Ramaswamy’s Unprecedented Fundraising Scheme on Safe Legal Ground, Former FEC Chairman Says

Commissions, American flags, and gift cards: Vivek Ramaswamy and Doug Burgum unveiled their own novel incentives for donors to their presidential campaigns this week, raising questions about the legality and ethics around their respective schemes.

Ramaswamy is encouraging donors to recruit others to donate to his campaign by offering a 10 percent commission on the contributions they raise. Burgum, meanwhile, said he will give away $20 gift cards to the first 50,000 donors who donate even $1 to his campaign.

So much for T-shirts and yard signs.

Ramaswamy says his new plan is actually an attack on the “disgusting” status quo where a “small oligopoly of political fundraisers” make an “ungodly” amount of money doing what they do.

“I want to help you do it — build the skills needed to help you sell effectively,” Ramaswamy said. “And believe me, if you can sell a politician’s vision, you can sell anything in this country. We’re going to help you be successful.”

Despite critics of Ramaswamy’s plan suggesting it resembles a multilevel marketing scheme, Michael Toner, an election lawyer and former chairman of the Federal Election Commission, told me he doesn’t see anything illegal about it.

“I think from an FEC compliance perspective, I don’t see any problems with it. . . . A fundraising consultant has been paid on commission for decades, so it’s an established part of that process,” he said. “But from a tax perspective, from an IRS, labor-law perspective, kind of uncharted. It doesn’t mean that it’s a problem, it just means there’s some unsorted issues there.”

However, the campaign says the supporters will work as independent contractors who essentially serve as fundraising “bundlers” and must agree to pay applicable taxes. Members of “Vivek’s Kitchen Cabinet” will undergo a background check before they can be issued an affiliate link to raise money for the candidate, Ramaswamy’s general consultant told Politico.

NR’s Noah Rothman writes that the “practice of bundling campaign contributions is common and, generally speaking, legal” but that “the larger the bundler pool, the more opportunity for contributions to roll in from sources the campaign will ultimately have to answer for (or even return).”

While Ramaswamy’s campaign has brought in funds from more than 60,000 donors, easily clearing the GOP debate requirement to have 40,000 individual donors, Burgum’s gift-card strategy is an effort to widen his donor pool in time to make the debate stage on August 23.

“Yes, 50,000 people will actually get a Visa or Mastercard gift card to their mailing address. When it comes to providing economic relief to the American people, I’m not messing around!” the North Dakota governor said in a tweet.

Burgum, who is a billionaire, has thus far outspent every other Republican in the race. He first offered donors full-size American flags before moving on to the gift-card giveaway.

Several election-finance experts have suggested the plan could violate the federal prohibition on straw donors. Northwestern University law professor Michael S. Kang explained to NPR that it is “illegal to reimburse another person for their campaign contribution.”

“Giving a donor a $20 gift card for donating seems a bit like that,” Kang said.

Saurav Ghosh, director of federal campaign-finance reform at the Campaign Legal Center, told Politico that Burgum’s offering is different from the usual straw-donor context, where the donor is used to hide the original source of funds. “Campaigns generally have a tremendous amount of flexibility as far as how they spend their money,” Ghosh said.

Even if an FEC complaint were to be filed regarding Burgum’s scheme, Toner tells me it would be “many, many months — probably after the election — until the FEC sorts it out one way or the other.”

Ahead of the first official primary debate next month, on Friday several candidates will participate in a GOP forum in Iowa hosted by Tucker Carlson. Ramaswamy, Ron DeSantis, Nikki Haley, Tim Scott, and Mike Pence will all appear at the FAMILY Leader’s Leadership Summit, though former president Donald Trump will be notably absent.

Bob Vander Plaats, the organization’s president and CEO and an influential Evangelical leader in Iowa, said Trump’s team offered to send Senator J. D. Vance as a surrogate, but Vander Plaats declined, per the New York Times’ Jonathan Swan, because the organization has a policy of declining surrogates or video presentations for its events.

Trump also ruffled feathers in the Hawkeye State this week by attacking Governor Kim Reynolds in a Truth Social post: “I opened up the Governor position for Kim Reynolds, & when she fell behind, I ENDORSED her, did big Rallies, & she won. Now, she wants to remain ‘NEUTRAL.’ I don’t invite her to events!”

Reynolds previously explained her decision not to endorse: “I want to welcome everyone to this state. And if I weigh in, I don’t know if they’ll feel all that welcome. But, you know, I’ve made it clear, I will be happy to help introduce you, help travel the state, connect in any way that I can — especially to make sure that if we’ve got big things going on that they know about it.”

Vander Plaats responded to the attack saying: “Forest Gump says, ‘stupid is as stupid does.’ My Mom says don’t call anyone, ‘stupid.’ So, I won’t. However, this isn’t smart. Iowa is wide open. #ChooseWell2024.”

Senator Chuck Grassley also came to Reynolds’s defense. “We aren’t going to get involved in campaigns, because we want everybody to feel welcome in Iowa. . . . And if the governor were to back somebody, that may discourage other people from coming. Same way for me,” he said.

The drama is the latest in a series of missteps for Trump in Iowa. He previously missed Senator Joni Ernst’s Roast and Ride and, though his team said he would send over a prerecorded video, he failed to deliver despite Ernst’s team having laid out money to rent large screens to show it, according to the New York Times. He also canceled a rally in Des Moines in May because of “severe weather”; Ron DeSantis held a successful surprise campaign stop there that same day.

Now, a mysterious mailer has gone out to Iowans from the group “Advancing Our Values” that highlights Trump’s support for the LGBT community. The mailer calls Trump a “transgender trailblazer.”

In any event, Trump remains comfortably ahead of DeSantis in Iowa polls.

DeSantis, for his part, said Tuesday he doesn’t think he’d serve as Trump’s running mate if he were offered the role, telling the Wisconsin Right Now radio show he’s “not a No. 2 guy” and the vice president “doesn’t really have any authority.”

Around NR

• Noah Rothman says the events that have transpired since March, when reporting first revealed then–Fox News host Tucker Carlson would host a GOP presidential candidates forum in Iowa, “should have convinced most of the Republican Party’s presidential aspirants to rethink their association with Carlson.”

Carlson has always been a controversialist. But when he was a controversialist broadcasting in prime time on the Fox News Channel, the real estate he commanded made him unavoidable. Now, he’s not just avoidable, you have to swerve to encounter him. And his compulsive penchant for stepping on rhetorical landmines suggests that any competent political campaign with an instinct for self-preservation should steer clear.

• Haley Strack warns presidential candidates not to underestimate the power of moms after Casey DeSantis released a new video ad as part of her “Mamas for DeSantis” campaign.

Kudos to Casey, who amply makes up for her husband’s supposed social deficiencies, and who has long been called Ron’s campaign weapon. Suburban women are a key demographic in the next presidential election and already one in which Donald Trump underperforms. Moms don’t much like politicians who threaten to grab women by their privates, or who commit fraud to cheat on their postpartum wives with porn stars.

• Dominic Pino argues in favor of doing away with stigmatizing self-funded presidential campaigns and says wealthy candidates should actually be encouraged to fund their own campaigns.

The conventional wisdom is backwards. Voters should appreciate candidates who, if nothing else, believe enough in themselves to put their own money on the line in pursuit of elected office. And they should be skeptical of candidates who have exorbitant means to do so and beg for money anyway.

• Philip Klein applauds Mike Pence for his recent interaction with a voter who questioned the former vice president about his decision to reject efforts by Team Trump to overturn the 2020 election results.

Pence deserves tremendous credit for standing up to the pressure he was facing that day, risking his political career and even his life, to carry out his sworn duty to uphold the Constitution. And he deserves kudos for standing by his decision on the campaign trail, even when pressed by voters who have been led to believe that President Biden would not be in power were it not for Pence’s actions on January 6.

• Trump is looking to postpone his classified-documents trial until after the 2024 election. Andrew C. McCarthy notes that, given the complexities involved in trying classified-documents-related cases, the trial is in fact very unlikely to begin before the election anyway.

Bottom line: The more classified information the Trump defense demands, the more fighting Smith is going to have to do with U.S. spy agencies — and that’s wholly apart from the extensive litigation contests he’ll have wage with the defense (once the lawyers finally have clearances) and, potentially, the trial court and the appellate courts. Even if Trump’s dance card were not already overflowing with other criminal and civil cases, it would be nigh impossible to get this case to trial prior to Election Day 2024.

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