Publication: Progressive Review
FEC Warns McCain on Campaign Spending | |
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THE PROGRESSIVE REVIEW - February 25, 2008
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FEC Warns McCain on Campaign Spending
By Matthew Mosk and Glenn Kessler
The Washington Post
The nation's top federal election official told Sen. John
McCain yesterday that he cannot immediately withdraw from
the presidential public financing system as he had request-
ed, a decision that threatens to dramatically restrict his
spending until the general election campaign begins in the
fall.
The prospect of being financially hamstrung by the very
fundraising system he helped create is the latest in a
series of bitter challenges for the presumed GOP nominee,
who still faces a fractured conservative coalition as he
assumes the mantle of party leadership.
Yesterday, McCain blasted the New York Times for an article
that alleged that he had an inappropriate, romantic
relationship with a female lobbyist eight years ago. With
his wife, Cindy, standing next to him at a Toledo campaign
stop, he called the report "untrue" and assailed the news-
paper, saying it was waging a "smear campaign" against him.
McCain's aides went on the offensive, blaming the Times.
"Obviously, we were very angry," said senior adviser Steve
Schmidt, speaking to reporters as McCain flew to Michigan
from Ohio. "When we read the story, my initial reaction
was that it was something you would see in the National
Enquirer, not the New York Times."
Cindy McCain told reporters that she trusts her husband,
saying that he "would never do anything to... disappoint
our family" or the American people. "He's a man of great
character."
John McCain disputed almost every part of the Times
article, saying that he did not have a romantic affair
with lobbyist Vicki Iseman and that he had never done
inappropriate favors for her or other lobbyists. He denied
the part of the story, also reported in The Washington
Post, that his staffers had confronted him about his ties
to Iseman.
McCain said that if staffers had had such concerns, "they
did not communicate them to me." He noted that as many as
150 people worked on his staff at the time and said he had
no idea who could have spoken to the newspapers.
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One of those former staffers, John Weaver, was quoted on
the record in both papers as saying he had a confrontation
with Iseman about her claims of closeness to McCain. But
McCain said he did not know of the conversation until he
read about it.
Weaver quit McCain's campaign last year when it appeared
to be on the verge of collapse. But McCain said that there
were no hard feelings and that the two men still talk from
time to time. "John was a friend of mine, and he remains a
friend of mine," the senator from Arizona said.
Within hours of the article's publication, McCain sought
to turn it to his advantage, sending out a fundraising
appeal decrying the "baseless attacks" and urging
contributions. "With your immediate help today, we'll be
able to respond and defend our nominee from the liberal
attack machine," McCain's campaign manager, Rick Davis,
said in an e-mail.
But McCain's attempts to build up his campaign coffers
before a general election contest appeared to be threaten-
ed by the stern warning yesterday from Federal Election
Commission Chairman David M. Mason, a Republican. Mason
notified McCain that the commission had not granted his
Feb. 6 request to withdraw from the presidential public
financing system.
The implications of that could be dramatic. Last year, when
McCain's campaign was starved for cash, he applied to join
the financing system to gain access to millions of dollars
in federal matching money. He was also permitted to use his
FEC certification to bypass the time-consuming process of
gathering signatures to get his name on the ballot in
several states, including Ohio.
By signing up for matching money, McCain agreed to adhere
to strict state-by-state spending limits and an overall
limit on spending of $54 million for the primary season,
which lasts until the party's nominating convention in
September. The general election has a separate public
financing arrangement.
But after McCain won a series of early contests and the
campaign found its financial footing, his lawyer wrote to
the FEC requesting to back out of the program - which is
permitted for candidates who have not yet received any
federal money and who have not used the promise of federal
funding as collateral for borrowing money.
Mason's letter raises two issues as the basis for his
position. One is that the six-member commission lacks a
quorum, with four vacancies because of a Senate deadlock
over President Bush's nominees for the seats. Mason said
the FEC would need to vote on McCain's request to leave
the system, which is not possible without a quorum. Until
that can happen, the candidate will have to remain within
the system, he said.
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The second issue is more complicated. It involves a
$1 million loan McCain obtained from a Bethesda bank in
January. The bank was worried about his ability to repay
the loan if he exited the federal financing program and
started to lose in the primary race. McCain promised the
bank that, if that happened, he would reapply for matching
money and offer those as collateral for the loan. While
McCain's aides have argued that the campaign was careful
to make sure that they technically complied with the rules,
Mason indicated that the question needs further FEC review.
If the FEC refuses McCain's request to leave the system,
his campaign could be bound by a potentially debilitating
spending limit until he formally accepts his party's
nomination. His campaign has already spent $49 million,
federal reports show. Knowingly violating the spending
limit is a criminal offense that could put McCain at risk
of stiff fines and up to five years in prison.
"If in fact he is stuck with these spending limits, it
would be a serious limitation on what he can do," said
Rick Hasen, an election law expert at Loyola Law School
in Los Angeles.
Finance experts compared the situation to the massive
imbalance faced by Republican presidential nominee Robert
J. Dole in 1996, when he was forced to contend with spend-
ing limits while his opponent, President Bill Clinton,
was not.
Trevor Potter, a former FEC chairman who is McCain's top
lawyer, immediately disputed the assertions in Mason's
letter, saying McCain has a constitutional right to exit
the federal program. He also dismissed the letter as
unenforceable because the FEC lacks a quorum to resolve
the dispute.
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"We believe that Senator McCain had a clear legal right
to withdraw from the primary matching fund system, and he
has done so," Potter told the Associated Press. "No FEC
action was or is required for withdrawal."
Campaign finance experts were split on how serious the FEC
position could become. But several agreed that the matter
would not be resolved by McCain simply ignoring the letter
and plowing ahead.
"It's nice for Trevor Potter to say 'Buzz off,' but the
campaign is going to have to respond," said Bradley Smith,
a former FEC chairman.
"This is serious," agreed Republican election lawyer Jan
Baran. Ignoring the matter on the grounds that the FEC
lacks a quorum, Baran said, "is like saying you're going
to break into houses because the sheriff is out of town."
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Kessler reported from Toledo. Staff writer Michael D. Shear
contributed to this report.
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