[Carol Lin, Cnn Anchor:] Big news in politics today. Howard Dean is turning down nearly $19 million. The money comes from that check off box on our income tax returns. No Democrat has ever turned it down going into the primaries, but as Bruce Morton explains, Dean is saying no thanks because the dollars come with an important string attached, a limit on donations that Dean wants to ignore.
[Bruce Morton, Cnn Correspondent:] Howard Dean told a crowd in Burlington, Vermont that his supporters had voted to abandon public financing for the primaries because President Bush had raised so much money, the law couldn't work anymore. He supports campaign finance reform, he said.
[Howard Dean, Presidential Candidate:] Our campaign is campaign finance reform. Over 200,000 people have given us an average of $77 to bring us here. And now they have overwhelmingly refused to be intimidated by George Bush and his cronies giving him $2,000 a piece.
[Morton:] The problem is accepting public financing means accepting a spending limit of $45 million in the primaries, and probably spending that much to win the nomination. President Bush hopes to raise at least $170 million, meaning that he could hammer a broke Democrat on television for months until more public money kicks in in the fall campaign. John Kerry has said he may follow Dean, telling "The Boston Globe," "I'm not going to disarm." Others may follow.
[Stu Rothenberg, Rothenberg Political Report:] If the major candidates aren't going to take public funding, then public funding for presidential elections doesn't exist anymore.
[Morton:] Public financing supporters say increase the spending limits. Critics say voters don't like the law. The number of voters who check that box on their tax returns is declining. Let it die. Dean, meanwhile, announced a plan to compete with President Bush's massive fund-raising.
[Dean:] We ask two million Americans to give us $100. And we believe that two million Americans will borrow $100 simply for the pleasure of sending this president back to Crawford, Texas.
[Morton:] Last time, both Mr. Bush and Al Gore used public financing in the general election campaign. This time, we don't know yet. Bruce Morton, CNN, Washington.
[Lin:] For a political candidate, turning down matching funds can be like a high wire act without a net. If the candidate slips just once, and the contributions stop, the campaign can go boom. So why take the chance? Well, our senior political analyst Bill Schneider is in Washington with lots of reasons. Good evening, Bill.
[Bill Schneider, Cnn Sr. Political Analyst:] Hi, Carol.
[Lin:] Does it show that the public financing system is not working?
[Schneider:] That's exactly what it shows, because what Howard Dean is saying is we can't be at a disadvantage. George Bush can raise maybe as much as $200 million. Look, he doesn't have a primary opponent. What is all that money for? It's to throw at the Democratic nominee, once the Democratic nominee is chosen probably by March of next year. And they'll be five months when Bush can spend all that money. And the Democrats, if they accept public financing, will have a limit on what they can spend, $45 million not $200 million. And they'll probably spend it in the primary contests. So the Democrat will be at a disadvantage. It's the same problem Bob Dole had in 1996. When Bill Clinton raised a lot of soft money for the Democratic party, the Democrats spent all that money promoting the Clinton-Gore ticket, Bob Dole had to fight in the primaries. And he ended up without any money to spend for month after month until the conventions.
[Lin:] So how...
[Schneider:] So the system really isn't working.
[Lin:] Yes. So how do you think this is going to affect the rest of the Democratic field? John Kerry, for example, said that he was going to follow suit if Howard Dean did so.
[Schneider:] Well, I think the other Democrats are kind of stuck. You might think it would give other Democrats an issue. They say, you know, that Dean is undermining the public financial system, which a lot of Democrats believe in, Republicans not so much. But in the end, I think that Dean has a powerful argument. He made it in New York on Wednesday when he said a Democratic nominee with no money is exactly what the Bush campaign is hoping for. Ours is the only campaign with a chance of defending itself during the five months between the primaries and the general election in the fall. That's a powerful argument. And I think a lot of Democrats are going to say, you know, that makes sense. And if we want to beat Bush, maybe we should go with Dean.
[Lin:] So you think Dean Howard Dean has really done something here that changes the way campaigns are financed?
[Schneider:] Oh, he's done a lot of things. One of the things he's discovered is a new competitive source of fund-raising. The Internet, it enables Democrats to compete with direct mail fund- raising and those dinners that Republicans give. It's really the Democratic answer to talk radio, because what happens on the Internet is people give money in small amounts. These are mostly angry, passionate voters. They're stirred up by a desire to get rid of George Bush. And Dean is packed into those passions. And what it means, really, is to run in the future with the campaign finance system faltering, you're only going to have two candidates. Candidates who are rich like Ross Perot and didn't need public financing or candidates who can stir up a lot of passion, very divisive candidates. And that in this case, that would be Howard Dean.
[Lin:] Yes, and it better be a lot of passion to get $200 million pretty quick. Hey, there's a new poll out tonight that President Bush can't be very happy about, Bill?
[Schneider:] Well, that's right. The poll is done by "Newsweek" and it just came out. And it shows that when people were asked "would you like to see Bush re-elected" 50 percent of Americans say no. Just 44 percent say yes. That suggests that Bush could be vulnerable and it ought to make Democrats very happy. But I should point out in that same poll when they asked people would you vote for Bush or Dean, Bush beats Dean by five points. Does that say that Dean is a very weak Democrat? I'm not sure it says that. I think it says that Dean is still unknown to a lot of Americans.
[Lin:] Yes, it's early in the game. All right.
[Schneider:] Yes, it is.
[Lin:] All right, thanks, Bill.
[Schneider:] Sure.
[Lin:] Bill Schneider, our senior political analyst. Well, no matter how much a candidate spends on TV ads, phone banks, and junk mail, you're still free to vote for the other guy or gal. So is a flood of money ruining politics? Or are spending limits out of line? We invited a couple of political fund-raisers to make their pitch. Chris Korge has worked for the Democratic National Committee, as well as former candidate Bob Graham. He's in Miami. And in Washington is Republican fund-raiser Nancy Bocskor. She has worked for, among others, Newt Gingrich. Good to see both of you here this evening.
[Nancy Bocskor, Republican Fund-raiser:] Good evening.
[Lin:] Thanks so much for being here.
[Chris Korge, Democratic Fund-raiser:] Good evening, Carol.
[Bocskor:] Absolutely.
[Lin:] Nancy, let me start with you. Do you think it's true that the candidate with the most money is the only candidate who can win?
[Bocskor:] Well, you have to have money to be competitive in races. And that is the bottom line. And as we as Mr. Schneider was talking about, Bob Dole went months without having the money he needed to run a competitive race. George Bush recognized that in 2000 and decided we needed to change the way we were doing that. And I think Howard Dean has recognized that as well.
[Lin:] All right, well, Chris, Howard Dean supporters raised $14.8 million, a record, just in the last quarter. Do you think that his supporters can come up with as much as $170 million, $200 million to match President Bush's war chest?
[Korge:] I absolutely do believe that he has that many supporters that would come through for him. I mean, when you consider the fact that he already has 200,000 supporters that have given him money through the Internet, I think he's made a very smart move in deciding to not take public financing and to go on and continue to raise money so he doesn't go without money, if and when he wins the primaries and is the de facto nominee. I mean, when you consider the fact that you would have to go from potentially March to July, and be faced with $200 million being spent in ads attacking you and promoting President Bush, I don't think there's any other real alternative.
[Lin:] But Chris, doesn't that put him in the position of being the candidate who also may have to take money from the oil industry and from the drug companies and from the chemical companies, the special interest groups that he has been so critical of, who have contributed to President Bush's campaign?
[Korge:] Absolutely not. I mean, the money that he's gotten so far come from working class people. I think his average...
[Lin:] But it's a drop in the bucket. I mean, Nancy, isn't that a drop in the bucket, compared...
[Bocskor:] Well, it is.
[Lin:] ...to what he's going to have to raise to win the primaries and win the presidency?
[Bocskor:] It is. And beyond that...
[Korge:] It is.
[Bocskor:] ...you have the groups like headed up by George Soros, who have pledged to raise millions, as much as $400, $500 million. And they are unregulated, third party groups that want to defeat the president. So when you add that to no matter how much Howard Dean or the nominee raises, that's a lot of money going after Bush. And that's why the president has had to work very hard to raise his money.
[Lin:] But Nancy, I mean, do you think it's true, as Howard Dean has said, that if a politician takes money from say oil or drug companies or chemical companies, that they cannot be critical or cannot talk honestly about energy policy or Medicare reform or the environment?
[Bocskor:] Well, I look at it this way. When you're off raising, you know, more than $80 million, as President Bush has had, that has come from more than a quarter of a million contributors. And it has come from more than 99 percent of counties across America. So it's coming. You have quite the breadth and width of donors. So it's not just coming from, you know, sure we love having the rangers and pioneers out there raising large amounts of money. But when you have more than a quarter of a million donors, you're getting a lot of $15, $20 and $25 donations. So I think it's very balanced.
[Lin:] So is Chris...
[Korge:] Carol?
[Lin:] ...go ahead. Jump in.
[Korge:] Yes, Carol, I mean, let's not fool ourselves. President Bush has raised approximately $100 million. And $80 million of that comes from contributions of $1,000 or more. Howard Dean, on the other hand, has raised no where near that amount, but you know, $25, pushing $27 million.
[Lin:] Yes, but Nancy's point...
[Korge:] And that's...
[Lin:] ...because I want to make sure we get to this in the seconds we have. Nancy's point is that it is a democratic process, because when you look at the width and breadth of the total contributors, even though it amounts to $200 million, you still have an electorate out there representing itself in these contributions.
[Korge:] Well, there's no question that there's that's one great way of participating in the democratic process is giving contributions. But what Howard Dean's been able to do, and has revolutionized fund-raising by getting individuals to give $70, an average of $70 contributions. And most of his contributions are not $1,000 checks, but they're small, $50, $100, $125 checks. And people continue to give him money. They may have given $20 to start with, and then $50, $75 more dollars. And he will, if he wins the nomination, will be able to capture more individual contributors, and I wouldn't be surprised at all if he got two million contributors that were giving somewhere around $70, you know, $80...
[Lin:] Yes. Well if he does...
[Korge:] ...a contribution.
[Lin:] ...he may make history once again, Chris. Thank you very much.
[Bocskor:] Well, also...
[Lin:] You know what? I wish we had more time to talk about this...
[Bocskor:] OK.
[Lin:] Because I find it fascinating, but we are going to make more time down the road as we see this campaign contribution debate continue. Thank you very much, Chris Korge and Nancy Bocskor.
[Bocskor:] OK, thank you.