Campaign Finances

The Wall Street Journal has in interesting article on finances and the two campaigns of nomination for the Democratic Party candidacy, particularly the measures being taken by the Clinton campaign. Remember at the beginning of the campaign when it was said that Clinton modeled her tactics after those of Bush; that is, to amass a war chest that would overwhelm the resources of every opponent. Super Tuesday, where she fought Obama to a virtual draw, marked the depletion of that war chest. Since then Obama has won every primary and has been attracting money at about a $1 million a day pace, far outdistancing Clinton. Clinton is shackled by campaign finance laws insofar as she has big money backers who have already given the maximum allowable amount $2300 and tapped out their networks of donors.

There is speculation that Clinton’s campaign will shift into attack mode in an effort to change the momentum of the campaign. In this light Clinton’s backers now seem to be falling into step with those of Bush’s supporters in 2004 by forming a 527 group of questionable legality. These groups were given an exemption form campaign contribution limits with the proviso that they were prohibited from influencing elections. Swift Boaters determined that violating the constraint was worth the post-election fines and such groups are commonly regarded as a thinly veiled means of avoiding campaign financing laws.

The spin on this has begun as well with Clinton’s spokesman Howard Wolfson saying that Obama used a 527 in California and that it spend millions on his campaign. In truth he had asked all 527’s supporting him to cease operating and the California group spent about $50,000, not the millions attributed to it by the Clinton campaign.

Two interesting question emerge: How will Obama stand up under the pressure of attack?; and What limits will Clinton put on the attack?

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