From MSNBC.com:

Democratic-Linked Groups Mount Ad Offensive
Tom Curry
MSNBC
May 11, 2007
WASHINGTON - 501(c)(4) - it's the most potent little algorithm in politics right now.

A 501(c)(4) is the Internal Revenue Service term for a tax-exempt organization "primarily engaged in promoting in some way the common good and general welfare of the community."

However one might define "the common good," the IRS allows such groups to take part in campaigns opposing or supporting candidates, as long as such electioneering is not the group's primary activity.

IRS guidelines suggest that as long as the group does not target voters in a candidate's state or district with ads shortly before an election, and as long as it has been running a series of "issue ads" outside of election season, then its tax status is safe.

One alluring feature of using these tax-exempt groups is that - unlike campaign committees - the donations to a 501(c)(4) are anonymous and unlimited in amount.

A single donor could, under cover of the 501(c)(4)'s anonymity, give $20 million or $200 million to pay for political ads.

Keeping heat on GOP incumbents
Since the beginning of this year, Democratic-allied 501(c)(4) organizations such as VoteVets.org and Americans United for Change, headed by former Democratic Senatorial Campaign Committee (DSCC) spokesman Brad Woodhouse, have been keeping pressure on Republicans up for re-election next year.

The Democrats charge these Republicans with supporting what these groups see as a failed policy in Iraq.

VoteVets.org and Americans United for Change are targeting GOP senators such as Sen. Susan Collins of Maine and House incumbents, including Rep. Jim Walsh of Syracuse, N.Y. ,who barely staved off a challenge last November from underfunded Democrat Dan Maffei.

A flurry of VoteVets ads launched this week features retired Marine Corps Gens. John Batiste and Paul Eaton and targets four Republican senators up for re-election in 2008, including Collins, as well as nine GOP House members.

The tag line for the ad: "Sen. Collins [or whoever the targeted member is], protect America, not George Bush."

"The intent is to increase her negatives," said Republican consultant Chris LaCivita.

Collins, running in a state that Democrat John Kerry carried in the 2004 presidential election with 54 percent, will face Democrat Tom Allen next year.

GOP warning at meeting with Bush
Two of the VoteVets House targets, Walsh and Rep. Mike Castle of Delaware, were at a White House meeting on Iraq with President Bush on Tuesday, a get-together first reported by NBC's Tim Russert on Wednesday.

The members warned Bush of the political risk to Republicans from the morass in Iraq.

On Wednesday and Thursday, VoteVets spent its money to do an ambitious fly-around: eight cities in 30 hours. It deployed Batiste and Eaton to Syracuse to hammer home the message to Walsh's constituents; to Bangor and Portland, Maine, to pressure Collins; to St. Paul to put the heat on Minnesota Sen. Norm Coleman; and to other GOP districts in Michigan and Pennsylvania.

VoteVets says its 501(c)(4) "primarily focuses on nonpartisan education and advocacy on behalf of troops, veterans and their families." VoteVets.org Chairman Jon Soltz said his group's ads are "very much about the votes in Congress, not the votes in elections."

As for the targeted members, all of them Republicans, in his ads: "Some of the targets are in very safe seats, frankly," Soltz said, arguing that the ads were not election-related.

"If there are Democrats who start to blindly support the failed strategy in Iraq, we'll go after them too," he said. "Right now, though, there aren't any."

Democrats exempted from targeting
But seven House Democrats did, like Republicans Walsh and Castle, vote to support President Bush on the May 2 Iraq spending veto override effort.

The Democrats included vulnerable members John Barrow and Jim Marshall of Georgia. The group chose not to target these Democrats.

VoteVets said it has a limited budget and chooses those members of Congress that it thinks are most likely to peel away from supporting Bush if some pressure is applied.

Having done ads targeting Collins, Coleman and Walsh, will Gens. Batiste and Eaton campaign next year to defeat them?

"I don't know who they support or don't support in elections," Soltz said. "I haven't asked. All I know is that Batiste and Eaton are both Republicans and voted for George Bush and are very disappointed by his performance and think Congress has to step in here."

The VoteVets advisory board includes Democratic National Committee member and former Al Gore adviser Elaine Kamarck and Tammy Duckworth, a Democratic House candidate in Illinois last year.

The ad campaign is being paid for by the VoteVets 501(c)(4), but the group also has a political action committee, which in last year's election targeted Republicans, spending, for example, $45,000 to defeat Sen. George Allen of Virginia.

So far in the 2007-08 election cycle, Democratic-linked 501(c)(4) groups are playing a far more prominent role than Republican-affiliated groups.

GOP ad with nuclear blast
One GOP-linked group called Move America Forward has been running TV ads that end with footage of a nuclear explosion as the narrator says, "The choice is clear: We win in Iraq ... or we face the terrorists here in America."

The use of 501(c)(4) groups and related tax-exempt groups in campaigns "is not a new phenomenon," said Republican consultant Patrick Davis. "These types of 'issue advocacy' ads were the stock in trade of national party committees before the 2002 campaign finance law outlawed 'soft money,'" the unlimited funds that used to be legal.

"These activities must be effective given that both left and right donors are willing to invest millions in their execution," said Davis.

The 501(c)(4) status has an advantage, Woodhouse said, because it "is not tied to a political party. You have a greater sense of credibility when you're advocating a message."

He said much of the funding for his group comes from labor unions, including the American Federation of State, County and Municipal Employees and the Service Employees International Union.

"Contributions will neither be used to support or oppose the election of a clearly identified Federal candidate nor to influence Federal elections," says the Americans United for Change Web site.

Do the activities of the 501(c)(4) groups allow the DSCC and the Democratic Congressional Campaign Committee to save their funds for use next year, since, for now, VoteVets and other groups are doing the work of softening up Republican incumbents?

Woodhouse said no.

No impact in 2008
"Almost in no case would the party committees be doing any advertising this far out" in advance of the 2008 elections, he said. "The money we're spending now is not going to have any impact on the political environment in 2008. People will have long forgotten the ads we ran."

Yet the targeted Republicans can't help but feel that the VoteVets ads are simply one element of the Democrats' campaign.

Collins said she wasn't surprised by the ads targeting her. "There is obviously a concerted plan among certain left-wing groups to work together, and everything that had happened from the first wave of ads that were run against me in April to demonstrations to phone calls to my office are all part of the plan that's being orchestrated."

She added, "Many people in Maine told me they didn't like out-of-state groups coming in with attack ads."

Coleman, who returned from a trip to Iraq three weeks ago, said, "I got a loud and clear message from folks on the ground in Iraq: Don't cut off our funding. We shouldn't put the troops in the middle of political cross-fire. Of course, I think this ad does that - I think they're playing politics with it.... Perhaps it'll backfire."