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If John McCain doesn't win Florida, he almost certainly won't be the Republican nominee.  And if he does win Florida, his only chance of avoiding a crushing defeat in November will be to embrace the same moneyed interests he's declared are among the biggest problems facing America.  

Some months back McCain's campaign applied for federal matching campaign funds.  (The money comes from individual taxpayers who voluntarily check off a $3 contribution on their income tax return.)  In December seven campaigns were officially notified that they qualified for matching funds.  However, because of a funding shortfall, none of the federal matching funds have been released.  Apparently the fund reserves the money needed for the general election before it starts to pay out matching funds for the primary, and until monies arrive from this year's tax returns, the fund doesn't have enough money to deliver money for the primary.  John Edwards secured a bank loan against the federal funds, so he is officially locked in to abiding by the spending limits in the event he gets the nomination.

McCain qualified for $5.8 million in matching funds.  He could do as Edwards has done, and get the money now by securing a bank loan against the eventual payment from the US Treasury.  But McCain has been anything but "straight talking" regarding his money; until he receives the money from the Treasury or borrows against it, he's not locked in to the system.  Thus, he's currently trying to evade the federal spending limits if he can raise enough money to stay viable, but holding out the option of taking the federal funds if he can't survive through tonight.  

Here's McCain's problem.  Accepting federal matching funds would limit him to spending no more than $53-$55 million during the primary period.  (The exact figure will be adjusted based on the campaign's fundraising expenses and other expenditures.).  If McCain wins the nomination and accepts the matching funds, the $53-$55 million limit would constrain his spending all the way until the beginning of September, when the Republicans nominate their candidate at their national convention in Minneapolis.  

Through the end of 2007 he had already spent almost $29 million.  I've learned from a source that has tracking information on all national advertising that McCain's television spending just in the month of January has been over $5 million.  When you add in other spending (like travel, field activities, administrative costs and staff salaries) you have to figure he's approaching $40 million already spent.  That means if he stays in the federal matching funds system, he'll be limited to spending no more than $15 million between now and September.  

That's only $2.5 million per month.  

If McCain is the nominee and he is limited to $2.5 million per month from now until September, while the Democratic nominee is spending freely, he will be slaughtered in November.    

McCain's real problems, however, are even more immediate.  Romney has twice as many delegates as McCain.  Romney isn't taking any matching funds, so the only limits on his spending are self-imposed, and related to how much he wants to spend of his considerable personal fortune.  And he's spending McCain under the table.  Romney has spent almost twice as much on television in January as has McCain, and they appear to be locked in a close battle in Florida.  McCain needs money now to avoid getting washed away by Romney.

The money problem has led McCain to turn to K-Street lobbyists for help bailing out his distressed and bankrupt campaign.  There are more lobbyist-bundlers collecting money for McCain's campaign than any other candidate's.  Last night they banded together for a DC fundraiser expected to generate around $300,000.  McCain needs that to keep his campaign alive, as it appears he's running on fumes.

If McCain wins Florida by a big margin, look for him to spurn the matching funds.  He will establish his viability, and should get a good financial bounce.  Presumably he would get money to continue on and lock up the nomination, which because of the Republicans' winner-talk-all primaries should be much easier to lock up.  

However, if McCain doesn't defeat Romney in Florida, donors would not assume he was the inevitable candidate, so they will hold back their contributions.  Thus, McCain will face a horrible choice: he will have to either borrow against the matching funds to keep his candidacy alive (and thus ensuring he will be broke after the primaries if he gets the nomination), or essentially concede the nomination to Romney.  

Presumably because they are waiting on the results on Florida, and because they are all facing money woes, none of the Republicans have done any advertising in any of the 20 states holding primaries and caucuses on February 5th, which is only one week from today.  

Whatever happens, Romney's win in Michigan now looms huge over the GOP's  nomination battle.  Had he not won Michigan, he would probably have dropped out.  But now, because he has a personal fortune and because Michigan kept his hopes alive, he may prove capable of buying the nomination.  

Much like Romney going in to Michigan, McCain must win Florida in order to survive and still have a chance to win the nomination and be a viable general election candidate.  And if he survives, he will have to spurn his reputation as the crusader trying to limit the effects of money and corporate lobbying from campaigns and politics.  If John McCain hopes to become President, he will need to win Florida, and he will have to reject public campaign financing and fully ally himself with the K-Street lobbyists he once loved to say were the enemies of clean, transparent and accountable campaigns and government.  

[UPDATE] Adam B points out that if Edwards changed the collateral for his loan from the matching funds certification to his home, hypothetically he might be able to opt out of the system if he were to choose to.

Originally posted to Daily Kos on Tue Jan 29, 2008 at 03:10 PM PST.

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