Follow the money..........

It's still 15 months to the Presidential election, and almost $500 million has been already been raised during the first half of 2015.  By far, this has been the fastest start to a presidential contest in terms of dollars raised. In a departure from previous elections, most of the money is flowing not into the campaigns directly, but into outside groups like “super PACs” and other political organizations that are allowed to raise unlimited amounts of money from wealthy individuals, labor unions and corporations.

In other words, these millions of dollars are coming from a handful of powerful individuals, most with an agenda of their own.

An often stated refrain regarding Donald Trump's popularity thus far in the early election cycle is that Trump is doing so well in the polls because he is not beholden to any kingmakers for cash.  Trump, as did Ross Perot and Mike Bloomberg before him, is using his own money, so doesn't need direct fund raising.  Here is a recent quote from Trump on his fellow candidates going to a Republican retreat sponsored by the Koch brothers:

I wish good luck to all of the Republican candidates that traveled to California to beg for money etc. from the Koch Brothers.

Perhaps they weren't begging, but voters want to know what these candidates are offering in return for these huge piles of cash.

Voters are frustrated that candidates are so frozen when speaking and just dribbling back talking points, that they don't really state what they feel.  Instead, they are simply being cautious to ensure they don't offend any of these big donors.  Trump has successfully tapped into this issue, speaking off the cuff and telling people what he thinks - whether they like it or not.  Bottom line, at least so far, its working.



The Trump impact I believe is best summed by columnist David Brooks:

The times are perfect for Donald Trump. He’s an outsider, which appeals to the alienated. He’s confrontational, which appeals to the frustrated. And, in a unique 21st-century wrinkle, he’s a narcissist who thinks he can solve every problem, which appeals to people who in challenging times don’t feel confident in their understanding of their surroundings and who crave leaders who seem to be.

Why are the non Trump candidates working so hard to say so little?  Because they need the money, and this big money is coming from fewer and fewer.

The NY Times recently ran an article listing 65 individuals who have already given over $1 million to candidates, a year and a half before the election!  This list ranges from Wall Street Executives, to casino owners to film directors.  Some names are recognizable, some are not. 

At this writing, almost half of the money raised so far in the Presidential campaign has been contributed by less than 400 individuals and families.  This top heavy cash grab is without precedent, and all due to the rise of Super PAC's as I have written about in prior posts.

Most candidates simply don't have the wallet to finance their own campaigns, and with the Super PAC's laws as they are, make it irresistible to chase these limited donors.  Why attempt to raise $50K from 20 different potential donors, when you can chase $1 million from a single potential donor.

Simply put, the speed in which these Super PAC's can raise money has allowed candidates to raise enormous campaign war chests in a fraction of the time that it would take candidate to raise similar amounts directly.

As with everything that involves politics and money, there is a potential cost.  As noted above, these small wealthy donors have made today's candidates deeply dependent on this small pool of the richest Americans.  While the concentration of donors is greater on the Republican side, this issues cuts across party lines.

As an examples, 130 donors provided more than half of the money raised by Republican candidates via the Super PACs.  Instead of these campaigns listening to hundreds of people's questions/issues while fund raising, they now only need to address dozens.  Not to pick on Scott Walker from the GOP,  but of the $20 million or so raised by Mr. Walker to date, at least $13.5 million (68%) came from just four donors.   From the Democratic side, Hillary Clinton brought in $15 Million, with nine donors giving at least $1 Million.

Fred Wertheimer, the president of Democracy 21, which favors limits on political money had this to say about the recent Super PAC figures:

The 2016 presidential candidates and their individual candidate super PAC's are wiping out the nation's anti corruption candidate contribution limits.

Unless we have some limits, or rolling back of these Super PAC's, only the super wealthy will have a say in fund raising and politicians ears.  No longer can a candidate rely on grass roots support; they are all feeding from the same trough.

An Immigration to America Narrative

While the subject of immigration continues to dominant the political campaign (see Donald Trump's recent comments), for most of us, our lives in America can be traced back to Ellis Island with our Grandparents (or Great Grandparents) arriving in the land of the free. 

We often forget, or need to reminded, how much political decisions impact each of our lives on a daily basis.  Particularly during Presidential campaigns, when key issues are debated endlessly, it's a good time to reflect on how these decisions ripple through our lives.

 On both sides of my family, my maternal Grandfather and paternal Grandfather came to America from Western Europe in the early 1900's.  While I have attended a few family reunions, I unfortunately don't remember much of either (they both passed away when I was just a child).  However, my parents have shared memories with me of this incredible journey.

I would like to use this narrative for a look back, on my Grandparents and the millions of others who bravely came to America during that era, when immigration was not an issue, and most people were welcome at American borders.

In his book, A Nation of Immigrants, John F. Kennedy writes,

“There were probably as many reasons for coming to America as there were people who came. It was a highly individual decision.”

Historians agree that three social forces were the chief motivators for the mass migration to America: religious persecution, political oppression and economic hardship. It is, however, almost impossible to relate such a combination of overwhelming circumstances to the experience of one immigrant, or even of one family.

Although more than 12 million people passed through Ellis Island on their way to the promise of a better life in America, they walked through its gates one at a time, individual by individual.

Ellis Island opened in 1892 as a federal immigration station, a purpose it served for more than 60 years (it closed in 1954). Millions of newly arrived immigrants passed through the station during that time–in fact, it has been estimated that close to 40 percent of all current U.S. citizens can trace at least one of their ancestors to Ellis Island.

After an arduous sea voyage, many passengers described their first glimpse of New Jersey, while third-class or steerage passengers lugged their possessions onto barges that would take them to Ellis Island. Immigrants were tagged with information from the ship’s registry and passed through long lines for medical and legal inspections to determine if they were fit for entry into the United States. From 1900 to 1914–the peak years of Ellis Island’s operation–some 5,000 to 10,000 people passed through the immigration station every day. Approximately 80 percent successfully passed through in a matter of hours, but others could be detained for days or weeks. Many immigrants remained in New York , while others traveled by barge to railroad stations in Hoboken or Jersey City, New Jersey, on their way to destinations across the country.




Passage of the Immigrant Quota Act of 1921 and the National Origins Act of 1924, which limited the number and nationality of immigrants allowed into the United States, effectively ended the era of mass immigration into New York. From 1925 to its closing in 1954, only 2.3 million immigrants passed through Ellis Island–which was still more than half of all those entering the United States.

Steerage was enormously profitable for steamship companies. Even though the average cost of a ticket was only $30, larger ships could hold from 1,500 to 2,000 immigrants, netting a profit of $45,000 to $60,000 for a single, one-way voyage. The cost to feed a single immigrant was only about 60 cents a day!

For most immigrants, especially early arrivals, the experience of steerage was like a nightmare (at one time, the average passenger mortality rate was 10 percent per voyage). The conditions were so crowded, so dismally dark, so unsanitary and so foul-smelling, that they were the single most important cause of America’s early immigration laws. Unfortunately, the laws were almost impossible to enforce and steerage conditions remained deplorable, almost beyond belief. As late as 1911, in a report to President William H. Taft, the United States Immigration Commission said:

“The open deck space reserved for steerage passengers is usually very limited, and situated in the worst part of the ship, subject to the most violent motion, to the dirt from the stacks and the odors from the hold and galleys... the only provisions for eating are frequently shelves or benches along the sides or in the passages of sleeping compartments. Dining rooms are rare and, if found, are often shared with berths installed along the walls. Toilets and washrooms are completely inadequate; saltwater only is available."

“The ventilation is almost always inadequate, and the air soon becomes foul. The unattended vomit of the seasick, the odors of not too clean bodies, the reek of food and the awful stench of the nearby toilet rooms make the atmosphere of the steerage such that it is a marvel that human flesh can endure it... Most immigrants lie in their berths for most of the voyage, in a stupor caused by the foul air. The food often repels them... It is almost impossible to keep personally clean. All of these conditions are naturally aggravated by the crowding.

In spite of the miserable conditions, the immigrants had faith in the future. To pass the time—a crossing could take anywhere from a week to more than a month, depending on the ship and weather—they would play cards, sing, dance and talk... talk... talk...




Rumors about life in America, combined with stories about rejections and deportations at Ellis Island, circulated endlessly. There were rehearsals for answering the immigration inspectors’ questions and hour upon hour was spent learning the strange new language.

By the time the tiring trip approached its long-awaited end, most immigrants were in a state of shock: physically, mentally and emotionally. Yet, even with the shores of a new world looming before their eyes, and even with tears of relief streaming down their faces, their journey was not at an end.


I was told my paternal Grandmother landed in America with $4.00 in her pocket.   She was on the ship for over 3 weeks, alone, and of course frightened.  Yet She persevered, and lived in NYC for the rest of her life, marrying and having 3children, and 10 grandchildren.  Although She didn't live long enough to see us grow, I am so thankful for her bravery and kindness.

This is not a political statement, but I ask each of you to think of where most of would be if not for the immigration policy of America during that time.
 

Recent Presidential campaign gaffes

Although the election is still 16 months away, candidates are being watched/followed closer then ever, so they must be very careful not to make any mistakes.  Unless you are Donald Trump and are simply looking for any publicity (good or bad), most candidates tread cautiously during this period.  To that point, let's have a little fun and take a look back at some modern blunders that leading candidates made in their quest for the White House:

1.)  Micheal Dukakis in the tank - Dukakis was neck and neck with George Bush (Bush I) in 1998 until a series of attack ads and personal blunders did him in.  The biggest of these errors was riding in the tank, which most pundits said He looked like a little boy in a big helmet:

2.)  John Kerry - being in favor of the war before he was against it.  Under attack for changing his mind on important issues for political reasons, Democratic presidential candidate John Kerry explained his switch on a funding bill. “I actually did vote for the $87 billion, before I voted against it,” he declared. That one sentence came to define the Massachusetts senator in the minds of many swing voters. Republican National Convention attendees taunted Kerry by waving flip-flops on the Madison Square Garden convention floor. Republicans repeated the ad from coast to coast. Kerry came close but fell just short of unseating President George W. Bush.

3.  Howard Dean's scream:  During the 2004 Democratic primary, The one-time frontrunner’s campaign never recovered from his “yee-haw” moment the night of his defeat in the 2004 Iowa caucuses. The former Vermont governor got carried away while reciting a list of states he had targeted for victory. “The Scream” became The Story of the night. And the campaign.

4.)  Gary Hart's challenge to the media to follow him:  When rumors first began circulating in 1987 that Democratic presidential front runner Gary Hart was having affairs, he taunted the press. “Follow me around,” he challenged the media. “It will be boring.” Well, they did. And it wasn’t boring. The Miami Herald discovered a woman named Donna Rice. The famous National Enquirer photos on the good ship “Monkey Business” followed. And Hart — whose campaign buttons stated “My Heart Belongs to Gary” — ended up jilted by voters.

5.)  Al Gore inventing the Internet:  Vice President Al Gore was locked in a tough primary race against former New Jersey Sen. Bill Bradley when he spoke to CNN anchor Wolf Blitzer. Ticking off his qualifications for president, he noted, “During my service in the United States Congress, I took the initiative in creating the Internet.” Gore indeed had been an early proponent of the Internet. But his misstatement became part of a damaging image of the Tennessee Democrat as a serial exaggerator.

 

 Of course, these blunders are just from recent campaigns, and we can expect many more in the months ahead with this many candidates all looking for attention.   Stay tuned for many more!

1998 PA Gubernatorial Election; an interview and look back

The Pennsylvania Gubernatorial election of 1998 was held on November 3, 1998. It was a race between incumbent Republican Tom Ridge and Democrat Ivan Itkin. Ridge, a popular moderate, won easily with 57% of the votes.

Ridge ran unopposed for the Republican nomination. State Representative Itkin, from Pittsburgh, defeated former Auditor General and US Representative Don Bailey. Itkin, although not well know in the state, was a powerful figure in the legislature and had the backing of the party establishment.

During the election cycle, Democrats struggled with fundraising issues and had difficulty recruiting a top tier candidate. Itkin was generally considered to be a sacrificial lamb against the popular Ridge. 

Marc Weinstein was at the center of this election, as the campaign manager for Itkin. Weinstein graduated from Duke University, and while at Pitt pursuing his law degree, began to volunteer for the Democratic party. Itkin's wife, also a local political figure in Pittsburgh, quickly took to Weinstein and offered him a job with her campaign. From there, He was introduced to Itkin and was utilized in local house races (Itkin was majority leader) with great success.

During the Democratic primaries, Weinstein had a senior role, but was not the leading campaign manager. However, once Itkin won the primary, Weinstein was elevated to the lead campaign role for the uphill race against the popular Ridge. 

Marc and I have mutual friends, and He recently agreed to speak with me about his experiences with the campaign and politics in general in our discussion below:

How did you get involved in politics to begin with?
I was always interested in politics, and particularly during my law school days at Pitt. I also was interested in meeting some of the political players, and figured volunteering would be the quickest way to get started. I was lucky enough to meet Mrs. Itkin, and was fortunate to help a few winning campaigns at the state level. 

How did you meet the candidate/get hired?
I met Mr. Itkin during the primaries, through his wife, and was hired full time in 1996 just as the Gubernatorial race was beginning.

 

What was the your main campaign strategy, and how did you develop it?
That's a tough one. You have to remember, in 1998, the economy was in great shape, and Tom Ridge (the incumbent) was very popular in Pennsylvania. Ridge was a moderate, so He was difficult to attack on traditional Democratic issues. Our general strategy was to win in Philadelphia and Pittsburgh, and try to get out the Democratic vote in the middle of the state. Most politicians label Pennsylvania as Pittsburgh in the west, Philadelphia in the east, and Kentucky in the middle. We knew we had an uphill battle, and honestly were hoping for a Ridge mistake.

 

How did you raise campaign funds?
Incredibly difficult, and no doubt one of our biggest challenges. We had extreme problems getting donors to write checks, since most suspected Ridge would win in a landslide, and they didn't want to offend Ridge. If I recall, Ridge raised $12 Million, and we were at $500K. Even small PAC's wouldn't join us for fear of offending Ridge. Incumbency, particularly during good times, is the most powerful position to run from. Also, Itkin was not wealthy, so did have funds to put in for himself.

How active were you on message with the candidate?
We would sit with Itkin, take his ideas, and then mold them into a politically correct message. 

How much polling did you utilize?
Small focus groups and some phone blitzing, but funds were limited.

How much outside influence was involved?
Not much from our side. As we discussed, we called multiple people for help, but since most were certain it was a losing campaign, they refused to get involved. Again, Ridge, at that time was viewed as a potential Presidential candidate, and most agree He was runner up to Dick Cheney for VP in 2000 to George Bush.

Did you hire any political consultants?
Yes, biggest waist of funds.

           How did you attack Ridge?
           We ran small print and tv ads in Pittsburgh, but they had little to no impact.

When did  Itkin (and you) know you were in an uphill battle?
Right away.

Did the candidates ever speak to each other?
Yes, but only on election night to concede.

Did you have interaction with the other campaign team?
Yes, but only to schedule debates and also on election night during concession.

Do you miss politics/campaigns?
No at all. It's a dirty game with no rules.

Anything else interesting you can recall?
Was interesting going to newspaper editorial boards and see how that worked, and meeting some amazing people.

This was Weinstein's last political role, as He went into private practice right after graduation and the election. Ridge went on to run Homeland Security, but never ran for higher office again. Itkin retired from the House following his gubernatorial defeat and was subsequently appointed Director of the Office of Civilian Radioactive Waste Management in the Department of Energy by President Clinton in 1999.

A big thank to you to Marc Weinstein for sharing his campaign experience with us and giving readers an insiders look at a campaign.

The money race updated, and what the figures don't show.

Last Wednesday was the first deadline for candidates to report to the Federal Election Commission details on how they are raising, and spending their money.

This NY Times article details how much has been raised, spent, and in some instances, where the money is coming from.

As you can see from the table below, while Hillary Clinton has raised the most from direct contributions ($47.5 million), Jeb Bush has raised the most money from outside support (PAC's) with $103 million. 


For those of you that have been following my blog, you can clearly see the disconnect between direct funds raised and PAC money raised, and how this is impacting campaigns.

What the campaign filings don't show is how much the Super PAC's continue to have growing sway.  While these reports do provide an early glimpse at each campaign's financial operations, they promise to tell only part of the story.  These figures do not include any of the money being raised by the "super PACs" and other outside groups supporting many of the candidates.  In many cases, the money raised by these super PAC's will dwarf what the direct campaign brings in.

As we have discussed, some candidates are relying on these groups, which can tap unlimited corporate and individual contributions, so long as they do not coordinate directly with the candidates.  This is a huge departure from past campaigns and has directly led to candidates becoming reliant on a handful of super rich donors.

As you can with the table above, without Super PAC's, Jeb Bush would have raised approximately the same amount as Marco Rubio and Ted Cruz in the Republican field.  Instead, the field is clearly separated by those that have the most Super PAC money (and again, this table doesn't show all of it).

Rick Perry offers a perfect example.  The former governor of Texas, who ran a choppy campaign in 2012, has had trouble firing up direct contributions.  Perry is at the bottom of direct money raised. 

However, a few super PAC's have furnished Perry with over $10 million, with most of that money coming from just a handful of super wealthy donors.

With some much power and influence in the hands of a few, watchdog groups (and citizens) continue to be concerned about this growing trend in fund raising.