NY Times Magazine, July 25, 2004 Wiring the Vast Left-Wing Conspiracy By MATT BAI
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By the time this election year ends, George Soros will have contributed more than $13 million to the independent political groups known as 527's. (The term is shorthand for the section of the tax code that makes them legal.) For this reason, Republicans insist that the 74-year-old Soros, who may become the largest single political contributor in history, has resolved to buy the Democratic Party.
This is, on its face, a little silly. To put things in perspective, $13 million is a fraction of what it takes to run a serious modern presidential campaign, let alone control a party. And Soros, who made his fortune as an international investor, is worth an estimated $7 billion; his foundation alone gives away some $450 million every year. In other words, if George Soros really felt like buying the party, you would know it. For Soros, spending $13 million on a campaign is like you or me buying 100 boxes of Thin Mints from the Girl Scout next door.
The real significance of Soros's involvement in politics has little to do with the dollar amount of his contributions. What will stand out as important, when we look back decades from now at the 2004 campaign, will be the political model he created for everyone else. Until this year, Democratic contributors operated on the party-machine model: they were trained to write checks only to the party and its candidates, who decided how to spend the money. But by helping to establish a series of separate organizations and by publicly announcing that he was on a personal mission to unseat Bush, Soros signaled to other wealthy liberals that the days of deferring to the party were over. He became what the financial world would call the angel investor for an entirely new kind of progressive venture.
To understand why Soros matters, you have to slog, however briefly, through the mind-bending swamp of the nation's campaign finance laws. Democrats in the 90's became obsessed with erasing the Republican advantage in fund-raising, so much so that it was fair to wonder which party wasn't representing the rich and privileged. Under Clinton, who became the most powerful money magnet the Oval Office had ever seen, the Democratic Party and its various committees began sucking up mountainous contributions from what are known in politics as access donors -- corporations, Wall Street firms and trade associations whose leaders had an interest in certain legislation or who coveted a ride on Air Force One. Unlike the ''hard money'' checks that an individual might write to a candidate, these corporate contributions to the party were ''soft money,'' meaning they had no legal limits; it was as if both parties were drawing cash from an endless equity line, with power as its only collateral. During the 2000 presidential election cycle, lawyers and law firms gave more than $33 million to the Democratic Party, while securities and investment firms anted up more than $25 million, according to the nonpartisan Center for Responsive Politics.
For ideological donors like Soros, whose goal was to effect changes in Democratic policy, these were not the best of times. You could give millions of dollars in soft money to the Democratic Party, if you were so inclined, but a lot of ideological donors were not. (Soros gave $100,000 to the party in the 2000 cycle.) Donors had no control over how the money was spent -- badly, a lot of them suspected -- and because the party was getting so much money from large industries, the influence that might have been gained through such a contribution was instantly diluted. In other words, a $5 million check might buy you an invitation to a state dinner, but it wasn't going to make anyone at the Democratic National Committee listen seriously to your idea for a national health care plan.
A lot of ideological donors continued to give money to independent interest groups like Emily's List, Naral Pro-Choice America and the Sierra Club. These issue-based groups, however, were notoriously balkanized and territorial. Your dollars might be useful in organizing pro-choice voters or in preserving Pacific woodlands, but there was no way to contribute money that would have an impact on the overarching framework of Democratic ideology.
Then came the campaign finance law passed in 2002, known informally as McCain-Feingold (after its iconoclastic Senate sponsors, John McCain, a Republican, and Russell Feingold, a Democrat), which prohibited the parties from accepting soft money. Overnight, the era of the access donor essentially ended. Individual lawyers and executives could still wield influence by bundling small personal contributions from employees or colleagues, but their firms could no longer write the giant checks that let them rent out the party as if it were a billboard or a blimp.
For the ideological donors, however, the new era seemed quite promising. McCain-Feingold left untouched and unregulated a vehicle that had been little used on the national level up to that point: the 527. And last fall and winter, the surprising success of Howard Dean's campaign convinced a lot of wealthy liberals that a new ideological movement could be nurtured outside the constraints of the Democratic Party. By controlling 527's, donors believed, they could determine, to a greater extent than ever before, the message and the strategy of a Democratic presidential campaign. ''This is like post-Yugoslavia,'' Andy Stern, president of the Service Employees International Union, told me. ''We used to have a strongman called the party. After McCain-Feingold, we dissolved the power of Tito.''
Having financed projects in the former Communist bloc, Soros understood the opportunitites that political tumult can create. He and the more reclusive Peter Lewis began by contributing about $10 million each to America Coming Together (ACT), the largest of the new 527's, which was designed to do street-level organizing for the election; the donations enabled ACT to expand its canvassing campaign from five critical swing states to 17. ''I used 527's because they were there to be used,'' Soros said bluntly during a conversation in his Manhattan office.
Soros's and Lewis's donations made it possible for longtime leaders of Democratic interest groups to do something they had never done in the modern era: work together. Now the insular factions have begun to form alliances. The founders of ACT included Ellen Malcolm and Carl Pope, the heads of Emily's List and the Sierra Club respectively, Andy Stern from the service employees' union and Steve Rosenthal, the former political director of the A.F.L.-C.I.O. Suddenly, because they no longer had to compete with one another for contributions -- and because they had such a galvanizing villain in Bush -- the leaders of the party's most powerful adjunct groups were able to look beyond the more limited interests of their own membership.
Strangely, for someone who is supposedly staging a hostile takeover of an entire party, Soros said he is only nominally a Democrat, and he evidenced an obvious distaste for the business of politics. ''I hate this kind of political advertising,'' he said at one point, complaining about the anti-Bush attack ads he had paid for. ''I always hated it, but now that I've sort of been involved in it, I hate it more.'' Soros said his only goal is to get rid of Bush, whom he believes is endangering American democracy. After that, he said, he didn't expect to continue meddling in politics at all, and in fact, he seemed eager to be rid of it.
And yet, even if they walk away after 2004, both Soros and Lewis have begun to expand on what they started -- by handing off their political portfolios to the next generation. Both Jonathan Soros, a 33-year-old Harvard-trained lawyer, and Jonathan Lewis, a 45-year-old restaurateur, have become deeply involved in monitoring their fathers' political investments day to day. They have also traveled extensively throughout the country, asking their contacts in different circles -- business types for Soros, while Lewis hits up the Hollywood crowd -- for million-dollar checks.
Both sons, and particularly the younger Soros, are also looking to play a deeper role in the future of Democratic politics. Last January, at the invitation of Alan Patricof, a New York venture capitalist who has been one of the Democratic Party's most reliable fund-raisers over the years, both Jonathans attended a hastily planned meeting of wealthy Democrats at Patricof's Park Avenue office. George Soros and Peter Lewis were there, too, along with some 45 other Democratic donors. No one at the meeting quite knew why Patricof had summoned them. Then he introduced them to Rob Stein and his PowerPoint slides.
full: http://www.nytimes.com/2004/07/25/magazine/25DEMOCRATS.html
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