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December 7, 2012

$2 billion price tag for presidential election

WASHINGTON — The 2012 presidential election broke the $2 billion milestone in its final weeks, becoming the most expensive in American political history, according to final federal finance reports released Thursday. The reports detailed a last-minute cascade of money from mega-donors and an onslaught of spending by the Obama and Romney campaigns and “super” political action committees.

The final campaign finance tallies filed with the Federal Election Commission included nearly $86 million in fundraising for the losing presidential candidate, Republican Mitt Romney, in the election’s last weeks. That final burst brought the Romney campaign’s total for the election to above $1 billion. Final fundraising and spending totals for President Barack Obama’s victorious drive also topped $1 billion.

Surpassing the $2 billion mark was long expected after an election season dominated by the supercharged competitive pressures that both campaigns faced in mounting massive fundraising blitzes to stoke expensive media ad battles and ground wars. The Obama and Romney campaigns each mobilized competing squads of ultra-wealthy fundraisers, sought aid from free-spending allied super PACs and deployed multimillion-dollar media broadsides and armies of organizers.

The final thrust of fundraising included a massive late surge of $33 million in donations to pro-Romney political committees from a single billionaire, Las Vegas casino owner Sheldon Adelson. In all, Adelson and his wife, Miriam, gave Romney and other Republican candidates $95 million during the election season, closing in on the gambling magnate’s vow to give $100 million to GOP causes.

The new campaign finance filings covered the final few weeks of the race, when campaign organizations for Romney and Obama, along with a slew of super PACs, raised and spent millions toward the long-expected $2 billion milestone.

Despite Romney’s bitter election loss, his national finance chairman on Thursday declared a fundraising victory. Spencer Zwick said “every dollar we raised was put to use in the effort to elect Mitt Romney” and described the totals as “the most successful in Republican Party history.”

Both campaigns already were nearing $1 billion each in expenditures by late October, and super PACs supporting Obama and Romney had spent more than $500 million in media ads. Politically oriented nonprofit “social welfare” organizations that do not have to declare their finances or identify their fundraisers have spent hundreds of millions more on so-called issue ads.

The main pro-Romney super PAC, Restore Our Future, brought in $22 million in the campaign’s final weeks, finishing with $152 million for the entire campaign. Adelson and his wife provided $10 million of that last-minute total — as well as $23 million to American Crossroads, another pro-Romney super PAC headed by veteran GOP strategist Karl Rove. Other top late donors to Restore included Larry Ellison, head of software giant Oracle Corp., who gave $3 million, and Houston Texans owner Robert McNair, who gave $1 million. The Renco Group, a New York company headed by investor Ira Rennert, also gave $1 million.

The rival super PAC supporting Obama, Priorities USA Action, reported raising $15 million during the last weeks of the campaign. The group was run by a group of former White House aides. The committee’s final haul accounted for about 20 percent of roughly $78 million in contributions this election cycle.

The group’s top donors included Renaissance Technologies investors James H. Simons and Henry Laufer, who each gave $1.5 million. Chicago media mogul Fred Eychaner, Texas lawyer Steve Mostyn, and Stephen Robert, also of Renaissance, also gave $1 million, as did the Laborer’s International Union of North America.

But Adelson was the election’s single most influential donor, vowing he would give more than $100 million to GOP candidates by the election. His postelection super PAC total does not quite match that figure, but the casino magnate also hinted broadly he would also give millions more to GOP-leaning nonprofits that do not have to report their war chests to the FEC but instead provide confidential figures to the Internal Revenue Service.

Along with his dominant presence in the presidential race, Adelson also poured money into super PACs backing several GOP Senate candidates in the final weeks of the election. More than $1.5 million in Adelson money went to a super PAC backing GOP candidate George Allen in Virginia, $1 million to a committee aiding Michigan candidate Peter Hoekstra and $500,000 to a super PAC supporting Sen. Scott Brown. All were defeated.

Adelson recently told The Wall Street Journal that he would double his $100 million investment in GOP causes by the next election and he has the financial muscle to do it. His massive campaign donations are backed by his lucrative casino holdings in the U.S. and Macau. The most recent November quarterly statement of his Las Vegas Sands Corp. estimated that Adelson’s casino revenues surged $1.11 billion in the first nine months of 2012 compared with the same period in 2011.

In late November, Adelson’s company announced a special dividend of $2.75 a share in anticipation of the threatened “fiscal cliff” rise in federal tax rates. The dividend move netted Adelson — who owns more than half of Sands’ 820 million shares — an estimated personal gain of as much as $1.2 billion, according to financial analysts.

Adelson’s role as the premiere fundraiser in American politics could be complicated by his casino company’s continuing struggles with the federal government over tax revenues and Justice Department and Securities and Exchange Commission investigations focusing on possible violations of the Foreign Corrupt Practices Act, which targets money-laundering and international bribery.

Sands’ recent quarterly statement acknowledged the federal probes as well as negotiations with the IRS over “unrecognized tax benefits” highlighted by a tax audit of the company’s Macao and Singapore casino earnings between 2005 and 2009.

Sands cited a “possible settlement of matters presently under consideration at appeals in connection with the IRS audit.”

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Follow Jack Gillum on Twitter at http://twitter.com/jackgillum

 

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