Is President Obama Trying to Intimidate GOP Voters?

Is President Obama running scared? That’s certainly one explanation for two recent efforts to squash the flow of money into GOP campaign coffers.

Not only is the White House pushing an executive order requiring would-be federal contractors to disclose political donations – a proposal so blatantly partisan that even Democrats are crying foul – but now the IRS has climbed aboard by challenging gifts to politically involved not-for-profits.

The double-whammy continues the president’s Quixote-like tilting at the influence of businesses across the country; he’s got this one right – they don’t much like Mr. Obama. It also signals anxiety among the president’s reelection squad; will he manage to rally the army of supporters who donated millions to his campaign coffers and so brilliantly got out the vote in 2008?

Though the killing of Usama bin Laden has bolstered the president’s poll ratings of late, his campaign staff cannot imagine that his reelection is guaranteed. As has been widely remarked, it’s all about the economy. The recovery continues to struggle, with job creation bumpy and a whiff of inflation wafting over the land. The country is concerned about our rising national debt, and many hold President Obama responsible.

The refusal by Democrats – and the president -- to engage in meaningful spending reform has convinced voters that the GOP may be the better steward of the economy.

These headwinds, coupled with more tempered enthusiasm from gays, Hispanics, and young people, could undermine the president’s ability to gin up the kind of populist campaign that surprisingly vaulted him into office in 2008. That makes the specter of unlimited corporate funds flowing to the GOP a nightmare scenario. Consequently, the White House is on the attack.

Thursday, while attention was focused on yet more theater from Congress – this time aimed at Big Oil – the Small Business Committee of the House (along with the House Committee on Oversight and Government Reform) was considering the White House executive order regarding campaign disclosures.

The proposal demands that companies hoping to do business with the government disclose political gifts made within two years of the contract submission. A preview statement from Chairman Darrell Issa described “bipartisan alarm” over the suggested rule, which many think could lead to a “spoils system”. (A system, for instance, that would not be out of place in Chicago.) As Mr. Issa points out, noticeably absent from the White House Executive Order is any such requirement for unions.

To their credit, a number of Democrats, including Senators Claire McCaskill and Joe Lieberman, are on record opposing the White House measure.

Steny Hoyer, the number two Democrat in the House, is also against it. He argues that “contracting ought to be on the merits of the contractor’s application and bid and capabilities….I think there are some serious questions as to what implications there are if somehow we consider political contributions in the context of awarding contracts.”

Another Democrat, Gerry Connolly, says it might “have a chilling effect on the ability of people freely to participate in the political process and donate as they see fit.”

At the committee hearings yesterday, law professor Bradley Smith described the order as “ill-advised” and said it “represents an attempted power grab by the Obama administration on campaign finance issues.” Committee Chair Sam Graves noted that some 360,000 small companies do business with the federal government; this is just one more regulatory burden for those firms.

Scurrying to develop other ways to clamp down on GOP money-raising and influence, the Obama administration also has the IRS scrutinizing gifts made to non-profit groups that have political leanings. The tax authority has sent letters to five wealthy donors questioning, for the first time, the treatment of gifts to such advocacy groups. President Obama has long been on the warpath against such entities, that are organized as 501(c)(4)s and that have become increasingly powerful vehicles for political activists.

The IRS has gone out of its way to portray this unprecedented inquiry as the labor of two “career civil servants” in the estate and gift tax department, trying to suppress suspicions that the move is politically motivated. Still, the Financial Times calls the move a “radical departure in how tax authorities have treated such “gifts” over the last 30 years.”

The timing of the investigation is, to put it mildly, suspect. The media has emphasized that while the Koch brothers, Karl Rove and other leading conservatives have supported such organizations, uber-liberal George Soros might also be caught in the net. That is true, but Republicans are unquestionably much bigger supporters of such groups.

Looking ahead to the 2012 election, President Obama and his cohorts would do well to focus on those issues of importance to American voters, such as putting forward a reasoned and effective fiscal blueprint, pushing forward job-creating measures such as the still-stalled free trade agreements with South Korea, Panama and Colombia, and devising a realistic means to reduce our dependence on imported oil.

It will be policies that decide the course of our economy and the outcome of the 2012 elections, and not Chicago-style shenanigans.

Liz Peek is contributor and a financial columnist who writes for The Fiscal Times.  For more visit