Government shutdown: How political money drives the fight over budget and Obamacare

Government shutdown: Washington faces three deadlines Monday: A possible government shutdown over funding, health insurance exchanges under Obamacare kick in, and the quarterly reporting of campaign contributions. In important ways, political money is driving all of it.

Congress is hurtling toward three deadlines at the stroke of midnight on Monday, all related: Barring congressional action, the federal government shuts down and the first-ever mandate for Americans to buy health insurance kicks in.

Here’s the third deadline that may be having an outsized influence on the other two: The Federal Elections Commission (FEC) closes its books on the third quarter of campaign funding.

The shutdown and the launch of "Obamacare," two issues that will have a huge effect on American lives, have been the object of intense news media scrutiny. (A recap is coming.)  By contrast, financing for the 2014 campaign is an outcome of interest mainly to members of Congress, those who would oust them, and those who invest in politics by contributing to political campaigns.

But big events are good for fundraising – think Wall Street bailouts, bank regulation, energy bills, health-care legislation – and the fundraising around Obamacare and the prospects of a government shutdown has been intense.

It may also prove decisive, as Congress works out the endgame on a government shutdown and the future of Obamacare.

First, the recap: Early Sunday morning, the House rejected the Senate offer to fund government through the first six weeks of the new fiscal year, which starts on Oct. 1, with no conditions.

Instead, House Republicans sent back to the Senate an amended measure that delays the launch of Obamacare, President Obama's signature health-care reform law, for a year. The measure passed on a near-party-line vote, 231 to 192.

The House also repealed a 2.3 percent sales tax on medical devicemakers and, in a surprise move, added a “conscience clause” that allows insurers to opt out of providing coverage for contraception – an issue that nearly derailed health-care reform at its inception.

The measure is dead on arrival in the Senate. The Democratic-controlled Senate on Friday stripped a House measure to defund Obamacare out of the House’s first stop-gap spending proposal, 54 to 44.  

Senate majority leader Harry Reid (D) of Nevada says the Senate will not take up any measure that undermines health-care reform and the White House pledges to veto it. The House and Senate have until 11:59 p.m. Monday to work out their differences.

Meanwhile, there’s a fury of fundraising around these issues, the results of which will be clearer, at least for individual political candidates, after FEC filings, due Oct. 15.

The repeal of the medical-device tax, for example, could have been added to attract the support of senators from Massachusetts and Minnesota, where much of the industry is based. But if four Democratic senators are still reluctant to derail the new health-care law for medical devicemakers, the provision has a second function: It’s a good basis for raising campaign funds from an industry that has spent more than $150 million lobbying Congress since 2008.

The addition of a conscience clause on birth control also has been a strong basis for fundraising from both advocates and opponents.

Conservative groups that fund political campaigns, especially for challengers to incumbents viewed as not conservative enough, used Sen. Ted Cruz’s 21-hour “filibuster” this week on defunding Obamacare as a platform for building up their war chests.

“As Americans wake up this Wednesday morning, they will see what true leadership looks like,” reads a video fundraising appeal from Conservative Action, which supports tea party candidates. “After more than 16 hours of a non-stop debate against Obamacare, U.S. Senator Ted Cruz (R-TX) and Mike Lee (R-UT) are still standing.” 

The Heritage Action Fund on Friday alerted supporters in an e-mail to pressure House members on Saturday’s vote. “Now the fight shifts back to the House. It is never too late for your Representative to get it right,” the appeal read, with a link for donations.

The Tea Party Express on Sept. 26 called on its supporters to “melt the phone lines” to put pressure on the Senate to defund Obamacare. The mailing ended with an appeal: “The Tea Party Express is committed to do all that we can to make sure that Obamacare is both delayed and defunded. If you agree with us and would like us to continue our fight, please consider making a generous contribution today. Unfortunately, funding such a fight is not cheap and we are up against forces that have deep pockets.”

Senator Lee began raising campaign funds in August on a pledge to “defund Obamacare before it’s too late.”

Facing attacks from a conservative primary opponent, Senate minority leader Mitch McConnell (R) of Kentucky sent out a fundraising appeal on Sept. 13 citing his work “day and night to make sure Republicans fully understood the damage this law would do to our constituents’ health care.”

But, in a jab at tea party groups, he also noted that “dividing fellow conservatives is the only way to ensure our defeat.”

Rep. Paul Ryan (R) of Wisconsin, who has been nearly invisible in the floor fights on Obamacare, has been active in fundraising on the issue for the Republican National Committee.

“The Republican National Committee has made it their mission to hold accountable each and every Democrat who chooses to embrace the President’s health care train wreck at the expense of their constituents,” he wrote in a fundraising e-mail for the RNC.

But the biggest beneficiary of the fallout from shutdown fundraising could be Senator Cruz.  

These donations will show up not just in FEC filings but also in contributions from conservative groups, such as the Club for Growth and the Senate Conservatives Fund, which bundle individual donations to candidates.

The Club for Growth and the Senate Conservatives Fund have accounted for $705,000 and $315,000, respectively, in contributions to Cruz in his career, according to the Center for Responsive Politics, which tracks money in politics.

“Less clear is how his actions may sit with some of his other top donors – which are also donors to senators who are leaders in the Republican establishment. That establishment either kept its distance silently during Cruz's marathon monologue or, in a few cases, outright criticized him,” says Russ Choma, in a blog for Opensecrets.org.

That’s the kind of question the FEC data on campaign contributions can help sort out.