Nonprofit's role in defending McCain raises questions

WASHINGTON — For weeks, Republican presidential candidate John McCain had been hammered for supporting the Air Force decision in February to award a $40 billion contract for refueling tankers to Northrop Grumman and its European partner, Airbus parent European Aeronautic Defence & Space.

Democrats, labor unions and others blamed the senator for a deal that snubbed Boeing and that they said could move tens of thousands of jobs abroad.

McCain's advisers wanted to strike back against key Democratic critics. But they did not mount an expensive ad campaign to defend the candidate's position. They called a tax-exempt nonprofit closely aligned with the Arizona senator, seeking information and help.

Citizens Against Government Waste (CAGW) partnered with Northrop and one of its consultants to produce an ad campaign defending the deal.

"Rep. Jack Murtha, Mr. Porker himself, has threatened to hold up funding," the citizens group said in an e-mail soliciting support, referring to the Pennsylvania Democrat.

"Plus, there is great outcry from some in the media claiming we are turning over the Air Force to the French and giving Europe a gazillion jobs too. Nothing could be further from the truth."

Cooperation denied

Although the campaign and the group deny any cooperation, CAGW's willingness to jump into the tanker controversy illustrates what some experts describe as potentially improper political activity by nonprofits.

Last week, two key McCain supporters in the Senate, Joe Lieberman, I-Conn., and Lindsey Graham, R-S.C., backed out of their advisory roles with another nonprofit, Vets for Freedom, after the group ran online ads attacking Democratic presidential candidate Sen. Barack Obama of Illinois.

CAGW's ad campaign falls into a murkier space. The group's work on the Northrop deal offered indirect support of McCain on a high-profile issue while costing his campaign nothing. It never mentioned McCain's name.

"This is the public-relations equivalent of air cover: You saturate debate with your rhetoric so people start talking about your message and stop talking about McCain," said Sheldon Rampton, research director for the Center for Media and Democracy, a liberal organization that tracks the use of public relations by corporations and politicians.

Because of their tax-exempt status, nonprofits, or 501(c)3s, are not supposed to engage in political activity.

They are allowed, however, to set up a separate political arm — a 501(c)4 — that may donate money to candidates and lobby on policy issues as long as political activity is not its primary purpose. The Internal Revenue Service is charged with enforcing the rules.

"The question is: What is lobbying and what is campaign intervention?" said Frances Hill, a University of Miami law professor who specializes in charitable organizations. "The difficult issue that arises ... is whether a candidate for public office is benefiting improperly from an organization's activity."

McCain image promoted

CAGW, formed in 1984, has long promoted McCain's image as a taxpayer advocate. Since 2006, the nonprofit's board of directors has included Orson Swindle, who also works on veterans issues as a volunteer for the McCain campaign.

CAGW has a lobbying arm, the Council for Citizens Against Government Waste, which has twice supported McCain for president and has donated $11,000 to McCain or a political-action committee under his control, 20 times more cash than it has given any other candidate, records show.

The McCain campaign said it did not coordinate with CAGW on its ads about the tanker deal and that Swindle played no role in initiating the attack on Northrop's opponents.

"One campaign staffer called CAGW to ask for information about what CAGW had said in the past on the issue, and was told that CAGW had a policy of not talking to the campaign. That was the end of the conversation," spokeswoman Jill Hazelbaker said.

Swindle is a friend of McCain who shared a cell with him as a prisoner of war in Vietnam. He did not respond to requests for comment.

As the campaign's veterans liaison, Swindle helped the candidate fend off attacks in South Carolina from a group called Vietnam Veterans Against John McCain, which said that while in captivity, McCain gave information to the North Vietnamese.

Swindle countered the group's charges in a campaign statement: "Nothing could be further from the truth. I know because I was there."

He defended the senator's war record after it was questioned by Sen. Jay Rockefeller, D-W.Va. Swindle also has appeared in several McCain online ads.

But CAGW spokeswoman Leslie Paige said that in Swindle's role as a director, "There are absolutely no discussions related to the McCain campaign."

Policy on lobbying

A new McCain policy on lobbying by his aides bans campaign officials from participating in any political group known as a 527, "or other independent entity that makes public communications that support or oppose any presidential candidate." The campaign did not respond directly to a question about whether the policy applies to Swindle.

Praise from the group has been built into McCain's campaign messages. "John McCain, named a 'Taxpayer Hero' by Citizens Against Government Waste, has led the fight against wasteful spending his entire career," his campaign Web site states.

Paige said neither McCain's campaign nor his Senate staff influenced CAGW's decision to defend Northrop.

In their joint campaign this year, CAGW and Northrop collaborated on a Northrop-funded Web site, America's New Tanker, which exhorted citizens to contact their lawmakers to support the award.

Northrop spokesman Randy Belote said the company has not donated any money to CAGW.