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					Election Spending

Election Spending

The 2008 election has dwarfed all others in terms of historical significance but also in the amount of money spent on the campaign

December 2008

What’s your vote worth?
Because Barack Obama and John McCain can spend about $8 to get it.
Together, the two presidential candidates have amassed nearly $1 billion. A stratospheric number in a campaign of record-shattering money numbers. Depending on turnout, $1 billion means nearly $8 for every presidential vote, compared with $5.50 in 2004. And that’s just McCain and Obama. All the presidential candidates in the 2007-2008 contest took in $1.55 billion, nearly twice the amount collected by candidates in 2004 and three times the amount from 2000. The total includes fundraising for the primaries as well as the general election. Using all that cash, the candidates have traveled more miles, employed more workers and advertised more than ever. But it has been Obama, with his $641 million and 3.2 million donors, who has rewritten the rules for financing campaigns. He abandoned the public financing system — after pledging to participate if McCain did — and became the first major party candidate to raise private funds to pay for a general election since the campaign money reforms of the Watergate era. McCain did take public funds, but Obama’s success left little doubt that taxpayer-supported presidential campaigns, as currently configured, are 20th century relics. Neither Obama nor McCain participated in public financing during the primaries. McCain’s acceptance of $84 million in general election public financing also came with limitations on spending. He continued to raise money for the Republican Party, though, which so far has spent about $100 million on his behalf to supplement his public funds. Obama mastered new technology, turning the Internet into an incredible political networking tool and attracting record numbers of donors giving less than $200. While that flood of money raised new questions about the safeguards of Internet fundraising, it also helped dilute the role of big money donors and fundraisers. “When you have that many contributors, I think it does, in a weird way, cleanse the system even though it seems like that much more money,” the Federal Election Commission chairman, Republican Donald F. McGahn II, said recently. “That many more contributors disperse the influence of any one contributor.” Some of the financial highlights from the presidential campaign: The total is almost the same as what the Federal Trade Commission says food and beverage companies spend in a year marketing their products to children. Selling politics like burgers: With all that money, Obama has blanketed the country with his message. As of mid-October, he had spent $240 million on broadcast ads to penetrate old battlegrounds and to help create new ones. He spent $77 million in the first two weeks of October, more than McDonald’s spends on ads in a month. He pinpointed audiences with ads on such video games as “Guitar Hero” and “Madden NFL 09.” He also went global, with national network advertising that culminated with a $4 million-plus

Election Spending

half hour buy on prime time six days before the election. His spending stretched McCain’s resources; the Republican had spent about $116 million as of mid-October. Bad apple, bad money: Some fundraisers put campaigns in awkward situations. Barack Obama donated to charity tens of thousands of dollars in donations to his past campaigns that were linked to convicted Chicago developer Antoin “Tony” Rezko. Democratic Sen. Hillary Rodham Clinton returned more than $800,000 to donors whose contributions were linked to Norman Hsu, a fundraiser who was wanted in California on charges of bilking investors. Hsu was subsequently indicted in New York on federal charges of fraud and violating campaign finance laws. Bundle up some cold hard cash: Perfecting a fundraising practice initially mastered by George W. Bush, presidential candidates enlisted fundraisers to raise thousands upon thousands of dollars for them. These are the well-connected money people to whom a campaign is ultimately indebted. Both McCain and Obama list their fundraisers — or bundlers, as they are known — on their Web sites. McCain’s are easier to find than Obama’s. But unlike McCain, Obama lists the fundraisers’ home towns.

Who are those small donors, anyway: Obama has raised about half of his money in increments of $200 or less. The average contribution is $86, the campaign says. But the success of the Internet fundraising effort has also led to some puzzling donors. Individuals have been credited with giving tens of thousands of dollars to the Obama campaign, far more than the $2,300 limit. Obama has reported more than $17,000 in contributions from a donor identified as “Doodad Pro” and more than $11,000 from one identified as “Good Will.” “I wouldn’t be surprised if the FEC doesn’t address this in the next couple of years — what you have to put on your Web site for soliciting contributions,” said Bradley A. Smith, a former FEC chairman and a law professor at Capital University Law School in Columbus, Ohio. I show mine, you don’t show yours: Federal law requires candidates to identify only those donors who contribute, in the aggregate, more than $200. But McCain has made his entire donor database available through his Web site. Obama has not, drawing criticism.

John McCain and President Elect Barrack Obama discuss reform issues post-election

December 2008

The Obama campaign bought time on CBS, NBC and Fox for $1 million per network. In Fox’s case, the ad

will precede the resumption of rain-suspended Game 5 of the World Series in Philadelphia.
Fox decided to pre-empt its World Series pre-game show for the Obama spot and will start its baseball coverage after the commercial’s 8:30 p.m. conclusion. The 30-minute spot, which was announced in early October, will air six days before the election between Obama

and Republican candidate John McCain. It is also scheduled to run on Univision, BET, MSNBC and TV One. Described by the Obama campaign as a “program,” the half-hour will present “the specifics of Obama’s plans to turn the economy around and get the country back on track,” according to a statement from campaign spokesman Nick Shapiro. Short political spots are the traditional way for politicians to communicate with voters. But Obama’s campaign has deep pockets for the costly ad buy that allows him to make a closing argument nationwide: his fundraising has topped $600 million. ABC hasn’t been left out of the Obama campaign budget. From Oct. 8-24, the campaign purchased about $1.8 million worth of commercial time on the network’s schedule, including prime-time and morning spots, according to ABC.

Election Spending

December 2008

The Breakdown

$8 each candidate spent per vote $21,000 allegedly charged to the state of Alaska for Palin family travel expenses $150,000 on Sarah Palin’s campaign clothing $1.8 million spent on Barrack Obama’s 30 minute ad campaign $15 million Democratic Party is in debt $600 million raised for Obama’s Campaign $40 billion gas pipeline proposal $ 700 billion-proposed bailout that became major election issue
process that subjected the decision Gov. Sarah Palin’s to extensive public scrutiny and due signature accomplishment — a diligence.” contract to build a 1,715-mile TransCanada estimates it will pipeline to bring natural gas from cost $26 billion; Palin’s consultants Alaska to the Lower 48 — emerged from a flawed bidding process that narrowed the field to a company with ties to her administration, an Associated Press investigation shows. Beginning at the Republican National Convention in August, the McCain-Palin ticket has touted the pipeline as an example of how it would help America achieve energy independence. “We’re building a nearly $40 billion natural gas pipeline, which is North America’s largest and most expensive infrastructure project ever, to flow those sources of energy into hungry markets,” Palin said during the Oct. 2 vice presidential debate. “Governor Palin held Governor Sarah Palin speaks with firmly to her fundamental belief that Alaska could lators and engineers about the best serve Alaskans and the nation’s interests by pursuing a estimate nearly $40 billion. competitive approach to building a The pipeline would run from natural gas pipeline,” said McCainAlaska’s North Slope to Alberta in Palin spokesman Taylor Griffin. Canada; secondary supply lines “There was an open and transparent would take the gas to various points in the United States and Canada. The pipeline would carry 4.5 billion cubic feet of natural gas daily, about 8 percent of the present U.S. market. Building such a pipeline had been a dream for decades. The rising cost and demand for energy injected new urgency into the proposal. So too did the depletion of Alaska’s long-reliable reserves of oil, which are trapped in the same Arctic Circle reservoirs as clean-burning natural gas. Not only does that oil provide jobs, it pays for an annual dividend check to nearly every Alaska resident. This year’s payment was $2,069, 25 percent higher than 2007 — plus a $1,200 bonus rebate to help offset higher energy costs. Several important requirements in the legislation were unpalatable to the big oil legis- companies. In the talks under Murkowski, the firms asked that the rates for the gas production tax and royalties be fixed for 45 years; Palin refused to consider setting rates for that long.

Palin Spending
A lot of focus has been on spending for Sarah Palin.
Republican John McCain said Sunday that one-third of the $150,000 that the GOP spent on clothing and accessories for his running mate, Alaska Gov. Sarah Palin, and her family, “is given back.” McCain strategist Mark Salter said “about a third of it was returned immediately” because they were the wrong size, or for other reasons. Salter’s explanation was the first time the campaign has said any of the items had been returned. Last week after the purchases at such high-end department stores as Saks Fifth Avenue and Neiman Marcus appeared in campaign spending reports filed with the government, McCain and his aides repeatedly said the clothes would be donated to charity after the election. News of such expensive clothes offered a stark contrast to Palin’s image as an average “hockey mom.” Tracey Schmitt, Palin’s campaign spokeswoman, said some of the clothing was returned after the Republican National Convention in September. The governor generally wears her own outfits on the campaign trail, Schmitt said. “A third was returned postconvention,” she said. “Many of the remaining clothes have never been worn.” Schmitt said Palin intended to donate the items she has worn to charity. “Regardless, what wasn’t returned will go to charity after Election Day,” said Schmitt. Asked about Palin as he was interviewed on NBC’s “Meet the Press,” McCain rejected the notion that Palin is unqualified to be president and that she is hurting is campaign for the presidency. He also was questioned about the clothing purchases. “Look, she lives a frugal life. She and her family are not wealthy. She and her family were thrust into this, and there was some — and some third of that money is given back, the rest will be donated to charity,” he said. “Americans right now care about whether they’re going to stay in their homes, whether they’re going to have a job, whether they’re going to be able to keep their health insurance, if we’re going to come out of this ditch that we’re in,” McCain added. “They want change. They want reform. She is a role model to millions and millions and millions of Americans.”

Election Spending

$150,000 on cloth
December 2008

“I did not order up these clothes,” she told NBC. “The New York stylists who were already there and already orchestrating what the wardrobe should look like. Just like they have people to figure out what the staging and the lighting and everything else, the wardrobe, I guess, was a part of that.”

Palin gives a thumbs up to McCain supporters at a pre-election rally

ing and Accessories

Election Spending

“I did not know that [the election] would be as brutal a ride as it turned out to be,” Palin said.

Palin Accused of charging the state for Family’s Travel Costs
Sarah Palin, accusing the Alaska governor of abusing her power by charging the state when her children traveled with her. The complaint alleges that the Republican vice presidential nominee used her official position as governor for personal gain, violating a statute of the Alaska Executive Branch Ethics Act. It follows a report by The Associated Press last week that Palin charged the state more than $21,000 for her three daughters’ commercial flights, including events where they weren’t invited, and later ordered their expense forms amended to specify official state business. In some cases, Palin also has charged the state for hotel rooms for the girls. The complaint released Wednesday says Palin charged the travel costs for events her children were not invited to and where they served in no legitimate state purpose or business. Administration officials have said Alaska law allows governors to charge the state for their family’s travel if they conduct state business. “Governor Palin intentionally secured unwarranted benefits for family members, improperly used state property to benefit her personal and financial interests, and illegally altered documents that were the subject of a Public Records request,” the complaint states. Earlier this month, a legislative report found Palin violated state ethics laws when she fired her public safety commissioner. The state’s Personnel Board also has hired an independent counsel for a similar investigation. Any ethics complaints against a governor, lieutenant governor or attorney general go to the Alaska Personnel Board to determine whether state law was violated.

new ethics complaint has been filed against

The three-member panel is appointed by the governor. Dave Jones, an assistant attorney general, said ethics complaints are confidential unless their targets waive confidentiality or allegations are found to have merit. Jones said he could not discuss any particular case, but added that in general possible penalties could include fines of up to $5,000. In a case where an official has been found to have benefited, the official could be ordered to pay up to twice the amount of the personal gain. The latest complaint was filed by Frank Gwartney, an Anchorage Democrat who supports Democratic presidential hopeful Barack Obama. Gwartney, 60, said he is fed up with “all the corruption” among Alaska’s elected officials, including Alaska Sen. Ted Stevens, who was convicted this week on federal corruption charges. “Sarah ran on this very self-righteous campaign on ethics and anti-corruption,” Gwartney told the AP. “She is no different from the others.” Palin’s attorney, Thomas Van Flein, said he was not aware of the complaint and could not comment. Palin spokeswoman Sharon Leighow said she can’t comment specifically on the complaint because it is confidential. But she said generally the first family is expected to participate in community activities across Alaska and represents the state on travels. “We receive hundreds of invitations for the governor each month, and a majority of them request the first family participate,” Leighow said. “The Palin children can only participate in a fraction of the events.” Responding to the travel issue, Palin told Fox News last week that every Alaska governor has traveled with family when it’s a first family function. “And it’s always been charged to the state,” she said. “That’s part of the job.” The state already is reviewing nearly $17,000 in per diem payments to Palin for 312 nights she slept at her home in Wasilla, about an hour’s drive from her satellite office in Anchorage. The ethics travel grievance was first reported by CBS News.

December 2008

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