Scared Democrats Seek Soft Lucre to Save Party

On June 17, members of a group known as the New Democrat Network are scheduled to assemble at a Washington hotel, where they will make a bold pronouncement: They have discovered the political formula that could save the Democratic Party from long-term minority status.

Thegroup, which is headed by ex-Clinton war-room operative Simon Rosenberg, plans to release a policy agenda which it hopes will serve as a guide to reversing the party’s recent setbacks.

“I don’t even think Democrats understand how bad things are, and what could happen if we don’t radically alter the way things have been going,” said Mr. Rosenberg, the group’s president. “Someone’s got to step up here to provide some leadership and to demonstrate a new way of thinking in the party. And I’m hoping it’s going to be us.”

The New Democrat Network already has enjoyed some success on a more limited scale. It has raised and spent millions of dollars, and is aiming to raise between $10 million and $20 million for the 2004 elections. It has helped elect scores of centrist Democrats across the country, contributing resources to competitive races, assembling a heavyweight lineup of advisors, and building a reliable donor base that mixes earnest young professionals with big-money Democratic contributors.

Now, with the imminent release of its new agenda, the N.D.N. is expanding its outlook and trying to join an elite handful of powerful groups that are helping to shape the strategy and policy of the Democratic Party.

With its forthcoming policy statement, entitled “Agenda for the First Ten Years of the 21st Century,” the N.D.N. has assigned itself the task of “rebuilding progressive politics,” according to a draft given to The Observer. It was formulated with the help of advisers like pollster Mark Penn and former White House spokesman Mike McCurry as well as allied elected officials, including Senators Blanche Lincoln and Tom Carper. It lays out policy goals in the areas of the economy (a balanced budget, a more progressive tax code), foreign policy (a strong military), homeland security (more resources), education (tougher standards), health care (expanded access) and the environment (more domesticproduction,more conservation), among other issues.

The N.D.N. is one of many Democratic groups that are trying to fill a vacuum created by new fund-raising rules that severely curtail the party’s ability to raise money. Under the McCain-Feingold campaign-finance reforms, traditional party organizations are restricted from raising and spending large soft-money contributions, leaving room for any group with an interest or an agenda.

These groups stand to play an increasingly large role in the Democratic Party. Out of power in Washington and without a hope of competing with Republicans for smaller hard-money contributions, Democrats are going to rely on this largely untested and disparate array of entities. Known in the industry as “527’s,” these groups compile large war chests that can be spent on issue ads, get-out-the-vote efforts, polling and organization building. With such activities, these and other groups hope to offset the Republican Party’s fundraising edge-and enhance their own influence in the process.

The groups are proliferating at a rapid pace. Many of the same big-name New York donors who just received invitations to the N.D.N. conclave in Washington, for example, also received a letter from hotel magnate Jonathan Tisch inviting them to an “informal breakfast” on June 18 with labor organizer Steve Rosenthal and former Clinton aide Harold Ickes, each of whom is now running a soft-money project of his own.

Other groups expected to be major players in upcoming election cycles are the pro-choice group Emily’s List and the online organization

The N.D.N. would seem to be one of the better-positioned groups. The brainchild of Mr. Rosenberg, a 39-year-old native of the Connecticut suburbs, it boasts a seasoned staff and high-powered array of advisers, backers and allied public officials. In addition, unlike many of the newer groups, which have yet to establish their reputations or track record, the N.D.N. have been in operation for seven years.

But it also has some formidable obstacles to overcome. The group will have to contend with, among other things, a Democratic Party consumed by self-doubt and internecine feuding. A host of single-issue committees, such as the pro-environment Sierra Club, pro-gay-rights Human Rights Campaign or pro-choice NARAL, threatens to drown out the less focused appeals to donors from broad-based groups like the N.D.N.

There is also confusion over the new fund-raising rules. And there’s a great deal of uncertainty over how money given to these groups can actually be used, given that they will be, in essence, subverting the spirit of McCain-Feingold, which was designed to keep soft money out of the political process.

“I know donor after donor where they have no idea where they’re going to give or even what’s allowed,” said Fred Hochberg, a former Clinton administration official and a major Democratic fund-raiser. “When people don’t have clarity, it really impedes action.”

A final factor putting a damper on Democratic fund-raising is the Republicans’ stranglehold on power in Washington, which is dispiriting to many Democrats, as well as the apparent strength of President George Bush, who recently kicked off his re-election campaign with a series of staggeringly successful fund-raisers.

Republican money people regard the ascent of groups like Mr. Rosenberg’s as a symptom of Democratic desperation. “We’ve got a popular President, both houses of Congress, and we’re very well organized state to state,” said Georgette Mosbacher, a prominent Republican fund-raiser. “On the other side, the Democrats now have to rely on these groups raising soft money- the very sort of fund-raising they spent so much time demonizing. I think it’s going to be a huge problem for them holding to the letter of the law, and they’ll have no excuses.”

A Better Machine

For Mr. Rosenberg’s part, he hardly sounds any happier about the overall state of Democratic political and fund-raising infrastructure.

“The Republicans simply have a much better political machine than we have, and they’re beating on us across the board,” he said. “We need [a fund-raising] capacity like they have. Most of the functioning groups that we do have are very good at focusing on narrow interests, which is important, but not enough. Our machinery was adequate years ago, when there were many more Democrats in this country than Republicans, and it was sufficient to concentrate on turning out loyal voters and not on persuading unaffiliated ones. Now, if we can’t do both, we can’t win.”

But in all the bad news, Mr. Rosenberg sees a bright side: namely, an unprecedented opportunity for his group to flourish. The increasing reliance of the Democratic Party on groups like the N.D.N., combined with a Democratic backlash against the White House’s conservative agenda, is creating a groundswell of support for his group, he says.

“There are a lot of donors out there looking for a way to do something about the radical stuff that’s happening in Washington,” Mr. Rosenberg said. “And there are clearly a lot of them looking at us as a smart way to do it.”

As for the idea of competition between the many other Democratic groups now seeking influence in a changed political landscape, Mr. Rosenberg believes it to be a luxury for political think tanks like the centrist Democratic Leadership Council or the liberal Campaign for America’s Future. Groups charged with the actual raising and spending of resources, he predicts, will get along with each other for one reason: They have to. “I think we Democrats have to hope that all these groups out there succeed in what they’re trying to do,” he said. “If they don’t, we won’t win as a party.” Scared Democrats Seek Soft Lucre to Save Party