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Jeb Bush's astonishing money machine: brilliant or dodgy? (+video)

Jeb Bush set up a massive super PAC that will go on autopilot the moment he declares his candidacy for 2016. Critics say it's a move that runs afoul of the spirit and even the letter of campaign finance laws.

News of a record early fundraising total for Jeb Bush is remarkable not just for the sums of money involved, but also for how those sums have been raised – in ways that could either revolutionize campaign strategy or run afoul of federal election law.  

The former Florida governor has sought to position himself as being on the acceptable side of a fuzzy legal line, using his status as a not-yet-declared presidential candidate to raise funds without any contribution caps for donors.

But some watchdog groups allege that he has already violated not just the spirit, but also the letter of a 2002 law that aims to limit what donors can give and candidates can spend in formal campaigns.

The legal and ethical ambiguity is heightened because the Federal Election Commission (FEC), tasked with enforcing election laws, is deeply divided along party lines on the issues at stake.

Mr. Bush’s strategy, for now at least, is a financially winning one. Speaking to 350 top donors at a Miami Beach event Sunday, he said he has raked in more money in the first 100 days of a possible run than any Republican ever. (The exact amount, not yet made public, could by some accounts reach $100 million.)

All this appears to be a prelude to what might be called an “autopilot campaign.” And Bush looks set to delegate a stunning level of responsibility – key roles in advertising and more – to his political-action committee (PAC).

The boldness of this: These kinds of super PACs, by law, are supposed to remain wholly separate from the candidate and his or her campaign organization.

“We are in a new era,” says Viveca Novak, spokeswoman for the Center for Responsive Politics, a research group in Washington that tracks the flow of money in US politics. “There were super PACs in 2012, but this is the first presidential election where people have openly talked about farming out elements of their campaigns to outside groups.”

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And it isn’t just the Bush organization that’s pushing down this new track. Other presidential hopefuls, such as Wisconsin Gov. Scott Walker (R), also have independent groups that can raise unlimited sums – but must ultimately operate at an arm’s-length distance from the candidate they support.

Candidates will still have traditional campaign committees, playing their own vital roles (and subject to contribution limits of $2,700 per donor).

But, in a glimpse of how things are shifting, a recent report by The Associated Press hinted at Bush’s goals for his super PAC, which is called Right to Rise. Citing unnamed Republicans and donors familiar with the Bush team’s thinking, the article said the Bush campaign plans to put Right to Rise “in charge of the brunt of the biggest expense of electing Bush: television advertising and direct mail.”

The AP report added that Right to Rise could also play a prominent role in other activities (such as get-out-the-vote efforts), while outspending the formal wing of the Bush campaign during the primary election season.

As the lines between official campaigns and independent groups blur in the 2016 race, the trend exposes candidates, including Bush, to possible legal challenges.

Already, two election watchdog groups have filed formal complaints with the FEC about Bush and several other likely candidates.

“Publicly denying that they are candidates does not exempt these presidential hopefuls from federal election laws passed by Congress to keep the White House off the auction block,” Paul Ryan of the Campaign Legal Center said recently in filing the appeal for action.

The complaints allege that Bush, Governor Walker, and former Sen. Rick Santorum (R) of Pennsylvania have actually crossed the threshold of candidacy by steps such as referring to themselves publicly as candidates or amassing campaign funds that will be spent after they formally declare.

Fred Wertheimer of the group Democracy 21, which joined in filing the complaints, argues also that the 2002 campaign law prohibits an outside group from receiving unlimited contributions if a candidate or his proxies are involved in “establishing, financing, maintaining or controlling” the group.

In many cases, super PACs are run by people with close ties to the candidates or prospective candidates. Right to Rise, according to news reports, may end up being run by Mike Murphy, a longtime Republican strategist and ad consultant for politicians including Bush.

Mr. Wertheimer says in an online commentary that super PACs backing Walker and Sen. Rand Paul (R) of Kentucky are being run by their former campaign managers.

The opposing view is that there’s nothing wrong with surrogates running super PACs, so long as they keep their distance from official candidates. And for now, Bush is operating on the assumption that until he officially declares his candidacy, he’s free to raise unlimited sums and help to plot what Right to Rise will do during the campaign.

The FEC’s history doesn’t suggest any imminent crackdown on Bush or other candidates. No more than half the commission’s six members can be from the same political party. Deadlock has been the norm lately on issues such as the acceptable role of super PACs.

The Justice Department took one action earlier this year on illegal coordination between candidates and super PACs, in a case against Republican campaign manager Tyler Eugene Harber of Virginia in a 2012 House race.

In many ways, this growing reliance on super PACs is the logical outcome of the current legal climate for campaigns. The fact that outside money faces no caps gives candidates, donors, and political activists an incentive to emphasize that kind of fundraising and spending.

Congress passed new limits on money in politics in 2002, but the US Supreme Court ruled in 2010 that portions of the law were an unconstitutional infringement on First Amendment free-speech rights. Specifically, the Citizens United and SpeechNow rulings validated the idea that political speech by independent people or groups can't be constrained.

The super PAC era grew from these court rulings and from the emergence of donors willing and able to write million-dollar checks. Traditional campaign committees and small donors are far from irrelevant, but the role of outside money is huge and growing.

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