Norman Hsu has recently become a household name among politically attentive people due to the juxtaposition of his criminal record, his encouraging investments in dubious projects that sometimes fail, and his eagerness to give and raise money to Hillary Clinton and other Democratic politicians.
The Hsu saga may continue for sometime. All the recipients of his gifts have agreed to divest themselves of at least the money he contributed personally, and, in many cases, all the money he raised for them as well. What he wanted, who his allies were, and whether or not some or all of the money gave from some illegal source are all subjects of active investigation. Hsu's recent threat to commit suicide adds to the drama.
Pennsylvania Governor Ed Rendell, a champion fundraiser, has spoken highly of Hsu because he gave so generously and apparently asked for nothing in return. Just having a degree of access was enough for him. Rendell, though, gave his money to charity after Hsu fled rather than report for a scheduled court date.
However the Hsu affair turns out--anywhere from a major political scandal to an overblown case of a wealthy man who sometimes crosses the borderline of the law enjoying the chance to bask in the publicly expressed gratitude of the politically powerful--it does point out one essential truth: for those who have the network, the personality, and the stature to raise money, access to top tier candidates for public offices is easy to obtain.
Campaigns are incredibly low-staffed and open affairs. 80% to 90% of all money raised can go to media advertising. There are large high schools that are better staffed than some front-running Presidential campaigns. Raising money under severe time pressures can be both time-consuming and emotionally exhausting. Anyone willing to work competently for free is welcome. Anyone willing to raise large amount of money for free is the answer to campaign prayers.
What Norman Hsu offered--large amounts of money with little investments of time required by the candidate and campaign staffers--was both incredibly rare and extremely valuable. Hsu likely got far more expressions of gratitude than he would have had he raised a similar amount of money for a wing of a hospital, for instance.
The opportunity to talk to national political figures in a relaxed manner is inherently rare, as they have inherently have limited time. They also can become exhausted from the demands of showing gratitude to so many supporters: at the 2004 Democratic National Convention, for instance, both George McGovern and Michael Dukakis looked to me to be totally worn out and somewhat harassed from being greeted enthusiastically by so many delegates in individual personal encounters.
Numerous questions arise from the Hsu's moment in the national spotlight. Can candidates raise enough money without building a network of national fundraisers? If not, what scrutiny should these people receive? Where should the line be drawn in deciding whether or not to accept or reject their offer of help?
The law and ethics of fundraising can be somewhat murky in practice, even if they are clear in concept. A direct quid pro quo of money for a position or an action is clearly illegal, but accepting a donation while listening to a presentation about the merits of an action is OK.
There is nothing illegal about a fundraiser displaying pictures of himself with a prominent politician, or seeking to gain trust in business transactions by sprinkling phrases like "As President Clinton told me the other day" in his conversations. If the business dealings are dubious, then ethical questions arise even if no law is broken.
Hsu's prominence also makes clear to those who seek political access and the possibility of influence that fundraising is certainly a good way to get there. It takes a rare kind of person to enjoy asking friends and associates to part with their money, but those who can do it certainly can have a great future in national politics.
The challenge for those of us who seek new directions in public policy is to be able to help the financing of campaigns without either getting bogged down in a legal and/or ethical morass, and without having the fundraising mechanism eat up too much of the money raised.
Howard Dean's Presidential campaign, for instance, failed to a large degree because it spent too much of its money raised on fundraising related activities; using business terminology, its net profits were low although its revenue was high. The Norman Hsus of the world solve that problem, even as they cause other problems.