 31, 


1988.................................................................... 16 


Richard Berke, In Election Spending, Watch


Ceiling and Use a Loophole, N.Y. Times, Oct.


3, 1988................................................................ 16 


Thomas Edsall, GOP Plans Big-Donor Drive, 


Wash. Post, Aug. 16, 1988................................. 15, 16 


Thomas Edsall, Soft Money Competition: GOP


Seeking $50 Million from Big Donors, Wash. 


Post, Aug. 16, 1988............................................ 15 


Thomas Edsall, ‘Victory Fund’ Raises Millions 


for Party, Wash. Post, July 19, 1988 ................. 15, 16 


MISCELLANEOUS 

Brooks Jackson, Broken Promise: Why the Fed­


eral Election Commission Failed (1990)........... 15 


Common Cause, The Soft Money Finale!, Follow 


the Dollar Report (Apr. 7, 2003)........................ 10 


Common Cause, “National Parties Raise Record


$470.6 Million In Soft Money During The 


2001-2002 Election Cycle Before New Law


Takes Effect” (Jan. 6, 2003) .............................. 25 


Common Cause, The Money Trail: The


Democrats (1996) .............................................. 20 


Common Cause, The Money Trail: The


Republicans (1996) ............................................ 20 


Notification to the Court Pursuant to 28 U.S.C. 


§592(b) of the Results of Preliminary Inves­


tigation filed in In re William Jefferson Clinton


(D.C. Cir. Dec. 7, 1998) (Independent Counsel 


Division) ............................................................ 22 


Sebastian Junger, The Perfect Storm (1997).......... 18 


Expert Report of Thomas E. Mann....................14, 17, 26 

INTEREST OF THE AMICI CURIAE 1 

Common Cause is a nonprofit, nonpartisan citizens’ organization with approximately 200,000 members and supporters 

nationwide. Common Cause has had a longstanding concern 

with the growing problem of soft money in the federal 

political process, and has publicly advocated for congressional action to ban soft money in order to restore 

integrity to the electoral system. Common Cause was a strong 

advocate for congressional enactment of the Bipartisan 

Campaign Reform Act of 2002, Pub. L. No. 107-155, 116 

Stat. 81 (BCRA). 

AARP is a nonprofit membership organization with more 

than thirty-five million persons age 50 and older that is 

dedicated to addressing the needs and interests of older 

Americans. AARP is nonpartisan and does not support or 

oppose any candidate for public office. Nor does it contribute 

money to political candidates’ campaigns or to political 

parties. Older Americans have made clear their interest in 

promoting and protecting the integrity of our nation’s 

electoral processes. Because of the significance of campaign 

finance reform to its members, AARP was active in 

supporting enactment of the BCRA, including through 

grassroots efforts across the nation. 

SUMMARY OF ARGUMENT 

BCRA serves compelling governmental interests not only 

in “preventing corruption and the appearance of it that flows 

from munificent campaign contributions,” Nixon v. Shrink 

Missouri Gov’t PAC, 528 U.S. 377, 390 (2000), but also in 

closing the enormous loopholes in the law that have been 

used for “circumvention of [valid] contribution limits,” FEC 

v. Beaumont, 123 S. Ct. 2200, 2207 (2003), quoting FEC v. 

1

 Letters of consent to the filing of this brief from all parties have been 

lodged with the Clerk. No counsel for a party authored this brief in whole 

or in part, and no person or entity, other than the amici curiae, made a 

monetary contribution to the preparation or submission of this brief. 
2 

Colorado Republican Federal Campaign Comm., 533 U.S. 

431, 456 (2001) (Colorado Republican II). 

The soft money system2--addressed by Title I of BCRA-­

grew over time into nothing less than a massive scheme for 

circumventing the contribution limits and source prohibitions 

of the federal campaign finance laws--measures that, over the 

last hundred years, have been enacted by Congress and 

sustained by this Court as necessary to preserve “the willingness of voters to take part in democratic governance.” 

Shrink Missouri, 528 U.S. at 390. 

Soft money was not created by Congress. Rather, it was a 

loophole opened in the law by the Federal Election Commission in 1978, through administrative interpretations that 

allowed first, state parties, and then national parties, to raise 

and spend funds not subject to federal contribution limits and 

source prohibitions for voter activities--such as voter 

registration and get-out-the-vote drives--that clearly affected 

federal elections. 

The soft money system changed character and scale in 

1988 when it became an integrated part of that year’s presidential campaign. Both presidential candidates, working 

closely with their national party committees, organized 

$100,000 donor clubs, and incorporated the raising and 

spending of soft money into their presidential campaign 

strategies. This new organizing focus doubled the amount of 

soft money raised, and injected it directly into the presidential 

campaign in a major fashion. 

The soft money system changed yet again in the 1996 

election, this time even more catastrophically, when it mutated from paying for just the “ground” war of grassroots 

voter activities to also paying for the “air” war of multimillion dollar television campaigns that promoted the 

2 Soft money, simply put, is money that does not comply with the 

contribution limits, source prohibitions and reporting requirements of 

federal law. 
3 

presidential candidates. An unprecedented quarter of a 

billion dollars of soft money was raised by the national 

parties, much of it by the presidential candidates themselves. 

Tens of millions of dollars of soft money was channeled 

through state party accounts to pay for candidate-specific 

broadcast ads controlled by the presidential campaigns, in 

what amounted to a sophisticated scheme for evasion of the 

law. In so doing, the presidential candidates also dodged the 

spending limits they had agreed to as a condition of their 

receipt of public funds, thus undermining key aspects of the 

presidential public financing system as well. 

During the 1990’s, the soft money system spread also to 

the congressional level where, in an innovation that emerged 

by the end of the decade, “joint fundraising committees” were 

developed as vehicles for congressional candidates to raise 

soft money in their own names, and then funnel those funds 

through party accounts to be spent on candidate-specific ads 

promoting their congressional campaigns. 

By 2002, the last election conducted prior to the effective 

date of BCRA, the soft money system had grown to half a 

billion dollars–all of it from sources or in amounts that may 

not be contributed or spent to influence federal elections. 

Soft money became not just a loophole in the law, but a 

systemic circumvention so massive as to virtually overwhelm 

the law. 

The enactment of BCRA was a necessary congressional 

response to this evisceration of the federal election laws, not 

just as a step to address the corruption and appearance of 

corruption caused by soft money, but also as an anticircumvention measure intended to repair and restore laws 

that this Court has deemed “critical . . . if confidence in the 

system of representative Government is not to be eroded to a 

disastrous extent.” Buckley v. Valeo, 424 U.S. 1, 27 (1976), 
4 


quoting Civil Service Comm’n v. Nat’l Ass’n of Letter 

Carriers, 413 U.S. 548, 565 (1973).3 

ARGUMENT 

I. Introduction 

In 1997, in the midst of a major congressional investigation 

of the campaign finance abuses that occurred during the 1996 

presidential election, Democratic National Committee (DNC) 

fundraiser Johnny Chung was quoted as saying, “The White 

House is like a subway: You have to put in coins to open 

the gates.”4 

Chung was in a position to know. According to the final 

report of the investigation conducted by the Senate Governmental Affairs Committee (“Thompson Committee”), Chung 

made soft money donations totaling $366,000 to the DNC 

from August 1994 through August, 1996.5 And in the two 

year period ending in February, 1996, Chung obtained access 

to the White House on 49 occasions–“access that he used . . . 

to further his interests with foreign business clients . . . .”6 

Further, according to the Thompson Committee, 

3 Although this brief focuses on the circumvention of the campaign 

finance laws caused by soft money, and addressed by Title I of BCRA, the 

amici also strongly support the other provisions of BCRA, including Title 

II, which responds to the equally serious problem of sham “issue” 

advocacy that has been used as a means for corporations and labor unions 

to circumvent, on a massive scale, the longstanding prohibition on the 

spending of corporate and labor treasury funds “in connection with” 

federal elections. 2 U.S.C. § 441b. 4

 Marc Lacey, House Subpoenas Torrance Businessman, L.A. Times, 

Nov. 8, 1997, at A12, quoted in Investigation of Illegal or Improper 

Activities in Connection with 1996 Federal Election Campaigns, Final 

Report of the Committee on Governmental Affairs, S. Rep. No. 105-167, 

105th Cong., 2d Sess. (1998) (“Thompson Committee Report”) at 783. 5

 Thompson Committee Report, supra note 4, at 783, 795. 6 Id. at 783. The Report notes that in a newsletter to his company’s 

shareholders, Chung “boasted of his political clout, claiming that he had 

‘built up connections to easily arrange visitations to the White House and 

meetings with the President.’” Id. at 785. 
5 

There can be no question that Chung’s contributions to 

the DNC helped give him this access to the President 

and the First Lady. So close was the nexus between 

Chung’s donations and his visits, in fact, that White 

House officials actually collected money from him in the 

First Lady’s office in exchange for allowing him to bring 

a delegation of his clients to White House events.7 

Johnny Chung’s analogy of the White House to little more 

than a coin-operated gateway for the sale of access and 

influence is a fitting epitaph for the debasing effect of soft 

money on the American political process. 

An equally dispiriting picture was painted by Roger 

Tamraz, another DNC donor who figured prominently in 

the Thompson Committee investigation. Described by the 

Committee as “an unrepentant access-purchaser,” id. at 2907, 

Tamraz donated a total of $300,000 of soft money to the 

DNC and various state party committees or campaigns 

between July 1995 and March 1996, all at the DNC’s request. 

Id. at 2913-14. In apparent exchange for these donations, 

Tamraz sought, and received, access to an array of DNC and 

government officials in an effort to win U.S. backing for an 

oil pipeline project he was promoting in central Asia.8 DNC 

chairman Don Fowler personally interceded with officials at 

the Central Intelligence Agency and the National Security 

Council in an effort to help Tamraz, id. at 2917-18, who 

attended six events with President Clinton from September 

1995 through June 1996. Id. at 2920. Tamraz spoke on 

several occasions with the President, who directed his chief of 

staff, Mack McLarty, “to follow up” on Tamraz’s requests. 

Id. at 2920, 2929. McLarty did so in numerous ways, 

7 Id. at 783. 8 When asked at the hearings if “one of the reasons” he gave this 

money was to get access to government officials, Tamraz replied, 

“Senator, I’m going even further. It’s the only reason--to get access. . . .” 

Id. at 2913, n.46. 
6 

enlisting officials from the Department of Energy in the effort 

to promote Tamraz’s mission. Id. at 2925-28. 

Although Tamraz clearly succeeded in buying access to the 

highest levels of government in exchange for his $300,000 of 

donations, he did not ultimately succeed in his goal of 

obtaining government support for his project. But his own 

conclusion was not that money fails to buy policy, but rather 

that he had not given enough money. He told the Thompson 

Committee, “I think next time, I’ll give 600,000 [dollars].” 

Id. at 2930. 

The Thompson Committee investigation followed months 

of front-page headlines about a wide range of scandals arising 

out of the fundraising practices of the 1996 campaign. These 

scandals included: 

• 	The “sale” of White House access to major donors 

through “coffees,” overnight stays in the Lincoln Bedroom and other presidential events. Id. at 191-499. 

• 	The funneling of funds into U.S. elections from foreign 

nationals to influence U.S. policy through political 

contributions. Id. at 2499-2517. 

• 	The influence that political donations may have had on 

federal review of Indian casino operations. Id. at 3165-

3547. 

• 	The use of non-profit groups as “fronts” for funneling 

party soft money into federal campaigns. Id. at 5974-81 

(Minority Rpt.). 

Although diverse stories, these scandals of the 1996 campaign are unified by a common thread–soft money. 

Protections against the pernicious influence on federal 

elections of corporate and union donations, and of unlimited 

individual contributions, had been put in place by Congress 

over time since the beginning of the last century. These laws 

were enacted precisely in order to prevent the same reality 

and appearance of corruption and influence-peddling that 

were graphically on display in the 1996 campaign. But by 

that campaign, the rise of soft money as a means to 
7 

circumvent the federal campaign finance laws had become so 

dominant that the longstanding regulatory regime had all but 

collapsed. The result, as stated by the Thompson Committee, 

was that the President and his aides “left themselves open to 

strong suspicion that they were selling not only access to high 

ranking officials, but policy as well.” Id. at 3. 

II. 	This Court Has Long Recognized that AntiCircumvention Measures Serve a Compelling 

Purpose in Ensuring that the Campaign Finance 

Laws Are Effective. 

Last Term, in Beaumont, this Court once again recognized 

the important role played by anti-circumvention measures in 

protecting the integrity of the campaign finance laws. In 

upholding a ban on corporation contributions, the Court said 

that “[q]uite aside from war-chest corruption and the interests 

of contributors and owners,” the restriction on corporations 

was separately justified because it “hedges against their 

use as conduits for ‘circumvention of [valid] contribution 

limits.’” 123 S. Ct. at 2207, quoting Colorado Republican II, 

533 U.S. at 456. As the Court noted in Colorado Republican 

II, “all Members of the Court agree that circumvention is a 

valid theory of corruption. . . .” 533 U.S. at 457. 

Precisely because “substantial evidence demonstrates how 

candidates, donors and parties test the limits of the current 

law,” id., anti-circumvention measures are necessary. While 

corporations were the vehicle threatening circumvention in 

Beaumont, it was the political parties that posed the same 

danger in Colorado Republican II. There, the Court upheld 

limits on party coordinated expenditures in order to prevent 

the use of parties “as conduits for contributions meant to 

place candidates under obligation,” id. at 452, and to forestall 

their “exploitation as channels for circumventing contribution 

and coordinated spending limits. . . . ,” id. at 455. 

Similarly, in California Medical Ass’n. v. FEC, 453 

U.S. 182, 197-98 (1981), the Court upheld the limit on contributions to multi-candidate political committees, 2 U.S.C. 
8 

§ 441a(a)(1)(C), in order “to prevent circumvention of the 

very limitations on contributions that this Court upheld in 

Buckley.” And in Buckley, the Court sustained the aggregate 

annual limit on contributions by an individual, because it 

“serves to prevent evasion of the $1,000 contribution limitation by a person who might otherwise contribute massive 

amounts of money to a particular candidate through...huge 

contributions to the candidate’s political party.” Buckley, 424 

U.S. at 38. 

BCRA is, at bottom, an anti-circumvention measure. By 

1996, the growth of soft money had caused, in the words of 

the Thompson Committee, “the erosion of safeguards in U.S. 

election law designed to guard against political corruption . . . .”

9 BCRA was enacted precisely to close the soft 

money loophole, to repair this erosion, and to prevent the 

continued evasion of current law. 

III. 	Over the Last 25 Years, the Soft Money System 

Has Evolved into a Massive Scheme for Political 

Parties, Federal Candidates and Campaign Donors 

to Circumvent the Federal Campaign Finance 

Laws. 

The enactment of the Federal Election Campaign Act 

Amendments of 1974, Pub. L. 93-443, 88 Stat. 1263 (FECA), 

was a milestone in the effort to limit the deleterious influence 

of large campaign contributions on the federal political 

process. Based on evidence of serious improprieties resulting 

from the flow of campaign contributions in the 1972 presidential election, and the concomitant public concerns arising 

out of the Watergate investigation,10 Congress enacted FECA 

in order to, inter alia, limit the amount of money that donors 

9

 Thompson Committee Report, supra note 4, at 33. 10 The Final Report of the Senate Select Committee on Presidential 

Campaign Activities, S. Rep. No. 93-981, 93d Cong., 2d Sess. (1974). 
9 

could give to federal candidates,11 and to political committees, including party committees.

12 These contribution limits 

were upheld in Buckley because they serve a compelling 

governmental interest in dealing “with the reality or appearance of corruption inherent in a system permitting unlimited 

financial contributions, even when the identities of the 

contributors and the amounts of their contributions are fully 

disclosed.” 424 U.S. at 28. 

So too, FECA re-codified the longstanding prohibition on 

contributions and expenditures by corporations and labor 

organizations in connection with federal elections.13 “The 

overriding concern behind the enactment” of this prohibition 

“was the problem of corruption of elected representatives 

through the creation of political debts. The importance of the 

governmental interest in preventing this occurrence has never 

been doubted.” FEC v. Nat’l Right to Work Comm., 459 U.S. 

197, 208 (1982), quoting First Nat’l Bank of Boston v. 

Bellotti, 435 U.S. 765, 788 n. 26 (1978); see also Beaumont, 

123 S. Ct. at 2206. These provisions also seek “to eliminate 

the distortion caused by corporate spending” in the political 

process, Austin v. Mich. State Chamber of Commerce, 494 

U.S. 652, 660 (1989), and to protect shareholders and union 

members from having their funds “used to support political 

candidates to whom they may be opposed,” Nat’l Right to 

Work, 459 U.S. at 208. 

11 2 U.S.C. § 441a(a)(1)(A) (limit of $1,000 per election). This amount 

was increased by BCRA to $2,000 per election. See BCRA § 307(a)(1). 12 2 U.S.C. § 441a(a)(3) (2002) (aggregate individual limit of $25,000 

per year to all candidates and committees). This limit was increased by 

BCRA to $95,000 per two-year election cycle. See BCRA § 307(b). In 

the 1976 FECA Amendments, contributions to national party committees 

were made subject to a limit of $20,000 per year, 2 U.S.C. § 441a(a) 

(1)(B), an amount now increased by BCRA to $25,000 per year. BCRA 

§ 307(a)(2). 13 2 U.S.C. § 441b. For a history of this prohibition, see generally FEC 

v. Nat’l Right to Work Comm., 459 U.S. 197, 208-09 (1982). 
10 

Shortly after the enactment of the 1974 FECA Amendments, the soft money system developed as a means to evade 

these contribution limits and source prohibitions. 

Over the last 25 years, and until the effective date of 

BCRA, soft money donations have consisted of the unlimited 

sums--in some cases considerably more than $1 million from 

a single donor--given to the national or state political parties 

by corporations, labor organizations and wealthy individuals, 

and then spent by the parties, in conjunction with their federal 

candidates, on activities that were intended to influence, and 

that had the effect of influencing, federal elections.

14 

The soft money system, which began in 1978, just four 

years after passage of the FECA, developed slowly at first, 

but then grew with escalating velocity. By the 1996 

presidential election cycle, the soft money system had 

become little more than a massive scheme for circumventing 

the federal election laws. 

14 For instance, the American Federation of State, County and Municipal Employees (AFSCME) gave $7.4 million in the period January 1, 

2001 through November 5, 2002, virtually all of it to the Democratic 

Party. The Pharmaceutical Research & Manufacturers of America 

(PhRMA) in the same period gave $3.4 million, virtually all to the 

Republican Party. The two major parties together collected a total of 

$470 million in soft money in that period. See Common Cause, The Soft 

Money Finale!, Follow the Dollar Report (April 7, 2003), available at 

http://www.commoncause.org/publications/april03/040703.htm. 

The most cynical form of soft money comes from “double givers”--

those who make large contributions to both parties in the same election 

cycle. In the 2002 cycle, there were 37 donors who gave $250,000 or 

more to both political parties. These included AT&T, which gave $1.5 

million to the Democrats, and $1.7 million to the Republicans; the Philip 

Morris Companies, which gave $625,000 to the Democrats and $2.2 

million to the Republicans, and Microsoft, which gave $2.7 million to the 

Democratic party committees and $852,000 to the Republican committees. Id. 
11 

A. Phase One: 1978-1988--The creation of the soft 

money system based on the fiction that soft 

money does not affect federal elections. 

The soft money system was founded on a regulatory fiction 

promulgated by the Federal Election Commission–that 

spending by the political parties on “mixed” activities such as 

voter registration or get-out-the-vote drives which, by their 

nature, affect federal, as well as non-federal, elections, can be 

parsed into those separate components, and that the nonfederal portion can be funded by soft money without those 

funds affecting federal elections. 

This conclusion was first set out by the FEC in a 1978 

advisory opinion that reversed a position the Commission had 

taken just two years earlier. In the earlier opinion, the FEC 

had held that state parties had to pay for “mixed” voter 

activities using solely hard money, i.e., monies raised under 

the federal law rules, because those activities affected federal 

elections, even in part.15 

But in its 1978 advisory opinion, the FEC opened the door 

to soft money in federal elections by reversing itself and 

holding that such mixed activities could be financed with a 

combination of federal and non-federal funds.16 The Commission left it up to the discretion of the parties to decide on 

the proper mixture of such funds, requiring only that the 

allocation be made on a “reasonable basis.”17 This ruling 

allowed state parties to spend soft money on activities that 

would affect federal elections.18 

15 Response to FEC Advisory Opinion Request 1976-72 (Oct. 6, 1976); 

see also Response to FEC Advisory Opinion Request 1976-83 (Oct. 12, 

1976). 

16 See FEC Advisory Opinion 1978-10 (August 29, 1978). 17 See 11 C.F.R. § 106.1(e) (1978) (permitting allocation to be made 

“in proportion to the amount of funds expended on federal and nonfederal 

elections, or on another reasonable basis”). 18 This included not only get-out-the-vote and voter registration drives, 

but also “generic” party activities, such as ads that say “Vote Republican.” 
12 

Not surprisingly, the national parties soon followed suit. In 

1979, the FEC opined that the national parties, as well, could 

open non-federal accounts to raise soft money, and that the 

same allocation principles would apply to national party 

expenditures.19 

In November 1984, Common Cause petitioned the FEC to 

institute a rulemaking to reverse these administrative interpretations, arguing that soft money was being used in a 

wholesale manner to influence federal elections.20 After a 

two-year consideration of the petition, the Commission 

denied the request.21 Common Cause then sued the FEC for 

abuse of discretion. 

19 See FEC Advisory Opinion 1979-17 (July 16, 1979). In 1979, Congress amended the FECA to encourage state parties to spend money on 

grassroots activities such as voter registration and get-out-the-vote 

drives. See Federal Election Campaign Act Amendments of 1979, Pub. L. 

No. 96-187, 93 Stat. 1339. Contrary to the belief of some, these 

Amendments did not authorize the soft money system. Although the 1979 

Amendments provided that money spent by state parties on certain 

grassroots activities was exempt from the definition of “expenditure,” and 

thus exempt from the overall limit on party spending in 2 U.S.C. 

§ 441a(d), the law expressly stated that the money spent for these 

activities is subject to federal contribution limits and source prohibitions. 

2 U.S.C. § 431(9)(B)(viii), (ix) (exempting certain voter activities from 

the definition of “expenditure” provided “such payments are made from 

contributions subject to the limitations and prohibitions of this Act”). 

Thus, the importance of the 1979 amendments was to provide greater 

room for state parties to spend money on grassroots voter activities, but 

not to authorize that spending be done with non-federal funds. See 

Thompson Committee Report, supra note 4, at 4463-4. 20 See FEC Rulemaking Petition: Notice of Availability, 50 Fed. Reg. 

477 (Jan. 4, 1985) (citing Letter of November 5, 1984 from Fred Wertheimer, President of Common Cause, to Lee Ann Elliott, chair, Federal 

Election Commission). 21 FEC Rulemaking Petition: Notice of Disposition, 51 Fed. Reg. 

15,915 (April 29, 1986), quoted in Common Cause v. FEC, 692 F. Supp. 

1391, 1393 (D.D.C. 1987). 
13 

The district court ordered the FEC to issue new regulations, 

finding that the agency had acted contrary to law by allowing 

the parties too much discretion in determining the mixture of 

hard and soft money to spend on mixed activities.22 After a 

year passed without action by the Commission, the court 

again ordered the agency to act, noting that “it is undisputed 

that there is a public perception of widespread abuse, 

suggesting that the consequences of the regulatory failure 

identified a year ago are at least as unsettling now as then.”

23 

Finally, three years later, in 1991, the FEC promulgated new 

regulations on soft money, but in effect only codified the 

existing soft money system by establishing specific percentages for the allocation of hard and soft money in different 

scenarios.24 In addition, the regulations, for the first time, 

required the national parties to disclose their soft money.

25 

B. Phase Two: 1988-1996--The integration of soft 

money into the presidential campaigns. 

While the FEC was engaged in its protracted rulemaking 

process, the use of soft money in federal campaigns underwent dramatic change in the 1988 presidential campaign. The 

nascent soft money system had operated at a comparatively 

modest level in prior election cycles, with both national 

parties raising and spending a total of about $20 million in 

22 692 F. Supp. at 1396. In fact, the court noted that the Commission 

might reasonably conclude “that no method of allocation will effectuate 

the Congressional goal” that only hard money be spent on activities 

influencing federal elections. Id. (emphasis in original). 23 Common Cause v. FEC, 692 F. Supp. 1397, 1399 (D.D.C. 1988). 24 See Methods of Allocation Between Federal and Non-Federal Accounts; Payments; Reporting, 55 Fed. Reg. 26,058 (June 26, 1990) 

(codified at 11 C.F.R. § 106.5 (1991)) (establishing several methods and 

formulae for allocation that depend on whether the spending is by a 

national or state party committee, whether the spending is in a presidential 

or non-presidential election year, and whether the activity being funded is 

party administrative costs, generic voter drives, or fundraising). 25 Id.; see also 11 C.F.R. § 104.8(e)(2002). 
14 

non-federal funds in each of the 1980 and 1984 campaigns.26 

In 1988, however, this amount doubled--to a total of $45 

million.27 

Soft money in the 1988 cycle for the first time became an 

integrated part of the major party presidential campaigns, 

organized and directed by the top strategists and fundraisers 

of those campaigns. Democratic nominee Governor Michael 

Dukakis and Republican nominee Vice President George 

Bush, in conjunction with their national parties, systematically solicited individuals for six figure contributions to 

their respective political parties--amounts far in excess of 

federal contribution limits.28 

The spiral of soft money fundraising began with the 

Dukakis campaign which, led by its treasurer and chief 

fundraiser Robert Farmer, initiated a program to solicit 

$100,000 contributions from wealthy individual donors.29 At 

26 Expert Report of Thomas E. Mann, available in the record at DEV 

(Defendants’ Evidentiary Volume) 1, Tab 1, at Table 1, National Political 

Party Spending, 1976-2000. 27 Id. 28 See Charles Babcock, $100,000 Donations Plentiful Despite PostWatergate Restrictions, Wash. Post, Sept. 22, 1988, at A27 (“Spurred by 

competition between presidential fundraisers, the number of $100,000 

donors in this election year has already surpassed that in the 1972 

Watergate era, when alleged abuses triggered reform in federal election 

financing.”); Brooks Jackson, Democrats’ Coffers Fill Up as Fat Cats 

Seek Bigger Role in Party, Wall St. J., July 19, 1988, at 60 (“Fat cats are 

back, more numerous and playing a bigger role in Democratic politics 

. . . . More than 200 people have become Democratic Party ‘trustees’ by 

agreeing to give $100,000 for the fall campaign, or to raise such an 

amount from others.”). 

29 Brooks Jackson, GOP Is Aiming New Fund Drive at Big Donors, 

Wall St. J., Aug. 17, 198, at 44 (“The see-sawing spending war was 

touched off weeks ago by Michael Dukakis’s chief fundraiser, Robert 

Farmer . . . Mr. Farmer stunned the political community by announcing 

his intention to raise a total of $50 million in party funds, including much 

soft money, to be spent in addition to the $36 million in public funds to be 

spent directly by the Dukakis campaign.”). See also Charles Babcock, 
15 

first, the Bush campaign attacked the Dukakis soft money 

operation as, according to deputy campaign manager Richard 

Bond, “illegal on its face.”30 Shortly thereafter, however, 

when it failed to stop the Dukakis soft money effort, the Bush 

campaign moved to match, and then out-raise it.31 The Bush 

“Team 100” fundraising campaign of $100,000 soft money 

donors was headed by Robert Mosbacher, who had been 

serving as the chief fundraiser for the Bush presidential 

campaign.32 

Thus, the chief fundraiser for each presidential candidate 

headed each party’s soft money fundraising drive. According 

to The Wall Street Journal, 267 individuals and corporations 

made contributions of up to $100,000 to the Bush effort, 

while a top Dukakis fundraiser said “his $100,000 club 

numbered 130 individuals.”33 Ultimately, each presidential 

campaign raised more than $20 million in soft money.

34 

Fund-Raisers Gear Up for Fall Race, Wash. Post, June 27, 1988, at A1; 

Thomas Edsall, ‘Victory Fund’ Raises Millions for Party, Wash. Post, 

July 19, 1988, at A21 (Edsall, Victory Fund). 30 Thomas Edsall, GOP Plans Big-Donor Drive, Wash. Post, Aug. 16, 

1988, at A1 (Edsall, Big Donor Drive). See also Brooks Jackson, Broken 

Promise: Why the Federal Election Commission Failed 52 (1990) 

(Jackson, Broken Promise). 31 Richard Berke, Big Money’s Election Year Comeback, N.Y. Times, 

Aug. 7, 1988, at E5 (“‘The Democrats are saying that they’re going for the 

big money,’ said Robert A. Mosbacher, Jr., finance chairman of the Bush 

campaign. ‘And I don’t think there’s much we can do about it but match 

them.’”); Thomas Edsall, Soft Money Competition: GOP Seeking $50 

Million from Big Donors, Wash. Post, Aug. 16, 1988, at A1 (Edsall, Soft 

Money) (“For the GOP, the decision to go with Team 88 represents a 

major policy change. As recently as three weeks ago, top officials of Vice 

President Bush’s campaign described the almost identical Democratic 

program as blatantly illegal. . . . According to Mosbacher, ‘We intend to 

match the Democrats plus $1.’”). 32 Edsall, Soft Money, supra note 31. 33 Brooks Jackson, Bush, Dukakis Presidential Campaigns Each Spent 

More than $100 Million, Wall St. J., Dec. 11, 1988. 34 Jackson, Broken Promise, supra note 30, at 54. 
16 

The 1988 presidential campaigns were involved not only in 

raising soft money but in spending it as well. A spokesperson 

for the RNC soft money effort said “the decision on how to 

spend Team 88 money will be made primarily by key 

officials of the Bush campaign, including Lee Atwater, the 

campaign manager and [Richard] Bond [the deputy campaign 

manager] . . . [T]he basic criterion in picking states to benefit 

from the fund will be the closeness of the presidential race.”

35 

Soft money was used in the 1988 election to perform vital 

“ground war” functions for the presidential campaigns--such 

as get-out-the-vote and other field operations.36 In Illinois, 

for example, The New York Times reported that the Dukakis 

campaign had only five paid staff members. But it shared 

office space with Campaign ’88, a “state party” operation 

organized by the DNC and employing 115 workers across the 

state, paid for with a budget of $2 million in soft money.

37 

Peter Kelly, chairman of the California Democratic Party, 

told the Times that the “whole theory behind” the 1988 soft 

money effort was to raise enough money to help Dukakis win 

the state.38 In short, the 1988 presidential campaigns were 

structured as two parallel operations--an official campaign 

receiving public funds and subject to a spending limit, and an 

35 Edsall, Big Donor Drive, supra note 30. 36 T. Edsall, Victory Fund, supra note 29 (“The money raised by the 

Victory Fund and Victory 88 will be used to finance what is known as the 

‘ground war’ of the campaign: get-out-the-vote drives, voter registration, 

direct mail and voter list development. To the degree a soft money 

campaign is successful, it permits the presidential campaign to spend a 

high percentage of the $46.1 million in federal money each nominee 

receives on the ‘air war’--television advertising and moving the 

candidates around the country.”). 37 Richard Berke, In Election Spending, Watch Ceiling and Use a 

Loophole, N.Y. Times, Oct. 3, 1988, at A23. 38 Richard Berke, Contributors Help Dukakis by Avoiding Limits He 

Set, N.Y. Times, Oct. 31, 1988, at B5. 
17 

unofficial campaign raising and spending unlimited amounts 

of soft money.

39 

C. 	Phase Three: 1996-2002--The expansion of the 

soft money system from the “ground war” to 

the “air war.” 

If the 1988 campaign saw soft money being used to pay for 

presidential “ground war” activities, the 1996 campaign saw 

soft money spent to finance presidential “air war” efforts as 

well. Beginning in late 1995, President Clinton’s reelection 

campaign used millions of dollars of soft money to fund so 

called “issue” ads run through the DNC or Democratic state 

parties. In reality, those ads were nothing more than 

candidate-specific campaign ads promoting the President’s 

re-election effort. By early 1996, the presidential campaign 

of Senator Robert Dole followed suit. 

The explosive growth of soft money in the 1996 cycle-­

from a total of $80 million in 1992 (itself a near-doubling 

from the amount in the 1988 cycle) to more than triple that 

amount, over $271 million, in 199640--was fueled by the 

39 This dichotomy illustrates another major harm caused by the soft 

money system--the subversion of not only the contribution limits and 

source prohibitions of federal law, but the spending limits of the public 

financing system as well. Under 26 U.S.C. § 9003(b), a major party 

nominee who receives public funds is prohibited from raising or spending 

any additional funds for his or her general election campaign. But since 

1988, while party nominees have made a binding commitment to limit 

their general election spending to the amount of the public grant, they 

have then solicited soft money donations to their political parties and 

controlled the spending of that money through their parties to advance 

their campaigns. The spending limit on which the grant of public funds is 

conditioned has become largely meaningless. Thus, the injection of soft 

money into the middle of presidential campaigns has dramatically undermined key purposes of the presidential public financing law--“to reduce 

the deleterious influence of large contributions on our political process . . . 

and to free candidates from the rigors of fundraising.” Buckley, 424 

U.S. at 91. 40 Mann Expert Report, supra note 26, at Table 1. 
18 

collision of the soft money loophole with the sham “issue” ad 

loophole, in a “perfect storm” that effectively destroyed the 

barriers between hard money and soft money spending in 

federal elections.41 In short, the political parties, working in 

close conjunction with their presidential candidates, started to 

spend soft money to pay for the broadcast of candidatespecific campaign ads that simply avoided the use of express 

advocacy phrases like “vote for” or “vote against.” 

There was no foundation in law for this development. In 

Buckley, this Court made clear that the “express advocacy” 

test was intended to address a problem of vagueness encountered in regulating the political activities of “an individual other than a candidate or a group other than a political 

committee,” Buckley, 424 U.S. at 79. Thus, the “express 

advocacy” test was not meant to apply to spending by 

candidates and political parties, whose expenditures, this 

Court said, do not present comparable issues of vagueness 

because their activities “can be assumed to fall within the 

core area sought to be addressed by Congress. They are, by 

definition, campaign related.” Id.42 

Nonetheless, in late 1995, the DNC, working under the 

direction and control of the Clinton re-election campaign, 

began to use soft money to fund an aggressive nationwide 

program of TV ads promoting President Clinton and his 

41 Sebastian Junger, The Perfect Storm (1997). 42 The DNC claimed that its new use of soft money was permitted 

under FEC Advisory Opinion 1995-25 (Aug. 24, 1995), which held that 

“legislative advocacy media advertisements” run by a national party 

committee could be funded with an allocated mixture of hard and soft 

money. But this claim was wrong: the Commission’s opinion was 

explicitly based on the condition that the ads would not refer to a federal 

candidate, or if they did so at all, would not contain any “electioneering 

message.” See FEC Advisory Opinion 1995-25, n.1. 
19 


policies, or criticizing Senator Dole.

43 These ads were 

written, edited, produced, directed and targeted by Clinton 

campaign officials, and the President himself was personally 

involved in the effort.44 The ads were run in key “battleground” states for the 1996 presidential election.45 

By early 1996, Republican nominee Senator Robert Dole 

and the RNC began running a similar TV ad campaign, using 

soft money to promote Dole’s candidacy.

46 That effort was 

coordinated by the Dole campaign.47 

43 A typical Clinton/DNC soft money ad was called “Finish,” and 

promoted President Clinton while criticizing Senator Dole: 

Head Start. Student loans. Toxic cleanup. Extra police. Anti-drug 

programs. Dole, Gingrich wanted them cut. Now they’re safe. 

Protected in the ’96 budget--because the President stood firm. Dole, 

Gingrich? Deadlock. Gridlock. Shutdowns. The president’s plan? 

Finish the job, balance the budget. Reform welfare. Cut taxes. 

Protect Medicare. President Clinton says get it done. Meet our 

challenges. 

See Thompson Committee Report, supra note 4, at 4478. See also 

Investigation of Illegal or Improper Activities in Connection with 1996 

Federal Election Campaigns: Hearings Before the Senate Committee on 

Governmental Affairs, 105th Cong., S. Hrg. No. 105-300 Part VIII (1997) 

(“Thompson Committee Hearings”) 277-317 at 301 (letter from Ann 

McBride, President of Common Cause, to Attorney General Janet Reno 

(October 9, 1996) (“Common Cause Letter”) at 25). 44 See Thompson Committee Report, supra note 4, at 107-129. 45 The evidence discussing the efforts by the Clinton and Dole campaigns to promote their candidates using ads run through their respective 

political parties and paid for with soft money is extensively discussed in 

the letter of October 9, 1996 sent by Common Cause to the Department of 

Justice seeking an investigation of these practices as violations of the 

campaign finance laws. See Common Cause Letter, supra note 43. 46 Id. A typical Dole/RNC soft money ad was called “Stripes,” and 

criticized President Clinton: 

Bill Clinton, he’s really something. He’s now trying to avoid a 

sexual harassment lawsuit claiming he is on active military duty. 

Active duty? Newspapers report that Mr. Clinton claims as 

commander in chief he is covered under the Soldiers and Sailors 

Relief Act of 1940, which grants automatic delays in lawsuits 
20 

The two presidential campaigns and their parties ultimately 

spent more than $60 million during the 1996 election on ads, 

funded in substantial part with soft money, that praised their 

candidate or criticized the opposing candidate by name. 

Much of this money was solicited by the presidential 

candidates or their campaign fundraisers, and donated to the 

national party committees, which then transferred a mixture 

of hard and soft money funds to particular state parties. The 

state parties immediately transferred the same funds back to 

the Washington, DC-based media consultants for the 

presidential campaigns, who then placed the ads in the name 

of the state party.

48 

This flow of funds highlights the integral role in the 

soft money system played by the state parties, which acted as 

little more than conduits for injecting soft money into the 

against military personnel until their active duty is over. Active 

duty? Bill Clinton, he’s really something. 

Common Cause Letter, supra note 43, at 36. 47 See Thompson Committee Report, supra note 4, at 8294-8305 

(Minority Rpt.). 48 To trace just two of several hundred similar transactions documented 

in the evidence compiled by Common Cause, the DNC on November 17, 

1995 transferred $81,070 in soft money to the California Democratic 

Party, and on November 21, 1995 transferred $39,930 in hard money. On 

November 22, 1995, the California Democratic Party transferred $81,070 

in soft money and $39,930 in hard money to Squier, Knapp, Ochs 

Communications, a media consultant for the Clinton presidential committee, to pay for a broadcast ad aired in the name of the state party. 

Similarly, on June 24, 1996, the RNC transferred $780,870 in soft money 

to the California Republican State Party, and on June 25, 1996, it 

transferred $384,608 in hard money. On June 25, 1996, the California 

state party sent $780,870 in soft money and $384,608 in hard money to 

Multi-Media Services Corp., a media buyer in Alexandria, Virginia that 

made the media buys for the Dole campaign and was headed by the chief 

pollster for Dole. See Common Cause, The Money Trail: The Democrats 

(1996) and The Money Trail: The Republicans (1996), in the record at 

DEV 36, Tab 9 and Tab 10; see also Thompson Committee Report, supra 

note 4, at 4467. 
21 

presidential campaigns. Most of the soft money deployed in 

the 1996 campaign by the national parties was routed through 

the state parties and then paid out to the media consultants for 

the presidential campaigns. This was done in order to 

maximize the amount of soft money that could be used to 

fund the ads.49 

But substantial amounts of soft money also were donated 

directly to the state parties at the behest of national party 

officials, thus bypassing the national party accounts in order 

to avoid federal reporting requirements.50 Thus, for instance, 

at the same time that “Vice President Gore was attacking the 

Republican National Committee as ‘just about a wholly 

owned subsidiary of the tobacco industry,’ DNC fundraisers 

asked R.J. Reynolds Tobacco Co. to make campaign contributions through state Democratic parties.”51 

And there are many other examples. Roger Tamraz, for 

instance, made most of his contributions directly to Democratic state parties, at the direction of DNC officials, 

including $100,000 to the Virginia state party and $25,000 to 

the Louisiana state party.

52 Another controversial DNC fundraiser, John Huang, solicited $482,500 in soft money that was 

49 FEC allocation regulations more leniently regulated state parties, and 

allowed them to spend a greater proportion of soft money on an ad, than 

could the national party in airing the same ad. Compare 11 C.F.R. 

§ 106.5(b) (2002) (allocation of expenses between federal and non-federal 

activities by national party committees) with id. at § 106.5(d) (2002) 

(allocation by state and local party committees). 50 See Charles Babcock, DNC Diverted Controversial Donations, 

Wash. Post, April 13, 1997, at A1 (“Democratic National Committee 

officials channeled millions of dollars in campaign donations to state 

Democratic parties last year, effectively hiding big contributions from 

tobacco, gambling and other special interests . . . Because the money was 

not deposited in the accounts of the national party, the identities of the 

donors did not appear on the DNC’s federal disclosure reports.”). 51 Id. 52 See Thompson Committee Report, supra note 4, at 2913-14. 
22 

given directly to Democratic state parties in 1996.53 Carl 

Lindner, chairman of Chiquita Brands and a longtime 

Republican donor, “quietly gave $415,000 to about two dozen 

Democratic state parties . . . in April 1996, only hours after 

the [Clinton] administration formally challenged European 

Union trade sanctions against Central American bananas 

grown by Chiquita.”54 

In October, 1996, Common Cause filed a complaint with 

the Justice Department that urged the appointment of an 

independent counsel to conduct a criminal investigation into 

the “knowing and willful” violation of the federal election 

laws arising from the use of soft money by both parties and 

both presidential campaigns in the 1996 election.55 A parallel 

complaint was filed with the FEC, calling on the agency to 

pursue civil violations of the law. 

After a two year criminal investigation, the Attorney 

General ultimately closed the Justice Department’s inquiry 

without taking action,56 and referred the matter for civil 

53 See Ira Chinoy, DNC Donors Also Gave to State Groups, Wash. 

Post, Jan. 26, 1997, at A1. 54 George Archibald, Banana Baron Peeled off Half a Mil; White 

House Paid Back in WTO Fight, Wash. Times, Aug. 25, 1997, at A1. 

According to Time, “DNC officials instructed Lindner to give directly to 

state party coffers, which are subject to far less public scrutiny than 

federal election accounts.” Michael Weisskopf, The Busy Back Door 

Men, Time, March 31, 1997, at 40. 55 See Common Cause Letter, supra note 43. 56 Notification to the Court Pursuant to 28 U.S.C. § 592(b) of the 

Results of Preliminary Investigation filed in In re William Jefferson 

Clinton (D.C. Cir. Dec. 7, 1998) (Independent Counsel Division). The 

Attorney General did not conclude that the soft money advertising was 

lawful, but only that the campaigns acted pursuant to advice of counsel, 

and therefore lacked the requisite specific intent to commit a criminal 

violation of the law. Id. at 8. 
23 

enforcement to the FEC which also--contrary to the advice of 

its staff--failed to act.57 

In the absence of any law enforcement action, the abuses of 

1996 became the established practices of subsequent campaigns. Both presidential candidates in the 2000 election 

cycle raised soft money, which was funneled through national 

party accounts to state party accounts and then used to fund 

so-called “issue” ads promoting their campaigns.58 

57 See Statement of Reasons of Comm. Scott E. Thomas in In the 

Matter of Dole for President, Inc. et al., MURs 4553 and 4671 (FEC May 

25, 2000) at 2-5, available at http://www.fec.gov/members/thomas/ 

Thomasstatement05.htm (recounting procedural history of the FEC’s 

consideration of the audit and enforcement actions involving the 1996 

presidential campaign spending). On most of the series of votes about 

whether to proceed with the enforcement actions, the Commission 

deadlocked by a vote of 3-3, thus resulting in the closure of the 

matters. Id. 58 See e.g., Howard Kurtz, DNC Issue Spot Touts Gore’s Medicare 

Plan, Wash. Post, June 8, 2000, at A4: 

The Democratic National Committee unveiled its first issue ad 

designed to boost Vice President Gore’s campaign yesterday, 

featuring Gore calling for expanded Medicare benefits to shield the 

elderly from “ridiculously high prices for prescription medicines.” 

While Democratic National Chairman Joe Andrew ... described 

the commercial as a “party-building” spot, it never mentions the 

Democratic Party. Instead, the 30 second ad spotlights Gore and a 

Web site touting “the Gore Plan,” and is produced by Gore’s media 

consultants, including Carter Eskew and Robert Shrum. . . . 

The ad is financed in part by controversial “soft money” donations to the party that are supposed to be used to generate support 

for the party and not to explicitly promote a specific candidate. 

See also Peter Marks, Some Soft Money to Pay for Gore Ad Blitz, N.Y. 

Times, June 7, 2000, at A28. The RNC shortly followed suit, running 

similar ads praising its nominee, George Bush. See Howard Kurtz, GOP 

Launches Its First Salvo in ‘Issue’ Ad War, Wash. Post, June 11, 2000, 

at A4. 

Common Cause (joined by Democracy 21) again filed complaints with 

the Department of Justice and the FEC arguing that this use of soft money 

was illegal. Neil A. Lewis, The 2000 Campaign: The Donations; 2 
24 

During the 1990’s, soft money also migrated from the 

presidential to the congressional level, where it was raised by 

congressional candidates and used, first, for grassroots 

activities and then, for broadcast ads to promote congressional candidates. 

There is no clearer illustration of this point than in the 

growth of soft money raised by the congressional campaign 

committees of both parties. These committees are national 

party entities that consist in their entirety of sitting Members 

of Congress in both Houses, and that have the purpose of 

electing candidates of each party to the House and Senate.59 

Notwithstanding this exclusively federal campaign function, all four congressional committees have raised and spent 

huge sums of soft money, exposing the myth that soft money 

is used only for non-federal purposes. In the 2002 election 

cycle, for instance, the DCCC raised $53.7 million in soft 

money, more than three times what it had raised in the 1998 

cycle. The NRCC similarly tripled its 1998 soft money total, 

to $60.7 million in the 2002 cycle. The two Senate campaign 

Groups Ask Justice Dept. To Investigate Parties’ Ads, N.Y. Times, July 

28, 2000, at A16. Both complaints were ultimately dismissed without 

action. 59 The Democratic Congressional Campaign Committee (DCCC), for 

instance, describes itself as “the only national party committee whose 

principal mission is to elect Democrats to the House of Representatives.” 

See DCCC website at http://www.dccc.org/about/. Similarly, the 

Democratic Senatorial Campaign Committee (DSCC) describes itself as 

“the national committee of the Democratic Party formed to elect 

Democratic members of the United States Senate.” See DSCC website at 

http://www.dscc.org/information/about/. To the same effect, the National 

Republican Senatorial Committee (NRSC) says on its website, “It is our 

sole responsibility to make sure that Republican Senate candidates are 

elected to the United States Senate.” See NRSC.org website at http:// 

www.nrsc.org/nrscweb/aboutus/. The National Republican Congressional 

Committee (NRCC) describes itself as “governed by its chairman, U.S. 

Rep. Tom Reynolds (NY-26), and an executive committee composed of 

Republican members of the U.S. House of Representatives.” See NRCC 

website at http://nrcc.org/nrcccontents/issuesagenda/overview.shtml. 
25 


committees did even better. The DSCC raised a total of 

$85.9 million in soft money in 2002, over four times what it 

raised in 1998. The NRSC increased its soft money from 

$23.2 million to $54.1 million.60 With regard to the soft 

money practices of the party congressional campaign committees, the Thompson Committee Minority Report noted: 

Like the national party committees, the parties’ national 

senatorial and congressional campaign committees raise 

and spend soft money in ways that render prohibitions 

on corporate and union contributions virtually meaningless. Senatorial and congressional campaign committees are intended, as their names imply, to help elect 

United States Senators and Representatives. . . . The 

amounts of soft money raised [in 1996] by the House 

and Senate committees increased dramatically over 

previous years, demonstrating the greater importance of 

soft money in the last election cycle.

61 

But the apotheosis of the soft money infiltration into 

congressional campaigns came with the development of 

congressional “joint fundraising committees”--which were in 

essence nothing more than dedicated soft money accounts for 

specific congressional candidates. These joint committees, 

used by more than 20 Senate campaigns in 2000, were typically formed between the candidate’s campaign committee and 

the senatorial campaign committee of the candidate’s national 

party. A Senate candidate typically solicited both soft and 

hard money for his or her designated joint committee. The 

hard money contributions would be disbursed to the 

60 See Common Cause, “National Parties Raise Record $470.6 Million 

In Soft Money During The 2001-2002 Election Cycle Before New Law 

Takes Effect” (Jan. 6, 2003), available at http://www.commoncause.org/ 

news/default.cfm?ArtID=83. 61 Thompson Committee Report, supra note 4, at 7518 (Minority Rpt.). 

The report also states: “Experts agree that soft money into the House and 

Senate campaign committees stretches to the limit the credibility of the 

argument that the money is being used only for party building and not to 

elect federal candidates.” Id. at 7527, n. 27. 
26 


candidate’s authorized campaign committee, and the soft 

money would be sent to the party senatorial committee, which 

would place the money in party soft money accounts. The 

party committee would then typically transfer the soft money 

to the state party of the Senate candidate who raised the 

money, which would then spend it for candidate-specific 

“issue ads” and other voter activities to support the Senate 

candidate.62 In effect, these joint fundraising committees 

allowed Senate candidates to raise soft money in their own 

name and for their own campaigns. All pretense of doing 

anything else was dropped.

63 

The growing use of soft money in congressional races in 

the 2000 cycle, combined with its continuing use in the 

presidential campaign, resulted yet again in the near doubling 

of the soft money raised, from $271 million in 1996 to $498 

million in 2000.64 The soft money system had now 

mushroomed into a loophole of nearly half a billion dollars. 

IV. 	Congress Crafted BCRA’s Soft Money Ban To 

Ensure That It Would End the Circumvention of 

the Campaign Finance Laws. 

Congress wrote Title I of BCRA in light of this history of 

how the soft money system actually evolved, and how it 

actually worked. Practical experience shows that the 

provisions of Title I are each necessary to close the soft 

money loophole. Three points in particular are crucial. 

62 See John M. Broder, Democrats Able to Circumvent Donation Limit, 

N.Y. Times, Dec. 22, 1999, at A1. 63 In April 2000, Common Cause and Democracy 21 filed a complaint 

with the FEC, alleging that these joint fundraising committees were 

illegal. The FEC ultimately dismissed the complaint without action. See 

Statement of Reasons of Comm. Scott E. Thomas in In the Matter of 

Ashcroft Victory Committee et al., MUR 4994 (FEC Dec. 19, 2001) 

available at http://www.fec.gov/members/thomas/thomasstatement41.html. 64 Mann Expert Report, supra note 26, at Table 1. 
27 

A. The total ban on national party soft money is 

necessary. 

Experience shows, as this Court has recognized, that 

parties act as agents “on behalf of those who seek to produce 

obligated officeholders.” Colorado Republican II, 533 U.S. 

at 452. The relationship between national parties and federal 

officeholders is so inextricably intertwined--as noted above, 

four of the six national party committees are in fact nothing 

more than associations of federal officeholders--that to serve 

anti-corruption purposes effectively, a soft money ban must 

preclude the national parties from raising or spending any soft 

money, for any purpose. Otherwise, national party officials 

will continue, as they have, to broker access to and influence 

with federal officeholders for those who donate large amounts 

of soft money to the national parties, even if the parties spend 

that money for purportedly non-federal purposes. Likewise, 

national party officials will continue, as they have, to direct 

donors like Roger Tamraz or Carl Lindner to make large 

contributions directly to state parties or candidates in a corrupt relationship that exchanges money for access to, or 

benefits from, federal officeholders. With regard to the 

national parties, Congress correctly recognized that the nub of 

the issue is how the money is raised, not how it is spent. 

B. The ban on state party soft money for “Federal 

election activities” is necessary. 

The history of the soft money system recounted above 

demonstrates why Congress was correct to extend Title I of 

BCRA to the state parties, which have been integral participants in the funneling of soft money into federal elections. 

The state parties have been the willing vehicles through 

which national parties and federal candidates have operated-­

to transfer, direct and spend soft money funds for federal 

electoral purposes. Indeed, as the flow of funds in the 1996 

campaign shows, the state parties have been used as eager 

conduits to “game” the allocation rules specifically in order 

to maximize the amount of soft money that could be spent. If 
28 

Congress had failed to take account of the role of the state 

parties in this history, and had banned soft money only for 

national party committees, the entire soft money system 

would simply have shifted to the state party level and recreated itself there. 

But this history also shows that the objections to BCRA by 

the Political Party Appellants are based on little more than 

hyperbole. BCRA is not the radical new regulatory regime 

they describe. State parties have for decades operated under 

federal rules that, inter alia, require them to use exclusively 

hard money for ads that expressly advocate the election of 

federal candidates, and to limit their contributions to, or 

spending in coordination with, federal candidates.65 

Moreover, since 1978, the state parties had operated under 

a federal allocation system that required them to use hard 

money to pay at least part of the costs of voter mobilization 

activities that affected federal elections (even if these activities also affected state and local elections)--a federal regulatory regime that Congress ultimately found was inadequate to 

protect compelling federal interests. 

Thus, BCRA does not suddenly impose federal rules on 

state parties where none had existed before. Instead, it simply 

defines, by statute, certain state party activities that Congress 

correctly deemed to affect federal elections, and substitutes 

one allocation system for another: instead of funding these 

activities with a mixture of hard money and soft money, the 

parties are now to fund them with a mixture of hard money 

and limited soft money funds raised pursuant to the Levin 

Amendment.66 If a state party wishes to avoid the conditions 

65 2 U.S.C. § 441a(a)(2)(A) (contribution limit); 2 U.S.C. § 441a(d) 

(coordinated spending limit). 66 2 U.S.C. § 441i(b)(2) (added by BCRA § 101(a)) (Levin Amendment). The Levin Amendment illustrates the particular care that Congress 

took in balancing the need to protect federal interests in preventing 

corruption, against its concern that state parties continue to have adequate 

resources to engage in grassroots voter drive activities. Not only did 
29 

placed on the use of Levin funds, it is free to spend entirely 

hard money for these activities. The state party has the 

choice. And by the same token, Congress has left wholly 

unregulated by federal law a wide range of state party 

activities that are directed solely to state and local elections.67 

C. 	The coverage of “voter mobilization” activities 

is necessary. 

Prior to the 1996 campaign, the soft money system operated exclusively through party spending on voter mobilization 

activities such as voter registration and GOTV drives, and 

generic campaign ads. That kind of spending--as the vivid 

experience of the 1988 presidential campaign shows--was 

how the soft money system worked. If Congress had failed to 

cover these activities in BCRA, the reform law would do little 

more than codify the pre-1996 soft money system, which was 

already a system awash in “Team 100” type donors who were 

solicited by the presidential campaigns for donations then 

spent on the “ground war” to affect federal elections. 

This history alone refutes the district court’s conclusion 

that such voter mobilization activities do not directly or 

sufficiently affect federal elections. Common sense also 

Congress double the individual contribution limit on hard money donations to state parties, BCRA § 102 (codified at 2 U.S.C. § 441a(a)(1)(D)), 

but in the Levin Amendment, it also provided state parties with an option 

to raise funds under more liberal rules for certain voter mobilization 

activities, in order to ameliorate the impact of BCRA on state parties. 67 BCRA itself expressly excludes from the definition of “Federal 

election activity” essential state party functions such as making contribuions to state and local candidates, all “public communications” (such as 

party-funded campaign ads) referring to state or local candidates if the 

communications are not otherwise “Federal election activity,” the costs 

of state and local conventions, and the costs of grassroots campaign 

materials that name only state or local candidates. 2 U.S.C. § 431(20) 

(B)(i)-(iv). In addition, any other state party spending that is not within 

the definition of “Federal election activity,” 2 U.S.C. § 431(20)(A), is also 

excepted, such as voter registration drives prior to 120 days before a 

federal election, or party administrative costs. 
30 

counsels that when state parties spend money to register their 

core voters and get them to the polling booth where they will 

cast votes on ballots that contain federal candidates, such 

spending will necessarily and substantially benefit federal 

candidates and affect those federal elections. Even if the 

party’s “message” in turning out voters is a generic one that 

promotes the party without mentioning any candidates, or is 

one directed solely to state and local races, there is no doubt 

that the voters who are brought to the polls then cast their 

ballots in federal races as well. That impact, and the history 

of circumvention which is the defining characteristic of the 

soft money system, amply justify Congress’ judgment to 

include such spending within the definition of “Federal 

election activity.”

68 

CONCLUSION 

The Court should sustain the constitutionality of BCRA as 

a measure necessary to address the dangers of corruption and 

the appearance of corruption caused by the rise of soft money 

in American campaigns, and as a necessary anti-circumvention measure to close the soft money loophole. 

68 The Party Appellants erroneously equate a loss of soft money 

funding for their voter mobilization activities with a limit (or even, ban) 

on the activities themselves. Nothing could be further from the truth. 

Although the Party Appellants repeatedly refer to Title I as a “spending 

limit,” e.g., Br. at 48, 50, or even, a “pure expenditure limit,” id. at 39, 

that is a clear mischaracterization. The state parties are free to engage in 

as much voter mobilization activity as they wish, and to spend as much as 

they want on such activities, so long as they use hard money, or funds 

otherwise permitted by the Levin Amendment. This is no “spending 

limit.” See Buckley, 424 U.S. at 21-22 (contribution limits upheld because 

their effect “is merely to require candidates and political committees to 

raise funds from a greater number of persons . . .”). 
Of Counsel: 

DANIEL B. KOHRMAN 

AARP FOUNDATION 

LITIGATION 

MICHAEL SCHUSTER 

AARP 

601 E Street, N.W. 

Washington, D.C. 20049 

(202) 434-2060 

August 5, 2003 

Respectfully submitted, 

DONALD J. SIMON * 


SONOSKY, CHAMBERS, SACHSE


ENDRESON & PERRY LLP 

1425 K Street NW, Suite 600 

Washington, DC 20005 

(202) 682-0240 

Counsel for Amici Curiae 

Common Cause and AARP 

* Counsel of Record