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New Campaign Finance Rules Go Into Effect

After a multibillion-dollar election in which big money won most of the time, a new era in fund raising dawned Wednesday with stricter contribution limits — and political strategists looking for loopholes.

Partisan groups are already popping up to take in the "soft money'' that national parties are now barred from raising.

Sen. Russ Feingold, a lead sponsor of the law that took effect Wednesday, said he still believes it will take much of the big money out of federal elections.

"I think it will succeed in preventing what is the absolute worst offense, which is members of Congress and senators directly asking for these huge checks and having them deposited in political party accounts where they are under the control directly of the same politicians,'' Feingold said.

The law prohibits the national parties from raising unlimited contributions from corporations, unions and others, while doubling the amount of "hard money'' — limited donations from individuals and political action committees — that federal candidates can collect.

The new rules come after a record dash for cash this election year that paid off for most of the highest-spending congressional candidates.

Ninety-five percent of the biggest-spending House candidates won on Tuesday, while 25 of the 33 highest spenders in the decided Senate races, or about 75 percent, prevailed, according to an Associated Press analysis of spending figures compiled by the Federal Election Commission. The Louisiana Senate race was headed for a December runoff.

A cash advantage didn't always mean victory. Democratic Sen. Jean Carnahan of Missouri lost to Republican Jim Talent after spending roughly $10 million to his $4 million as of mid-October, the most recent figures available.

In what shaped up as the costliest House race this year, West Virginia Democrat Jim Humphreys lost to incumbent Republican Shelley Moore Capito after devoting at least $6 million of his own money to the race. Capito's campaign spent at least $2 million.

Other losers included two gubernatorial candidates who helped set spending records in their states. Texas Democrat Tony Sanchez and New York Independence Party candidate B. Thomas Golisano each spent some $60 million of his own money but lost to lower-spending Republican incumbents.

In all, House and Senate candidates in Tuesday's election spent at least $617.4 million, an FEC analysis found. They would be able to collect even more under the new law, which raises the individual contribution limit from $1,000 per election to $2,000.

The Democratic and Republican national party committees together spent at least $800 million this election cycle. Roughly half was soft money, which they could use for general party-building activities such as get-out-the-vote drives and issue ads.

As of Wednesday, the national parties can raise only limited hard money. New partisan groups have already surfaced that could take on some of the soft money spending.

Those popping up on the Democratic side in recent days include the Democratic Senate Majority PAC and the PAC for a Democratic House, each formed to support Democratic candidates and committees, according to a report by the nonpartisan PoliticalMoneyLine, which tracks campaign finance. The registration statement for the Democratic Issues Agenda group, meanwhile, says it is dedicated to "development and promotion of important issues of public policy.''

The contact information for all three lists the address of Perkins Coie, a Washington law firm that represents the Democratic Senatorial Campaign Committee and its House counterpart.

On the Republican side, a group called The Leadership Forum has registered "to engage in nonfederal political activities on state and local levels and to engage in dialogue on issues of importance to all Americans.'' The organization is run by Susan Hirschmann, former chief of staff to Republican Majority Whip Tom DeLay of Texas.

The new Republican State Leadership Committee also plans to raise money for state and local election activity. And the Republican Governors Association has separated itself from the Republican National Committee, which will allow it to continue raising soft money for nonfederal election activity.

The rush to adjust to the new law comes as several groups sue to try to overturn it, arguing it violates free-speech and other constitutional rights. The law's sponsors, meanwhile, have gone to court to try to undo the FEC's interpretation of the soft money ban, contending the commission of three Republicans and three Democrats is opening loopholes.