How McCain Is Skirting His Own Spending Caps

Posted Monday, July 07, 2008 2:37 PM
How McCain Is Skirting His Own Spending Caps
by Andrew Romano
Newsweek Magazine

Republicans, it seems, are finally showing McCain the money.

Last week, we wrote that despite the vast disparity between John McCain's and Barack Obama's overall fundraising total this cycle--$120 million to $287 million at last count--the Republican stands a surprisingly good chance of keeping up with his rival in the general election. One reason was the RNC. When you combine McCain's individual war chest with his party's bankroll, it turns out the Republican nominee has about $90 million currently burning a hole in his pocket, while Obama and the DNC weigh in at a relatively paltry $47 million, or half as much. And even though McCain has agreed to an $84.1 spending limit by accepting public funds--a decision he likes to portray as a principled stand against the corrupting influence of money on politics--at least double that sum will be dropped on his behalf before Election Day thanks to loopholes in the law that allow outside groups to effectively skirt such limits with largely unregulated "soft money" contributions.

Well, that's no longer a theoretical proposition. Starting last weekend, McCain finally saw the first tangible benefits of his joint fundraising account with the RNC--just as moneyed interests unable to donate directly to the senator's taxpayer-sponsored campaign began to reveal how they plan to circumvent spending limits and play an outsized part in the election.

First up: the RNC. On Sunday, OnMessage Inc., a Virginia-based company with Republican ties, rolled out a series of pro-McCain, anti-Obama television ads in the battleground states of Michigan, Ohio, Pennsylvania and Wisconsin. The energy-centric campaign--a $3 million RNC buy set to air over 10 days--is a perfect example of how, when it comes to spending, the distinction between McCain and the RNC is pretty much irrelevant. While McCain is "pushing his own party to face climate change," says the ad's announcer, "Barack Obama... just says no to lower gas taxes... no to nuclear... and no to more production." This is exactly the same (misleading) message McCain's campaign delivered in a spot released online late last month. But because McCain "had nothing do with the [new] ads," and the RNC merely funded the spots--it apparently didn't consult on content--they're subject to neither the candidate's $84.1 million spending limit nor the $20 million cap on what the party can spend in coordination with the campaign. In other words, the RNC can invest unlimited sums of money in commercials like this. Given that GOP donors can each contribute $28,500 to the national party--or about $25,000 more than Dems can give directly to Obama--expect to see plenty more On Message-style spots before Election Day. After all, it's not like they're going to sound any different from the ads McCain would air if he could afford to.

Meanwhile, McCain campaign is stepping around federal spending limits by funneling cash through the state and national party machinery--and potentially benefiting from donations to a non-RNC organization that could boost his chances in key states. As the Wall Street Journal reported last Thursday, the Republican Governors' Association, a GOP group unrestrained by federal spending limits because it's designed to elect governors, is now "marketing itself as a home for contributions of unlimited size to help Sen. McCain." "While using [such] a fund... to boost a national candidacy would seem to cross legal restrictions against federal electioneering," as the New York Times wrote this morning,* so far the benefits for McCain seem to outweigh the risks. According to the Journal, the group "has seen a "significant" increase in contributions from individual donors since [it] began mentioning the side effects for Sen. McCain's campaign," doubling its take in the first six months of 2008 to $14 million, compared with the same point in the 2004 election cycle. Currently, Team McCain is soliciting checks of up to $70,100 from each donor--$28,500 for the RNC, $40,000 for a quartet of state parties and $2,300 for the candidate himself. But if the Governors' Association actually works on a local level to boost McCain's bid,* even that ceiling on individual contributions--which is already high enough to ensure that the senator's publicly-financed campaign will raise about half of its money from private sources--would be shattered.

Finally, the well-funded but completely unregulated outside groups known as 527s are beginning to shell out on McCain's behalf. The operatives who bankrolled the Swift Boat attack ads against Sen. John Kerry four years ago are investing in the governors' kitty. The National Rifle Association plans to spend about $40 million on this year's presidential campaign, with $15 million of that devoted to portraying Obama as a threat to voters' Second Amendment rights. And just this morning the Christian Defense Coalition launched a new campaign called "Barack Obama: The Abortion President" designed to blunt Obama's attempts to make inroads with evangelicals. All of which boost McCain--without depleting his war chest.

The irony here, of course, is that it was McCain who co-sponsored the 2002 law meant to curtail the influence of wealth on presidential politics by limiting direct donations to the campaigns. Now he's the one's doing everything imaginable to circumvent the very caps he fought to create. We don't begrudge the senator his acrobatics. With Obama anticipated to raise between $200 and $300 million for the general election--much of it from his network of 1.5 (mostly small-sum) donors--it's the only way the Arizonan can stay competitive. But let's hope whoever's elected in November figures out a better way of keeping cold, hard cash from dominating our politics. That way we won't have to deal with these shenanigans again in 2012.

* RGA Communications Director Chris Schrimpf responds:

RGA does not expressly advocate the election of Sen. McCain, use its resources to assist the McCain campaign, or otherwise allocate its resources disproportionately to presidential swing states, nor do we solicit with representations of same. The simple political truism is this: as a rising tide lifts all boats, a popular politician benefits those around him, like Tom Ridge outpolling Rick Santorum or George Voinovich outpolling Mike DeWine in 1994. That's the only case we've ever made. RGA is seeing great fundraising success not because of loopholes, or attempts to assist the McCain campaign, but because our donors see a Republican group which is winning races, which has candidates who are popular and policy-driven, which is outraising its Democratic counterpart, and which has a plan to make a significant difference for the country over the next 3 years.