Thursday, February 21, 2008

You Can Bank On John McCain

I'm a little late with this, but I think it is more interesting than the NYT story - it's too inuendoeee.

McCain's loan to help his campaign is something that, I feel, is much more telling of McCain.
As you may, or not, know, McCain took a $4 Million loan out to help out with his struggling campaign. The collateral he used for the loan? A guarantee to use the Federal Matching Funds every Presidential candidate can use - which explains McCain's insistence that Obama use the Federal Matching Funds - Obama for his part is not falling for the gambit. McCain had put himself in a bind and wants to make sure Obama is similarly bound. Tricky.

Well, fast forward and McCain is now trying to opt out of the Federal Matching Funds. Problem is, the FEC says McCain may not be able to, which would really hurt McCain's chances in the general election (he would be vastly out-spent by his opponent).

as hilzoy explains,
"I am not a lawyer, and thus have no opinion about whether McCain's loan violates the, um, McCain Feingold Act, or any other provision of federal law. But I did think that this was a pretty transparent attempt to violate its spirit. Campaign finance laws ask candidates to make a choice: either you take federal money, in which case you are subject to a number of restrictions, or else you don't take it, in which case you are not. Getting a loan by using the matching funds you have not yet received as collateral is a way of trying to have it both ways: essentially, you get to spend your matching funds now, but because the money did not literally come from the government, you can delay a decision about whether or not to accept the restrictions that go with them until later. If you can leverage the money into enough wins to generate contributions, you can pay back the loan and duck the restrictions; if not, you've lost anyways, so you might as well abide by them. That's exactly what campaign finance laws do not want candidates to be able to do.

McCain tried to be tricky about this: he didn't use the matching funds he had qualified for as collateral, but he did use the fact that he could qualify for them at any time. That's why he had to give away his legal right to withdraw from the campaign if he lost: to satisfy his lenders, he had to promise to stay in long enough to actually get the matching funds he qualified for, and to give them first dibs on those funds. Whether or not this violates the law -- a law McCain authored -- I have no idea, but it is certainly an attempt to wriggle out of its requirements, and it ought to put paid, once and for all, to the idea of McCain as a straight-talking man of principle."

Ah, but it doesn't end there. There are not enough commissioners to make any ruling. The FEC needs four commissioners to act; it currently only has two. This will benefit McCain since there are not enough comminsioners, a ruling can't be made, giving McCain the wiggle room to break(?) the campaign finance rules. McCain is probably breating a sigh of relief!

I want to comment on the NYT article about the alledge affair, but I just want to see what comes out, first.



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