Saturday, September 18, 2010
The house is about to vote on a bill for public funding for congressional campaigns.
http://thecaucus.blogs.nytimes.com/2010/09/17/spending-to-overhaul-campaign-spending/?hp
I've been hearing about this from the coffee party and other liberal fronts.
In this post I'm going to outline how to manipulate bankrupt and embarrass the system into collapse, if it passes in something close to how it's been described.
In order to qualify for 5 to 1 matching funds, about $300,000, here's what you do.
You need to raise $50,000 in donations from your state from 1500 people, no more than $100 each.
In practice that's going to work out to ~500 (490) $100 contributions, and 1000 $1 contributions. This is going to be easier to pull off in a big state like california than a small state like north dakota.
Step 2: solicit pledges for $100 from everyone you can. give them a number.
Have this automated online with paypal and such to make it easier to go viral.
At this point you aren't collecting money from anyone, just pledges.
I haven't read the fine print of the bill; I don't know if it's ok to give them a ticket to a $100 fundraising dinner when they pledge.
Meanwhile, you can tell people that if the funds are available, you are going to be staffing your campaign with a large number of part time workers; basically volunteers who are getting a check for $100 to cover their expenses. You are hiring precinct captains for each precinct that has met its fundraising goal of $100.
Some of the people who pledge will sign on as workers, and be able to earn their pledges back. One of the simplest ways to earn it back is to be a bundler - get pledges from 3 or 5 friends .. let's say 4, and you get a $100 bonus, payable after the pledges are collected. Are you up to 490 yet?
Oh yeah, I forgot step 1. Step one is hire me, at 15%, to run this program for you. Trust me. If it doesn't work, 15% of zero is zero. Since the expected take from this scam is $300,000, 15% is $45,000. This will give me some walking around money to grease any bottlenecks we run into.
Now we still need the 1000 $1 contributions. Have a free picnic in the park, ask for $1 contributions, have a band. Document everything; get the names. Possibly this can all be done online with a tip jar.
Not at 1000 yet? Go back to your pledgers and bundlers, ask them to collect contributions of at least $1, maybe by emailing their contact lists or facebooking.
(blogger is freezing so posting part 1 now, will edit)
Step 3. Let's say by now you are close, you've got $1000 in small contributions and
400 pledgers. OK, let's try microfinance. Do a mailing to your $1 contributors, letting them know you know a guy who can loan them $99 to level up.
This is a real loan; it's not a pass-through illegal contribution. The lender takes a risk of loss; the borrower risks bad credit if they welsh. These guys get first dibs on jobs in the campaign, if that's legally allowed. That is, you might not be able to give them preference over other applicants, but you can affirmatively act to encourage them to apply.
Basically keep networking your donors contacts lists until you have both the $50,000 and the 1500 contributors.
Step 4. Now collect the pledges. You'll lose a few that are uncollectable, but the bump from having met the goal will bring in some bandwagoners.
Ok, step 5 is go pick up your check for $300,000. Minus my fee of $45,000, and assuming $5000 in expenses so far on stuff like picnic supplies, you now have... $300,000. You can now hire your $100 workers as precinct workers, pay off bundlers, etc. Set aside $50,000 for this, leaving $250,000.
Step 6. Throw a party. Whether your taste runs to string quartets or strippers and booze, spend $10,000 on a nice party and invite your 500 contributors.
A phone call and a card is a nice touch here too.
$240,000 left. You can buy the campaign a car, or hire your kids as office staff, or go on a fact-finding junket to bermuda, so long as it's all plausibly campaign expenses.
step 7. For appearances, spend $5000 on yard signs and brochures and balloons and such, so there's some appearance of an actual campaign. Your goal at this point is to lose the primary, make sure all your donors have had the chance to earn back their investment.
step 8. But wait, there's more. You can keep raising more funds and they'll keep matching it 5-1, up to some threshold.
step 9. OK, here's where it gets interesting.
By now you know how to do this, you've done it, you have a database of donors,
you know who your effective bundlers are. Sit down with them, and offer them a chance to be the next 9 candidates. Pick the first nine that say yes and seem qualified.
Now, you are going to back to each of your 500 $100 donors. You'll be asking them to write 9 $100 checks. They'll already know they have the chance to make that back by working for the campaign, if they want to. you won't get all 500, but you'll get a quick head start on the process. Meanwhile your nine have started at step 1.
Keep in mind you have $235,000 left to help jumpstart all this.
Plus, the 9 have contracted with me at $45,000 each, 15%. Which comes to 405,000.
Contact your 1000 $1 donors and ask them to make nine $1 contributions.
Have another picnic, with a better band. Or do another online thing, or both.
Viral marketing, direct mail, phone banking. Pretty soon one of your nine reaches the 490 pledges, moves into collection mode, and collects their 300,000.
This money is right away going to get reinvested in helping the other 8 level up.
Assume each nets $235K after expenses. 8x 235k = 1,850,000.
Time to start the next set of 10.
This has been the bootstrap method.
Now lets look at the mass production method.
Recruit 100 candidates. Each writes a $100 check to each candidate, $10,000 in seed money, and each finds 4 friends to do the same. These 4 get offered a job on the campaign at $10,000 or more. Each of the 100 now has 50,000. Oh we also need 1000 people to write checks for $1 to each of the 100. So each candidate need to find 4 people at $10,000 and 10 people at $100. Each now collects $300,000, which times 100 = 30 million. This can all be in one congressional district, in one state, say new york or california or chicago. New contributions are also matched $5 to $1, up to about another 30 million, no more than $100 per person.
Think about a group like acorn going door to door. It's grass roots democracy, but it's also a recipe for massive fraud.
http://thecaucus.blogs.nytimes.com/2010/09/17/spending-to-overhaul-campaign-spending/?hp
I've been hearing about this from the coffee party and other liberal fronts.
In this post I'm going to outline how to manipulate bankrupt and embarrass the system into collapse, if it passes in something close to how it's been described.
In order to qualify for 5 to 1 matching funds, about $300,000, here's what you do.
You need to raise $50,000 in donations from your state from 1500 people, no more than $100 each.
In practice that's going to work out to ~500 (490) $100 contributions, and 1000 $1 contributions. This is going to be easier to pull off in a big state like california than a small state like north dakota.
Step 2: solicit pledges for $100 from everyone you can. give them a number.
Have this automated online with paypal and such to make it easier to go viral.
At this point you aren't collecting money from anyone, just pledges.
I haven't read the fine print of the bill; I don't know if it's ok to give them a ticket to a $100 fundraising dinner when they pledge.
Meanwhile, you can tell people that if the funds are available, you are going to be staffing your campaign with a large number of part time workers; basically volunteers who are getting a check for $100 to cover their expenses. You are hiring precinct captains for each precinct that has met its fundraising goal of $100.
Some of the people who pledge will sign on as workers, and be able to earn their pledges back. One of the simplest ways to earn it back is to be a bundler - get pledges from 3 or 5 friends .. let's say 4, and you get a $100 bonus, payable after the pledges are collected. Are you up to 490 yet?
Oh yeah, I forgot step 1. Step one is hire me, at 15%, to run this program for you. Trust me. If it doesn't work, 15% of zero is zero. Since the expected take from this scam is $300,000, 15% is $45,000. This will give me some walking around money to grease any bottlenecks we run into.
Now we still need the 1000 $1 contributions. Have a free picnic in the park, ask for $1 contributions, have a band. Document everything; get the names. Possibly this can all be done online with a tip jar.
Not at 1000 yet? Go back to your pledgers and bundlers, ask them to collect contributions of at least $1, maybe by emailing their contact lists or facebooking.
(blogger is freezing so posting part 1 now, will edit)
Step 3. Let's say by now you are close, you've got $1000 in small contributions and
400 pledgers. OK, let's try microfinance. Do a mailing to your $1 contributors, letting them know you know a guy who can loan them $99 to level up.
This is a real loan; it's not a pass-through illegal contribution. The lender takes a risk of loss; the borrower risks bad credit if they welsh. These guys get first dibs on jobs in the campaign, if that's legally allowed. That is, you might not be able to give them preference over other applicants, but you can affirmatively act to encourage them to apply.
Basically keep networking your donors contacts lists until you have both the $50,000 and the 1500 contributors.
Step 4. Now collect the pledges. You'll lose a few that are uncollectable, but the bump from having met the goal will bring in some bandwagoners.
Ok, step 5 is go pick up your check for $300,000. Minus my fee of $45,000, and assuming $5000 in expenses so far on stuff like picnic supplies, you now have... $300,000. You can now hire your $100 workers as precinct workers, pay off bundlers, etc. Set aside $50,000 for this, leaving $250,000.
Step 6. Throw a party. Whether your taste runs to string quartets or strippers and booze, spend $10,000 on a nice party and invite your 500 contributors.
A phone call and a card is a nice touch here too.
$240,000 left. You can buy the campaign a car, or hire your kids as office staff, or go on a fact-finding junket to bermuda, so long as it's all plausibly campaign expenses.
step 7. For appearances, spend $5000 on yard signs and brochures and balloons and such, so there's some appearance of an actual campaign. Your goal at this point is to lose the primary, make sure all your donors have had the chance to earn back their investment.
step 8. But wait, there's more. You can keep raising more funds and they'll keep matching it 5-1, up to some threshold.
step 9. OK, here's where it gets interesting.
By now you know how to do this, you've done it, you have a database of donors,
you know who your effective bundlers are. Sit down with them, and offer them a chance to be the next 9 candidates. Pick the first nine that say yes and seem qualified.
Now, you are going to back to each of your 500 $100 donors. You'll be asking them to write 9 $100 checks. They'll already know they have the chance to make that back by working for the campaign, if they want to. you won't get all 500, but you'll get a quick head start on the process. Meanwhile your nine have started at step 1.
Keep in mind you have $235,000 left to help jumpstart all this.
Plus, the 9 have contracted with me at $45,000 each, 15%. Which comes to 405,000.
Contact your 1000 $1 donors and ask them to make nine $1 contributions.
Have another picnic, with a better band. Or do another online thing, or both.
Viral marketing, direct mail, phone banking. Pretty soon one of your nine reaches the 490 pledges, moves into collection mode, and collects their 300,000.
This money is right away going to get reinvested in helping the other 8 level up.
Assume each nets $235K after expenses. 8x 235k = 1,850,000.
Time to start the next set of 10.
This has been the bootstrap method.
Now lets look at the mass production method.
Recruit 100 candidates. Each writes a $100 check to each candidate, $10,000 in seed money, and each finds 4 friends to do the same. These 4 get offered a job on the campaign at $10,000 or more. Each of the 100 now has 50,000. Oh we also need 1000 people to write checks for $1 to each of the 100. So each candidate need to find 4 people at $10,000 and 10 people at $100. Each now collects $300,000, which times 100 = 30 million. This can all be in one congressional district, in one state, say new york or california or chicago. New contributions are also matched $5 to $1, up to about another 30 million, no more than $100 per person.
Think about a group like acorn going door to door. It's grass roots democracy, but it's also a recipe for massive fraud.
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