Donor Bundling Emerges As Major Ill in '08 Race

WASHINGTON -- The bundling of political donations once was an innocuous play in the game book of Washington political operatives. Now, the fund-raising practice has grown so widespread, and some of its practitioners so brazen, that bundling has become the chief source of abuse in the American campaign-finance system.

The strange case of Norman Hsu, the textile-importer-turned-fugitive who cobbled together $800,000 in contributions for Sen. Hillary Rodham Clinton's presidential campaign, is the tip of the iceberg. Candidates for offices from county commissioner to U.S. president are increasingly turning to bundlers -- individuals who ask friends, family and business associates for contributions to their candidate of choice -- to help bring in the tremendous amounts of cash now needed to wage political campaigns.

Knowledge about these bundlers is limited, however, because candidates aren't required to disclose information about them. While some campaigns honor bundlers by name on their Web sites or disclose the total number of bundlers working for them, others guard their identities.

In this high-pressure, low-disclosure environment, the practice has increasingly evolved into a method for disguising illegal donations. In several cases already this year, campaign bundlers have admitted to making contributions in the names of others to get around caps, or coercing employees to give.

Last month, Mr. Hsu was charged with surpassing the legal limits on his own contributions by secretly reimbursing others for the donations he bundled together.

A name-by-name analysis of bundlers reveals that this year's operatives are drawn from the same pools as fund-raisers past. Lawyers account for about 27% of the bundlers named by Public Citizen, according to an analysis of that list conducted for the Journal by the Washington-based Center for Responsive Politics. Another 11% work in securities and investment and 8% in real estate.

A Clinton fund-raising event earlier this year illustrates how campaign deadlines, and bundlers' desire to win favor, can mix. William Danielczyk, a Clinton fund-raiser who runs a northern Virginia private-equity fund, says he wanted to plan an event for Mrs. Clinton in April. "We were encouraged to do it in March," he says, so the funds would be reported under the campaign's first-quarter results.

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Mr. Danielczyk and Mrs. Clinton agreed to schedule a fund-raiser for late March at the Clintons' Washington home. Campaign-finance reports show that in the days around the event, Mr. Danielczyk's employees and family members contributed more than $100,000 to the Clinton campaign.

Nearly half of the money came from individuals who are Republican voters, according to election records. One of those, Pamela Layton, said that she and her husband, who is the director of information technology at Mr. Danielczyk's private equity firm, were reimbursed for the $4,600 apiece they donated to Mrs. Clinton. Mr. Danielczyk denied that he reimbursed anyone for donations. After the reimbursement was reported last month by the Journal, the Clinton campaign returned the Laytons' donations and said it would contact all of the Danielczyk contributors to confirm that they had donated their own money.

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This year, in Michigan, attorney Geoffrey Fieger was indicted for illegally reimbursing employees for $127,000 in bundled campaign contributions to Mr. Edwards's 2004 presidential campaign. Prosecutors alleged that Mr. Fieger and a law partner reimbursed 60 employees and associates for donations to the campaign by disguising the reimbursements as bonuses or other payments.

Per article, "it's Bush's fault" - he was the "Pioneer" of bundling...

It doesn't say that. Here's what it says:

"By the late 1990s, presidential hopefuls were chafing at the federal spending limits. In 1999, George W. Bush announced he would opt out of the federal system -- the first major presidential candidate to do so since the program was introduced 25 years earlier. His decision freed his campaign from spending limitations, but increased the pressure to raise private money to offset the waived federal funds.

Retooled Strategy

Mr. Bush retooled his strategy. As governor of Texas, he had cultivated donors who contributed $100,000 or more to his campaigns. (Texas law doesn't limit campaign contributions from individuals.) But when Mr. Bush began his first presidential campaign, those donors were forbidden under federal law at the time from giving more than $1,000. Mr. Bush created a program that rewarded individuals who brought $100,000 or more to his campaign, in increments of $1,000 or less."

How you extrapolate that into "Per article, "it's Bush's fault"" is beyond me.

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