It’s one of those conflict-of-interest dynamics that’s so obvious, it’s hard to understand how and why political leaders ever tolerated it in the first place.
For a few decades now, Democratic presidential candidates hire media advisors who make millions encouraging their clients to follow campaign strategies that make them even more money. John Kerry’s 2004 presidential campaign captured the problem perfectly.
It was the spring of 2004, and Senator John Kerry had just secured the Democratic presidential nomination. But as huge sums of money began pouring into his campaign, his top strategists had more on their minds than just getting ready for a tough race against President Bush.
Behind the scenes, they were fighting over the lucrative fees for handling Mr. Kerry’s television advertising. The campaign manager, Mary Beth Cahill, became so fed up over the squabbling that she told the consultants, led by Robert Shrum, one of the most prominent and highly paid figures in the business, to figure out how to split the money themselves.
Divvy it up they did. Though the final tally has never been publicly disclosed, interviews and records show that the five strategists and their firms ultimately took in nearly $9 million, the richest payday for any Democratic media consultants up to then and roughly what the Bush campaign paid its consultants for a more extensive ad campaign.
Mr. Shrum and his two partners, Tad Devine and Mike Donilon, walked away with $5 million of the total. And that was after Ms. Cahill, in the closing stages of the race that fall, diverted $1 million that would otherwise have gone to the consultants to buying more advertising time in what turned out to be an unsuccessful effort to defeat Mr. Bush.
Tony Coelho, who managed part of Al Gore’s 2000 campaign, couldn’t help but notice that media consultants like Shrum and Devine had “a real conflict” in that they were “setting up the media buy, and they were getting a commission on the media buy on top of that.” In Kerry’s case, which was plagued by the same dynamic, this ended up costing the campaign additional millions, which may have been better spent elsewhere.
Thankfully, the leading Dem candidates in this cycle have learned from their predecessors’ mistakes.
The three leading Democrats — Senators Hillary Rodham Clinton and Barack Obama and former Senator John Edwards — are all clamping down. They are following what has become an almost standard practice among Republican presidential nominees by paying their media advisers flat fees, or placing a cap on their payments, rather than making payments based on a percentage of the amount they pay television stations to broadcast their commercials.
Even with the changes, media consultants in both parties will continue to be paid handsomely for their work in the 2008 campaign, and their business continues to be one of the largest and most lucrative in politics.
But beyond the internal pressures to limit payments to consultants, campaigns face increasing pressure from the Internet as an alternative for disseminating political videos. That development is reducing reliance on expensive television advertising time, diminishing the control of consultants over their candidates’ images and threatening more fundamental changes.
Already, the shift in the way consultants are being paid is far-reaching. The old approach allowed the fees to shoot up with increases in advertising in hotly contested races. Critics say it also provided a built-in incentive for the consultants to run more ads — a concern that has led to infighting in many races.
In interviews, aides said Ms. Clinton, of New York, and Mr. Edwards, of North Carolina, had negotiated flat fees with their top consultants. And Mr. Obama, of Illinois, has capped what his consultants can earn, which will convert their more traditional percentage deal into a flat fee once his ad spending passes a certain threshold, his aides say.
“That is a startling change in the way major Democratic presidential candidates operate,” said James A. Thurber, a professor at American University in Washington who has studied political consultants.
It’s about time. Republican candidates have been running presidential campaigns this way for years; it’s absurd that it’s taken Dems so long to catch up.
Better late than never, I suppose.