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Published: Monday, 10/31/2005

Money fueled Ohio GOP, now puts future at risk

BY JIM TANKERSLEY AND JAMES DREW
BLADE STAFF WRITERS

COLUMBUS - The falcons are ceramic, wings folded back, eyes gazing sternly across the room.

They sit on some of the wealthiest desks in Columbus and throughout Ohio, unnoticed to all but a few political heavyweights, to whom they are a badge of honor.

A decade before George W. Bush pinned "Pioneer" status on his top presidential fund-raisers, Ohio Republicans sent avian statues to about 10 men who raised at least $100,000 each for George Voinovich's 1990 campaign for governor.

The businessmen and lobbyists who earned the "Maltese Falcons" - a reference to Mr. Voinovich's right-hand man, Paul Mifsud, whose family was from the Mediterranean island of Malta - went on to wield enormous influence during Mr. Voinovich's two terms in office.

The success of Mr. Voinovich's $8.7 million campaign, along with Republican Bob Taft's $2.7 million bid for secretary of state, ignited a political machine that would dominate Ohio for the next 15 years - and nurture a network of donors who helped Mr. Bush win the state's wallet and votes in 2004.

"George Bush comes to Ohio and inherits that very powerful Republican infrastructure to help him, and John Kerry comes to Ohio and inherits a very weak Democrat infrastructure," said Mark Weaver, a Republican consultant who has worked on Ohio campaigns since 1990. "In a race that was otherwise pretty much even, that was a factor."

But now scandal is threatening the GOP machine - and money is at its roots.

A Bush Pioneer, former Toledo-area coin dealer Tom Noe, was indicted last week on charges that included laundering money to Mr. Bush's re-election campaign.

The scandal surrounding Mr. Noe led to criminal ethics convictions for Mr. Taft, now the governor, and two of his top aides.

Some Republicans question the party's direction and the business dealings of its chairman, though others predict the GOP will weather next year's statewide elections with its hold on state government intact.

Democrats see an opportunity to crack the Republican hammerlock on state politics next year - the same sort of opening a Cleveland campaign operative named Robert T. Bennett envisioned in 1988, when he became state chairman and took control of an Ohio Republican Party shut out of power and mired in debt.

Democrats ruled the 1980s in Ohio. By decade's end, they held both U.S. Senate seats, all statewide executive posts - including the governor's office - and the state House of Representatives.

They also controlled the political cash flow, led by powerful House Speaker Vern Riffe. Jo Ann Davidson, a Republican leader in the House, said Mr. Riffe could raise more at his annual birthday party than she could in a year.

The state Republican Party owed more than $680,000 to creditors when Mr. Bennett won its reins in 1988.

Republican leaders from the era say the party needed two things to compete statewide: better funding and more favorable legislative districts.

Mr. Bennett had a plan to get them both.

He began by enlisting W.R. "Tim" Timken, Jr., a Canton businessman, as the party finance chairman.

Mr. Timken erased the debt by the end of 1988, thanks, Mr. Bennett said, to large donations from big donors flush from the presidential victory of George H. W. Bush.

With elections looming in 1990, Mr. Bennett focused his resources: By winning at least two of the three races for governor, auditor, and secretary of state, he knew Republicans would be able to redraw the legislative and congressional map to favor their candidates and notch a foothold of power.

The party's two strongest candidates wanted the governorship. Mr. Bennett did not want a costly primary. He brokered a deal.

Mr. Voinovich - who had a history of winning Democratic votes as the mayor of Cleveland - stayed in the governor's race. Mr. Taft switched to secretary of state.

The party secured $1.4 million in bank loans to help Mr. Taft, Mr. Bennett said; Mr. Voinovich agreed to help repay the money.

The campaigns' list of big contributors foreshadows Mr. Bush's Pioneers by a decade and a half. It includes Carl Lindner, Jr., Alex Arshinkoff, Mr. Timken, and Bill DeWitt, along with Mercer Reynolds, who would direct fund-raising nationally for the President's re-election campaign.

"The great wheel in the sky was turning," said Doug Preisse, chairman of the Franklin County Republican Party, who was political director of Mr. Voinovich's 1990 campaign.

Press reports criticized Mr. Bennett for ignoring other races. Mr. Voinovich and Mr. Taft's wins vindicated him.

Mr. Bennett said his biggest regret was not having the "guts" to put the party another $200,000 in debt so that Republican Jim Petro would have beaten Democratic state Auditor Tom Ferguson, whom the GOP portrayed as corrupt.

The loss didn't matter. Republicans still controlled the apportionment pen. They paired more favorable legislative lines with an increased focus on candidate recruitment.

The party had centralized its legislative campaigns after years of letting candidates run individually.

Ms. Davidson signed promises of party support - polling, staff, ads - and peddled them to prospective candidates; party leaders flew the hopefuls to Washington to meet then-President Bush.

Recruiters scored their first great coup in 1990. A tobacco farmer named Doug White, lured into the race by persistent GOP leaders and backed by a party-funded campaign manager, defeated one of Mr. Riffe's top allies in the House, the Democratic chairman of the rules committee.

"There was a real effort to go out and find the person who should be running," said Joe King, who managed Mr. White's campaign and now works as a Republican consultant in Columbus, "instead of the person who was next in line."

The work paid off in 1994, when, bolstered by the national "Republican Revolution," GOP candidates swept to a majority in the Ohio House. Ms. Davidson became speaker.

Contributions flowed.

"Superior message, superior people, and when you are in the majority, it is a lot easier to raise money," said Jeff Ledbetter, who joined the Ohio GOP as treasurer and now is Secretary of State J. Kenneth Blackwell's fund-raiser.

Mr. Bennett was an "evangelist" who preached, "What's good for corporations is good for Ohio" to business leaders - and future Bush money men - said Andy Douglas, then a Republican justice on the Ohio Supreme Court whose pro-trial lawyer and pro-union decisions infuriated GOP leaders.

The GOP chairman's flock of donors included Mr. Lindner; Mr. Timken; Richard Farmer, chairman of Cintas, which sells uniforms, restroom supplies, and other goods to businesses; and Akron industrialist David Brennan, whom the state has paid more than $250 million to operate charter schools. All were future Bush Pioneers.

"They appoint people, they give out contracts, they have leverage that their opposition doesn't possess," Mr. Douglas said of the Republican lawmakers who had taken over the Statehouse.

"Included in that is, frankly, a fear factor. It's either play our way or be ostracized. That's the power."

Republicans have now surpassed the Democrats' 1980s dominance, controlling both legislative chambers, the state Supreme Court, and the congressional delegation - by a 12-6 margin.

They have swept the last three statewide elections for executive posts.

In 1988 and 1989, the Ohio Republican Party was unable to crack a $250,000 balance, according to filings with the secretary of state.

By 1991, the party reported donations of $2.04 million, including at least $160,000 from Mr. Timken and his family.

Democrats say state finance reports don't reflect the GOP's full fund-raising power.

David Leland, who was chairman of the Ohio Democratic Party from 1995 to 2002, said the major difference in how the two parties raised money in the 1990s was the huge amount of money that flowed into the Ohio Republican Party's secret operating account.

A loophole in Ohio's campaign finance laws permitted unlimited contributions to a party operating account. Those donations and expenditures never had to be disclosed.

State law said the money had to be spent on items such as party headquarters maintenance and sample ballots, but there was no requirement for the account to be audited, said Carlo LoParo, a spokesman for the secretary of state's office.

"Millions and millions of dollars were sequestered without any accountability," Mr. Leland said.

Mr. Bennett estimated his party raised between $1 million and $2.5 million annually for its operating account from "philosophical Republicans" such as Mr. Timken and Mr. Brennan, though he would not name all the donors or say exactly what they gave.

He said the money countered the field operations of labor unions, which he dubbed "the infrastructure" of the Democratic Party.

The party steadily built its base of small donors in the 1990s through improved direct-mail and telemarketing, Mr. King said. Several other GOP leaders from that time say power opened larger pocketbooks.

"Donors want to deal with the people who are affecting public policy," said Rex Elsass, the state Republican executive director in the early 1990s.

"There's no magic to it - that's what it is."

By 1997, Mr. Bennett was working to avert another gubernatorial primary, this time shuttling a young state treasurer named Ken Blackwell to the secretary of state's race so Mr. Taft could be governor.

In August that year Mr. Bennett traveled to a convention in Indianapolis that served as a sort of kickoff for the 2000 Republican presidential primary. The featured speaker was a Texas governor named George W. Bush.

Mr. Bennett watched Mr. Bush's speech from the back of the room.

He stood next to Karl Rove, the governor's political guru. Speech over, Mr. Bennett offered his assessment.

"It wasn't the best speech that George Bush had ever given," Mr. Bennett reflected recently. Later he added: "I put it pretty gently."

Mr. Bush improved by 2000, when he made Ohio a critical part of his run for president. He had also built a national network of Pioneers - men and women who raised at least $100,000 for his campaign.

Ten came from Ohio, including Mr. Reynolds, who knew Mr. Bush from oil and baseball ventures in Texas.

By 2004, Mr. Bush's Ohio ranks included 30 Pioneers and anew group, "Rangers," who each raised at least $200,000. More than a dozen had donated heavily to state Republicans through the 1990s. Many rose, postelection, to prominence in Mr. Bush's second administration, including Mr. Timken, now ambassador to Germany.

Mr. Bennett was among the Ohio Rangers for the President's re-election campaign.

He said it wasn't difficult: "I was picking some low-hanging fruit."

The Bush campaign also tapped a new vein of donors who had given little or nothing to state Republicans. They were largely Christian conservatives from the Cincinnati area.

Mr. Bennett said many of them were "people that strictly get involved in presidential races."

Equally important, Republicans and Democrats say, the campaign plugged into a state GOP organization that dwarfed its Democratic counterpart. County parties had sophisticated voter-tracking systems. A stable of statewide leaders waited to deploy as surrogates or warm-up acts for the President whenever he visited.

Bob Paduchik, the Bush-Cheney campaign manager in Ohio, said the state GOP and the campaign worked "seamlessly."

In the 2000 primary and general election, Ohio backers of Bush-Cheney made 600,000 phone calls to potential voters. Last year 450,000 calls were made just on Election Day, Mr. Paduchik said.

Republicans delivered Ohio to Mr. Bush by a slim 120,000 votes. Its 20 electoral votes sealed his re-election.

The next year would be decidely tougher for Republicans in the state.

The Blade broke the news in April that Mr. Noe, who was appointed by Mr. Voinovich to the Ohio Board of Regents and by Mr. Taft to the Ohio Turnpike Commission, was under federal investigation for allegedly laundering campaign contributions into President Bush's re-election campaign.

Earlier in the month, The Blade was the first to report on problems in two rare-coin funds Mr. Noe had set up with $50 million in state money.

Mr. Bennett said he was shocked.

"Tom is a pretty solid Republican," Mr. Bennett said in an April 27 interview.

"I don't think he's turned anybody down for fund-raisers. That is what you do when you are in the business. You do it by the book."

When a federal grand jury indicted Mr. Noe on three felony counts last Thursday, Mr. Bennett issued a press release.

"It doesn't matter whether Tom Noe is a Democrat or a Republican," he said.

"If he's found guilty of a crime, he should be prosecuted to the fullest extent of the law."

The Noe scandal has also touched Mr. Taft, chairman of President Bush's Ohio campaign last year.

Mr. Taft was convicted in August of four ethics misdemeanors for failing to disclose gifts from supporters, including free golf from Mr. Noe.

Another Bush Pioneer, former House Speaker Larry Householder, is under federal grand jury investigation for alleged skimming of campaign funds.

Three Republican statewide officeholders - Mr. Blackwell, Mr. Petro, and Auditor Betty Montgomery - are locked in the sort of bruising gubernatorial primary that Mr. Bennett has always headed off.

Republicans don't argue with Mr. Bennett's track record in winning elections, but some now criticize his fund-raising and business ties.

Neil Clark is a former GOP state Senate staffer who earned a "Maltese Falcon" by raising $1 million for Mr. Voinovich in 1990.

He now ranks among the most powerful Statehouse lobbyists. Recently, he criticized Mr. Bennett's business arrangement with lobbyist Tom Whatman, a former Ohio GOP executive director who was also a Bush Pioneer last year.

"I told Bennett that he should give up his job and take the lead in cleaning up this disgusting situation," Mr. Clark said.

Many Republicans expect Mr. Bennett to work his primary magic again.

"It's early," said Mr. Elsass, who is now a GOP media consultant.

"Bob Taft wasn't too early in 1990 saying, 'Hey, I'll run for secretary of state.' It was a process," Mr. Elsass said.

Democrats may be eager to spin scandals into electoral success, other Republicans said, but the GOP machine hasn't died yet.

"We're a year out from the election," said Mr. King, the campaign manager-turned-consultant, "so there's a lot to be done still, and a lot of time for us to make our case. If we don't make our case, it's going to be a long election night."

Staff writer Joshua Boak contributed to this story.

Contact Jim Tankersley at: jtankersley@theblade.com or 419-724-6134.


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