Combining two of his less explicable obsessions -- Kerry-hating and finding loopholes in campaign finance law -- Mickey Kaus has been dwelling on the question of whether Kerry can "pre-buy" media for the period between the Democratic convention and the general election in November, thus using his windfall from small contributions to avoid the limits imposed in the post-nomination period, when he can spend only the $75 million in public funds that he and Bush will both receive.
The answer, of course is that the Federal Election Commission does draw a bright line between spending in the pre-convention period -- when candidates like Bush and Kerry who have opted out of public financing for the primaries can raise and spend whatever they want in contributions of $2,000 or less -- and spending leading up to the election, which is limited and publicly financed. To pay now for an ad to run in October, treating it as a July expense, would be blatantly illegal. Yes, Kaus says, the FCC is not a great enforcement agency and the penalty may be no more than to have to repay the funds. But it's not a gray area, and no campaign would want to be caught with a contract for election-week ads signed, paid for and reported in July. The campaign finance scandal following Clinton's reelection in 1996, which included a special congressional investigation and several indictments, was based on violations no less technical.
However, there are two points to make: First, there are other ways to manipulate funds in order to boost the money available in the pre-election period. Second, this is not a story about the Kerry campaign. Whatever those techniques are, the Bush campaign, which has known for years that it would opt out of pre-convention public financing and also that it would have roughly $200 million, has long ago figured them out. For Kerry, who only a few months ago decided for sure that he would opt out in the primaries, and only a few weeks ago realized that rather than facing a "dark period" before the convention, he actually would find himself raising more many than any candidate in history from individual contributions, it is much too late to figure out and implement many of the tricks that allow that money to go further.
The slickest trick, of course, was delaying the Republican convention so that they have only nine weeks in which to spend their $75 million, while the Democrats have to stretch it over another month. That's why Kerry may or may not have toyed with the idea of delaying his formal acceptance of the nomination until later.
The time factor alone is not enough to worry the Democrats. I think Kerry's campaign would not be so worried about money in the end-game if they did not suspect that Bush had already figured out all the tricks. And the main trick is not to pre-purchase ads, but to essentially pre-purchase everything else a campaign needs, so that every penny of the $75 million can go to television ads.
A friend who is a political scientist suggested a hypothetical example, and one that would be far less blatant than the contract with the broadcaster: How are the field staff of the Bush campaign being paid? Are they being paid more now and less after the convention? Or even, do they have contracts that run only through the nomination, at fairly high pay, after which they will reappear as volunteers? (I have no idea if the Bush campaign is doing anything like this, just that it's an example of how this might be done. Much like the date of the convention, it is too late for Kerry to do something like this even if he wanted to.
Finally, I should point out that all this confusion and these loopholes come about because the Congress of 1976, responding to the Buckley v. Valeo decision, made a fundamental mistake in the design of a public financing scheme: It allowed candidates to opt out of one portion of a public financing system and not the other. That is why we have to draw these elaborate lines between the privately-financed Bush campaign, which ends September 1, and the publicly-financed campaign. It seems to be a consensus among everyone who has proposed reform to the presidential public financing system that it must be a strict in-or-out choice. If you opt out of the spending limits of the primary period, you cannot turn around and take public money in the general election. To make that requirement work, and persuade most candidates to stay in the fairer public system, will require other changes to make the system more generous. My own preferred option is the system used in New York City, so that in the public system, contributions of $250 or less would be matched at 4:1, rather than dollar-for-dollar. No one opts out of that system! It's worth noting that Kerry, as the cosponsor of the Kerry-Wellstone bill to establish public financing of congressional elections, has shown an understanding of and commitment to this issue, and is more likey than Bush to want to fix the system.
[Update: Matthew Yglesias points out, of course, that Mayor Bloomberg opted out of the NYC public financing system. Indeed. So did Elana Waksal Posner, daughter of Sam Waksal of Martha Stewart fame, who ran for a city council seat. 99.something percent of all eligible candidates did participate. And those two opted out in favor of using their own considerable wealth, rather than raising money from others, as Bush and Kerry are doing. The 4:1 match provides a strong incentive against opting out in favor of traditional fund-raising, and the spending limit is also relatively hight.]
Didn't Michael Bloomberg opt out of that system?
Posted by: Matthew Yglesias | 07/11/2004 at 03:42 PM