Monday, February 25, 2008

Oh, the irony!

John McCain is coming to understand what being hoist up on his own petard truly means. He's having problems with the FEC over the loan that he took out using his possible use of public financing as part of his agreement. And FEC rules say that if you take public financing or even benefit from saying you'll take the financing, you can't overspend the limits.
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.

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.
Of course, having those limits on McCain's spending up to the convention would be almost a paralyzing blow to McCain. Obama is raising money faster than Jerry Lewis doing a telethon and would have no such limits.

Meanwhile the Republicans and Democrats have been squabbling about all the nominees that the Senate Democrats have been holding up and filibustering. There are four openings on the FEC: two Republicans and two Democrats. And the Democrats object to one of the Republican nominees and the GOP are demanding that all the nominations are be voted on as a group.
With van Spakovsky and three other nominees to the FEC hung up in the Senate, the commission has only two members and is unable to conduct most of its business. Democrats want to vote separately on the nominees -- two Republicans and two Democrats -- but Republicans maintain that Senate tradition requires a vote on the four as a package.
Now Howard Dean is complaining that McCain is violating FEC rules.

To pile irony upon irony, John McCain is able to just ignore the possible problems with the FEC because the FEC doesn't have a quorum and can't rule on his situation. And Barack Obama is partly responsible for the vote on Hans van Spakovsky because he's one of the four senators who placed a hold on van Spakovsky's nomination.
Bradley Smith has a summary of the objections to van Spakovsky's nomination. A lot of it centers on his support for voter ID laws which some Democrats insist is a civil rights violation. I wonder if most American voters would agree that it is a violation of rights to ask voters to show a picture ID when they vote, especially when they find out that the government is giving out free picture IDs to those who don't have a driver's license. The Supreme Court is hearing a case based on the Indiana law and we'll find out if the law is constitutional in the Court's view. And the Democratic senators will have to decide if their objections to van Spakovsky are strong enough to allow McCain to get away without a ruling from the FEC about his spending. As the Wall Street Journal editorializes today, what's been going on behind the scenes for the FEC nominations is just the sort of politics that Barack Obama tells us he wants to change.
Mr. von Spakovsky's nomination was approved by the Rules Committee in September, but then Mr. Obama intervened with a "hold." Other Democrats have since joined him.

Mr. von Spakovsky was supposed to be voted on in a package of four FEC nominees. Senate Majority Leader Harry Reid instead demanded that all four get individual votes, hoping to tank only Mr. von Spakovsky. The six FEC commissioners have staggered terms, and one Republican and one Democrat are supposed to end their terms simultaneously so there is no partisan advantage. Mr. von Spakovsky is paired with Steven Walther, a Nevada lawyer with close ties to Mr. Reid. The Majority Leader can hardly expect to get his hand-picked choice, while throwing Mr. Bush's overboard.

All of this is the rankest sort of partisan Beltway gamesmanship, all the worse because it is rooted in racial politics. It is precisely what Mr. Obama says he wants to rise above, but apparently that will happen only after he wins the Presidency. Mr. Obama also boasts about his role in crafting last year's lobbying and ethics law, which includes a provision requiring candidates to report "bundled" campaign contributions. The FEC was unable to devise the rules for that provision before it lost its quorum in December. Meanwhile, Mr. Obama is bundling away.
For now, the empty seats on the commission could allow Mr. McCain to spend some money to promote his candidacy before being reined in.

"He may have the upper hand for the time being," a Republican election lawyer, Jan Baran, said of Mr. McCain, "but he will be subject to FEC action at some point."

If Mr. McCain is hobbled by the spending limits, he would likely turn to the Republican National Committee to help him compete with the Democratic nominee over the summer, much as Robert Dole did in 1996. But the RNC does not raise so-called "soft money" because of the 2002 McCain-Feingold bill, Mr. Baran noted, so it may not have as much money to spend on Mr. McCain's behalf.
And you know what will happen? Some 527s will emerge to fill in the spending gap. And Mr. Take the Money out of Politics will be dependent on unregulated money in politics.

Oh, the irony.