Campaign spending: Democrats cry foul on pro-Reagan fund raising

A major test of the presidential campaign finance law is gathering force in 1980, as the Republicans and Democrats get ready for their summer conventions. At issue is the right of a half dozen "independent committees" to raise and spend funds -- estimated to total from $8 million to $80 million -- to elect Ronald Reagan. This amount would be separate from the $29.4 million in federal money for the general election that goes to each of the two major party nominees , and another $4.4 million for the party conventions.

Opponents of the independent committees allege they are, in effect, "clones" of the Reagan campaign, or thinly disguised, controlled satellite efforts.

Backers of the commitees contend they are exercising their constitutional right of free political speech.

Three legal actions are under way. Common Cause, the public interest group, has gone to federal district court to stop one of the independent committees, Americans for Change, headed by Sen. Harrison Schmitt of New Mexico.

The Carter-Mondale campaign has filed a complaint with the Federal Election Commission (FEC) against five of the independent committees, the Reagan campaign , and the Republican National Committee (RNC). The Carter forces want to FEC to freeze the Republican's anticipated $29.4 million in federal general election funds after his nomination in Detroit next week.

Independent political philanthropist Stewart Mott is preparing to appeal a district court decision that went against him last week. Mr. Mott contends it is inconsistent for the law to allow him to spend as much as he cares to in behalf of a candidate, so long as he acts alone, but limits him to $1000 if he joins with one or more other people.

A fourth suit is in prospect. Independent Republican candidate John B. Anderson is expected later this summer -- after getting on enough state ballots -- to test the way federal finance law affects independents. The law now provides for funding minor parties if they get 5 percent or more of the votes in the current election. But the law says nothing about independent candidacies.

Eugene McCarthy tried unsuccessfully four years ago to win such support, when an FEC voted ended in a 3-to-3 tie. The issue became moot when Mr. McCarthy failed to get 5 percent of the vote. While the funds in question would not be available until after the November election, a candidate could presumably borrow against them if given a reasonable chance to exceed the 5 percent threshold. Polls project Mr. Anderson could take perhaps 20 percent of the fall vote.

The legal flurry over federal campaign laws, originally put into place in the wake of Watergate abuses, follows a rather placid primary season where most experts agree money turned out to be not very crucial. In all, the three Democratic candidates will have raised and spent about $30 million by convention time, the seven Republicans $74 million, or a total of about $104 million, according to late spring FEC filings.

The ability to raise money, or limits on spending, were not regarded as decisive in the primary and caucus outcomes in either party. John Connally's fund-raising prowess netted him only one delegates, observes Herbert Alexander, University of Southern California campaign finance expert.

However, George Bush's astute husbanding of funds, with which he engineered strong late showing in Pennsylvania, Connecticut, and Michigan, have helped give him an edge in the vice-presidential sweepstakes, Mr. Alexander says.

The independent committee issue is significant, however, Mr. Alexander says:

"It is a fundamental testing of the campaign finance laws, touching on civil liberties and constitutional rights, and affects the political arena where individuals and the parties have high stakes."

"At one level, it's a nuisance complaint -- part of a Carter strategy to attack Reagan and the Republicans on excess spending, or violating the spirit if not the letter of the law. It may have a chilling effect on the independent fund raising."

Michael Malbin, American Enterprise Institute on Campaigning Finance Law, says the issue boils down to viewing the independent committees as "exploiting loopholes that should be closed" or as "a constitutional right to expenditures to express oneself."

The Common Cause and Carter-Mondale complaints raise similar arguments, though Common Cause has taken the matter to federal court and Carter-Mondale to the FEC.

"When you look at this group [Americans for Change], given who the people are , you cannot characterize them as "independent," says Kenneth Guida, Common Cause lawler. "The chairman [Senator Schmitt] is a delegate pledged to Ronald Reagan at the convention. Another is an ex-officio member of the RNC executive committee. The treasurer is in charge of RNC political and financial services. Four are heads of RNC advisory committees."

Also, because the press regularly carries reports of campaign strategy, it is easy for such a committee to assay where to spend funds to bolster the campaign, without any need for direct consultation, opponents say.

"This full-blown professional kind of campaign, is not what Buckley had in mind," says a Carter-Mondale official, referring to the January 1976 Buckley v. Valeo decision, in which the US Supreme Court ruled that political committees had the right to support candidates if they acted independently of the official campaigns.

Under FEC regulations, individuals can contribute up to $1000 to such committees if they support a single candidate, and up to $5000 for multiple-candidate committees.