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World & Nation

Haley Barbour known for fundraising talent and tactics

As he ponders a run for president, Haley Barbour would not seem a natural fit for the anti-establishment political mood now brewing: The governor of Mississippi is a longtime inside-the-Beltway operator who lobbied for the tobacco industry and other powerful interests.

But Barbour wields a key asset that makes him a potential heavyweight in a crowded GOP field: fundraising prowess born of decades as a Republican power player.

Presiding over his party’s national committee and then its governors association, Barbour raked in donations with a ferocity that delighted Republicans, boggled Democrats and alarmed campaign finance watchdogs.

A savvy navigator of campaign finance rules, Barbour’s aggressive tactics while leading the Republican National Committee — the record sums he raised helped the GOP take back the House in 1994 — prompted investigations by a congressional committee and the Justice Department.

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During his recent chairmanship of the Republican Governors Assn., the group took advantage of states with the least-restrictive campaign finance laws to shuffle millions of dollars in donations around the country through various political action committees.

Part of Barbour’s strength lies in his vast Rolodex: After serving as political director in the Reagan White House, he started what eventually became the most influential lobbying shop in Washington. When he successfully challenged the sitting Mississippi governor in 2003, he raised more than $11 million — almost triple the previous record.

But his tenure as head of the governors association represented perhaps his biggest coup, as he guided the organization to an astounding fundraising haul of $117 million in the 2010 cycle — double that of its Democratic counterpart.

“I think it’s almost impossible to overstate his impact,” said Nathan Daschle, then the executive director of the Democratic Governors Assn. “He just shattered our perceptions of what we thought was possible. We had always kept relative pace with them until Haley Barbour came around.”

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Barbour says there is no magic to his technique. “If someone is interested and wants you or your candidates to win, he or she will normally do what he or she is asked,” he wrote in an email.

Part of Barbour’s secret, colleagues say, is that unlike many politicians, he has no qualms about asking for money.

“I’ve been there when he asks someone for a million dollars, and he enjoys it,” said Henry Barbour, his nephew and top political advisor.

The scrutiny from the Justice Department, Federal Election Commission and Senate Committee on Governmental Affairs stemmed from a $2-million loan he secured from a Hong Kong businessman in 1994 for a GOP think tank Barbour had started. The think tank used some of the proceeds to repay a loan from an RNC committee.

The FEC’s general counsel recommended that the commission find Barbour and the RNC in violation of the federal ban on receiving money from foreign nationals, but the commission deadlocked. The Justice Department dropped the matter after a federal appeals court panel ruled the money did not constitute a political contribution.

At the governors association — whose chairmanship Barbour held from June 2009 until November — he moved quickly to expand the group’s corporate donor base with a slew of new individual contributors. At the time, GOP donors were fleeing the party’s national committee, then under the rocky leadership of Michael Steele.

“He believed in very aggressive goals,” said Nick Ayers, then the executive director of the GOP governors organization. “I had already laid out a plan to raise more than double what had been raised before, and Haley said, ‘That’s not enough; I want to triple it.’ ”

At one meeting, staff members detailed plans to recruit 40 top business leaders to kick off a group called the Executive Roundtable, which required a minimum two-year commitment of at least $25,000 a year.

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“He cut them off,” said Henry Barbour, recalling his uncle’s words: “Forty? We’re going to get 400.”

Barbour persuaded Fred Malek, a veteran GOP political hand, to chair the group. But he remained intensely involved, making monthly trips around the country to woo heavyweights such as FedEx Chairman Frederick W. Smith.

Ultimately, 588 donors signed up, most of whom had never before given money to the governors association.

Flush with cash, the organization found creative ways to distribute its wealth.

Michigan served as a veritable clearinghouse for the money. The Michigan Chamber of Commerce, for example, gave the organization a total of $5.37 million between May and October of 2010, according to data from the nonpartisan Center for Responsive Politics.

But Michigan bans corporate contributions to political candidates. So rather than put that money into its political action committee in Michigan, the governors group transferred at least $1.8 million to its PACs in Maine and Florida — states without such prohibitions. It is unclear where the rest was sent.

“Obfuscating political accountability is what they were doing,” said Rich Robinson, executive director of the nonpartisan Michigan Campaign Finance Network, who said the aim was “to get the corporate money to land in states where it was most fungible.”

While the Michigan chamber’s money went elsewhere, out-of-state money from individuals flooded into the GOP governors’ Michigan PAC. Of its $8.4 million in donations, 98% came from out-of-state contributors such as New York-based conservative donor David Koch, who gave just under $1 million, and Texas homebuilder Bob J. Perry, who gave $1 million, according to an analysis by the Michigan Campaign Finance Network.

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The group’s Michigan PAC then directed $5.2 million to the Michigan Republican Party — almost the same amount the state’s chamber had donated to the group that went out of state. In an unusual move, the Michigan PAC also sent $3 million to Texas for the reelection bid of Republican Gov. Rick Perry. In the past, he has received generous donations from both Koch and Bob Perry, the out-of-state donors to the Michigan PAC. (The Perrys are not related.)

Republican election law attorney Trevor Potter described the dizzying flow of money as “one of the most aggressive and largest” uses of state PACs he has seen.

“It makes it very difficult to follow the money and undermines and frustrates the disclosure requirements,” said Potter, president of the Campaign Legal Center, which supports campaign finance regulation.

Ayers, the former executive director of the governors group, disputed the charge that the organization was trying to mask its donors.

“It was done to comply 100% with campaign finance law,” he said, noting that the organization is governed by different rules in each state. “We don’t write the law, therefore I can’t make it make common sense.... Nothing has been alleged; there has been no inquiry or fines because we reported all of our activity.”

Gov. Barbour said through Henry Barbour that he was not familiar with the Michigan strategy. Ayers said the elder Barbour simply approved the organization’s quarterly budgets for state spending as a member of its executive committee.

A presidential race would provide a new challenge for Barbour. After years of soliciting five- and six-figure sums, he would have to raise money under strict contribution limits of $2,500 a person.

But those who know him say they have no doubt he will adapt. Steve Golding, a river barge operator in Vicksburg, Miss., recalled first meeting Barbour in 1982, when the 34-year-old first-time candidate was challenging Democratic Senate institution John C. Stennis. Few gave Barbour a chance, and Golding was reluctant to even listen to his pitch for a donation.

After 15 minutes, Golding was sold — and handed over $1,000. Barbour ended up raising $1.1 million, an eye-popping figure in Mississippi at the time.

“Don’t ever underestimate Haley and his fundraising ability,” Golding said. “He was born with it.”

matea.gold@latimes.com

Melanie Mason in the Washington bureau contributed to this report.


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