Ted Cruz super PACs: A new era of political fundraising
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WASHINGTON, DC - MARCH 20: U.S. Sen. Ted Cruz (R-TX) speaks during the first day of the Supreme Court confirmation hearing for Judge Neil Gorsuch before the Senate Judiciary Committee in the Hart Senate Office Building on Capitol Hill March 20, 2017 in Washington, DC.
Supporters of the Texas Republican presidential candidate made a bombshell announcement this week — that a network of four affiliated super PACs will have raised an eye-popping $31 million by the end of the week. The disclosure, coming within weeks of Cruz launching his campaign for president, has sent deep ripples through the political fundraising world.
The idea of not one, but multiple, affiliated super PACs ostensibly working together to haul in donations for the same presidential candidate is unprecedented, campaign finance experts say.
Veteran fundraisers point out that the strategy could give already powerful donors never-before-seen levels of influence — and choice — over how their dollars are spent to help a presidential candidate. The unique setup is aimed at giving mega donors “influence and control over the expenditures” they are funding, explained Dathan Voelter, an Austin-based attorney and treasurer to three of the four super PACs.
As political strategists and campaign finance experts scramble to assess just what this all means for the future of political fundraising, one thing seems clear: Wealthy donors are most certainly about to get more powerful – not less.
“My bet is that it all has to do with the donors – donors having different views of what the super PAC should do,” said Cleta Mitchell, a political law attorney at Foley & Lardner, who summed up the strategy as “very unusual.”
“So rather than having internal arguments about it, they just established different super PACs,” she said.
Campaign finance reformers have for years spoken out against the oversized influence of deep-pocketed donors in the political system. There was no bigger blow to their cause than the Supreme Court’s historic Citizens United ruling in 2010, which allowed for super PACs — a kind of political action committee — to accept unlimited amounts of contributions from various entities including, individuals, corporations and unions.
In recent election cycles, a handful of high-profile, mega-wealthy donors have spent unprecedented sums of money through super PACs, supporting or attacking political candidates often with an eye towards achieving a narrower cause.
Liberal billionaire and environmentalist Tom Steyer; pro-Israel conservative casino magnate Sheldon Adelson; and wealthy businessmen Charles and David Koch — better known to many as simply the “Koch brothers” — have poured hundreds of millions of dollars into super PACs to influence elections.
One Republican strategist who leads a major GOP super PAC called the multi-super PAC strategy a “brilliant move” that offers potential donors an “a la carte” menu of super PACs to consider.
“A super PAC might go into a pitch and say here’s our plan to win: We’re going to tear down Bush. And a donor might say, “Nah, I’m not interested,’” said the strategist, who declined to speak on the record so as not to expose their clients. “But now, they walk in and they say, ‘We’re going to have data, we’re going to model the voters, do rallies, tear down Bush and build up Ted.’ And the donor says, ‘All right, I’m interested in that one, this one and that.’”
So far, there are four super PACs pulling in cash to benefit Cruz’s campaign: Keep the Promise PAC, Keep the Promise PAC I, Keep the Promise PAC II and Keep the Promise PAC III. Each is tethered to a big donor or donor family. Voelter said more could spring up if another big enough donor walks onto the scene – a Keep the Promise IV, for example.
Former Florida Gov. Jeb Bush has said his decision to run for the Republican nomination will be based on two things: his family and whether he can lift America's spirit. His father and brother are former Presidents.
Wisconsin Gov. Scott Walker has created a political committee that will help him travel and raise money while he considers a 2016 bid. Additionally, billionaire businessman David Koch said in a private gathering in Manhattan this month that he wants Walker to be the next president, but he doesn't plan to back anyone in the primaries.
Louisiana Gov. Bobby Jindal is establishing a committee to formally explore a White House bid. "If I run, my candidacy will be based on the idea that the American people are ready to try a dramatically different direction," he said in a news release provided to CNN on Monday, May 18.
Sen. Bernie Sanders, an independent from Vermont who caucuses with Democrats, has said the United States needs a "political revolution" of working-class Americans looking to take back control of the government from billionaires. He first announced the run in an email to supporters early on the morning of Thursday, April 30.
On March 2, retired neurosurgeon Ben Carson announced the launch of an exploratory committee. The move will allow him to raise money that could eventually be transferred to an official presidential campaign and indicates he is on track with stated plans to formally announce a bid in May.
South Carolina Sen. Lindsey Graham has said he'll make a decision about a presidential run sometime soon. A potential bid could focus on Graham's foreign policy stance.
Hillary Clinton launched her presidential bid Sunday, April 12, through a video message on social media. She continues to be considered the overwhelming front-runner among possible 2016 Democratic presidential candidates.
Sen. Marco Rubio announced his bid for the 2016 presidency on Monday, April 13, a day after Hillary Clinton, with a rally in Florida. He's a Republican rising star from Florida who swept into office in 2010 on the back of tea party fervor. But his support of comprehensive immigration reform, which passed the Senate but has stalled in the House, has led some in his party to sour on his prospects.
Lincoln Chafee, a Republican-turned-independent-turned-Democrat former governor and senator of Rhode Island, said he's running for president on Thursday, April 16, as a Democrat, but his spokeswoman said the campaign is still in the presidential exploratory committee stages.
Jim Webb, the former Democratic senator from Virginia, is entertaining a 2016 presidential run. In January, he told NPR that his party has not focused on white, working-class voters in past elections.
Vice President Joe Biden has twice before made unsuccessful bids for the Oval Office -- in 1988 and 2008. A former senator known for his foreign policy and national security expertise, Biden made the rounds on the morning shows recently and said he thinks he'd "make a good President."
New Jersey Gov. Chris Christie has started a series of town halls in New Hampshire to test the presidential waters, becoming more comfortable talking about national issues and staking out positions on hot topic debates.
Rep. Paul Ryan, a former 2012 vice presidential candidate and fiscally conservative budget hawk, says he's keeping his "options open" for a possible presidential run but is not focused on it.
Sen. Rand Paul officially announced his presidential bid on Tuesday, April 7, at a rally in Louisville, Kentucky. The tea party favorite probably will have to address previous controversies that include comments on civil rights, a plagiarism allegation and his assertion that the top NSA official lied to Congress about surveillance.
Texas Sen. Ted Cruz announced his 2016 presidential bid on Monday, March 23, in a speech at Liberty University. The first-term Republican and tea party darling is considered a gifted orator and smart politician. He is best known in the Senate for his marathon filibuster over defunding Obamacare.
Democrat Martin O'Malley, the former Maryland governor, released a "buzzy" political video in November 2013 in tandem with visits to New Hampshire. He also headlined a Democratic Party event in South Carolina, which holds the first Southern primary.
Republican Rick Perry, the former Texas governor, announced in 2013 that he would not be seeking re-election, leading to speculation that he might mount a second White House bid.
Former Pennsylvania Sen. Rick Santorum, a social conservative, gave Mitt Romney his toughest challenge in the nomination fight last time out and has made trips recently to early voting states, including Iowa and South Carolina.
Political observers expect New York Gov. Andrew Cuomo to yield to Hillary Clinton's run in 2016, fearing there wouldn't be room in the race for two Democrats from the Empire State.
The four PACs can solicit unlimited amounts of money, thanks to the Citizens United ruling, and can coordinate amongst each other but are banned from working with Cruz’s campaign.
The $31 million amount cannot be independently verified until the next Federal Election Commission disclosure deadline. If it’s accurate, that starting figure would easily top the $23 million the Winning Our Future super PAC hauled in – mostly from Adelson – to buoy Newt Gingrich’s 2012 primary bid, according to the Center for Responsive Politics.
Voelter said the super PAC setup sprang up after a “group of donors” started looking for ways to contribute to the election effort but also “address some of the shortcomings” of past super PAC efforts.
Austin Barbour, who runs a pro-Rick Perry super PAC, said it’s not unusual for most generous donors to want to have heavy sway over a PAC.
“Donors want to know how you’re spending the money. Donors want to know what you’re doing,” Barbour said.
The setup has prompted a lot of head-scratching among campaign finance experts who question the upsides of the fragmented organization.
“I don’t think there are any efficiency gains from doing it this way – the accounting headaches are not insignificant having been on that end of trying to report stuff like this,” said David Keating, president of the Center for Competitive Politics, a group that tracks political spending. “It seems like a big hassle.”
Regardless, the super PACs have given a big boost for Cruz, who few expected to attract this kind of a hefty financial backing in such a short period of time.
“People were saying you know Cruz is good and he’s a conservative and this and that, but he’s not going to be able to raise money and he’s not going to be able to win,” campaign spokesman Rick Tyler said of the super PAC haul. “I knew it would be over and it’s over.”
Meanwhile, the Cruz campaign has also made strong inroads in the first weeks of his official candidacy, raising more than $4 million in eight days after Cruz launched his bid, mostly from small donors. This is a clear sign, Cruz allies say, of his viability in what is expected to be a crowded Republican field.
“It’s just very difficult to get out your message when you don’t have the resources to do it. Here we have a conservative who actually can raise money,” Tyler said. “And not just grassroots money, but major donor money.”