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By Michelle Conlin and Grant Smith | January 26, 2016
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| IMAGE SOURCE: WIKIPEDIA COMMONS |
NEW YORK (Reuters) - There were stays at boutique hotels featuring rooftop pools, private soirees at members-only, jacket-and-tie clubs and fundraisers at the Four Seasons, the St. Regis and the Mandarin Oriental.
In the world of Jeb Bush, the campaign for the 2016 Republican presidential nomination has at times been a whirl of private planes and high-end affairs, according to the federal filings of Bush’s campaign and his Super PAC, Right to Rise, which can raise unlimited funds for Bush as long as it does not coordinate directly with him.
It is not unusual for U.S. presidential candidates to fly private or even sometimes stay in luxury hotels. But some disgruntled donors say they are unhappy with Bush's large outlays, which also include big spending on staff and tens of millions of dollars in ad buys.
Eleven of 16 major donors contacted by Reuters questioned whether it was money well spent, especially given how the one-time frontrunner has stumbled badly in the polls and is now facing questions about whether he should withdraw from the race.
(Graphic on Bush spending vs performance in polls http://tmsnrt.rs/1SKC4O1)
In contrast to Bush, Senator Ted Cruz, who is running second in national polls of Republican voters, favors cheaper accommodation options like Holiday Inn and often flies on budget carriers, campaign finance filings through the third quarter show.
Several members of the Bush camp vigorously rejected the donor critiques. Bush spokeswoman Kristy Campbell said, “We are running a national campaign that is competing everywhere and we have made investments that have allowed us to do what serious campaigns must do to be competitive in the primary and general elections."
Ad-tracking firm SMG Delta says Bush's campaign and Right to Rise have spent $82 million on ads, significantly more than the three leading candidates in the Republican race: Donald Trump ($5 million); Senator Ted Cruz ($11 million) and Senator Marco Rubio ($49 million). The tracking firm’s data is more up to date than what has been reported so far in the federal filings.
"There is no return on investment on the Bush ad buys, zero,” said one high-dollar donor who asked not to be named, pointing to how the ads have done little, at least so far, to lift Bush in the polls or dent his opponents.
On Sunday, donors will learn just how much Bush has spent from his $100 million-plus warchest. That's when Republican and Democratic candidates and their Super PACs release their latest campaign finance reports. What is known so far is that Bush and Right to Rise spent at least $82 million, both in operating expenditures through the third quarter of 2015 and on ad spending through this month.
The campaign finance reports also show that between June 2015, when Bush formally announced his candidacy, and September, the Bush campaign spent $1.2 million on private planes versus the roughly $700,000 spent during the same period by Democratic frontrunner Hillary Clinton.
Cruz spent $158,000 on private planes, and Rubio $293,300. Trump flies around the country in his own Boeing 757.
MONEY DOES NOT EQUAL SUCCESS
The former Florida governor's spending pattern illustrates the limits of campaign donations: Even in an era when candidates can receive unlimited sums from wealthy donors, money doesn't guarantee success.
“They are burning money,” said a second major donor, who, like all the other high-dollar donors interviewed, asked not be named for fear of displeasing the Bush family.
“Look, this is not the election cycle to be spending like a silver-spoon Establishment candidate," said a third donor. "It just doesn’t look right,” the donor said, referring to the way income inequality has emerged as a key theme in the 2016 election.
Ambassador Jeanne Phillips, a member of the Right to Rise governance committee, laughed off the criticism.
“I’ve known Jeb for 30 years, so the idea that Jeb would allow anyone around him to be frivolous with money is hilarious, it’s ridiculous. The man is the most conservative, fiscally responsible person I’ve ever worked with.”
Bush’s campaign committee paid for all lodging on the campaign trail and the vast majority of private air charter, while Right To Rise paid for nearly all the known ad spending.
Money donated by both large and small donors kept the Bush camp traveling in style. There were stays at luxury hotels including the Wilshire in Beverly Hills, the Viceroy in Florida, the St. Regis in Dana Point, California, and the W in Stamford, Connecticut, the campaign finance filings show.
The filings do not offer a complete picture. It is not clear for example, how many nights were spent at each of the hotels or indeed whether it was Bush himself who stayed or staff members.
Bush isn’t the only candidate spending at high-end hotels, but it’s a high proportion of his overall hotel spending. He spent $125,000,or 70 percent of his total hotel spending between June and September on hotels defined as luxury or "upper upscale" luxury hotels by STR Global, which tracks supply and demand data in the hotel industry.
Cruz and Rubio each spent less on luxury hotels and a smaller proportion of their overall lodging expenses on them, at roughly 56 percent and 61 percent, respectively, federal filings through the third quarter show. Trump flies home nearly every night so he can sleep in his own bed.
POSH VENUES
Bush also spent more than $400,000 on renting facilities and catering at posh venues, including the Union League Club and the upscale beachfront 1 Hotel South Beach in Miami, where the campaign spent $60,000 last year. Rubio and Cruz spent roughly $265,000 and $185,000 respectively.
Bush defenders said the spending on high-end venues was simply how the donor world operated.
"If you can hold an event at a fancy hotel and raise millions, then it's well worth holding it at a swanky hotel” said Charlie Spies, counsel for Right to Rise.
Spies said Right to Rise had negotiated "below market" rates with vendors and consultants, including an overall compensation cap for staff.
Nevertheless the Bush camp has spent more on staff and consultants than any of the leading candidates. Starting roughly in the spring, Bush paid out about $8 million. Cruz spent just $2 million; Rubio, just under $2 million; and Trump, $1.7 million.
Overall, Trump, Cruz, and Rubio have spent a small fraction of the $82 million Bush has reported paying out. Cruz spent $18.5 million and Rubio outlayed $32 million, according to the filings made so far.
Bush is certainly not the only candidate to spend big on the trail. Wisconsin Governor Scott Walker, for instance, ran an expensive campaign and burned through nearly $10 million before quitting after three months.
Bush's prospects were far brighter last summer. Trump had yet to join the race and Bush was making headlines for the size of his warchest. His Super PAC had just cracked its goal of raising more than $100 million in just six months — an unprecedented haul in American politics.
To celebrate, Jeb’s parents and family welcomed their large network of well-heeled donors to their oceanside compound in Kennebunkport, Maine, where attendees were treated to rides in private trolley cars, lobster rolls and group photos with the sprawling Bush clan.
(Editing by Paul Thomasch and Ross Colvin)
