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The 2008 Campaigns for President Are Rife With Questionable Funding

by Aaron Turpen, The Militant Libertarian

In reviewing the campaign funding for those running for President in 2008, I noticed an appalling trend amongst most of the “front-runners.” According to www.opensecrets.org, much of the funding candidates are receiving is unaccounted for (in other words, it may have come from anywhere).

Let’s take a look at some of them, as of the last required reporting date (end of June, 2007):

Hillary Clinton (D): $63.07 million raised, $17.8 million spent, $45.2 million in the bank, and $3.02 million in debts. Surprisingly, only 11.4% of her campaign’s income is undisclosed. That’s pretty good compared to some of the others.

Mitt Romney (R): $44.4 million raised, $32.3 million spent, $12.1 million in the bank, $8.9 million in debts. A big 16.4% of his campaign’s income is from undisclosed sources. On top of that, he’s one of the few candidates who has received PAC donations (about 1% of his total income).

Barack Obama (D): $58.9 million raised, $22.6 million spent, $36.2 million in the bank, and $0.9 millionin debts. A whopping 29.8% of his contributions were from undisclosed sources!

Rudy Giuliani (R): $35.6 million raised, $17.3 million spent, $18.3 million in the bank, no debts. Rudy has also received about 1% of his financing from PACs. More interesting, though, nearly 20% of his income has been from undisclosed sources.

John McCain (R): $25.3 million raised, $21.9 million spent, $3.2 million in the bank, and $1.7 million in debts. 2% of his income has been from PACs and about 15.5% of it from undisclosed sourrces.

Bill Richardson (D): $13.3 million raised, $6.2 million spent, $7.1 million in the bank, and debts of $0.6 million. PAC contributions make up 1% of his income, but he has the best undisclosed income record with only 4.2% of his income being from undisclosed sources.

Ron Paul (R): $3 million raised, $0.6 million spent, $2.3 million in the bank, and no debts. His undisclosed income accounts for about 10.7% of of his total income.

I could go through all of the candidates, one by one, but most of them tell the same stories. You can find out the details for all of these candidates at http://www.opensecrets.org.

So looking at the numbers listed, let’s compare the candidates on two levels: first, how much of their money is somewhat questionable. Admittedly, a lot of “undisclosed” income is cash handed over or mailed in without an accompanying form, but some of it could be “on the down-low”. Second, we’ll look at how much debt they have incurred, which could be a harbinger of how they plan to run the nation’s economy.

Undisclosed Income: Obama tops the list in undisclosed income (by percentage) while another Democrat, Richardson, comes in at the lowest. Giuliani, considered the GOP’s “favorite” for 2008, has 20% of his income from undisclosed sources, with Romney coming in close behind at well over 16%. Ron Paul comes in at the best in undisclosed income.

This means that the lowest score amongst the “front-runners” for the 2008 election are all getting over 10% of their income from undisclosed sources. For some campaigns (such as Hillary Clintons, which only gets 11.4% of its money from undisclosed sources), this means more than it does for others (such as Ron Paul’s at 10.7%). Not in terms of percentages, but in terms of actual dollars. It’s easier to justify, for instance, Paul’s undisclosed income of $180,000 or so than it is to justify Hillary’s $5.4 MILLION in undisclosed income.

Now, when we look at debt, we can see which candidates are probably more likely to spend on credit (meaning take the nation into debt) versus those who are not likely to do so. Some credit, of course, is expected through the normal course of business for any endeavor – be it a political campaign or a nation.

When you look at the huge amount of debt some of these campaigns have incurred, however, you begin to wonder about the fiscal policies of the candidate associated with it. For instance, Ron Paul has a debt of zero dollars and has cash on hand. Mitt Romney, on the other hand, has a debt of over $8.9 million, which means his debt accounts for over 73% of his cash on hand! In fact, compared to the fiscal status of the other candidates, Mitt looks like Paris Hilton with an American Express card on Friday night.

To put it bluntly, of all of the candidates on the roster, only Romney appears to have little financial responsibility. Every other candidate has zero or near-zero debt when compared to their cash on hand. The next-highest irresponsible candidate is John McCain who has a debt-savings ratio of about 53%. Most candidates are well under the 10% range.

So what does this mean? In my mind, it’s a good indicator of two things: what the candidate expects to get in contributions in the future and, more importantly, how well the candidate plans ahead and budgets his or her money. I think in Mitt’s case, he knows he has substantial resources at his disposal (his own personal fortune), so he’s probably banking on that being his fall-back – a fall-back he won’t have when the national budget is at issue. As for the other candidates, they seem to realize that it’s still early in the campaign and that a large amount of debt is a bad idea at this point. If only they could carry this thinking into the White House…

Unfortunately, once in office, most candidates seem to think that the purse of this nation is bottomless and that spending has no limits. Except Ron Paul, of course, who for ten terms in Congress has consistently voted against any unbalanced budget offered. Mitt Romney, as governor of Massachusetts, balanced the state budget, but did that through increasing taxes, fees, and the gasoline tax. Maybe that’s how a business mogul balances budgets, but that’s not the way to make government do it, in my mind.

So the numbers of the campaign tell an interesting tale. I hope you’ve enjoyed it as much as I have.

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