This interesting article in The Politico begins: “Sen. John McCain, R-Ariz., will sponsor a bill to strengthen campaign finance laws in this session of Congress despite vehement opposition to campaign finance reform from conservative Republican activists whose support he needs to win the party’s nomination for president in 2008.”
I think it is true that some conservative Republicans will be wary of any additional campaign finance regulation. But there are other Republicans who have supported some additional regulation, particularly of 527 organizations. Democrats, for the most part (Sen. Feingold, as mentioned in the article, a notable exception), have opposed this particular campaign finance regulation. This is no surprise: though Democrats usually favor c.f.r. more than Republicans, Democrats have used 527s more than Republicans and therefore their positions on this issue are often reversed.
Thus, Sen. McCain’s decision can be explained as a way of him (1) not being seen as a “flip flopper” on reform by (2) supporting a measure that primarily is seen as helping Republicans in (3) a Democratic Congress that won’t pass it. In the meantime, the Sen. has not been out front on more meaningful regulation, such as that to fix the presidential public financing system or require the disclosure of certain lobbying expenditures.