GOP Money Power Takes On Obama Fundraising McCain is taking public funds for the fall campaign, so his budget is a fraction of Obama's. But the Republican National Committee is balancing the scales, by spending party money on TV ads for the McCain-Palin ticket. In the week following the conventions, the GOP outspent the Obama camp on ads.
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GOP Money Power Takes On Obama Fundraising

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GOP Money Power Takes On Obama Fundraising

GOP Money Power Takes On Obama Fundraising

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MICHELE NORRIS, host:

From NPR News, this is All Things Considered. I'm Michele Norris. Now, politics and money. Barack Obama turned down public financing, and he's setting fundraising records. John McCain is taking public funds. If you think that means the Republicans will lag in the money race, well, think again. Under the public financing system, Senator McCain is required to obey spending limits, but his campaign has found a workaround. The Republican Party has been bankrolling more than half of the campaign's ads, as NPR's Peter Overby reports.

PETER OVERBY: McCain got 84 million dollars in Treasury funds. Under the law, he can't raise a penny beyond that. Obama with his fundraising juggernaut started September holding nearly that much in the bank, 77 million dollars. Yet McCain outspent Obama on TV in that first week after the conventions. He is using an arrangement in which he isn't collecting private money, but the Republican National Committee is. An analysis released today by the Wisconsin Advertising Project finds that the RNC helped to pay for more than 55 percent of McCain's ads that week. These are called hybrid ads. And yes, they are legal. Ken Goldstein is head of the Wisconsin Advertising Project.

Dr. KEN GOLDSTEIN (Director, Wisconsin Advertising Project; Professor of Political Science, University of Wisconsin-Madison): There is absolutely nothing different in terms of content, tone, or targeting from a completely candidate-sponsored ad and a hybrid ad. Indistinguishable.

OVERBY: Goldstein says McCain's campaign doesn't have to worry about its own financing. The government took care of that.

Dr. GOLDSTEIN: But it enables them to spend that additional money and retain control. And that's the key thing. A dollar you control is much better than a dollar you don't control, even if that other dollar is spent on your behalf.

OVERBY: The pioneer in using hybrid ads was President Bush in 2004. Democrat John Kerry quickly followed. Now, McCain and the RNC have perfected the technique with an entity called McCain-Palin Victory 2008. It's a joint committee to raise money for the RNC, four of the Republican state parties, and the legal compliance committee for McCain-Palin which pays McCain's lawyers and accountants. Donors can give up to 67,800 dollars each. All of the cash cycles back to help the McCain campaign.

This works so well because the RNC is raising far more money than the Democratic National Committee. In their last official filings, the RNC had 75 million dollars on hand, almost 10 times more than the DNC. Public financing made it illegal for presidential candidates to raise money from ultra-rich donors, at least for their own campaigns. Critics say that's exactly what Obama and McCain end up doing, raising money for these victory committees. Rick Hasen teaches election law at Loyola Law School in Los Angeles.

Professor RICK HASEN (Election Law Specialist, Loyola Law School): Between all of the complex laws and regulations and Supreme Court opinions that rule over this area of campaign finance, we end up with some pretty perverse sorts of things.

OVERBY: And McCain and Obama - who has his own victory committees - have gone from being champions of campaign reform to poster children instead. Fred Wertheimer, head of the watchdog group Democracy 21, says victory committees are a problem that needs fixing.

Mr. FRED WERTHEIMER (President & CEO, Democracy 21): The way in which they have been used in 2008 has made the case for shutting them down legislatively in the future.

OVERBY: And here's the curious thing. That effort could give President McCain or President Obama a chance to reclaim his image as a reformer. Peter Overby, NPR News, Washington.

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