http://nymag.com/daily/intelligencer/2015/12/gop-billionaires-cant-seem-to-buy-this-election.html
Poor, poor billionaires.
You’d think buying an election would be easy. This is, after all, the rough pitch that political consultants deliver when persuading donors to part with their money. (It’s also the primary theme of Bernie Sanders’s presidential campaign.) The formula traditionally goes like this: Out-raise the competition, bludgeon them with attack ads, and watch the votes roll in. In the five years since the Supreme Court enshrined unlimited campaign contributions to organizations not directly affiliated with candidates, money has poured into the political system. And yet spending the cash haul effectively has never been more difficult.
Take the 2012 contest between Mitt Romney and Barack Obama. Celebrated political strategist Karl Rove assured a murderers’ row of Republican megadonors that, with enough funding, his super-pac could put Romney in the White House. “I had every expectation we would be the victors,” says Home Depot co-founder Kenneth Langone, who gave half a million dollars to Rove’s American Crossroads. In the closing weeks of the campaign, Crossroads circulated a top-secret presentation to a small group of billionaires that projected Romney could win a “mandate” if they contributed an additional total of $25 million to fund a “surge” of negative ads. A handful ponied up, and on Election Night, they assembled in Boston certain they would be watching their investment pay off.
Instead they watched Rove’s infamous Fox News meltdown as their $117 million grubstake went up in smoke. To many of the billionaires it felt like a mugging. A few days after the election, New York hedge-fund manager Daniel Loeb, who’d helped finance Rove’s surge, tried to sue Crossroads and Fox News for misrepresenting the facts. “Loeb felt this was like an investment bank committing fraud on a road show,” a friend of his told me. After conferring with a securities lawyer, Loeb discovered that there are no investor protections in politics. He never filed a suit. (And Loeb declined to comment.)
Rove’s 2012 crash is having profound effects on the 2016 Republican primary. To begin with, George W. Bush’s Brain is no longer considered much of a brain. “I gave Rove $500,000. What did I get for it? Nothing!” Langone told me. Two of Rove’s most generous 2012 funders, Texas billionaires Bob Perry and Harold Simmons, have since passed away, and their heirs have turned off the cash spigot. “Everyone is still shocked Romney lost,” says Simmons’s widow, Annette. “I haven’t committed at all.” So far this year, Crossroads has raised just $784,000, according to the Center for Responsive Politics. Rove insists he’s still a player. “We’ll be involved in the Senate races,” he told me. “Depending on who the presidential nominee is, we may be involved in that, but that’s a long way off.” What Rove is not is anywhere near the center of the Republican Party. “But for his perch on Fox News, Karl would be in political Siberia,” says a top Republican strategist. “The going joke is that he must have a picture of Roger Ailes in his underwear to keep his contract.”
It’s not just that Rove is personally marginalized. Donors have awakened to the realization that topflight consultants can earn millions from campaigns regardless of whether they win. “It bothers a lot of people that politics has become a cottage industry. Everyone is taking a piece of this and a slice of that,” says California winemaker John Jordan, a former Rove donor. “Crossroads treated me like a child with these investor conference calls where they wouldn’t tell you what was really going on. They offered platitudes and a newsletter.”
Working under the assumption that they can support a campaign better themselves, donors are building their own organizations, staffed by operatives who report to them. “A lot of people who felt betrayed in 2012 set out to build political structures,” says Kellyanne Conway, president of the pro–Ted Cruz super-pac Keep the Promise I, which is backed by hedge-fund billionaire Robert Mercer. Mercer is a prime example of the new breed of activist donor. This presidential cycle, he has donated more than $30 million to a quartet of pro-Cruz super-pacs. A computer scientist by training, Mercer is also part owner of a political data firm called Cambridge Analytica, which boasts on its website that it employs “psychographic profiling” to recruit voters. As a result, Mercer’s pacs have shunned the traditional strategy of saturation TV coverage. Instead, Mercer is focused on targeted radio buys, digital outreach, and field organizing.
The savviest GOP candidates have capitalized on this shift. In fact, Cruz’s campaign fund-raising apparatus seems designed to let donors roll up their sleeves. Cruz contributors can specify how they want their money spent, much in the way universities allow benefactors to earmark their donations for a new science wing or aquatics center. “If you’re a donor, you can say, ‘I want to see this money used for Iowa,’ ” one strategist told me. “It’s a way to entice donors. They look at it like fantasy football.”
The new billionaire-backed operations style themselves as models of superior sophistication. During the last Republican primary, Sheldon Adelson bankrolled Newt Gingrich’s campaign essentially by writing blank checks with little or no oversight. Compare that to the super-pac funded by Chicago Cubs owner Joe Ricketts, who has his own political staff and demands accountability. “I’m used to saying the Ricketts’ spend their super-pac money like it’s their own money — because it is,” the family’s political adviser, Brian Baker, told me.
Poor, poor billionaires.
