February 19, 1995 in Nation/World

Gop Candidates Racked Up Debts But Help Arrives From Pacs That Backed Rival

Jim Camden Christine Bedell Contribut Staff writer
 

(From For the record, Thursday, February 23, 1995:) A chart with Sunday’s story on congressional campaign contributions incorrectly linked two organizations. House Speaker Tom Foley received a $5,000 contribution from Prudential Insurance Political Action Committee. George Nethercutt received a $1,000 contribution from Prudential Securities PAC. Although Prudential Securities is a wholly owned subsidiary of Prudential Insurance, the PACs are operated separately.

Some Northwest congressional candidates who extol fiscal restraint and a balanced federal budget racked up large campaign debts in winning their elections.

Now installed in the new Congress, these freshman Republican representatives are paying off some of their debts by accepting contributions from new “supporters” - political action committees that previously backed their Democratic rivals.

“If you sought access with the wrong person, you’ll just ante up with the winner,” said Ellen Miller, executive director of the Center for Responsible Politics, a citizens advocacy group.

Of the 10 new PAC donors to Idaho Rep. Helen Chenoweth in December, seven backed Democrat Larry LaRocco before the election. Her biggest donor in December was the National Rifle Association, which gave nearly $5,000 to LaRocco last year after he voted against the semiautomatic assault weapon ban. Chenoweth, a longtime gun-rights activist, recently called for a study to determine whether that ban should be repealed.

Of the 14 PACs contributing new money to Rep. George Nethercutt of Spokane in December, 11 gave money to his opponent Tom Foley before the Nov. 8 election.

All of this is legal. It is defended by candidates, and described as “business as usual” by advocates of campaign finance reform.

Chenoweth said she and LaRocco scored equally well in the NRA’s rating system before the election, but the group felt obligated to support the incumbent.

“The NRA missed the boat before the general, but they’re very sorry,” she said of the group’s December contribution to her.

Long an advocate of fiscal responsibility, Chenoweth said she felt uneasy about running a deficit and loaning personal funds to her campaign. But that’s the only way average people can run for Congress, she contends.

“We were a heavily targeted campaign,” she said. “It would have been suicidal to get into this race and to try to change the rules of the game.”

Nethercutt said he sees nothing wrong with accepting money from local businesses or political action committees that traditionally backed Foley.

Post-election fund-raising is a way of “reaching out to the district” he now represents.

“They want me to know that they’re supporting the winner. This is a way to say it’s not all partisan, to contribute to the cause of good government,” Nethercutt said.

“This is not an investment in the democratic process,” Jay Hedlund of Common Cause said of post-election donations. “It’s a way to build some kind of favorable relationship with a new officeholder.”

Under federal law, candidates can collect contributions for years to pay off their campaign debts. The only caveat, said Ian Stirton of the Federal Election Commission, is that they must report those debts right after the campaign.

The debts often include personal loans candidates make to their campaign organizations or bank loans they secure with their homes or other property.

Loaning personal funds can be risky, said Donna Edwards, executive director for the Center for a New Democracy in Washington, D.C. Losers usually have trouble raising money to repay a loan. Winners can expect contributions to keep coming in after they take office, particularly from special interest groups that supported their opponent in the election.

Both Chenoweth and Nethercutt denied that the contributions buy access to them. Both said they had not even reviewed a list of their latest contributors.

“People in Idaho know they have access to me whether they contributed or not,” she said.

Miller and Hedlund see the potential for problems when candidates need to raise money throughout their term to pay off large debts.

“When that money is going to pay off a home mortgage or a personal loan, it’s more like a gift” to the candidate, Hedlund said. Because the campaign finance system is driven by PACs, which give mainly to incumbents, Miller said challengers often feel forced to borrow money to keep their campaigns running.

That’s the situation Chenoweth said she found herself in: “My opponent was one of the top money raisers. They really poured on the coal” before the general election.

During the campaign, Chenoweth sold a piece of property and loaned her campaign $70,000 because “I really thought it was the right thing to do to pay my bills.”

Her total campaign debt, personal loans and other bills, totalled $170,000 at the end of December. She hopes to repay that loan and her other creditors by this summer.

“I ask for how we’re doing on paying the bills down every week,” she said.

Chenoweth agreed the system has its faults. She would prefer campaign rules that make a candidate collect 80 percent or more of her funds from inside the district.

But limiting PACs and restricting loans would “punish the person of average means,” she said. Only the rich would be able to bankroll their own campaigns.

Nethercutt, who pledged early in his campaign not to run a deficit, also had to change his mind as election day drew near. Facing an onslaught of campaign ads from Foley, he took out a personal loan and ordered campaign advertising through his national strategists that he couldn’t cover with his existing campaign fund.

After the election, his campaign reported being $95,000 in the red - a combination of unpaid expenses plus loans totalling $56,000, FEC records show.

“I felt my deficit spending was not out of control,” Nethercutt said. He made sure all local companies were paid first, and arranged to stretch out payments to national firms.

Their situation is not unique among the region’s GOP challengers, who were swept into office by the Republican tide.

Rick White of Bainbridge Island was $146,000 in the red. Doc Hastings of the Tri-Cities owed $101,000.

But other GOP challengers proved that huge debts were not a pre- requisite to winning. Linda Smith of Vancouver owed less than $24,000 at the end of the campaign, despite being outspent nearly 2-to-1 by three- term incumbent Jolene Unsoeld. Randy Tate of Puyallup had $24,000 in debts after beating freshman Rep. Maria Cantwell.

The amount of money challengers loan their campaigns has steadily increased over the last six years, and Republicans are far more likely to deficit spend than Democrats, FEC records show.

As members of the House, these Republican freshmen are leading the charge for a balanced budget amendment to the constitution, to keep the federal government from spending more than it takes in. Campaign reform advocates find it ironic that they would deficit-spend to win elections, but not to run the country.

“It shows that depending on the emergency of the situation, they are willing to borrow for what they perceive is important,” said Hedlund. “They say `Let’s run government the way we run our households.’ I say, `Physician heal thyself.”’

Although she believes deficit spending is not a good idea, Chenoweth argues the two situations are not comparable. Average people occasionally borrow money for things that are important, and live up to their promise to pay it off. She sold off some of her assets to have money to cover part of her debts.

The federal government borrows continually and does not consider selling any of its assets to pay off its debt, she said.

“If the federal government were that conscientious about paying off its debts, we’d be better off right now,” she said.

ILLUSTRATION: 2 Graphics: “Campaign debt” and “The PACs switch sides”

MEMO: Cut in Spokane edition

The following fields overflowed: BYLINE = Jim Camden Staff writer Staff writer Christine Bedell contributed to this report.

Cut in Spokane edition

The following fields overflowed: BYLINE = Jim Camden Staff writer Staff writer Christine Bedell contributed to this report.


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