Republicans Set For Gains in U.S. Governors' Races as Funding Sets Record

Republicans, fueled by record fundraising, are poised to win most of the state governorships in November, which would give them an advantage in congressional redistricting and a new pool of talent for national office.

Democrats now hold 26 of the 50 governorships, and 37 are on the ballot this year, the most ever. Stuart Rothenberg, a nonpartisan political analyst in Washington, says the Republicans should pick up at least eight new posts, giving them control of 32.

Such a sweep would have longer-lasting consequences than the more visible races for all 435 House seats and about one- third of the 100 Senate slots, and give Republicans momentum throughout the decade, because the governors will help redraw congressional and state legislative lines after the 2010 census.

“The next class of governors will have enormous power far into this decade,” said Paul Light, a professor at New York University’s Wagner School of Public Service. “It’s no wonder the parties are spending huge sums on these races.”

The Republican Governors Association, which is coordinating the campaigns, points to its fundraising numbers as evidence it has the advantage. The group has raised $58 million between Jan. 1, 2009, and June 30, 2010, compared with $40 million for the Democratic Governors Association, Internal Revenue Service filings show. Both groups say the amounts are records.

Unlimited Donations

Unlike the national political parties and federal candidates, the governors’ associations can take in unlimited amounts from corporations, and companies are showing their interest. News Corp., the media company controlled by Chairman and Chief Executive Officer Rupert Murdoch, gave the RGA $1 million in June. Wellpoint Inc., the biggest U.S. health insurer, contributed a total of $500,000 to the Republican group.

Big Democratic givers for the governors’ races include two Washington-based labor groups, the Service Employees International Union, which donated $1.1 million, and the American Federation of State, County and Municipal Employees, which contributed $3.3 million.

Democrats hold majorities in the House and Senate, and the party that controls the White House traditionally loses congressional seats in the next midterm elections. Historical trends show the president’s party also typically loses more than five governorships, said Nathan Daschle, executive director of the Democratic Governors Association.

Retiring Democrats

That trend, combined with an economy marked by an unemployment rate of 9.5 percent in July and growth that slowed to 2.4 percent in the second quarter, is feeding Republican optimism the party can pick up Democratic-held governorships in such states as Pennsylvania and Michigan, where incumbents are retiring. In Ohio, where the June unemployment rate was 10.5 percent, Democratic Governor Ted Strickland is being challenged by former Republican U.S. Representative John Kasich.

In addition, Democratic governors in Republican-leaning states, such as Dave Freudenthal in Wyoming and Brad Henry in Oklahoma, are being forced to step down because of term limits and Republicans are favored to reclaim those governorships, according to Rothenberg.

While national Democratic Party committees have outraised their Republican counterparts, the reverse is true among governors. The Republican governors group had $40 million in the bank entering July, $8 million less than the three national Republican committees combined, and $18 million more that the Democratic governors, according to both committees. The money goes to candidates and the state parties, as well as independent expenditures to help elect gubernatorial nominees.

Daschle said the money advantage doesn’t necessarily spell trouble for the Democrats.

‘Always Outraise Us’

“They always outraise us,” said Daschle, son of former Senate Majority Leader Tom Daschle of South Dakota. “In our experience, good candidates, good policies and good ideas count for more than a lot of money.”

Besides helping to shape legislative districts, statehouses have been a breeding ground for U.S. presidents. Four of the last six served as governors.

Former Governors Mitt Romney of Massachusetts and Sarah Palin of Alaska and Governor Tim Pawlenty of Minnesota, who announced last year that he wouldn’t seek re-election, are potential 2012 Republican presidential candidates, as is Mississippi Governor Haley Barbour, who heads the RGA.

Republican Leaders

“The Republican Party was not going to be rebuilt out of Washington,” said Mike Schrimpf, an RGA spokesman. “Our party has always fared best when our leaders came from the states.”

The Republicans’ biggest corporate donor was New York-based News Corp. Teri Everett, a spokeswoman, said the company “actively supports organizations that advocate a pro-job, low tax, economic growth agenda.”

News Corp. opposes proposed federal rule changes that would weaken the position of its Fox network in negotiations with cable companies. Governors may have a stake in the issue. In March, for example, New York Governor David Paterson stepped in with a call for binding arbitration in a dispute over fees between Bethpage, New York-based Cablevision Systems Corp. and Burbank, California-based Walt Disney Co.’s ABC.

Indianapolis-based Wellpoint contributed $250,000 to Republicans in each of the last two years. A spokeswoman, Kristin Binns, didn’t respond to three requests for comment. In March, Binns said Obama’s health-care overhaul, enacted that month over Republican opposition, did “little to reduce cost and improve quality.”

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net.

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