McCain's Challenge: Shoring Up Republican Divisions

While the Democratic presidential candidates have been battling through the primary season, the presumptive Republican nominee has been looking ahead to the general election. Sen. John McCain must decide how to navigate between the party's conservative and moderate factions.

McCain Campaign Dogged by Funding, Lobbying Ties

Sen. John McCain's presidential campaign, never a smooth or easy operation, is navigating another rough patch.

The Arizona Republican with the maverick reputation finds himself tied to the lobbying industry he once scorned. He's also short on the big private campaign contributions he used to denigrate and is seeking help from the Federal Election Commission, which he has called despicable.

Despite his well-documented contempt for the usual ways of Washington, McCain is now finding it difficult to get elected president without them. Just last week, he had to impose a new campaign policy — one that's meant to protect him from the influence of Washington lobbyists.

Less than a month ago, McCain proclaimed in a campaign speech that "we need to close the door firmly on corporate lobbyists." But by one count, 115 registered lobbyists have been raising money or working for the campaign.

His new campaign policy states that registered lobbyists, registered foreign agents or political consultants with ties to independent political groups cannot work as paid staff or as volunteer advisers. The campaign has acknowledged five departures so far as a result of the lobbying flap — most notably, Tom Loeffler, an old friend and key fundraiser for McCain.

Loeffler lobbies for EADS North America, the U.S. subsidiary of a European-based aircraft manufacturer, which is currently fighting for an Air Force contract. He also counts Saudi Arabia among his clients.

Critics, including the liberal grass-roots group MoveOn.org, say McCain should also fire his senior adviser — veteran lobbyist and political consultant Charlie Black. Although Black quit his lobbying firm to work on the campaign, MoveOn.org is running a TV spot attacking his past record representing foreign governments that abused human rights.

The McCain campaign declined to comment for this story. A campaign spokesman earlier referred to the lobbying issue as "a perception problem."

McCain Facing Cash Issues, Too

But lobbyists aren't McCain's only problem. There's the question of money.

In 2003, he explained the motives behind the McCain-Feingold campaign finance law this way: "Average Americans are not heard in the legislative process because of the overwhelming influence of special interests, which is fueled by incredible amounts of money that are injected into political campaigns."

But statements like that are coming back to haunt him.

"The senator has always run on corruption and built his brand name on being against special interests," says John Samples of the libertarian Cato Institute, who has followed McCain's career. "But a lot of the people who are in the Republican Party, like anti-abortion groups — they understood very clearly that they were the special-interest groups he was talking about."

That wariness has affected McCain's fundraising, and he's campaigning on a shoestring. The financial picture has improved somewhat since he presumably clinched the nomination this spring. But as recently as December, McCain was being out-fundraised 2 to 1 by Ron Paul, the biggest maverick in the race.

Samples says: "A sort of long-term Republican activist asked me this morning as we were coming in to work, 'When is McCain's fundraising going to take off?' And my answer was, 'Well, it hasn't yet and I think it may well not.' "

McCain's financial problems are visible on their own, but they're especially stark when compared with the fundraising of the Democratic primary contenders, New York Sen. Hillary Clinton and, even more so, Illinois Sen. Barack Obama.

"My God, he's raised a quarter of a billion dollars already," David Rohde, a political scientist at Duke University, says of Obama.

Rohde points out that Obama's campaign is increasingly fueled by small donors. But he says McCain has a weak base of small-dollar givers, "and therefore he has to rely more on large donors, which means relying on exactly the same kind of Republican fundraising apparatus that he restricted through the campaign finance reform laws."

McCain and Public Financing for the Fall

McCain's financial plight also is pushing him to take public financing for the fall campaign. The federal grant would exceed $84 million, and he plans to supplement that heavily with funding from the cash-rich Republican National Committee. Still, both Clinton and Obama seem well-positioned to surpass that number easily and without using public funds.

Public financing presents also McCain with yet another conflict. He's railed against the Federal Election Commission for years. In 2004, on the CBS program Face the Nation, he said, "We have a Federal Elections Commission which is disgraceful and despicable in its conduct."

The FEC had been nonfunctional since January, because of a Senate deadlock over nominations. But the deadlock broke last week. It's good news for McCain, because only the FEC can vote to release the federal money for his fall campaign.

But it's bad news, too. FEC Chairman David Mason has questioned whether McCain has complied with public financing rules for the primaries.

The reconstituted commission also can vote on taking up that issue.

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