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Ted Cruz Has A Surprising Weak Spot In The Money Race

By Julie Bykowicz, Bloomberg News (TNS)

Texas Senator Ted Cruz, who said Monday he is running for president, must raise at least $30 million, his advisers say, to be competitive in a sprawling Republican primary field that will be financially dominated by former Florida Governor Jeb Bush. Cruz hopes to raise as much as $50 million, still half what Bush’s team set as a goal for early 2015 but also potentially more than any other GOP contender.

How Cruz gets there will come down to balancing two kinds of donors, his advisers argue: those who can raise tens of thousands of dollars from friends and those who regularly chip in a few bucks via online donations.

Cruz is already showing strength with large donors, his advisers say, with a packed guest list for his kickoff fundraiser March 31 in Houston. Each of the 29 listed co-hosts has pledged to raise at least $50,000, giving him $1.5 million right out of the gate.

But a review of Cruz’s campaign finances shows surprising weakness when it comes to small donors. Contributors giving Cruz less than $200 per election cycle made up just 16 percent of his funding base through the end of 2014, compared to Kentucky Senator Rand Paul’s 43 percent, according to the Center for Responsive Politics. Paul is expected to announce his own presidential intentions on April 7.

Both senators were propelled to victory in the Senate by limited-government activists who identify with the Tea Party — Cruz in 2012 and Paul in 2010. The Texan spent $15 million to upset then-Lt. Governor David Dewhurst, a better-known and better-funded Republican.

Cruz did generate conservative enthusiasm, but he relied heavily on Washington-based Tea Party groups for money in that race; the Club for Growth and Senate Conservatives Fund were his biggest contributors. More importantly, they spent more than $7 million on their own to help Cruz’s cause. Because much of his Tea Party support was indirect, he didn’t amass the thick file of e-mail addresses for low-dollar donors that would help him now.

His advisers say he has been hard at work building out his grassroots fundraising apparatus. Through the Jobs, Growth & Freedom Fund, a leadership political action committee he opened after his election, he has lured and engaged those supporters. More than three-quarters of $153,000 it collected in January and February was in the form of small, unitemized contributions, Federal Election Commission reports show.

Cruz’s September 2013 filibuster against President Barack Obama’s health care law shows how the senator’s firebrand persona has translated into campaign cash. He highlighted his 21-hour speech,a failed attempt to defund the law by way of killing a larger government funding bill, in dozens of fundraising appeals. As a result, his victory committee (which distributes money to both his Senate campaign and to his Jobs, Growth & Freedom Fund) saw a record infusion of cash in the three-month period that followed the filibuster — more than $1.3 million, FEC reports show.

Yet the episode also underscores why he might struggle with fundraising from traditional Republican Party donors, the kinds of people he’ll count on to bundle big checks from friends. Many of them, like his Senate colleagues, saw the filibuster as an embarrassing fool’s errand.

His advisers are optimistic they’ll be able to shake enough of the bigger money trees, saying he compares favorably in that arena to Paul and to another grassroots fundraising star, Baltimore pediatric neurosurgeon-turned-conservative idol Ben Carson.

Now that he is officially in the race, Cruz will turn his attention to the business of financing his campaign. He’ll be in Houston on March 31 for his first official presidential fundraising reception there, featuring country music singer Charlie Robison. There are 29 Texas couples and individuals listed as co-hosts. Among them: Dougal Cameron, a Houston real estate developer; Cary McNair, son of Houston Texans owner Bob McNair; Aaron Streett, a constitutional law attorney based in Houston; and Devinder Bhatia, a Houston heart surgeon.

Tickets cost $1,000 per person; the VIP reception is $2,700 (the maximum allowed under campaign finance law) and co-hosts commit to raising at least $50,000. The event shows that Cruz has a robust Texas donor base, despite the fact that he’s one of four Republican presidential hopefuls with Lone Star ties. Chief among them is Bush, who grew up in Texas and whose brother used Austin to launch his own successful presidential bid.

Cruz also keeps dealing himself into the big-money game: He was on stage with Paul and Florida Senator Marco Rubio in January at apolitical donor summit held by billionaire energy executives Charles and David Koch. And he’s one of several presidential hopefuls invited to Las Vegas in April to speak to the Republican Jewish Coalition, hosted by billionaire casino owner and Republican rainmaker Sheldon Adelson. Former Texas Governor Rick Perry, Ohio Senator Rob Portman, and Indiana Governor Mike Pence are also on the schedule.

Adelson’s top political adviser said he likely won’t back a Republican candidate until next year, though that will not stop Cruz and others from courting him now. He was the 2012 presidential cycle’s top spender, investing more than $15 million in Newt Gingrich’s failed bid before assisting Mitt Romney in the general election.

That kind of cash infusion is only possible through one source: SuperPACs, which can accept checks of unlimited size but cannot directly coordinate with the candidate it is assisting. There’s already one that can help him: His roommate from Princeton, Atlanta businessman David Panton, formed Stand for Principle in November.

It had raised $160,000 through the end of the year, FEC reports show, mostly from Panton.

Photo: U.S. Senator Ted Cruz (R-TX), speaks at a RedState Gathering at the Renaissance Worthington Hotel in Fort Worth, Texas, on Friday, Aug. 8, 2014. Cruz announced his presidential bid Monday. (Richard W. Rodriguez/Fort Worth Star-Telegram/TNS)

Adelson Presidential Endorsement ‘A Year Away,’ Aide Says

By Julie Bykowicz, Bloomberg News (TNS)

Republican megadonor Sheldon Adelson won’t get involved in the presidential primary contest until “well into 2016,” his top political adviser said in an interview Thursday.

“Any support of a presidential candidate is at least a year away,” the adviser, Andy Abboud, said.

What Adelson does matters. The 81-year-old billionaire casino owner spent more money on the 2012 presidential race than anyone else in the country, and his every move is being closely watched for signs that he has a favorite this time around.

In 2012, Adelson and his family invested more than $15 million in former House Speaker Newt Gingrich’s presidential aspirations through a super PAC, keeping him competitive far longer than he would have been otherwise. The Adelsons backed Mitt Romney after he won the nominating contest. All told, the family put about $93 million into super PACs and campaigns during the cycle.

Abboud’s remarks came in response to questions about Sheldon and wife Miriam’s participation in a March 3 fundraiser in Washington for South Carolina Senator Lindsey Graham’s presidential exploratory group, Security Through Strength.

They are listed as co-chairs of the event, which is set to follow the congressional address of Israeli Prime Minister Benjamin Netanyahu. The names on the invitation raised eyebrows, since some of them are already committed to other presidential hopefuls.

In all, there are three dozen co-chairs, each of whom will give $2,700 to the Graham group. Among them: Wayne Berman, a lobbyist who will back Florida Senator Marco Rubio if he runs for president, and Seth Klarman, a Boston-based investor who last month hosted an event for New Jersey Governor Chris Christie. Berman said he is unequivocal in his support for Rubio and is giving to Graham’s group only because “he has been one of Israel’s staunchest allies, and I appreciate that.”

Graham’s group will pocket at least $100,000 from the event, its first Washington fundraiser. The senator is in Iowa on Thursday and Friday and has a visit to New Hampshire planned for next week, his political adviser Christian Ferry said in an interview.

According to the fundraiser invitation, first obtained by Politico, Senators John McCain and Kelly Ayotte and former Senators John Kyl and Norm Coleman also will attend, as part of a policy panel. (McCain is unabashed in his desire to see Graham, a fellow defense hawk, run for president.) The panel will be moderated by Matt Brooks, executive director of the Republican Jewish Coalition, to which Adelson is a top donor.

Photo via Wikimedia Commons

Scott Walker Is King Of Kochworld

By Julie Bykowicz, Bloomberg News (TNS)

WASHINGTON — On a sunny Saturday in September 2009, with Wisconsin in the throes of Tea Party fervor, conservative starlet Michelle Malkin fired up a crowd of thousands at a lakefront park in Milwaukee with rhetoric about White House czars and union thugs and the “culture of dependency that they have rammed down our throats.”

Milwaukee County Executive Scott Walker, a Republican candidate for governor, casually attired in a red University of Wisconsin Badgers sweatshirt, stepped to the podium to amplify the message. “We’re going to take back our government,” he shouted, jabbing the air with a finger. The attendees whooped and clapped. “We’ve done it here, we can do it in Wisconsin and, by God, we’re going to do it all across America.”

In a way, the event was Scott Walker’s graduation to the political major leagues. The audience had been delivered up by Americans for Prosperity, a Tea Party organizing group founded by Charles and David Koch, the billionaire energy executives whose fortune helps shape Republican politics. With Americans for Prosperity, the brothers had harnessed the Tea Party’s energy in service of their own policy goals, including deregulation and lower taxes. And in Walker, they’d found the perfect instrument to help carry them out. The rally was one of the first times they’d joined forces.

The relationship between the Kochs and Walker was cemented during Walker’s bitter war against public unions that led to a recall election in 2012. During the tense weeks of standoff at the capitol in Madison, it was the Kochs’ Tea Party troops who provided the main counterforce to the tens of thousands of union activists protesting the governor, in a battle Walker eventually won.

As the struggle raged, Walker’s alliance with his benefactors was embarrassingly satirized when a liberal blogger posing as David Koch (who at that point Walker had never met) kept him on the line for 20 minutes, making the governor look like a lapdog to the powerful industrialist.

This year, the relationship may evolve in unpredictable ways. With three tough statewide election victories under his belt, Walker, 47, is poised to pursue the 2016 Republican presidential nomination. The Kochs have pledged to marshal $900 million to spend on a fight for the presidency, and although they may not wade directly into the GOP primary muck, their ties to Walker appear stronger than to anyone else considering a run. While the older brother, Charles Koch, has a personal affection for Kentucky Senator Rand Paul, the most libertarian-leaning potential candidate of the bunch, Paul doesn’t hold the same appeal for the Kochs’ donor friends. Another high-profile contender, former Florida Governor Jeb Bush, hasn’t attended the high-profile donor summits the Kochs host near Palm Springs, Calif., though he was invited this year.

While Tim Phillips, the president of Americans for Prosperity, said that his group won’t endorse a candidate in the primaries, his praise for Walker is effusive. “The difference Scott Walker has made with his policy achievements is as transformative as any governor anywhere in a generation,” he said in an interview. “That’s why his appeal flourishes for activists and for donors.”

The Kochs and Walker now share a donor pool — a moneyed set that isn’t the establishment Jeb Bush is counting on. One Koch stalwart solidly in Walker’s corner is Stanley Hubbard, a billionaire Minnesota broadcast executive.

Hubbard supplied a quick assessment of the center-right 2016 field: Jeb Bush may be a great guy, but his last name is Bush. Chris Christie “blew himself up” with, among other things, his preference for luxury travel. “I am actively encouraging Scott to run, and I know of many other people who are very positive about Walker running,” he said in an interview.

Walker and the Kochs saw their political fortunes supercharged by anger over President Barack Obama’s health care law. Charles and David Koch founded Americans for Prosperity in 2003, and it has become the largest organization in a network of Koch-backed activist groups that, as nonprofits, aren’t required to reveal donors or detail how they spend their money. The Wisconsin chapter has been around since 2005. The group’s mission is to promote a government that collects fewer taxes and regulates less. As the tea party movement grew in the aftermath of Obama’s election, the Kochs positioned Americans for Prosperity as the tea party’s staunchest ally.

Walker’s rough edges fit with the movement’s populism. Tea Partiers liked Walker “because he’s for real,” said Mark Block, who ran AFP’s Wisconsin chapter during Walker’s first run for governor. “He has a plain-spoken way that is totally relatable. He says what he’s going to do and does it.”

Americans for Prosperity’s national leaders, based in Arlington, Va., had already been paying attention to the then-Milwaukee County executive, an elected official who gave back part of his salary amid a fiscal crisis and reduced the number of county employees to close the budget hole.

They wanted to take Walker statewide and invited him to their many Wisconsin rallies and events — some attended by 10,000 fed-up voters — throughout 2009 and 2010. At a March 2010 AFP gathering with Walker at a Wisconsin Dells resort, Phillips praised the crowd as the reason the Democratic stronghold was finally breaking red. He added with a smile: “I think I ought to be an honorary Wisconsinite, being a part of this in some small way.”

Meanwhile, Koch Industries began to turn on the cash spigots. In July 2010, the first of two contributions from Koch Industries’ political action committee arrived in Walker’s campaign coffers. The $43,000 it ultimately gave him doesn’t sound like much, but it was his largest out-of-state contribution.

The company has also been a top donor to the Republican Governors Association, and that group spent $5 million attacking Walker’s Democratic opponent, Tom Barrett, in a torrent of 2.9 million mailers and series of eight different television ads.

Walker began battling with public employees soon after he was elected, submitting a budget in Feb. 2011 that cut public pensions and sharply limited the collective bargaining rights of many state employees. Koch reinforcements quickly arrived.

A bus caravan of Walker’s friends at Americans for Prosperity disgorged thousands of supporters, carrying signs saying “Your Gravy Train Is Over … Welcome to the Recession” and “Sorry We’re Late Scott. We Work for a Living” into the mass of union activists gathered at the steps of the capitol. It all played out for a cable network audience, with pundits pointing to Walker as the new tip of the spear in a long Republican fight against the labor unions that have helped elect Democrats over the decades.

The AFP’s support wasn’t just a big pep rally. After the governor won the budget battle and his opponents began their effort to recall him, the group deployed hundreds of volunteers to knock on doors and call into voters’ homes to spread Walker’s message that his pension cuts and union reforms were helping solve the state’s budget crisis. The group bought television and digital ads echoing the “It’s Working!” theme — a phrase Walker also frequently used.

“We’re helping him, as we should,” David Koch told The Palm Beach Post in February 2012. “What Scott Walker is doing with the public unions in Wisconsin is critically important. He’s an impressive guy, and he’s very courageous.”

All of this outside assistance was “hugely beneficial” to Walker, said Matt Seaholm, AFP’s Wisconsin director throughout the state budget battle and much of the aftermath. The governor’s approval rating was climbing. “No one else was getting the message out like we were,” Seaholm said. Walker prevailed in the rematch with Barrett in June 2012, actually beating him by a wider margin than he had the first time.

Two months later, Walker strode onto stage at a hotel in Washington, where several thousand AFP national donors and activists rose to their feet to greet him and give him an award for his work to curb union power. “Maybe consider this being the most valuable player in the nation for the advancement of freedom and prosperity,” said then-AFP Foundation Vice Chairman Art Pope, as he gave Walker a bust of George Washington.

Of course, all of this fawning had a flip side. Back in the tense weeks of February 2011, Walker took a call. It was David Koch on the line, or so he thought.

Walker breathlessly babbled about his union showdown strategy. “Koch” — it turned out to be a liberal blogger on the line, recording everything — chimed in with a warning, “Now you’re not talking to any of these Democrat bastards, are you?”

At one point, talking about confronting the legislators, the blogger impersonating Koch offers a suggestion.

“Koch”: Bring a baseball bat. That’s what I’d do.

Walker: I have one in my office; you’d be happy with that. I have a slugger with my name on it.

“Koch”: Beautiful.

Since then, Walker has gotten to know the real David Koch, and has become a familiar face among the brothers’ crowd, having attended several of their twice-a-year elite gatherings. The winter event is always near Palm Springs, Calif., and the one later in the year typically is held in Vail, Colo., or another ski town.

At those, he has solidified connections that will pay dividends if he decides to run for president. Billionaire Diane Hendricks, president of a roofing company in Wisconsin, is a million-dollar donor to the Koch network, and is smitten with Walker.

There’s footage of Walker and Hendricks — who has given his campaign more than $530,000 over the years — chatting and embracing the January after he was first elected. In a clip that made its way into numerous anti-Walker ads, she asks when Wisconsin would become “completely red” so that politicians like him could “work on” unions. She said she was ready to help the cause. He said his plan was to “divide and conquer” unions by starting with the public sector. He did just that a couple of weeks later.

With deep pockets like Hendricks and Hubbard already in his corner, Walker is likely to be a financial force if he competes for the 2016 Republican nomination. While no one will have nearly as much money as Bush — who aims to raise $100 million just in the first three months of this year — Fred Malek, who has raised money for Republican presidential candidates for four decades, predicted Walker would have more than enough money at his disposal. After all, he has already shattered records in his home state, raising about $83 million over his three elections.

Malek isn’t endorsing anyone, but he has gotten to know the Wisconsin governor in his capacity as chief fundraiser for the Republican Governors Association. Walker and his wife were guests at Malek’s Northern Virginia home on a recent visit to Washington. “He is like the low-key guy next door, and he lacks any pomposity. At the same time, he has a story to tell about how he has the guts to stand up to unions and prevail,” Malek said in an interview, explaining why he has seen donors react well to Walker.

At the Koch donor summit last month, a trio of Republican senators who want to be president, Marco Rubio, Ted Cruz and Rand Paul, shared a stage to debate economic and foreign policy. By the time they arrived, Walker had already come and gone; a day earlier as its opening speaker, he’d had the donors all to himself.

Photo: Gage Skidmore via Flickr