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The money shuffle begins again

Posted on May 6, 2010May 6, 2010 by Staff

Chris Fitzsimon

The latest round of state campaign finance reports are in and the usual speculation about the money race has begun. Senate President Pro Tem Marc Basnight raised just over $500,000 in the first quarter of 2010 and now has $725,000 in the bank, far more than any other state politician. It is a reminder of how powerful Basnight remains and how badly special interests want him to know how much they really care.

But that’s less than Basnight had raised at this time in 2008, prompting Republican strategists to claim that it is another indication that the Democrats are struggling and will have a hard time holding on to the state Senate in November.

That might be easier for the GOP to sell if they had come close to matching the war chests of Basnight and House Speaker Joe Hackney, who has $550,000 in the bank after raising more than $173,000 in the first quarter.

Senate Minority Leader Phil Berger raised $80,000 and has $170,000 on hand, while House Minority Leader Paul Stam raised just over $30,000 in the first quarter and has just $24,000 in the bank.

The fundraising by legislative leaders is so important because the state’s campaign-finance laws are so absurd. State law limits individual and PAC contributions to a candidate to $4,000 per election. But there are no limits on how much you can give to a political party, and more importantly there are no limits on how much a political party can give to a candidate.

It’s not always easy for a party to raise money from a special interest wanting access to powerful legislators, so the lawmakers themselves raise the money and transfer it to the party, which then doles it out in massive amounts to the campaigns of legislators in close races.

Basnight transferred more than a million dollars to the Democratic Party in 2008, which gave money to candidates in close races like that of Sen. Julia Boseman, who received more than $500,000 for her reelection campaign.

The Republicans play the game too, but so far have not been as successful in the legal money laundering scheme, though there are signs they are catching up. The practice is one main reason why so many lawmakers who are running unopposed or have only token opposition are still raising money.

They want to pass it on to their party so it can go to other candidates. Most donors understand the game and know they are making contributions to help other candidates, not the one whose name is on the check.

The practice makes a mockery of the current limits on campaign contributions and it helps legislative leaders consolidate their power once they are elected. Lawmakers who benefitted from a leader’s campaign fundraising prowess are far less likely to buck the powerful legislators or stray from the party line on a controversial vote.

Some states have recognized the ridiculousness of allowing political parties to launder money and limit how much a political party can contribute to individual candidates. The most obvious limit would be the same $4,000 that PACs and individuals face, but limiting party contributions to $10,000 or even $25,000 would at least stop the $500,000 transfers that make the campaign finance rules a joke.

But like every ethics and campaign finance issue, the people currently running the system and benefitting from it are the ones who will have to change it. Don’t hold your breath.

Chris Fitzsimon is executive director of N.C. Policy Watch.

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