August 08, 2004
A game of inches

Now that Kevin has kindly sent a boatload of readers here to find out about Fifty Years of the Texas Observer, I thought I'd discuss another article from that book, one from the much more recent past. This one, The Pols He Bought, is from 1999 and as such can be found on the Observer web page.

That article is about far-right hospital bed magnate James Leininger, first profiled on the Observer pages two weeks previously, and the influence he wielded on the 1998 elections with an infusion of late cash.

John Sharp didn’t lose to Rick Perry. Nor did Paul Hobby lose to Carole Keeton Rylander. Instead, the two Democrats lost their races to James Leininger’s money. Leininger helped guarantee two loans – a $1.1 million loan to Perry on October 25 and a $950,000 loan to Rylander on October 1 – that likely made the difference in the races for lieutenant governor and comptroller, the closest races on the statewide ballot. Perry beat Sharp by 68,700 votes. Rylander beat Hobby by 20,223 votes, in one of the closest statewide races in Texas history. In each race, about 3.7 million votes were cast. Sharp lost by 1.8 percent of the vote, Hobby by 0.55 percent.Handicapping political races is an inexact science, and there is no way to prove that Leininger’s loans were the decisive factor in the two races. "It’s almost impossible to narrow down the result to a single thing," says Bruce Buchanan, a professor of government at U.T.—Austin. "But when the races are as close as those two races, it’s reasonable to suggest that money like that may have made the difference."

Leininger’s money certainly provided critical ammunition to both Perry and Rylander:

• More than 10 percent of the $10.3 million that Perry raised before the election came from the loan guaranteed by Leininger and two other businessmen.

• Nearly 25 percent of the $3.85 million that Rylander raised in the year prior to the election came from the loan guaranteed by Leininger and four others.

• On the same day Leininger’s loan to Rylander was approved, her campaign wrote a check for $850,000 to National Media in Alexandria, Virginia, for media buys.

• Within five days of getting the money from Leininger, the Perry campaign spent slightly more than $1 million on media, with the bulk of that money ($966,000) going to David Weeks, Perry’s Austin-based media consultant.

• Leininger’s money came at critical times for both campaigns. When Rylander got the money from Leininger, she was trailing Hobby in the polls and was being outspent more than two to one. From July through September, Hobby had spent $3.7 million. Rylander had spent almost $1.7 million. In late October, when Perry got his loan, he was in a dead heat with Sharp, with polls showing both candidates with 37 percent of the vote. And Perry was being outspent by a margin of almost three to one. From July to September, Perry spent $2.3 million. Sharp spent $6.8 million.

Now, I don't fully buy into the notion that Leininger's cash was the difference maker. Texas was already fairly solidly Republican by 1998, and the top of the ticket that year featured the then-very-popular Governor George W. Bush, who destroyed challenger Garry Mauro by a 2-1 margin. And finally, Sharp and Hobby had a fair amount of cash, solid reputations, and good name recognition themselves. Leininger's money certainly helped Perry and Strayhorn, but I won't claim it was necessary or sufficient.

That said, these were two very close elections. A little change here and there, and the Democrats would have won two of the top four offices available that year (there was no Senate race in 1998). John Sharp would have then ascended to the Governor's mansion in 2001 when Bush headed to Washington, and while both he and Hobby would have faced strong challenges in 2002, it's fair to say that running as incumbents they'd have done a hell of a lot better than Tony Sanchez and Marty Akins did.

Under this scenario, it's likely that we'd be hearing a lot less about the decline and fall of the Texas Democratic Party. This is not to say that the actual decline and fall would have been arrested or reversed with these two wins in 1998. The underlying problems - lack of a bench, no cohesive philosophy, strong population growth in the heavily Republican suburbs, GOP death grips on Harris and Dallas Counties - wouldn't have gone away. Things might look OK for the Democrats on the surface, but the troubles would be there to see for anyone who'd bother to look, much like a candidate who's tied in the polls but getting clobbered on the internals. They'd still have their work cut out for them if they wanted to be a real force again.

What would probably be different would be how much ground they'd concede while they got their act back together. I think it's a lot more likely that Governor Sharp could have gotten a compromise redistricting bill passed in 2001, which would have avoided the court-drawn map and thus short-circuited the one plausible argument that the DeLay crew had when they steamrolled the 2003 sessions. The Republicans probably would have still won the State House in 2002, but they might not have had such a friendly map from the Legislative Review Board to work with, and as such Tom Craddick still might not have wrested the speakership from Pete Laney. Who knows what might have happened with the budget in the last Legislative session with Sharp and/or Hobby in office, or if Perry and/or Strayhorn had won in squeakers instead of routs? Maybe without being distracted by redistricting, they'd have straightened out school finance. You never know.

You can play that kind of what-if game all day. Here's something that for sure wouldn't have happened if John Sharp had won:

For his part, Perry made certain that he repaid Leininger’s loan. Records show that his campaign paid off the $1.1 million loan on December 17, an amazingly quick turnaround. How did he do it? In part, by pressuring lobbyists. After the election, several lobbyists who had supported Sharp were contacted by Perry’s campaign and told that they were expected to help retire Perry’s campaign debt. In some cases, they were given specific amounts of money to raise and/or contribute, with amounts ranging up to $50,000. Said one lobbyist who asked not to be identified, "There was no direct mention of the Leininger loan, but you don’t have to do any high math to put two and two together. Most of the people who were contacted understood where that debt came from." Republican Party political director Royal Masset even circulated a memo, advising Republican statewide elected officials to tell lobbyists who supported Democratic candidates that it was now going to cost them a premium to get on the "late train" with the Republican winners.

Sullivan insists no fundraising quotas were given and dismisses the complaints as "sour grapes from lobbyists whose guy lost the election." Perhaps so. But questions about Leininger’s influence over Perry and Rylander will undoubtedly continue, particularly as the issue of school vouchers becomes more prominent.

As shown by his secret trip to the Bahamas with Leininger and others, Perry is still paying that debt back in one way or another. Had it not been for those few votes here and there, ol' Jim would have gotten a much lower return on that investment.

Posted by Charles Kuffner on August 08, 2004 to Books | TrackBack