by hilzoy
The candidates have now filed their FEC reports for February (Obama, Clinton, McCain.) As I wrote about a month ago, the FEC believes that McCain might be subject to the spending caps that go with public financing because of a loan he accepted, in which he promised that if he lost, he would stay in the race long enough to get public financing, and would then give his lender first dibs on it. The DNC has also filed a complaint alleging that the fact that McCain used his eligibility for public financing to get on the ballot in Ohio and Delaware means that he should count as having benefitted from public financing, and should also be subject to spending caps on those grounds.
When I wrote last month, the actual spending caps had not yet been determined. Now they have: the limit for primary spending by Presidential candidates who use public financing is $42.05 million. McCain has spent $58,432,607.83 to date, of which $48,941,918.40 is operating expenses. That means that if McCain is subject to the spending cap, he is now plainly in violation of the law.
One other note: Al Giordano writes that the Clinton campaign's claim that it raised $35 million in February is wrong, since that figure includes her $5million dollar loan and $10million from her Senate campaign. If this were true, it would mean that Clinton had completely misled people about her Feb. fundraising. But it's not true. I have slogged through the finance reports, and I think Giordano has been misled by this bit from an LA Times piece that he cites:
"She collected $34.6 million in February, pushing her total to $173.8 million. That includes $10 million from her Senate campaign account and a $5-million personal loan. Clinton owes consultants and other vendors an additional $3.7 million."
It's the total of $173.8 million that includes the $10 million from her Senate campaign account and the $5 million personal loan, not her February fundraising totals. According to her new FEC report, during February she received $34,471,877.59 in contributions from "Individuals/Persons Other than Political Committees", and no loans from herself or transfers from "other authorized committees." Both the $10 million from her Senate campaign and the $5 million loan do, however, show up in her totals for the campaign to date.
That said, this is also true:
"Both Democrats ended up with more than $30 million in the bank, but Clinton can't use two-thirds of her cash on hand because it's only for the general election. That and her debt left her with less than $3 million in the black. The debt doesn't include the $5 million she lent her campaign in January."
I note with sorrow that the Clinton campaign still owes money to a number of small businesses in Iowa. I imagine the Depot Deli in Shenandoah, Iowa could use the $615.25 the Clinton campaign owes them. The Iowa caucuses were quite some time ago.
[UPDATE: while I was posting this, Al Giordano retracted his story.]
So does this mean that McCain will have to stop campaigning? Or will it be another IOKIFYAR?
PS: while I was posting this, Al Giordano retracted his story
Good for him.
Posted by: Jesurgislac | March 21, 2008 at 03:00 PM
So he promised to use his public campaign financing to pay a loan for early campaign expenses? That seems inappropriate. Probably not rising to the level of something that could be used to hurt him in the campaign though? (Alas.)
Posted by: The Modesto Kid | March 21, 2008 at 03:05 PM
Modesto -- As I understand it, McCain offered the public financing as collateral for a loan, but then said he wasn't bound to remain in the public financing system. The FEC (and others) are looking askance at this interpretation.
Posted by: farmgirl | March 21, 2008 at 03:08 PM
Oh, and if he's found guilty it is a jailable offense.
Posted by: farmgirl | March 21, 2008 at 03:09 PM
TMK: I actually think it is pretty serious. (See the links to my two previous stories.) Basically, you are supposed to either get public funding and abide by the caps, or not get it and spend whatever you want. You do not get to spend it and blow through the caps.
Taking out a loan using the public money as collateral is out, according to the FEC: if you took out a loan for the amount you'd be getting using the public money as collateral, used that loan to win enough that you could pay it back w/o having actually taken the public money from the government, and then said: ha ha, I never actually used my public funds! -- that would be against the law.
What McCain did was to say: I'm not using my actual eligibility for public money as collateral; I am using the fact that having been certified to get public funding now, I would get certified again if I tried, and by the way, if I lose, I will stay in the race just long enough to get the public money and pay off the loan.
Is it illegal? I have no idea. Ianal, etc. Is it flamingly out of keeping with the spirit of the laws McCain claims to support? Absolutely.
Posted by: hilzoy | March 21, 2008 at 03:11 PM
I mean, consider the fact that in the loan document, he promised to remain in the race, pretending to be a serious candidate, just long enough to collect our money and give it to the bank.
Posted by: hilzoy | March 21, 2008 at 03:12 PM
You would think that Iowans (and New Hampshirites) would know by now to ask for cash up front.
Posted by: Mike Schilling | March 21, 2008 at 03:27 PM
he promised to remain in the race, pretending to be a serious candidate, just long enough to collect our money and give it to the bank.
seems odd that nobody in the R primaries bothered to make a campaign issue out of that.
makes me wonder if such statements are S.O.P. for candidates... ?
Posted by: cleek | March 21, 2008 at 03:46 PM
farmgirl: Oh, and if he's found guilty it is a jailable offense.
Can't imagine the case going to trial, then. A Republican? Going to jail? For the crime of getting money to campaign against Democrats? Not with the modern, streamlined, DoJ on the case. ...particularly not when you look at the other options if McCain does have to drop out of the race.
I will prepare and eat a dish of tofu crow if anything happens to McCain over this that requires him to drop out of the race.
Posted by: Jesurgislac | March 21, 2008 at 03:49 PM
@cleek: Nope. This is a first as far as I know.
Also, the DNC's point is a perfectly good one as well: he used his publicly financed status to get on the ballot in a big state the easy way (no signature-gathering, etc., just the blessing of the Board of Elections), and that's worth several hundred thousand dollars of benefits right there. I.e., he has received a substantial in-kind contribution from public financing, and is therefore subject to the limits.
Posted by: Nell | March 21, 2008 at 03:58 PM
I don't believe a guilty verdict on this charge *requires* a trip to jail, as hefty fines are also an option, but it is a possibility.
As you say about the tofu crow, though...
Hey, did I ever see that on the menu at one of those Buddhist Chinese restaurants? Maybe with a mushroom-bean sauce?
Posted by: farmgirl | March 21, 2008 at 04:05 PM
Not to indulge too deeply in schadenfreude (quick quiz: how deep is too deep?), but maybe we can hope to see a moving display of that famous McCain temper.
Some sticky wicket.
But what are the options?
Posted by: felix culpa | March 21, 2008 at 04:15 PM
hey, I'm still holding out hope for a psychotic break on live TV by the President... but I'll take McCain's temper too.
Posted by: farmgirl | March 21, 2008 at 04:31 PM
"Oh, and if he's found guilty it is a jailable offense."
Would you have a cite as regards that?
It's true that the FEC has the power to issue contempt citations, which can be enforced by jail. As a rule, conciliation agreements are signed within the framework of civil law and civil penalties.
Usually when criminal charges are involved in an election case, they stem from connected perjury or conspiracy charges, in my limited experience/knowledge. (Example.)
But IANAL. Do you have any links about anyone ever being jailed for a violation of the FEC Act Laws, or a cite to which legal provision you have in mind, that I could read about?
That is, specifically that the candidate goes to jail, and for violation of FEC law, not ancillary charges pertaining to a FECA violation. I'm just curious if this has happened; I certainly could have missed a bunch of cases.
Posted by: Gary Farber | March 21, 2008 at 05:13 PM
Isn't there some kind of mulligan for getting accused under an Act that's named after you or something? No?
Posted by: Adam | March 21, 2008 at 05:14 PM
Sure: you can declare that that wasn't the author's intent...
Posted by: Anarch | March 21, 2008 at 05:31 PM
I don't think McCain really wants to wear a spending cap.
Posted by: Wgf | March 21, 2008 at 05:33 PM
Posted by: Adam | March 21, 2008 at 06:01 PM
Hmm.
FEC. FECA.. FECALaw?
I don’t need (nor expect) to see him go to jail. I only want to see him have a prime-time temper tantrum.
It’d be a fine-line balancing act; enough to please his partisans, not so much as to alienate his ‘inclined’.
It’s unlikely to lose him votes on account of inconsistency, given his present so-far-successful record of switchbacks.
Posted by: felix culpa | March 21, 2008 at 06:12 PM
Felix, the thing that amuses me is that if only the US had electoral law that was applied without fear or favor to anyone who broke the rules about campaign financing, it looks as if McCain would have to drop out of the race, which - as I understand it's way too late to nominate someone new - would leave the Republican party stuck with their bunch of no-hopers again.
Given that this is the US, and that this is the presumptive Republican candidate - well, I was looking up recipes for "tofu crow" out of interest: I do not expect to have to make use of them.
Posted by: Jesurgislac | March 22, 2008 at 04:35 AM