Corporate cash poses test for 2020 Dems

Potential Democratic contenders in the 2020 presidential election face a tough decision on whether to accept the flood of money from special interests, corporations and lobbyists.

The challenge is highlighted by Beto O’Rourke, a rising star, who met recently with former President Obama to discuss a 2020 run. Obama made running against K Street and rejecting corporate money a centerpiece of his first presidential campaign.


Whether O’Rourke, a former Texas congressman, follows Obama’s blueprint could set the tone for other candidates and have deep ramifications for the eventual Democratic nominee.

“I am certain that there will be candidates that will choose not to take PAC money because they feel it points to special interest and big money at the highest degree,” R. Scott Pastrick, CEO of Prime Policy Group, told The Hill.

Obama won the White House without accepting money from any PACs or lobbyists, raising more than $750 million in 2008. In 2012, he raised more than $1.1 billion. Obama also convinced the Democratic National Committee (DNC) to restrict lobbyist money and even instituted tough rules on lobbyists serving in his administration.

But those moves were controversial. The DNC rolled back its restrictions on lobbying money in 2016. The Democratic nominee that year, Hillary ClintonHillary Diane Rodham ClintonTrump defends indicted GOP congressman GOP lawmaker says he expects to be indicted over FBI investigation Why it's time for conservatives to accept the 2020 election results and move on MORE, raised $1.2 billion from super PACs alone.

O’Rourke shunned PAC money in his failed bid to unseat Sen. Ted CruzRafael (Ted) Edward CruzOvernight Health Care — Presented by Carequest — Colin Powell's death highlights risks for immunocompromised The Senate confirmation process is broken — Senate Democrats can fix it Australian politician on Cruz, vaccines: 'We don't need your lectures, thanks mate' MORE (R-Texas) last year. That was a change from past House races, in which he accepted PAC and corporate money.

He showed his staying power by raising about $80 million, more money than any Senate candidate in history, including $36 million from small individual contributions. He has $476,000 on hand currently.

But replicating that fundraising in a national presidential race will be a challenge. Democrats are expecting a historically large field, and candidates will need to think hard before turning away any potential campaign cash.

Another big factor is President TrumpDonald TrumpTrump defends indicted GOP congressman House to vote Thursday on holding Bannon in contempt Youngkin calls for investigation into Loudoun County School Board amid sexual assault allegations MORE, a fundraising juggernaut. Trump initially self-funded his 2016 campaign, saying he didn’t want to be beholden to special interests, but later accepted outside funding. He has already raised $100 million for 2020, the majority from small donors.

On the Democratic side, Sen. Elizabeth WarrenElizabeth WarrenDemocrats narrow scope of IRS proposal amid GOP attacks Overnight Health Care — Presented by Carequest — FDA moves to sell hearing aids over-the-counter FDA proposes rule to offer over-the-counter hearing aids MORE (D-Mass.) has jumped into the race with an exploratory committee. She does not have a leadership PAC but has begun soliciting small- dollar donations and has $12 million on hand from her reelection campaign.

Some potential contenders have already said they would refuse corporate PAC money, including Democratic Sens. Cory BookerCory BookerEmanuel to take hot seat in Senate confirmation hearing Senate GOP signals they'll help bail out Biden's Fed chair Defense & National Security — Military starts giving guidance on COVID-19 vaccine refusals MORE (N.J.), Kirsten GillibrandKirsten GillibrandOvernight Energy & Environment — Biden makes return to pre-Trump national monument boundaries official Biden signs bill to help victims of 'Havana syndrome' Lawmakers using leadership PACs as 'slush funds' to live lavish lifestyles: report MORE (N.Y.) and Kamala HarrisKamala HarrisAre supply chain disruptions the beginning of the end of globalization? Harris to campaign with McAuliffe in Virginia Harris to highlight drought, climate change in Nevada trip MORE (Calif.).

Many back overturning the Supreme Court’s decision in Citizens United v. Federal Election Commission, which allowed unlimited spending by outside campaigns. There is also pressure from progressives to reject corporate money, a litmus test for many on the left.

The contentious debate over fundraising in the party was further highlighted this year when the DNC reversed a ban on money from fossil fuel companies.

For Democrats, including O’Rourke, it’s a complicated decision.

O’Rourke did not return a request for comment.

“They would rather remove it as a debate point so they can be viewed as an outsider,” an Obama official-turned-lobbyist told The Hill about deciding whether to take corporate money.

“I don’t think that people really care either way, but I think that most presidential candidates will say it’s not worth the hit of being considered a K Street insider.”

“Corporate PAC money might make everyone feel good by saying they don’t take it,” added another former Obama official.

But Pastrick, who was treasurer at the DNC during former President Clinton’s 1996 reelection campaign, advised against rejecting special interest money.

“In the end, it’s all about winning, and Democrats must consider the money avenue that will bring success to their campaign,” he said. “My advice is to take advantage of funding resources that will provide you with the means to win. Only then will you be able to make change and govern.”

“You’re putting yourself at [a] disadvantage relative to your Republican opponents,” another former Obama official who now lobbies told The Hill.

Other lobbyists who hold checkbooks also advised against closing the door.

“I thought it was a bad idea with Obama,” a former aide in his administration, who now lobbies, told The Hill. “A CEO contributing to a member of Congress, that CEO is just as likely to ask a candidate where they are on legislative issues than a lobbyist.”

“Not accepting a lobbyist’s money makes no sense to me,” the aide added.

Others noted that even if candidates refuse corporate money, they can find other ways to harness support from business groups.

“If I was advising Beto, yes, he’s leaving a little bit of money off the table, but where the action is ... is not finding a lobbyist who can raise one $50,000 event,” the lobbyist said. “For a presidential candidate, D.C. is not going to be a fundraising ground zero. It’s going to be Chicago, L.A., New York, Dallas.”

For Democratic candidates who forgo corporate or PAC money, the race for small donors will be fierce.

In his Senate race, O’Rourke did not face a tough primary fight before the general against Cruz. In 2020, he could face some formidable names and some deep-pocketed contenders, such as former New York City Mayor Michael Bloomberg, in the Democratic primaries.

“Institutionally, presidential primary money in the early primaries is difficult to come by for some candidates that are perceived as long shots,” Pastrick said. “Candidates must look to grass-roots, small-dollar fundraising through social media or direct mail outlets which is highly competitive and can be costly.”

O’Rourke is already facing pressure on the issue, with the nonpartisan Center for Responsive Politics noting that he’s received more than $420,000 from the oil and gas industry, which is prominent in his home state.

As one of the perceived front-runners, an O’Rourke decision to forgo corporate PAC money could force other candidates to do the same.

The former Obama official-turned-lobbyist, though, downplayed the risks, saying that Democrats did not need to be dependent on corporate money.

“The focus is going to be much more on how do we raise a lot of money in low dollars so a speech, a rally or a well-publicized event is going to be a lot more important to folks than having a Rolodex with trade associations’ heads and lobbyists in it,” the lobbyist predicted.

“Folks are not going to be doing as much outreach from K Street as a result because they don’t need to.”