Watchdog Blog

Obama's Answer

On February 15, we sent a letter to Senator Barack Obama urging him to keep his promise to opt-in to the Presidential Public Financing system if he were the Democratic nominee, and the Republican nominee also used public funds. The likely Republican nominee, Senator John McCain, has agreed to these terms, but a spokesperson for the Obama campaign recently made a statement that conflicts with the committment made by Senator Obama. 

Read Obama's response printed in USA Today:

Both sides must agree
I will seek a good faith pact that results in real spending limits.

In 2007, shortly after I became a candidate for president, I asked the Federal Election Commission to clear any regulatory obstacles to a publicly funded general election in 2008 with real spending limits. The commission did that. But this cannot happen without the agreement of the parties' eventual nominees. As I have said, I will aggressively pursue such an agreement if I am my party's nominee.

Candidates Still Not Disclosing: Public Citizen Demands More on Bundlers

Public Citizen today sent letters to the seven major presidential candidates who have yet to provide any insight into how much their top fundraisers have raised. The letters asked the candidates to promptly disclose the names of bundlers who have brought in at least $100,000. The letters note that this minimal standard for disclosure was set by then-Gov. George W. Bush in his 2000 presidential campaign.

All of the candidates who have a realistic chance of capturing their party’s nomination are using bundlers, but only Sens. Barack Obama and Hillary Clinton have provided any insight into how much their bundlers have raised. Obama names bundlers who have raised at least $50,000, $100,000 and $200,000; Clinton discloses bundlers who have raised at least $100,000.

The eventual winner of this presidential election will almost certainly feel a debt of gratitude to his or her bundlers. Voters have a right to know who these superfundraisers are before they choose which candidate to send to the Oval Office.

Letters to the candidates can be viewed here.

A New Chance to Make Presidential Campaigns about Voters Not Dollars

Today, amid considerable fanfare, bipartisan legislation was introduced in both houses of Congress to overhaul the way we finance the presidential campaigns. It is long, long overdue.

In 2008, winning the nation’s highest elective office is going to cost $1 billion between the two major party candidates. The figure is even higher if you include the vast sums spent by all the other candidates, parties and political committees.

Let’s put this figure into a little perspective. Viable presidential candidates must raise at least $100 million each by the end of 2007, before even entering the actual election year. This means collecting five $2,300 campaign contributions “every single hour, every single day, including weekends and holidays, for an entire year,” estimates political scientist Michael Malbin.

And then the fundraising really kicks into gear next year.

Where does all this money come from? Mostly from the same special interests who have business pending before the federal government. In order to make sure that jingle of the pocket books of any particular special interest are heard loud and clear, businesses and wealthy special interest groups will be represented by a “bundler.”

Bundlers usually are CEOs or lobbyists of a business or industry. They will approach a campaign and receive tracking identification from the campaign, say, a tracking number. The bundler then reaches out to all the managers and other individuals of the business or industry and ask them to mail in their individual campaign contributions of $2,300 (the legal limit from an individual to a federal candidate), and write the company’s tracking number of the check. That way the campaign knows which business or industry is responsible for those contributions.

Workin' Too Hard For His Money

On Thursday, John Edwards announced that his campaign will accept public financing for his presidential campaign. Edwards told reporters that the decision was about taking “a principled stand” in favor of public financing and challenged his top opponents, Sens. Hillary Clinton and Barack Obama, to do the same.

The public funding system was designed to help candidates like Edwards, whose polling in states like Iowa clearly demonstrates his ability to appeal to voters, just not the ones with the deepest pockets. That system hasn’t kept up with the times, however. Both Clinton and Obama will probably raise $100 million by the end of this year, money they’ll be able to spend freely. Edwards, meanwhile, will have his spending in most areas restricted to less than half of that. The frenetic pace set by this season’s primary schedules unfortunately tilts the playing field toward the most heavily-funded candidates. Restoring the public financing system would put some much needed balance back into the contest, giving all voters a better voice.

Clinton to Return Tainted Money

In a surprise move, Hillary Clinton announced that she would return contributions totaling $850,000 from convicted felon and captured fugitive, Norman Hsu.  Hsu bundled this obscene amount of contributions from about 260 other donors. Clinton’s campaign is following the urging of Public Citizen and others to return the tainted cash to each donor.

As we’ve mentioned before, Clinton is not the first to deal with unsavory fundraisers, and Clinton is not the only candidate to have received money from Hsu.  Around 24 Democrats have accepted campaign contributions from Hsu since 2004.

One can’t help but wonder who the 260 people Hsu collected money from are and what influence was promised in exchange.  So far, Clinton’s campaign isn’t disclosing the names of the donors bundled by Hsu.  The names of these individuals and their ties to Hsu should be public record – just as all bundled contributions should be.

Unfortunately, the ’08 candidates have been even more secretive than Bush and Kerry were in ’04 about who their bundlers are and how much they have raised (are there more Hsus waiting to drop?). None of the presidential candidates in this election are adequately disclosing their bundlers to the public, and none of the campaigns – until now – have bothered to fully check the bundler’s backgrounds. You can bet that each campaign is feverishly doing background checks on anyone who has given them (or their opponents) hefty sums of money. 

The Real Dirt on Presidential Fundraisers

The newspapers lit up this week with revelations that Norman Hsu, a top fundraiser for Hillary Clinton, not only may have violated campaign finance laws by laundering contributions through family members but is also a fugitive facing jail time.

While the press enjoyed a reprieve from the dog days of August, partisans delighted in the chance to score some points. Michelle Malkin, Washington’s reigning queen of indignation and a stand-in host on the “fair-and-balanced” network, gleefully taunted, “What say you now, Hillary?” on her blog. Malkin later opined that even Clinton’s pledge to return Hsu’s contributions could not erase the “stain.” Oooooooh.

Clinton’s troubles are about the same as the unpleasant circumstance Mitt Romney faced in mid-August when news broke that a Maryland grand jury had returned a 23-count indictment against a co-chairman of his national finance committee. Ouch. Malkin’s blog item scolding Romney for his failure to perform due diligence on the co-chairman, Alan B. Fabian, is available here. (Oops. Curiously, a review of Malkin’s archive was unable to unearth any such item.)

Aside from the fact that partisans will use campaign finance scandals for their own advantage, here is what the Hsu and Fabian episodes really show: Our campaign finance system attracts unsavory fundraisers - and candidates have little incentive to ferret out the bad apples. In reality, their true incentive is to remain blithely ignorant of their donors’ histories.

Will McCain Run on the Presidential Public Financing System?

Yesterday, McCain became the first candidate eligible to receive funding from the presidential public financing system, having applied to the Federal Elections Commission earlier in the month.  He has not yet said whether he will accept the matching funds. 

It could be a lifeline for his campaign and make the system once again functional in the primary.  However, it is a tough call for McCain’s campaign since the system badly needs updating and he would be the sole candidate running accepting the spending limits in exchange for the federal funds. 

The fact that the system is still being considered in the primary shows it’s not dead yet.   However, it also highlights the real need to breathe new life into the system so that it can be an asset to more of the qualified candidates who could opt in and stay competitive.  Read what must be done to improve it on White House for Sale.

Edwards Agrees to Opt In

Edwards is the latest candidate to agree to use the presidential public financing system if he is the Democratic nominee and the Republican nominee also opts into the system. 

The Washington Post rightly gives Edwards kudos, and notes that he joins Obama and McCain in making the pledge. 

How about the others?

Until now Clinton has hedged, saying she would “consider” it.  Any candidate who says they support public funding of elections has an opportunity to walk the talk now.  Time to bird-dog.

Laura MacCleery on WVOX

Last week, Laura MacCleery, director of Public Citizen's Congress Watch division, spoke to New Yorkers about the recently passed Lobbying and Ethics bill, the role of lobbyists in campaign fundraising, Fair Elections, and presidential bundlers.

Listen to her interview on WVOX.

They talk big, but will candidates deliver the fundraising transparency we need?

Originally posted on Laura MacCleery's diary at MyDD

Last night, Presidential hopeful Barack Obama reiterated once more that he does not take money from lobbyists:

OLBERMANN: Thirty seconds. Senator Obama, I know you and Senator Edwards have taken a firm stand against accepting money from lobbyists, yet you allow them to raise money for you and, as the phrase goes, "Bundle it." What's the difference between those things?
OBAMA: No, no. I do not have federal registered lobbyists bundling for me, just like I don't take PAC money.  (APPLAUSE) And the reason that's important is because the people in this stadium need to know who we are going to fight for. And I want to be absolutely clear that the reason I'm in public  life, the reason I came to Chicago, the reason I started working with  unions, the reason I march on picket lines, the reason that I'm  running for president is because of you... (APPLAUSE) ... not because of the folks who are writing big checks. And that's a clear message that has to be sent, I think, by every candidate.

Click here for full transcript. 

Presidential Candidates Debate Lobbyist Campaign Contributions

At the Yearly Kos convention this past weekend, presidential candidates sparred over accepting contributions from lobbyists (which would include having lobbyists as bundlers). They all agreed, however, on the need for public funding of elections.

Joan Claybrook at The New School

Check out a video of Public Citizen President Joan Claybrook's recent panel discussion at The New School.  The panel was well-attended – focusing on "How to Return Democracy to the People."  Joined by former lawmakers and political scientists, the vibrant discussion dealt with the burden on politicians to drum up campaign cash and  showed how full public funding for congressional elections would do a lot to end the money chase.  Joan was joined by former Senators Bob Kerrey and Warren Rudman, John Rauh of Americans for Campaign Reform, Costas Panagopoulos, PhD., and Brennan Center Executive Director Michael Waldman.

(If you have trouble viewing this video, try here.)

Who is Killing the Presidential Public Funding System?

Suspect #1: Sen. Mitch McConnell (R-Ky.) - He recently called for the abolishment of the presidential public funding system.  His defense is that presidential candidates are choosing not to opt-in and that the public doesn't want to pay for it. McConnell says fewer people are checking a box on the federal tax forms to give $3 to program.  Is it true that the public doesn't want to pay for this?  A poll from last summer showed that 74% percent of the public supports publicly funded elections.  They believe the cost of running for office is out of control and would rather it be paid for by the public than by special interests.  Also, many states and municipalities have passed public funding or “Clean Elections.”

Suspect #2: The Presidential Candidates - Current candidates have all decided to fund their campaigns from private sources.  Sen. Hillary Clinton (D-N.Y.) is asking her biggest supporters to fork over $1,000,000.  At this rate, the 2008 presidential candidates could be expected to raise more than $500,000,000.  With these exorbitant entrance fees for the presidential elections, it is no wonder the public funding system can’t keep up.  No one in 1974 ever expected this kind of largess.

Clinton puts 'Rangers' to shame - Clinton Should 'Tell All' About Bundlers

Today, the Washington Post editorialized about Sen. Hillary Clinton's (D-N.Y.) one-million-dollar ask of supporters for her presidential bid. This dwarfs the $200,000 which Bush asked prospective Rangers to raise. Every four years, the bar for presidential fundraising shoots skywards - 2008 will surely take us to new stomach-turning heights.

The Federal Election Commission sets contribution limits at $2,300 per person for the primary, and allows another $2,300 per person for the general election. Big donors get around these limits by driving truck loads of cash through a loophole known as bundling. It allows people (especially those of the lobbyist variety) to keep funneling money to candidates long after reaching their personal limit. Examples of bundling include lobbyist who host fundraisers or corporate CEO who ask employees to make donations.

If running for president means asking supporters to gather this obscene amount of money, the public deserves to know who the bundlers are, whose money they are bundling and how much they bundle. Both Bush and Kerry chose to tell the public this information in the 2004 election, but such disclosure of bundling is entirely voluntary. It should be mandatory.

Reps. Chris Van Hollen (D-Md.) and Marty Meehan (D-Mass.) are co-sponsoring a bill (H.R. 633) that would require disclosure of bundling by lobbyists for all presidential and congressional candidates. The Senate already passed this measure in their lobbying and ethics reform bill (S. 1). You can take action here to ensure the House does the same.