Tea Party loosens K Street's stranglehold on the GOP

Washington Examiner ^ | October 5, 2013 | Timothy P. Carney

How did the Republican Party become so splintered and so infused with hard-line conservatives?

Don't blame redistricting. Don't chalk it up to anti-Obama fervor.

Republicans have become an unruly bunch of scorched-earth conservatives because the Tea Party smashed the business lobby's monopoly on GOP fundraising.
Here's a story of where the GOP used to be:
Back in 2006, I asked a couple of conservative Republican congressmen to give blurbs for my book on corporate welfare. “My boss loves the book,” one of their top aides said, “but we’re not going to put his name on it." Why not, I asked. "Who do you think funds his campaigns?" she whispered. "It’s not the Family Research Council.”

In short, the conservative congressman was happy to fight the good fight, but he wasn’t willing to upset Big Business because that’s where the checks came from — and no checks meant no re-election.
Back then, to raise money, Republicans had to go to K Street. Call your former chief of staff who was now at a lobbying firm, have him host a fundraiser. Your ex-aide would show up with colleagues carrying $2,500 checks and with corporate clients handing over $5,000 checks from their political action committees.
Although K Street was the road to campaign cash, the party leadership was often the path to K Street. This helps explain the power dynamic in the pre-Tea Party GOP.
But the Tea Party smashed K Street's monopoly on Republican fundraising. The Club for Growth was founded in the late 1990s, and early last decade, it began targeting liberal Republicans in primaries. By 2010, the Club had become a giant force, raising money for candidates who met its rigorous ideological tests and pouring millions into independent expenditures against less-favored Republicans and Democrats.
In 2009, Sen. Jim DeMint founded the Senate Conservatives Fund. The thinking was this: The job of the party leadership was to elect Republicans to the Senate, no matter what. DeMint wanted conservative Republicans.
Instead of corporate interests filling Republican coffers, ideological money started coming in, too.
While GOP leaders backed candidates like Charlie Crist (Fla.), Trey Grayson (Ky.), and Sue Lowden (Colo.) in 2010 primaries, the SCF backed Marco Rubio, Rand Paul, and Sharron Angle. K Street and the National Republican Senatorial Committee worked hand-in-hand -- but for a change, there was a countervailing force.
Consider the Kentucky primary that year.
With Mitch McConnell's help, Grayson raised half a million dollars from business PACs, including Obamacare backers like Pfizer and the American Hospital Association, bailout beneficiaries like the American Bankers Association and the Managed Funds Association and Beltway bandits like Northrop Grumman. At least a dozen lobbying firms and industry trade groups funded Grayson. Republican senators-turned-lobbyists like Trent Lott backed Grayson, warning, "We don't want a lot of Jim DeMint disciples."
Rand Paul, meanwhile, pocketed only $25,000 in PAC money before the primary. Where did Paul get his loot?
The Club for Growth was Paul's biggest source of funds, giving him $105,000, according to the Center for Responsive Politics. The Senate Conservatives Fund kicked in $36,685. These two groups, together with FreedomWorks, also spent big on independent expenditures for Paul.
Ted Cruz also came to Washington by defeating K Street. The Club for Growth spent more than $2.5 million helping Cruz in the Texas GOP primary, while the SCF spent about $800,000. K Street was backing Lt. Gov. David Dewhurst -- he got $500,000 from business PACs (33 times Cruz's take), and GOP lobbyists hosted a fundraiser for him at the Capitol Hill townhouse of Democratic superlobbyist Tony Podesta.
As Cruz put it, “Everyone who makes their living from continuing the government-spending gravy train is supporting Dewhurst.”
If not from lobbyists and big businesses, where are these Tea Party groups getting their money? Mostly from small-business owners and conservative retirees. The Club for Growth has a big chunk of wealthy investors cutting them checks.
It may confuse liberals who think free-market politics is just a corrupt deal to enrich Big Business — or who claim that the Tea Party is a Big Business front — but these are the opposing pulls in the GOP: K Street and the Tea Party.
Having two sources of money changes the party dramatically.
“I don't think there's a way for Wall Street to punish the 25 to 50 hardcore House Republicans,” one Wall Street lobbyist told Politico in the first couple days of the shutdown. Referring to an anti-establishment libertarian freshman congressman, the lobbyist said, “I don't thinkJustin Amash cares if Bank of America gives to him or not.”
A Republican who doesn’t care about Bank of America checks wasn’t possible before the Tea Party.