Refund Please: GOP donors critical of Palin's pricey threads

Wed, 10/22/2008 - 4:43pm by dreamsugar

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The Republican National Committee’s $150,000 investment in Sarah Palin’s wardrobe has prompted some teeth gnashing among the party’s big donors about its political sensibility and a feisty debate among campaign finance specialists about its legality.

“As a Republican Eagle and a maxed-out contributor to McCain’s general campaign, I’d like my money back – he can still have my vote,” complained one irate donor on Tuesday.

“I’m not one who says a candidate shouldn’t wear fine clothes,” he added. “I’d just like to think they were successful enough in the private sector to have afforded their wardrobe with their own money, not the party’s or the campaign’s, which is really our money as contributors.”

Another big donor was sympathetic to the effort, but critical of the execution.

The Alaska governor was tapped by Arizona Sen. John McCain to become his vice presidential running mate just days before the Republican National Convention in Minnesota, the donor noted.

Given the short notice and the Palins’ relatively modest means, “she could probably not go into her closet at home in Alaska to come up with a wardrobe appropriate for her status as a vice presidential candidate," he said.

“Having said that, $150K is big money,” he added. “It kind of makes it worth running. Even if you lose, you’ve got a whole new closet.”

Other donors, in other e-mails and interviews, said the costs were worth the investment.

Palin has proven to be a major draw at campaign rallies, and her strong performances and appearance provides a polished and professional image on television, one donor noted.

In addition, he suggested, the bad press only means the GOP base will unite even further behind the McCain-Palin ticket.

As Republican donors absorbed the news, the consensus among several prominent Washington-based attorneys was that the purchases were legal, albeit in a fuzzy area of the law.

Campaign finance laws prohibit candidates from spending donor cash to their authorized personal campaign committee on costs “that would exist irrespective of the candidate’s election campaign,” including clothing, vacations and gym memberships.

But the law does not prohibit such expenditures by party committees, and Congress has killed legislation to expand the personal use ban to those and other types of political committees.

The fuzzy part in the Palin case is that the RNC used money from an account designated for “coordinated,” or shared, expenditures with the McCain-Palin candidate account.

The Federal Election Commission, which interprets federal campaign finance laws, has never been asked to address this issue. And legal experts say the key question is: From which side of the joint account was the money drawn?

Noting that the expenses were reported by the RNC and not the McCain-Obama campaign, Ken Gross, a law partner at Skadden, Arps, Slate, Meagher & Flom who advises corporations on campaign finance laws, concluded: “The bottom line is that this is party committee money. These are not campaign funds.”

Wiley Rein lawyer Jan Baran, an adviser to several Republican candidates and committees, agreed with Gross, but added that the Palins may still be forced to comply with tax laws.

“The receipt of goods and services by the taxpayer usually constitutes reportable ‘income’,” Baran said. Consequently, Palin may have to declare the value of the fashion gifts as income and pay taxes on it.

“She might be able to offset some of the taxes by donating the items to charity after the campaign, Baran said, “although she will only be able to deduct the fair market value at that time.”

The campaign said Monday that Palin intends to donate the clothes to charity after the election.

Source: The Republican National Committee’s $150,000 investment in Sarah Palin’s wardrobe has prompted some teeth gnashing among the party’s big donors about its political sensibility and a feisty debate among campaign finance specialists about its legality.