Why Karl Rove Will Get One More Chance After Squandering $300 Million

Romney 2 wsigThe biggest loser in the 2012 elections, perhaps a bigger loser than Mitt Romney, who does not have a future in politics, was former George W. Bush strategist Karl Rove, who remarkably still does.

Almost three years ago, Rove announced that he was going to raise enough money to reshape the political landscape.

He did so with American Crossroads and Crossroads Grassroots Policy Strategies (GPS), his agile response to the Supreme Court’s Citizens United vs. the Federal Election Commission decision. That ruling made the financing of campaigns for federal elected office much like the financing of campaigns in Texas, where the elder Bush hired Rove in 1978 to create the fundraising architecture for a state party that barely existed.

Rove’s current campaign-funding operations—the American Crossroads super PAC and its nonprofit affiliate, Crossroads GPS—were the most profligate political spenders in the 2012 elections, excluding Romney’s own super PAC.

In a year in which outside groups poured $1.3 billion into campaigns, the Crossroads groups spent almost $300 million.

Thus far—and there are more Federal Election Commission filings to come—the Sunlight Foundation and the Center for Public Integrity have documented $176 million that Rove’s super PAC spent on ads aimed at defeating President Obama and Democratic candidates for the Senate and House.

Sunlight sorted through $107,400,427 in Rove donor expenditures and found $84,559,461 spent on ads attacking the president and $6,545,941 spent on ads supporting Romney.

Rove did little to damage the president, where his failure is most evident; but the list of Senate candidates targeted by American Crossroads reads like the Democratic Senatorial Campaign Committee’s victory list:

• $11 million against Virginia Senator-elect Tim Kaine

• $7.4 million against Wisconsin Senator-elect Tammy Baldwin

• $6.4 million against Ohio Senator Sherrod Brown

• $5.5 million against Montana Senator Jon Tester

• $4.7 million against Indiana Senator-elect Joe Donnelly

• $4 million against Florida Senator Bill Nelson

The only Democratic Senate candidates that Rove helped defeat were Rep. Shelley Berkley in Nevada ($7 million) and former Senator Bob Kerry, in his uphill race for the Nebraska Senate seat he left in 2001 ($1 million).

So Rove’s donors didn’t get much of a bang for their buck.

American Crossroads PAC, according to the Sunlight Foundation, spent 1.29 percent of its contributors’ money on winning candidates—thus, 98.71 percent on losers. At 14.4 percent, Crossroads GPS provided a better return. (On the other side of the political spectrum, Planned Parenthood’s political action committee spent $6,886,648, with 97.82 percent of the money going to candidates who won their elections.)

The magnitude of his spending on losing candidates probably informed Rove’s meltdown on Fox News (where he is a political commentator) on Election Night, when he briefly stopped the network’s news team from reporting that Obama had carried Ohio and therefore won the election.

Yet there is no reason to believe that a chastened Karl Rove will spend down his accounts and move on to Fox, where failed Republican political acts end their careers.

Here’s why I’m betting that Rove will survive the squandering of $300 million of other people’s money.

I began working as a reporter in Texas in the early ’80s, when Democrats controlled both houses of the legislature and all but one of the statewide offices—except for two split terms by Republican Governor Bill Clements, Rove’s first high-dollar client. (I also co-wrote a book on Rove, Boy Genius: Karl Rove, the Brains Behind the Remarkable Political Triumph of George W. Bush, in 2004; see facing page.)

By the time George W. Bush was reelected to his second term as governor in 1998, Republicans controlled both chambers of the legislature, and every statewide elected office. Rove—who recruited candidates, ran campaigns, and worked in concert with more than a dozen PACs, most funded by donors he had begun to cultivate when he arrived in Texas in 1978—was the architect of his party’s success.

Turning a solidly Democratic state into a Republican state took 20 years, yet Rove and his deep-pocketed donors recognized that with no limits on political spending, time was on their side.

When the Supreme Court ruled on Citizens United, it imposed Texas campaign finance rules on the entire nation—with two exceptions. In Texas, corporations and unions cannot fund political campaigns. And all donors are required to disclose their names and the amount of money contributed to a candidate.

The Citizens United decision allows corporations and unions to underwrite campaigns through outside groups like those controlled by Rove, and allows some donors to conceal their identities.

The Supreme Court ushered in a system more wide-open than Texas. It’s Texas, bad and nationwide.

Republican political donors eager to fight the last rather than the next war are likely to apply a lesson that Texas has taught them over the past 30 years: Unlimited political contributions buy much of what is needed from government.

One example. Rove’s most generous Texas legacy donor, Dallas multibillionaire Harold Simmons, contributed $18.5 million to American Crossroads. (He also contributed $16 million to Mitt Romney’s PAC.)

Simmons told The Wall Street Journal in March that his spending in the 2012 campaign was a response to “that socialist, Obama.” By socialism, Simmons means government regulation, which he has learned to undermine through campaign contributions.

In 1995, Simmons bought an interest in Waste Control Systems, which held a state charter to dispose of nuclear waste but lacked a permitted site for a waste dump. To actually build a dump, Simmons had to persuade the legislature to pass enabling legislation, then clear regulatory hurdles at two state agencies.

Simmons had been generously contributing to legislators for decades. In the election cycle preceding the critical vote that would provide a site for Waste Control’s state-granted nuclear-waste charter, he upped the ante, contributing $182,350 to 92 members of the Texas House, where the bill had failed to pass in previous sessions.

Only four of the 101 Republicans in the 150-member House voted against the nuclear-dump bill that passed the legislature in 2011.

WCS’s operating license subsequently cleared two state commissions whose boards had been appointed by Governor Rick Perry. In the 10 years leading up to Waste Control’s obtain- ing an operating license, Simmons had donated $1.2 million to Perry’s gubernatorial campaigns, according to Texans for Public Justice, a public-interest group that monitors political contributions in the state.

Harold Simmons is not the exception.

Homebuilder billionaire Bob Perry, who contributed $7.5 million to American Crossroads, is another Texas donor who has a history of working with Rove.

Perry is also the only corporate executive in Texas to ever persuade the legislature to create a state board to serve his own special interest, in this instance providing an institutional buffer between potential plaintiffs and the courts.

Donors like Simmons and Perry, who have come to learn that over time unlimited spending can housebreak legislators and regulators, will give Rove at least one more run—perhaps in the midterm elections, when the party that holds the White House almost always loses congressional seats.

“They might see this as a temporary ditch for Karl,” says Craig McDonald, who has been tracking Texas donors for more than 20 years at Texans for Public Justice. “They will be back. Rove has delivered for these guys for so long that they are not going to throw him off the bus so soon. They have a lot of loyalty to Rove.”

Also in this issue: Smart Money and How Rove Became Rove