Cain’s exit gives him financial flexibility

December 4, 2011

Republican presidential candidate Herman Cain’s announcement that he is suspending, rather than terminating, his campaign appears to give him greater flexibility in the months ahead to transfer leftover funds to a candidate or political committee of his choice.

That financial flexibility — as well as the potential to benefit by picking up Cain’s supporters — was not lost on the other GOP presidential hopefuls, who Sunday morning continued to heap praise on the embattled former Godfather’s Pizza executive.

“Suspension” has no legal meaning under Federal Election Commission rules, meaning Cain could continue to raise contributions and spend money until declaring a formal end to the campaign. Once a candidate formally ends his or her candidacy, the candidate has 60 days under FEC guidelines to cease most campaign-related activity.

As of the end of the third fundraising quarter on Sep. 30, Cain’s campaign had $1.3 million cash on hand and $675,000 in debts. In mid-November, Cain’s campaign said that it had raised $9 million over six weeks, an amount that would have put him on track to eclipse the best quarterly fundraising totals of former Massachusetts governor Mitt Romney (R) and Texas Gov. Rick Perry (R).

On the Sunday morning talk shows, several of the Republican presidential contenders expressed optimism that they might win over some of the Cain faithful. Rep. Ron Paul (R-Tex.), who surged to second place in Saturday’s Des Moines Register poll of likely Iowa Republican caucusgoers, said he’s “optimistic that we’ll pick up some votes” from Cain supporters.

“There are a lot of people who call themselves tea party people that did like the independent-mindedness of Herman Cain,” Paul said on CNN’s “State of the Union.” “So, I think that we’ll probably do better, even though some people are saying, ‘Oh, no, they’re all going to go to so-and-so.’ We’re paying a lot of attention to that, because obviously they’re going to go somewhere in the next week or so. That’s going to happen.”

Rep. Michele Bachmann (R-Minn.) told CNN in an interview following Paul’s that Cain “brought a really important, exciting, energetic voice to the race, and I think a lot of people are going to be very sorry to see him go.”

“We’ve been talking with the Herman Cain campaign, and I look forward to having a full conversation with him,” Bachmann told CNN’s Candy Crowley. “One thing that we’ve seen is that a lot of Herman Cain supporters have been calling our office, and they’ve been coming over to our side. . . . They saw Herman Cain as an outsider, and I think they see that my voice will be the one that would be most reflective of his.”

Former senator Rick Santorum (R-Pa.) said on ABC’s “This Week” that Cain “has gone through a very, very difficult time for himself and his family.”

“I think he made the right decision to leave, for his family and for the country,” Santorum said. “It was clearly a distraction that was not going to go away. And, again, I feel bad for Herman, I really do, and for his family in particular. And I hope that they can get well.”

Former House speaker Newt Gingrich (R-Ga.) did not appear on any of the Sunday news shows. But at a campaign event on Staten Island on Saturday afternoon, Gingrich praised Cain as a conservative leader and said that “this has been a very difficult time” for Cain and his family.

Recent polls suggest that Gingrich might stand to benefit the most from Cain’s departure from the race. Whether Cain decides to throw his support behind a particular candidate and what he decides to do with the funds remaining in his campaign account are separate questions.

The suspension issue came up in 2008 when then-Sen. Hillary Rodham Clinton (D-N.Y.) endorsed Barack Obama on June 7 and seemingly withdrew from the race.

But Clinton’s treasurer later told the FEC that Clinton had continued to actively contest delegates during the month of June and that “the term ‘suspension’ has no legal meaning.” The assertion allowed the campaign to transfer $6.4 million from Clinton’s presidential campaign to her Senate committee in late August, more than 60 days after she had conceded the race.

Cain faced questions in October after the Milwaukee Journal Sentinel reported that a tax-exempt charity run by two of his top aides footed the bill for $40,000 in travel costs, iPads and other expenses.

Nonprofit charities are not allowed to donate money or services to political campaigns under federal law. Cain’s aides said the campaign would ask an outside investigator to look into the allegations, but no further details have emerged.

Deputy editor, National politics
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