California on $1,000 a Day

News reports of Governor George W. Bush’s fundraising exploits have dumbfounded his political rivals and sent pundits looking for suitable superlative adjectives. Bush has raised more money, faster and with greater ease, than any other presidential wannabe in American history. Since March he has raised a total of $36.4 million; $29.6 million of that was raised between April 1 and June 31. With so much cash on hand, it’s not surprising that Bush is expected to beat the Democratic nominee like a redheaded stepchild and waltz into the White House. (The Republican nomination, we assume, is a done deal.)

While there’s no question that Bush’s fundraising has been impressive, his spending has also been prodigious. The campaign’s expense report covers more than 260 pages of items ranging from payroll and stamps to flowers and air travel. Between April 1 and June 30, Bush’s campaign spent $6.3 million, or about three times as much as rival Steve Forbes raised from all sources other than his own pocket.

Most of that money is being spent in Austin, on such things as salaries, travel, and other basic campaign expenses. While that spending doesn’t provide much insight into Bush’s campaign strategy, Federal Election Commission requirements that candidates disclose primary-related expenditures by state provide a few clues about Bush’s campaign strategy. The Bush campaign has spent more money in California than any other state. According to his expenditure report, Bush has spent $157,109 in California — almost five times what he spent in the important early primary states of Iowa and New Hampshire combined, and over three times what he has allocated to Connecticut, his second biggest target for investment.

Given that Bush is spending big bucks in California and is also committing significant sums of money to Iowa and New Hampshire, it’s also worth looking at those states where Bush is not spending. Thus far, he is ignoring the Deep South. In Mississippi, Bush has spent a grand total of $3.75. In Alabama, he’s spent $233; Louisiana, $300; Oklahoma, $88; and Arkansas, $59. But Bush isn’t ignoring Florida. In the state where his brother Jeb serves as Governor, the Bush campaign has spent $25,767.

The spending pattern suggests that Bush is counting on Texas and Florida as his base. If he wins those two states, he’ll have a fifth of the electoral votes he needs to win the presidency. His lack of spending in the other Southern states suggests that Bush believes he will win those states with little effort. So Bush appears to be using the same strategy that Ronald Reagan used in the eighties: capture the South and with the South in hand, you only have to worry about winning a third of the remaining electoral votes. But by running hard in California, which has fifty-four electoral votes, Bush may be hoping to take some starch out of the Democrats. If he wins Texas (which is virtually certain) and Florida, the Democrats must win in California — if they are to have any hope of keeping the White House.

Where Bush spends his money is interesting; how he’s spending it is also important. So far, the biggest expenses in Bush’s campaign appear to be postage, travel, and payroll. With more than 70,000 donors already on the books, Bush is spending heavily to make sure those donors get proper thank you notes. The campaign has paid the U.S. Postal Service more than $439,000 — and that’s just the postage, not payments to direct mail outfits. The campaign paid $51,573 to Praxis List Company, a direct mail list service owned by Olsen & Delisi, the Austin-based direct mail and consulting company that bought out political strategist Karl Rove’s consulting firm earlier this year. (For years Rove has done the thinking for the Bush campaign, where he now spends all his time.) The campaign also paid Olsen & Delisi $155,000 for direct-mail work. Add another $20,000 or more that was paid to additional direct-mail firms, plus $13,000 to Federal Express, and it’s clear that direct-mail expertise is an important factor in Bush’s campaign becoming the fundraising dreadnought of presidential politics.

The Democratic Party, meanwhile, has vowed to counter Bush’s hand-over-fist fundraising abilities by amassing as much as $200 million from well-to-do individuals or corporations in “soft” or unregulated funding (not subject to federal election law restrictions).

Travel and Payroll

While the Democrats scramble to catch up, Bush continues to stump across the country. Getting to Iowa, New Hampshire, Maine, and California with a huge entourage is expensive. While a complete account of the spending isn’t provided in the expense report, it’s clear that the campaign has spent at least $1 million on travel and travel-related expenses. Among the big ticket items are $300,000 to McNair Travel of Alexandria, Virginia, for aircraft charters, and $162,000 to the Century Plaza in Los Angeles, where the campaign held a fundraising event. (Campaign Study Group, a Virginia-based research and consulting firm, is currently analyzing Bush’s expenditures, with first publication rights going to The Los Angeles Times and CNN.)

In addition, the campaign spent tens of thousands more on airplane tickets, hotels, and reimbursements to individuals who traveled on behalf of the campaign. One of the more prominent names on campaign travel reimbursements is former President George H.W. Bush, who was paid $4,465 for costs he incurred on behalf of his son the candidate.

Now that we know where and how Bush is spending his money, it’s important to see who’s getting it. Bush’s payroll is huge; the campaign now employs about 100 people in Austin, with another twenty-five spread across the country. To get an idea of the payroll, consider that the campaign paid the Internal Revenue Service more than $289,000 over the last three months.

It’s no surprise that the biggest payroll checks are going to the people closest to Bush. The highest-paid staffer on Bush’s payroll is campaign manager Joe Allbaugh, who was paid $19,637 during the three-month reporting period. Allbaugh, previously Bush’s chief of staff, managed Bush’s 1994 gubernatorial campaign. He is now drawing slightly more than $2,500 per week for his expertise.

After Allbaugh, the top-paid staffers are communications director Karen Hughes and chief strategist Karl Rove, each of whom is paid slightly more than $2,100 per week. Following Hughes and Rove is former Bush spokesman David Beckwith, who made about $1,900 per week until he left the campaign in mid-July after making disparaging remarks about the straw poll in Iowa. Sources close to the campaign say that Beckwith was also blamed for the bad press Bush got after he briefly visited a conference for minority journalists in Seattle. Bush had been invited to the event, but declined to attend. After he was criticized for his decision, he showed up at the conference for about twenty minutes, and his brief appearance was later jokingly called a “drive-by photo op.” Whether or not Beckwith deserved the criticism, it is clear the events in Iowa and Seattle sealed his fate. Mindy Tucker, who is now handling many of Beckwith’s duties, is being paid $935 per week.

While Hughes is definitely Bush’s chief press operative, Rove is perhaps even more important to Bush’s presidential hopes. Since April, the campaign has paid Rove $26,996, mostly as salary. Like Hughes, Rove is taking home $4,255 every two weeks. Interestingly, that’s less than Allbaugh gets, although it’s arguable that Rove is the more important player. After all, Rove has been with Bush longer than any of the other advisers, and planned and designed Bush’s direct mail campaign. Rove was also Bush’s highest-paid consultant when he owned Karl Rove & Company. During this year’s first reporting period (which ended March 31), the campaign paid Rove’s company $220,000, or about one-fourth of the total campaign expenses incurred in the first quarter. In the most recent reporting period, the campaign paid the company $1,724.

Bush’s payroll suggests who he trusts and who will be pushing the buttons if and when he gets to the White House. And there are a few insights at the end of the paper trail created by small checks written by the campaign. For instance, the Bush campaign paid Austin lawyer/lobbyist Kent Hance $31.47 for a “direct mail expense.” Hance is a Pioneer, one of the more than 100 people tapped by the Bush campaign to raise $100,000 each for the Governor’s presidential bid. Hance said he was reimbursed for the postage expense to make sure that he stayed under the $1,000 individual contribution limit.

Hance, incidentally, is the only politician ever to defeat Bush in an election. He beat Bush when the two were running for a West Texas congressional seat in 1978. He is also a minority shareholder in Waste Control Specialists, one of the companies pursuing a permit to dispose of low-level radioactive waste in West Texas. Waste Control pushed hard during the last legislative session for a bill that would have allowed the company to set up a waste disposal site in Andrews County, but the Legislature did not cooperate, this time. Hance says his business interests are not motivating him to support Bush, and that he was among the first donors to give money to Bush’s first gubernatorial campaign.

As a Pioneer, Hance is running behind schedule in reaching the $100,000 goal. “I’ll probably make it or come close,” he said. “The problem is, I got started late. Half the people I called, somebody had already called them.” Hance is also confident that his candidate will be the next president. “I don’t have any doubts. It’s the most phenomenal thing I’ve ever seen. I don’t see him having much of a problem in the primary. I think he can beat Gore or Bradley.”

Will Bush win because he has raised so much money?

Says Hance, “It certainly helps in getting the message out.”

Robert Bryce is a staff writer for the Austin Chronicle, where a version of this article first appeared.