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"Inside The Dems' Shadow Party"

In 2002, as campaign-finance reform was about to become law, a few savvy Democratic activists saw the future -- and it was potentially devastating. The problem: While the Democratic Party raised $520 million in the 2000 election cycle, nearly half of it came in big-buck "soft-money" donations that the McCain-Feingold Act would all but eliminate. In the upcoming Presidential election, the Dems would be even more badly outgunned by the GOP, which in 2000 pulled in $712 million -- but only $246 million of it in soft money. To make an end run around the new campaign law, these behind-the-scenes players rushed to set up political committees that can legally collect soft money, pay for issue ads, and encourage voter turnout.

The downside: They cannot give to candidates or be directly connected to a political party. Known as 527s after a provision of the federal code that grants them tax-exempt status, the committees have been spectacularly successful since they got under way last year, having already raised almost $100 million in soft money. More important than the dollars, though, is the highly sophisticated political machine under construction -- a web of interlocking, like-minded organizations that could at once save and partly supplant the Democratic Party. And if the 527s don't give presumptive nominee Senator John Kerry an edge against George W. Bush, they will at least help level the playing field. -- Inside The Dems' Shadow Party (Business Week)

Thanks to Taegan Goddard's Political Wire for the link.