Tuesday, September 11, 2012

When Financing a Campaign is More Important Than the Candidate's Ideas

Critics from both ends of the political spectrum have noted the increasingly important role of fundraising in modern elections. Several legislative attempts at reform have been made, but still enormous focus and energy is devoted to finding sponsors who will contribute money to fund a candidate's campaign. When a prospective elected official spends that much time looking for donors, saying what he must in order to persuade them to contribute, the question arises - is the democratic process being sidelined, if the candidate has less time to study issues, less time to speak directly to voters, and the temptation to listen more to donors than to voters?

Because the electoral process is currently driven by a candidate's ability to raise funds, modern politicians have become experts at raising money. One of the best is Barack Obama. Gathering donors prior to his 2008 election to the presidency, and his 2012 reelection bid, he showed himself adept at finding ways to persuade them to give. One example is the LightSquared company, a business owned by the Harbinger Capital investment group.

Knowing that LightSquared and its owners were inclined to support him, Obama needed to find a way to direct funding to the company. The owners would take their share of the company's sales as their profit, and would donate a percentage of that profit to Obama's 2012 reelection campaign. So LightSquared needed to make some big sales prior to the 2012 campaign season. Obama arranged for government contracts to be handed to LightSquared.

This is a pattern: use the government budget to buy services and products from companies whose owners will use their income - their share of the profit from sales ot the government - to fund Obama's campaigns. This tactic has been highly successful. Historian David Limbaugh writes:

Four-star general William Shelton testified at a classified congressional hearing that the White House pressured him into changing a political briefing to reflect support for a wireless project by Virginia satellite broadband company LightSquared, a Democrat-backed firm, despite the Pentagon's concerns that the project could interfere with GPS. LightSquared is owned by Harbinger Capital hedge fund, which is led by billionaire investor Phil Falcone. According to the National Legal and Policy Center, after Falcone visited the White House and made large donations to the Democratic Senatorial Campaign Committee, the FCC granted LightSquared "a highly unusual waiver that allows the company to build out a national 4G wireless network on the cheap."

This pattern would be quite successful as Obama directed federal contracts - and millions of taxpayer dollars - to companies whose owners would donate to his campaigns. The Solyndra affair would follow a similar pattern. Obama demonstrated himself as quite skilled in the modern art of campaign finance.