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Financial arms race underway in Washington

Posh fundraisers already are in full swing after record spending on midterms. Nobody wants to get ambushed again.

December 11, 2010|By Tom Hamburger and Matea Gold, Tribune Washington Bureau

Reporting from Washington — When it comes to money in politics, the new normal is already on vivid display.

It could be seen last week in posh restaurants and corporate townhouses on Capitol Hill, where politicians held fundraisers at a record pace. It was evident at Washington's blue-chip law firms, where campaign finance lawyers began work setting up new political committees to collect unlimited donations. It was apparent in the halls of Congress, where lawmakers swapped strategies about how to contend with muscular interest groups looking to take them out.

The unusually intense December bustle is the product of this year's elections, where spending surged to $4 billion in sharp-edged campaigns across the country — a record for a midterm.

Several veteran Democrats accustomed to winning reelection by lopsided margins went down in defeat — partly because of the anti-incumbent mood of angry voters, but also because of the millions of dollars spent by outside groups in last-minute television ads.

Those who survived already are plotting how to deal with the attacks next time. There is no down time. Even the most entrenched incumbents — including many Republicans, who could face left-leaning independent attacks in 2012 — feel compelled to go into permanent campaign mode, further impinging on the already limited time lawmakers spend on policymaking and constituent service.

"It's a sad situation," said Rep. Maurice D. Hinchey of New York, a nine-term Democrat who came close to losing after facing more than $744,000 in independent attacks from outside conservative groups in the final weeks of the campaign. "This is destructive to the Democratic process, to the average American citizen, but we are going to have to pay more attention to fundraising."

Two years before the next national elections, it is clear that independent campaign money — unleashed by the Supreme Court — will wield even more influence in 2012.

Democratic and Republican operatives are racing to set up new "independent expenditure-only committees" that will allow them to spend money almost without limit to help their candidates, setting off a financial arms race.

"The obscene amount of money that was spent in this midterm, I think, is unfortunately just a harbinger of things to come," said Rep. Raul M. Grijalva (D-Ariz.), who narrowly won reelection last month after outside groups spent $600,000 in his rural district on ads attacking him in the final weeks of the campaign.

Grijalva, who enjoyed a 30-point advantage over his GOP rival in 2008, won by just 6 points this year, even after liberal allies poured in money to help him.

"We got caught flat-footed," he said. "I was watching an ad every 10 minutes on TV, even during 'Monday Night Football.' At some point, I didn't want to vote for myself."

Lawmakers say they fear the unrestricted independent spending is creating a Congress even more indebted to special interests, prone to gridlock and unlikely to find compromise. In a sign of the new order, a newly elected Republican senator, Wisconsin's Ron Johnson, paid a personal visit last week to U.S. Chamber of Commerce President Tom Donohue to thank him for the chamber's unsolicited support of his candidacy.

At the National Republican Congressional Committee, Chairman Pete Sessions of Texas is laying plans to ramp up fundraising for 2012 by setting benchmarks for all members of the GOP majority. Plans include giving every member a minimum fundraising threshold, with new, higher amounts set for incoming party chairmen.

"Economic interests are overwhelming the principle of one man, one vote," said Rep. Barney Frank of Massachusetts, the Democratic chairman of the House Financial Services Committee, who was outspent this fall by a previously unknown opponent and outside groups that ran ads attacking Frank. The only solution, short of legislation to overturn recent federal court rulings, Frank said, is "to raise more money on our side," even if the funds come from anonymous donors.

The Supreme Court widened opportunities for this spending in January, ruling in Citizens United vs. Federal Election Commission that corporations and unions could directly fund independent election ads. Other court and regulatory decisions made it easier for tax-exempt groups to air ads closer to election day paid for with unlimited and often anonymous donations.

Of the $4 billion spent overall, about $300 million came from nonparty independent groups, whose participation soared this year. Republicans benefited from the new legal environment more than Democrats, with conservative outside groups outspending liberal groups 2 to 1, according to the Center for Responsive Politics. Among the major outside spenders were the Crossroads Groups, the U.S. Chamber of Commerce and the American Federation of State, County and Municipal Employees.

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