After spending scandal, Republican Chairman Steele tries to reassure his party

Republican National Chairman Michael S. Steele has often found himself in the spotlight -- and not in a good way. Here's a look at some of his most memorable snafus.
By Philip Rucker and Chris Cillizza
Washington Post Staff Writer
Wednesday, April 7, 2010

As the Republican National Committee announced that it had recorded its best March fundraising ever in a midterm election year, Chairman Michael S. Steele moved to solidify his control of the party Tuesday, calling rank-and-file members to reassure them that the RNC is on stable footing.

Steele's operation has faced questions for more than a week, since the revelation of a spending scandal that some top party strategists warn could undermine the GOP's ability to pick up seats in November.

As he spoke with RNC members Tuesday, Steele highlighted that the party has responded to the scandal, with a new chief of staff and revamped accountability measures. An RNC spokesman also reported that the committee raised $11.4 million in March.

But the committee continued to face questions about the controversy. An RNC member from New Hampshire resigned Tuesday in protest of the party's handling of donor money. And GOP strategists groused that, March's fundraising notwithstanding, the RNC may not have enough money to fund voter-turnout operations and television advertisements in some competitive races.

With the elections seven months away, Mississippi Gov. Haley Barbour said the turmoil at the RNC "means very little" for the party's November prospects.

"Would everybody like for the RNC to be at the top of its game? Sure," said Barbour, a former RNC chairman who heads the Republican Governors Association. "But I'm not seeing much practical effect on the outcome of the election. . . . The political environment is certainly better for Republicans than it's been in many years at this stage of an election cycle. So if -- and I emphasize if -- the RNC is not as strong in November as it may have been at some other times, the other committees can make up for that, particularly with seven months of warning."

Not all Republicans were as sanguine. "It's incredibly frustrating," said a strategist close to the party's congressional leadership who spoke on the condition of anonymity. "They have victory plans that need to be put in place, volunteer recruitment goals, voter-turnout operations, and they don't have the money to put anything in place."

While the RNC's $1,900 expenditure at a racy California nightclub grabbed headlines, strategists said the greater problem is the party's cash flow as it begins a campaign cycle with dozens of competitive Senate and House contests, as well as 37 gubernatorial races. The committee has raised about $120 million during the current cycle but, according to its last federal report, it has just $9.5 million in the bank.

In February, for example, the party raised $7.69 million and spent $7.71 million, according to Federal Election Commission filings. By comparison, the RNC had a war chest of nearly $41 million in February 2006, although it had the advantage then of controlling the White House and both chambers of Congress.

Despite the RNC's cash-flow problems, Sen. John Cornyn (Tex.), who chairs the National Republican Senatorial Committee, said Steele came through in January by transferring critical manpower and money to help Scott Brown win a surprise victory in the special election for a Senate seat from Massachusetts.

"We've learned about several unacceptable developments at the RNC in recent weeks, which Chairman Steele has personally acknowledged should not have taken place," Cornyn said. "It's my hope that the RNC will regain its footing quickly and that we can move forward to focus on winning Senate seats during the November elections."

Yet it is not lost on congressional leaders that the NRSC and the National Republican Congressional Committee have traditionally received substantial disbursements from the RNC. In the 2006 election cycle, the RNC transferred $18 million to the NRCC and nearly $5 million to the NRSC in an unsuccessful attempt to preserve GOP majorities in both chambers.

"It made a big difference," said Carl Forti, who was the NRCC communications director in 2006. "It helped us play in races that we wouldn't otherwise be able to play in."

With the political environment looking favorable, there is a growing concern that the RNC will not be able to provide that sort of financial boost in the late stages of this fall's campaign.

"If the RNC continues on its current cash trajectory, the political environment won't mean a thing," said another senior Republican operative. "Both the Senate and House campaign committees will not be able to maximize GOP gains unless Steele starts netting cash and transferring it."

But even as the RNC seeks to restore confidence to major donors, there were fresh signs of discontent Tuesday. Sean Mahoney, an RNC member from New Hampshire, resigned, calling the nightclub scandal "the straw that broke the camel's back."

"The scandal represents a pattern of unaccountable and irresponsible mishaps that ought to unnerve every fiscal conservative," Mahoney wrote in a letter to Steele. "Overspending on private planes, limousines, remodeling, catered parties and high-priced junkets demonstrates a complete lack of respect for RNC donors; a lack of respect that was spelled out all too clearly in a leaked PowerPoint presentation that mocked our Committee's own donors."

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