By Mark Felsenthal
DES MOINES, Iowa (Reuters) - Newt Gingrich has become the first top candidate in the presidential campaign to feel the full bite of the Super PAC, a fundraising tool that is reshaping the way American political campaigns are run.
His challenge to Mitt Romney to be the Republican Party's nominee to face President Barack Obama in 2012 lost momentum this week when Romney backers took advantage of changes to campaign finance laws that erased restrictions on donations that corporations and wealthy donors can make for campaign advertising.
Political action committees, or PACs, have been a fixture of U.S. political life for over 50 years and have served as a mechanism for individuals and interest groups to spend money to support or oppose candidates and political causes.
But court rulings last year dramatically changed U.S. campaign finance by allowing corporations and wealthy individuals to make unlimited financial contributions, giving birth to the Super PAC.
Iowans have been bombarded by television spots sponsored by Romney's Super PAC, called Restore Our Future, that linked Gingrich to a litany of conservative taboos.
Restore Our Future has spent $2.6 million in the last two weeks on advertisements opposing Gingrich, according to OpenSecrets.org, a website associated with the nonpartisan group Center for Responsive Politics that tracks campaign spending.
Texas Governor Rick Perry's Super PAC, known as Make Us Great Again, aired ads attacking Gingrich as well as Romney as Perry also seeks the Republican presidential nomination.
A veteran politician who has himself used attack campaigns to discredit political adversaries, Gingrich has railed against negative ads, and asked his opponents to call them off.
But he is looking at the future of campaigning, which was set in January 2010 when the Supreme Court allowed the creation of "independent expenditure only committee," or Super PACs, that can take unlimited amounts of money from corporations and unions.
Although negative campaigning is as old as politics, the Super PACs have brought more money into the game of launching stinging attacks.
"We are witnessing this phenomenon with far more resources available to blitz the campaigns from the opening of the season in Iowa right through to Super Tuesday and beyond," said Fred Wertheimer, president of Democracy 21, a nonprofit group that follows money in politics.
Super Tuesday refers to March 6, when 10 states hold Republican presidential nominating contests on the same day.
CHANGED POLITICAL LANDSCAPE
"You are seeing in Iowa the beginning of the changed political landscape that five justices on the Supreme Court have created for this country," he said. The high court's ruling in a key case - Citizens United v. Federal Election Commission - was on a 5-4 vote.
Since Super PACs are prohibited from coordinating their activities with those of the candidate they are supporting, they allow the candidate to distance himself or herself from them. That makes them an ideal vehicle for going negative.
"Anonymous speech is much more likely to be negative speech. You remove accountability. People don't like saying nasty things, and ... the further you can retain anonymity, the more likely you are to say those nasty things," said Paul Ryan, a lawyer for the nonpartisan Campaign Legal Center in Washington.
Indeed, in response to Gingrich's calls to halt the negative ads, Romney said doing so would be illegal on his part.
"My goodness, if we coordinate in any way whatsoever, we go to the big house," he said on MSNBC's "Morning Joe" show, using an American expression for prison.
Candidates are prevented from raising money for Super PACs. And they may not discuss the content or strategies behind the advertising campaigns with the Super PAC.
But since many Super PACs are composed of close associates of the candidate, that distinction is technical at best.
That appears to be the case for Restore Our Future. Employees of Bain Capital, the private equity firm where Romney worked for years before entering politics, have given $1.25 million to the Super PAC, OpenSecrets.org said.
Super PACs came into being after the January 2010 Citizens United decision and a July 2010 U.S. Court of Appeals ruling in a case called SpeechNow.org v. Federal Election Commission. Those rulings effectively removed the restrictions on the use of financial resources, FEC officials told Congress last month.
Previously, political action committees were limited by how much individuals could give to them and by how much they in turn could give to candidates. The contribution limit was $5,000.
The court cases changed the rules of the game by saying corporations and unions could give to political action committees in unlimited amounts, and that these PACs could spend as much as they wanted to promote a certain candidate - or attack his or her rivals - as long as they did not contribute directly to the campaign of a candidate or work together with it on strategy, message and spending.
Money has flowed to the groups. Romney's Super PAC, Restore Our Future, has raised $12.2 million, according to OpenSecrets.org, while Obama's Super PAC, Priorities USA Action, has raised $3.2 million.
Gingrich's Super PAC, Winning Our Future, has raised a more modest $146,000, OpenSecrets.org said.
The ads are working: Gingrich's Iowa poll numbers have declined steadily over the last two weeks, and the candidate himself cites the ad onslaught as the reason.
Gingrich, meanwhile, has pledged to keep his campaign positive, and said he would cut ties with Winning Our Future, which was recently joined by former Gingrich staffer Rick Tyler, if it veered to the dark side.
"If Rick Tyler runs a single negative ad, I will disown the PAC and discourage anybody from giving them money," he said.
But analysts believe he may be unable to live up to the spirit of that pledge if he finds himself with his back against the wall.
"Gingrich's concern about negative attack ads is not credible as a concern about good government. It's a tactical position," Wertheimer said.
(Reporting By Mark Felsenthal; Editing by Will Dunham)