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Michigan Campaign Finance Network Campaign Finance Talk The Voice of the Michigan Campaign Finance Network December 2002 Proxies Overshadow Candidate Committees in 2002 Gubernatorial Election roxy groups, mainly the state Republican and fastly refused to disclose any data, despite an appeal that Democratic parties, spent more than three times as the information was controversial and in the public’s much as the candidates’ own campaign committees interest to know. Using data from the Campaign Media P in Michigan’s 2002 gubernatorial general election Analysis Group (CMAG), MCFN conservatively calculated campaign. Lieutenant Governor Dick Posthumus and Attorney estimated values for advertising buys at the four remaining General Jennifer Granholm each accepted $1.125 million in stations. public funds for the fall election campaign and therefore were obliged to limit their spending to $2 million each through Why use a proxy? their candidate committees. The political parties and the Three factors contribute to the strategy of campaigning Michigan Chamber of Commerce, on the other hand, spent at through proxies. First, it allows the supporters of the least $13.5 million. respective candidates to spend beyond the limit that is Approximately $10 million of the third party spending paid imposed on candidates as a condition of accepting public for undisclosed television “issue” advertising that did not financing. appear in any campaign finance report. Aside from television Secondly, it accommodates very large contributions. advertising, the Republican Party reported $1.3 million in Contributions to the parties or political action committees independent expenditures supporting Mr. Posthumus. The (PACs) are not subject to any limits in Michigan. Whereas Democratic Party reported spending an additional $87,000 individuals can give a maximum of $3,400 to a statewide for independent expenditures supporting Ms. Granholm and candidate’s committee and PACs can give a maximum of $117,000 opposing Mr. Posthumus. The Michigan Campaign Finance Network (MCFN) conducted a Third Party Television Advertising sweep of the public advertising files for 25 television broadcasters in all in Michigan’s 2002 Gubernatorial General Election the state’s television markets in the Estimated Amount weeks following the November 5th Supporting Granholm/Opposing Posthumus Total Disclosed election. Records of issue ad pur- chases were available in the public MI Democratic State Central Committee $ 7.2 million $ 0 files from 17 of the 25 stations. Of Supporting Posthumus/Opposing Granholm the remaining eight stations, four disclosed purchase summaries for MI Republican State Committee $ 3.7 million $ 2.2 million the Democratic and Republican par- MI Chamber of Commerce $ 1.1 million $ 0 ties and the Chamber to MCFN. Total $12.0 million $2.2 million The four remaining stations stead- Campaign Finance Talk • 1 Gubernatorial from page 1 Opinion by Rich Robinson $34,000, they are allowed Lame Duck Gaming to give as much as they want to the parties, who, in turn, can make independent ne of the controver- mission, where he is currently expenditures without limit. sial acts of the lame chairman, speaks to the depth Likewise, national party duck Legislature of the relationships. organizations are allowed to O was the passage of contribute without limits to a resolution directing Was this deal an inevitabili- the state parties. Governor Engler to negotiate ty that was simply done a Class III gaming compact sooner rather than later, and Finally, the issue ad loop- serendipitously benefits the hole allows campaigns to with the Gun Lake Band of Pottawatomi Indians. In 1998, governor’s old friends? Did bring corporate and union the Legislature strong-arm at the time the last four Indian treasury money into play. Governor Engler and make gaming compacts were being Detroit News as financial Corporations and unions are him do a deal he didn’t want negotiated, the governor partners in the proposed prohibited from making to do? Did the governor wrote to then-Speaker of the casino, W. Sidney Smith, contributions to candidates, strong-arm the Legislature to House Chuck Perricone that Barton LaBelle and James the parties or PACs for elec- give him cover to do a hurry- he would not negotiate Fabiano, put $115,000 into tioneering purposes. How- up deal (no resolution was another gaming compact, the Governmental Consult- ever, issue ads are not con- actually required to negotiate specifically not with the Gun ing Services Inc. (GCSI) sidered to be electioneering the compact)? Or was this Lake Band. Over time, the PAC this election cycle to under state law, so unions simply lame duck legislative governor’s position changed make campaign contribu- and corporations are free to sausage-making? You have and he said he would negoti- tions to House members and make contributions to fund to connect the dots and ate a compact with the Gun lobby for the compact. Their them. decide for yourself. Lake Band if the Legislature contributions were more than Furthermore, in contrast to directed him to do so. During 90% of the money received There is room for honor- by the PAC. In defending the federal law, where such soft the last week of the lame able persons to disagree effort, a GCSI spokesman money contributions are duck session, the Legislature about what drove the resolu- said, “That’s the way every- reported to the Federal Elec- resolved that the governor tion. But this case is a strik- one who gets involved does tion Commission, soft money should negotiate the compact. ing example of a contradic- it. It’s called democracy.” contributions to the state par- tion in the laws governing Supporters of the compact ties are not reported to the LaBelle, Smith and Fabi- gaming interests and cam- cited the fact that the state Secretary of State. ano, along with their respec- paign contributions in Michi- has negotiated a compact tive spouses, have also been gan. Those who are financial Why does it matter? with all the state’s other fed- generous supporters of Gov- stakeholders or significant erally recognized tribes and Just as so-called aggressive ernor Engler’s campaigns suppliers to state regulated said it was a matter of equity. corporate accounting has over the years. They have casinos (the three Detroit Furthermore, they argued, caused investors to withdraw collectively given more than casinos) are prohibited from the tribe would proceed with from financial markets, “cre- $40,000 to the governor’s making contributions to can- the casino development with ative” accounting in election campaigns over his last two didates for public office. But or without the compact and campaigns is alienating to vot- that is a provision of the the state would simply miss elections. Campaign finance state’s gaming law, not the ers. Our democracy would be out on a badly needed rev- records for 1990 and all prior campaign finance law. And better served by a campaign enue stream if it didn’t nego- years have been destroyed, so the state gaming law does finance system where limits tiate. Opponents, including there is no verifying the full not govern tribal gaming are real and all spending is nearly the entire west Michi- extent of their campaign con- facilities. Because the cam- clearly on the books. gan delegation of both cham- tributions. But perhaps the paign finance law is silent on bers, argued that their con- fact that the governor has — An expanded version of financial stakeholders in stituents did not want gam- appointed Smith and Fabiano this report, including gaming facilities, those who ing and the related social to the Board of Trustees of various funding vehicles are involved in tribal gaming problems in their region. Central Michigan University, involved in the gubernatorial where Fabiano is currently facilities (other than the primary campaigns, is Three Mount Pleasant busi- vice-chairman, and LaBelle tribes, themselves) are free to online at www.mcfn.org. nessmen, identified by The to the Transportation Com- invest in candidates. Campaign Finance Talk • 2 — FROM THE DESK OF THE DIRECTOR — Dear Friend, When I joined the Michigan stand in support of public funding publicly supported non-profit 501 Campaign Finance Network two for Michigan’s Supreme Court (c) (3) organization. Currently, most years ago, many people I talked with campaigns. There is still plenty more of our funding comes from founda- had a vague uneasiness about cam- spade work to be done before this tions and organizations concerned paign finances, but very few people reform ideal becomes a reality, but we about campaign finance reform. In really knew how the game is played. I are an important part of the process the next two years, the IRS requires think we have had some real success of persuading opinion leaders. us to receive a minimum of 10% of in telling the story and providing the our support from individuals and a media with the data and information I am very proud to let you know more diverse base of organizations. that make them more effective in that our Board of Directors is grow- Already, several individuals and telling the story. This is the issue that ing. This month five distinguished organizations have given us their touches all other issues. new members have joined us: State financial support. Won’t you join Senators Alma Wheeler Smith and them? Your contribution gives you By the time you receive this Joe Schwarz, who are both leaving the satisfaction of knowing you are newsletter, I hope you will have seen the Senate due to term limits, but supporting an important cause, and a story in your local newspaper bringing us their deep commitment to it is tax deductible. based on the front-page article of this integrity in public policy; former newsletter. I am reasonably confident State Representative Bill Bobier, who We appreciate your support.