Eleventh Hour Money Grab

With Congress at stake, business is being squeezed

Veteran American Trucking Assn. lobbyist Timothy P. Lynch thought he had the rhythms of political fund-raising down pat: Up until September, congressional candidates and the two parties would hit up corporate political-action committees like his for the maximum $5,000 contribution--and then disappear to mount their final media blitz.

But during Campaign '96, Lynch is finding the money chase has taken on a frenetic new beat. Just days before the election, he was getting up to two dozen calls a day from both Republicans and Democrats--mostly for "soft-dollar" donations that are subject to few restrictions. A GOP fund-raiser asked for $100,000. "After I stopped laughing, I realized the guy was dead serious," says Lynch, who refused the request.

"GET ON BOARD." With the race to control Congress coming down to a photo finish, both parties are asking Corporate America to open its checkbook one more time--and with success. As of mid-October, the two parties have exploited campaign-finance loopholes to raise a record $200 million in soft money used ostensibly for "party-building activities" such as voter registration but often targeted to benefit individual candidates.

They weren't stopping there: House Speaker Newt Gingrich (R-Ga.) in early October ordered his committee chairmen to raise $7 million to pump into tight races. And with most PAC managers tapped out, Senator Robert Kerrey (D-Neb.) was feverishly phoning CEOs on behalf of Democrats to solicit last-minute donations. "The pressure for contributions is way off the charts this year," says the lobbyist for one Boston bank, whose entire top management has been hit up for donations by both sides. "I've never seen anything like it."

Democrats are targeting most of their efforts at House races, where many of the GOP's 74 freshmen are on the ropes. Democratic fund-raisers have been faxing PAC managers lists of contests where Democratic challengers have surged ahead in the polls--thanks in part to a $35 million AFL-CIO media campaign.

But that has only served as a wake-up call for business groups to rush to the aid of endangered Republicans. "The implicit message by the Democrats is, `We're going to take over the House, and you'd better get on board,"' says Alan Kranowitz, senior vice-president of the National Association of Wholesaler-Distributors. "But appeals like that only have the opposite effect with us." Federal Election Commission reports show that insurance and tobacco interests kicked in nearly $900,000 in less than two weeks during October.

Whatever the outcome, the stench of campaign fund-raising a la '96 is leaving most participants disillusioned. "This election was drenched in a half-billion dollars of soft money," sighs GOP lobbyist Wayne Valis. "And there's nothing more corrupting or demeaning than having to repeatedly ask your clients for all these contributions. I hope somebody cleans it up." But with the finish line in sight, that's the furthest thing from the candidates' minds.

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