The Campaign Money-go-round

The Campaign Money-go-round

The Campaign Money-go-round

Gossip, speculation, and scuttlebutt about politics.
Oct. 11 1998 11:28 AM

The Campaign Money-go-round

Chatterbox, as is his election-year habit, has been busy checking out emblematic congressional and gubernatorial races around the country. These forays out onto the fabled campaign trail require Chatterbox to spend an inordinate amount of time in semi-abandoned industrial towns where the best hotel, if he's lucky, is the Holiday Inn. This is not to complain, of course. (Q: How do you know you're in a bad hotel? A: They steal your soap).

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As you can tell, Chatterbox is an ear-to-the-ground, out-on-the-hustings, knows-the-score kind of guy. And during a series of late-night dinners with candidates and campaign operatives--both Democrats and Republicans--Chatterbox has picked up assorted off-the-record anecdotes about the most taboo topic in politics. This dirty secret is not about how candidates raise money, but how they are forced to spend it. Like three-card-monte players in pre-sanitized-by-Guiliani Times Square, unsuspecting candidates are constantly being ripped off by the political-industrial complex.

Say you are Morrow E. Pure, running for an open House seat in a swing district. By begging and pleading for six hours a day on the telephone for months, you have managed to raise $500,000, the rock-bottom estimate to conduct a credible congressional race. But almost half of that money will be funneled right into the pockets of consultants before you get to air your first 30-second bio spot. (Here's the script: "Entrepreneur and father of six, Morrow E. Pure shares your values--family values--and in Washington will be on your side fighting for seniors, fighting for families and fighting for a better future for our kids.")

So let's follow the money as it disappears:

Right after you win the primary in your district, you fly to Washington to get sophisticated political advice from your party's congressional campaign committee. They tell you to immediately spend $15,000 on a baseline poll in your district. "My opponent and I are both unknowns," you protest. "Shouldn't we wait to poll until the race heats up in mid-October?" The political pros, rolling their eyes at your naivete, explain that the sole purpose of this poll is to impress the Washington PAC community. Alas, your $15,000 survey shows that Morrow E. Pure has low name ID. Unimpressed, the PAC community tells you, "Take a walk, kid." Disappearing money: $15,000.

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The wise heads at the national campaign committee, worried about your ability to raise money, direct you to one of the party's leading fund-raising consultants. With dollar signs dancing in your brain, you sign a contract promising the consultants 15 percent of what they raise--along with $10,000 to purchase lists and, say, a $6,000 a month retainer. That last item includes the services of a veteran 23-year-old "finance director," who graduated college in June and is taking a year off before he starts his MBA. A week later, during your first conference call with the fund-raising consultants, they explain that they have run into an unexpected snag: The word is out in Washington that you can't win because your own poll shows that you have low name ID.

Eventually, the firm helps you raise $200,000. Sounds like a good deal, nonetheless. Not when you subtract the costs: $30,000 for commissions; $20,000 total for lists; $24,000 for the monthly retainer; $10,000 for a second, inconclusive, poll; and $16,000 for miscellaneous costs like repeated trips to Washington to get the brush off from PACs. Disappearing money: $100,000.

But like your pioneer ancestors who settled this district, you are not deterred by adversity. You take control of your own financial destiny by importuning everyone you have met in your life. The calls begin something like this: "Hey, Buzz. It's Morrow E. Pure. Remember me from sophomore year at Alpha Chi Omega?" On your own, you manage to raise another $300,000, all earmarked for a TV blitz. Well, not exactly. There are $20,000 in production costs for the TV spots; $12,000 for the media consultant's monthly retainer; and, $8,000 for a third poll to identify campaign themes (Answer: Combating low name ID). So another, far more justifiable, $40,000 is gone.

Still, $260,000 can buy a lot of TV time to show that Morrow E. Pure is fighting for the future. Except, it's not exactly $260,000. There is that little item called the "ad placement fee," which amounts to 15 percent of all TV billings, paid to the media consultant. (Presidential campaigns often negotiate this ad fee down to as low as 7 percent, but a marginal congressional candidate like Morrow E. Pure does not have much bargaining power). So wave farewell to another $39,000.

This last expenditure is particularly galling since it comes right out of your television buy. And how much skill does it take to place ads in a congressional district that's split between two media markets? You buy the slots next to the 5 and 11 o'clock news shows; you buy network time during Ally McBeal if you want young career women; you buy the soaps if you want stay-at-home Moms; and football games to get red-blooded men opposed to gun control and high taxes. But if you want to use a competent media consultant, that 15-percent fee is non-negotiable.

By Chatterbox's reckoning (and he freely admits that many of these calculations are rough guesses), Morrow E. Pure has been bludgeoned into paying nearly $200,000 in vigorish to the political rackets. Small wonder that most campaign consultants see nothing wrong with a system that everyone else deplores. As long as the political handlers are raking off their ample share, who cares if nobody votes?

--Walter Shapiro