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    Money Talks

    Gephardt's Leaky Money Machine

    By Dwight L. Morris
    October 15, 1996

    Gephardt exemplifies the "permanent government" in Washington so despised by many voters. Elected in 1976 to Missouri's 3rd Congressional district as an anti-establishment candidate, Gephardt has stayed for ten terms – getting re-elected with at least 60 percent of the vote in all but the two bids. Twenty years and a failed presidential bid later, Gephardt, still biding his time for another shot at the country's chief executive post, is running for his 11th term.

    Helping the minority leader's campaign effort is the Cadillac of permanent campaign organizations: the "Gephardt in Congress Committee." An investigation into this political equivalent of a first-strike nuclear capability shows that Gephardt has far outspent his challenger – a political neophyte named Deborah Lynn Wheelehan.

    During the primaries, Wheelehan reported spending $23,531 through July 17 in her successful bid in an extremely close contest for the GOP nomination. She beat nine candidates including a cement company foreman, a private detective, a retired real estate broker and a computer consultant.

    Gephardt's campaign committee, on the other hand, reported expenditures totaling $1.6 million in a three-way bid – not counting the $71,000 spent on paying off debts from his failed 1988 presidential bid or $65,998 he paid to settle 1994 campaign debts. What's even more problematic is that $845,677 of Gephardt's spending went into campaign overhead – accounting for 52 percent of his total spending. (The usual amount is about 25 percent for candidates for the House of Representative.)

    An analysis of Gephardt's expenses shows the different components of his overhead pie:

    • Staff, Rent, Utilities: With at least eight employees on the payroll at all times (there were ten people drawing payroll checks by July of this year), Gephardt had rung up salary, payroll tax, and health benefit payments totaling $485,774 – nearly twenty-one times as much as Wheelehan had managed to spend on her meager challenge. Gephardt's office rent and utility payments during the first nineteen months of the election cycle alone amounted to well over twice as much as Wheelehan had spent on her entire campaign up to that point.
    • Travel: Gephardt's travel bills over the first nineteen month's of the election cycle totaled $86,291, including $12,723 paid to corporations for the use of their private jets – more than three and one-half times Wheelehan's budget. (Since the operating costs for these small jets can be as much as $4,000 per hour, his twelve campaign-funded jaunts were a real bargain.) Payments for standard charter air trips added $2,420 to Gephardt's travel tab; bills for hotels, rental cars, trips on commercial airlines, and travel reimbursements to staff members amounted to $71,148.
    • Telephone: At $56,804, Gephardt's campaign telephone bills amounted to more than twice Wheelehan's total budget, and the $11,230 he had spent on overnight delivery services was more than five times as much as she had been able to invest in advertising. The $1,793 he spent on just five meals at posh Washington restaurants was just $200 less than she had spent on persuasion mail and campaign literature.

    PAC Man
    In addition to his campaign fund, Gephardt has his own political action committee (PAC), the Effective Government Committee, which had spent well over $500,000 through the end of July. Here again, more than half that total – $275,623 to be exact – went into overhead.

    • Staff, Rent, Utilities: Sharing office space with his campaign committee, Gephardt's PAC spent $17,461 on rent and utilities. Five of Gephardt's campaign employees also drew payroll checks from the PAC totaling $80,226, accounting for 95 percent of the PAC's net payroll costs. Including payroll taxes and additional health benefits, the PAC's overall investment in staff amounted to $119,253.
    • Travel: Reflecting the grand style in which he has grown accustomed to traveling, Gephardt's PAC paid $13,769 to reimburse various corporations for thirteen trips taken on their private jets. Another $10,149 was invested in standard air charters; other travel bills amounted to $54,250.

    Combined with his campaign committee spending, Gephardt's basic overhead spending amounted to $1,121,300 during the first nineteen months of the election cycle. This amount is more than what all but a handful of challengers will spend on their entire campaigns in 1996.

    To generate the fuel for this machine, Gephardt sank $514,856 into his fund-raising activities, $488,186 of which was supplied by his campaign committee. While the PAC spent just $26,669 on fund-raising events, Gephardt's campaign committee poured $127,127 into various receptions. The campaign committee also invested $361,059 in a nationwide direct-mail fund-raising operation, including $335,747 paid to Gold Communications of Austin, Texas.

    A Generous Giver?
    Given Gephardt's leadership position, one might be tempted to conclude that this massive spending display was the result of a drive to raise money for other Democratic candidates and recapture the House. After all, as has been noted in previous columns, Speaker Newt Gingrich and Majority Leader Dick Armey had each given the Republican National Committee $250,000 by the end of July and were busy dispensing funds to Republican congressional candidates. It would be only logical that Gephardt would play the same game.

    However, as it turns out, many members of Congress use their excess campaign bounty to support their party's candidates to a far greater degree than Gephardt. He was not among the top 100 contributors to other federal candidates and Democratic party committees in 1990, 1992, or 1994, and if his present pace continues, he will not be among the top 100 in 1996. In 1994, he did not even place among the top 300.

    While his campaign spent $1,448,831 in 1990, including $557,746 on overhead and $211,357 on fund-raising, just $19,248 was given to other candidates and party committees. Although he poured $3,065,439 into his 1992 reelection effort, including $1,095,904 into overhead and $433,500 into fund-raising, he donated only $12,176 to other Democrats and party committees. In 1994, he donated just $1,600 out of a total campaign budget of $2,576,014. Through July of this year, he had contributed only $6,985 from his campaign treasury – less than one-half of 1 percent of his total spending.

    Even including his donations from the PAC – theoretically set up to help other candidates – the picture changes only slightly. Since January 1, 1989, Gephardt's PAC and campaign committee have spent a total of $12,429,924, and only $1,431,633 (11 percent) of that prodigious total has been donated to other Democratic candidates and party committees.

    Comparing Notes
    In 1992, for example, Gephardt's combined donations from the PAC and his campaign committee amounted to $255,522, or roughly 7 percent of his total spending. That year, Rep. Henry Waxman donated $313,403 to Democratic candidates and party committees, which represented 44 percent of his total spending for the two-year election cycle. Through July of this year, Gephardt had tapped his campaign committee and PAC for donations totaling $125,097 – roughly 6 percent of his spending.

    (To be fair, it should be pointed out that Gephardt has spent $70,881 from his campaign committee and $25,821 from his PAC on polls conducted by the Mellman Group of Washington, D.C. It is a safe assumption that much of that was spent to gauge Democratic strength across the country, not to further his own re-election prospects. And the National Committee for an Effective Congress (NCEC) received $49,000 from Gephardt's PAC for supplying demographic targeting analysis, which may well have gone to benefit other candidates in some way.)

    To what use, then, is Gephardt's money, overhead and all, being put? The biggest beneficiary of Gephardt's political machine is Gephardt. Should he ever decide to take another shot at the presidency, he will have cultivated massive fund-raising lists and an organizational structure to jump-start the process. He will have time and money on his side. This column originally appeared on the PoliticsNow Web site.

    © Copyright 1998 The Washington Post Company

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