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STATEMENT OF SENATOR JOHN MCCAIN ON THE INTRODUCTION OF THE 527 REFORM ACT OF 2007
January 31, 2007
"Mr. President, once again I am pleased to be joined by my good friend and colleague Senator Feingold from Wisconsin in introducing a bill to end the illegal practice of 527 groups spending soft money on ads and other activities to influence federal elections.
"This bill is very simple. It would require that all 527s register as political committees and comply with federal campaign finance laws, including federal limits on the contributions they receive, unless the money they raise and spend is only in connection with non-Federal candidate elections, state or local ballot initiatives, or the nomination or confirmation of individuals to non-elected offices.
"Additionally, this legislation would set new rules for federal political committees that spend funds on voter mobilization efforts effecting both federal and local races and, therefore, use both a federal and a non-federal account under Federal Election Commission (FEC) regulations. The new rules would prevent unlimited soft money from being channeled into federal election activities by these federal political committees.
"Under the new rules that would be established under this bill, at least half of the funds spent on these voter mobilization activities by federal political committees would have to be hard money from their federal account. More importantly, the funds raised for their non-federal account would have to come from individuals and would be limited to no more than $25,000 per year per donor. Corporations and labor unions could not contribute to these non-federal accounts.To put it in simple terms, a George Soros could give $25,000 per year as opposed to $10 million to finance these activities.
"It is unfortunate that we even need to be here introducing this bill today. This legislation would not be necessary if the FEC would enforce existing law. As my colleagues know, a number of 527 groups raised and spent a substantial amount of soft money in a blatant effort to influence the outcome of 2004 Presidential election. These activities are illegal under existing laws, but, unfortunately, the FEC has failed to implement the regulations necessary to stop these illegal activities.
"According to an analysis by campaign finance scholar Tony Corrado, federally oriented 527s spent $423 million to affect the outcome of the 2004 elections. The same analysis shows that ten donors gave at least $4 million each to 527s involved in the 2004 elections and two donors each contributed over $20 million. Let me be perfectly clear on one point here, Mr. President. Our proposal will NOT shut down 527s. It will simply require them to abide by the same federal regulations every other federal political committee must abide by in spending money to influence federal elections.
"Opponents of campaign finance reform like to point out that the activities of these 527s serve as proof that the Bipartisan Campaign Reform Act (BCRA) has failed in its stated purpose, which is to eliminate the corrupting influence of soft money in our political campaigns. Let me be perfectly clear on this, Mr. President. The 527 issue has nothing to do with BCRA, it has everything to do with the Federal Election Campaign Act of 1974 and the failure of the FEC to properly regulate the activities of these groups.
"The bill Senator Feingold and I are introducing today is designed to put an end to the abusive, illegal practices of these 527s. I urge my colleagues to support swift passage of this bill and put an end to this problem once and for all."