Could Rand Paul’s Shadowy Fundraising Machine Sink His Presidential Ambitions?

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March 31 2014 7:32 PM

Paul, Inc.

Could the shadowy network of Rand Paul’s old fundraising machine sink his presidential ambitions?

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And it was during the 2011 primary run up that things went awry. Iowa was one of Ron Paul’s best-wired states, with a strong “liberty movement” on college campuses and allies in the home school movement. It was also wired by National Right to Work. NRW had a convoluted relationship with local Iowa candidates, as revealed via leaks to journalist Lee Stranahan and surreptitiously recorded interviews between the key players and Dennis Fusaro, formerly of National Right to Work and briefly national political director for the 2008 Paul campaign.

The gist was that National Right to Work co-operated with some 2010 Republican candidates for Iowa’s state senate. Candidates’ family members were interviewed or encouraged to write about their lives together—the state senate hopeful that you wish you knew. NRTW then printed these up as letters to be sent to key direct-mail lists.  

It was effective, and necessarily under the radar. Even in the wild and untamed plains of campaign finance law, a nonprofit, nonpartisan group can’t appear to be coordinating any messages with candidates. But Fusaro proved that when he turned on his colleagues, and unbeknownst to them, hit record when he called them to talk about the direct-mail campaign. In 2010 he recorded a conversation in which Doug Stafford, then vice president of National Right to Work, explained why Dimitri Kesari—who’d just launched Mid-America Right to Work, in Indiana—was being tasked with so much. “Four years of election cycles, of having Dimitri and his guys run the mail shop, shows me that that’s who needs to be running the mail shop,” said Stafford in the call. Kesari was good at a task few people understood, and doing it in a way that seemed to skirt laws against candidate “coordination.” That became more important in 2011. Iowa State Sen. Kent Sorenson, one of the candidates aided by National Right to Work’s 2010 letter program, became a power player in the state’s Republican caucuses. Sorenson endorsed Michele Bachmann, and his Grassroots Strategies group started receiving monthly $7,500 checks from her campaign, which wasn’t even legal in Iowa. He could, in other words, be bought. Later in 2011, according to some documents leaked by Fusaro and some obtained by an investigator in Iowa, the Iowa Gun Association’s Aaron Dorr drafted a proposal under which Sorenson could switch his endorsement to Ron Paul. Dorr’s memo was addressed to John Tate, who’d temporarily left the Campaign for Liberty to manage the 2012 Paul effort. The plan would require Sorenson being paid off secretly.

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“The money for salary and the PAC needs to be paid in advance,” wrote Dorr in the Oct. 29, 2011 memo. “To be blunt, there is an issue of trust involved, likely on both sides, and as a result KS, etc. needs to have the financial side met in advance.” In return, “KS would naturally speak at RP events in Iowa and be visible with him.”

Dorr’s plan called for the Paul campaign to pay nearly a quarter-million dollars: $100,000 for a PAC to be run by Sorenson, $8,000 a month for the senator, and $5,000 a month for Aaron’s brother Chris Dorr, who was Sorenson’s clerk. Had the plan been carried out, it would have tied the Paul campaign to a career-ending scam.

But it wasn’t carried out, at least not to completion. Under investigation in 2013, Sorenson handed over to investigators a $25,000 check from Ron Paul’s deputy campaign manager Dimitri Kesari, dated Dec. 26, 2011. Sorenson had endorsed Paul two days later, but the check had never been cashed. Sorenson had previously said as much in a secretly taped phone call with Fusaro, in which he revealed his intention to “give it back,” wondering only whether he should “hold onto it so I have something over” Kesari. Drew Ivers, who introduced Sorenson at the endorsement event, says he was shocked when the senator showed up.

“I’ve been around for a long time, and I can smell out people pretty good,” says Ivers. “I put distance between Ron Paul and Kent Sorenson and Aaron Dorr.”

In 2013, Sorenson resigned in disgrace from the Iowa state Senate. He’s been talking to a grand jury, but no one else—his old phone numbers have been changed and he doesn’t answer questions from reporters. Kesari has remained active with candidates in the Saber/National Right to Work network. He made the rounds at March’s Conservative Political Action Conference, and was spotted partying with Rep. Steve Stockman.

But with every week there’s more distance between the Pauls and the people involved in the Sorenson mess. Jesse Benton, who’d been Ron Paul’s spokesman and Rand Paul’s 2010 campaign manager, went on to manage Mitch McConnell’s re-election bid. In 2013, campaign finance records revealed that McConnell’s campaign had paid $61,954 to Hyllus Corp., a newly incorporated company that happened to be located at a P.O. Box used by Kesari. There have been no payments to Hyllus Corp. since OpenSecrets reported this figure.

But Rand Paul remains deeply connected to the little-understood world of conservative direct mail. One of the first bills he took up in January 2011, after being sworn into the Senate, was a national right to work bill. (South Carolina Sen. Jim DeMint had introduced the legislation, fruitlessly, in prior Congresses.) Soon, Rand Paul’s name and face started appearing on e-­mails endorsing the latest efforts of National Right to Work and asking readers to sign a petition—i.e., to join a larger mailing list.

“They snickered when I said I came to the U.S. Senate to change Congress,” read one letter, sent on Jan. 21, 2011 to users of the conservative site TownHall.com. “Their laughter stopped when I sponsored the National Right to Work Act to free U.S. workers from forced unionization and break Big Labor's multi-billion dollar political machine forever. President Barack Obama and Big Labor allies in the Senate are now feverishly scheming to bury the National Right to Work Act without a vote. So I have a question for you. Will you be my sledgehammer?”

Rand Paul’s name has also appeared on scores of emails from Mike Rothfeld’s Saber clients, emails like the appeals from the National Association for Gun Rights asking conservatives to help stop the “U.N. gun ban” and take a “sovereignty survey.” In April 2013, the NAGR started running ads against Republicans who’d spoken about a need for “gun safety” legislation.

One of those Republicans, Virginia Rep. Scott Rigell called out Paul. “Your good name is being leveraged, with your permission one must assume, by a corrupt, detestable outfit,” said Rigell.

The attacks continued. According to Rigell, Doug Stafford made it clear that Paul would not distance himself from the National Association for Gun Rights. But after Politico reported on the spat, the e-mails stopped.

This was a teaching moment for the Paul network. By April 2013, Rand Paul had already delivered his 13-hour filibuster on drones and civil liberties. Pieces of a new network were coming together, and the senator no longer needed to rely on the more troublesome aspects of Paul, Inc. The direct mail industry and the outsider class of consultants had helped build a new libertarian political movement when the mainstream had wanted no part of it. But the mainstream had been gentled. Paul, if he chose to, could move on.

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