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US: Savings and Issues in Candidates’ Use of Private Jets

by Michael Cooper and Leslie WayneThe New York Times
July 26th, 2007

During a discussion of global warming at a debate this week in Charleston, S.C., the Democratic presidential candidates were asked if they had arrived in private jets. Quite a few hands went up, some a tad reluctantly.

But the issue of how the candidates are crisscrossing the country is of interest not only to people concerned about pollution or to envious summer travelers weary of walking shoeless through metal detectors, long flight delays and cramped seats.

It also shows how some campaigns have been able to reap financial benefits from their supporters by using corporate and privately owned jets for campaign travel at costs substantially lower than the main alternative, chartering a plane. Federal election rules allow candidates to reimburse corporate jet owners for travel by paying first-class commercial rates and in some instances coach rates for each passenger, making corporate and private jets less expensive in most cases than charters.

Travel costs are a particular issue in this election cycle because so many candidates have been campaigning far earlier than in previous elections. And with so many states having moved up the dates of their primaries, the candidates have more places to be, even at this early stage.

Some candidates rely so often on the same corporate patrons for discounted private jet travel that they seem to have their own air chauffeurs. John Edwards, the Democratic former senator from North Carolina, paid more than $430,000 in the first six months of this year for the use of a jet owned by Fred Baron, his finance chairman, a prominent trial lawyer. Rudolph W. Giuliani, the Republican former mayor of New York, has paid more than $175,000 during the first half of the year for flights on jets leased by Elliott Asset Management, a company owned by Paul E. Singer, a hedge fund executive who is one of Mr. Giuliani’s main backers.

Other presidential candidates have used planes from a variety of companies and executives. Mitt Romney, the Republican former governor of Massachusetts, has taken flights on corporate jets from eBay and from Lawrence Ellison, the chief executive of Oracle, among others. Gov. Bill Richardson of New Mexico, a Democrat, has used planes owned by some companies with business before his state.

The savings can be substantial. A chartered Hawker 800, a midsize, twin-engine corporate jet from Washington, D.C., to Manchester, N.H., would cost about $7,000, according to CSI Aviation services, an air charter company. The Hawker seats 8 to 13 passengers. If a candidate were to reimburse a company for the use of a corporate jet at first-class rates, the same flight would cost less than $700 per person.

A few candidates, including Senators Hillary Rodham Clinton and Barack Obama, both Democrats, have decided not to take corporate flights at all, opting instead to pay hundreds of thousands of dollars more each year to charter their own jets.

And Senator John McCain, Republican of Arizona, began by eschewing corporate jet travel, but with his campaign in straitened financial circumstances has decided it can no longer afford such scruples — even though Mr. McCain sponsored legislation in the Senate that would have required lawmakers to pay the full value of their trips on private planes.

“Senator McCain had hoped that other candidates in the race would follow suit and pay the true cost of chartered planes,” said Jill Hazelbaker, a campaign spokeswoman. “It’s regrettable, but moving forward we cannot continue at such an incredible financial disadvantage.”

The McCain campaign spent more than $1.5 million on air travel during the first half of the year, mostly on chartered planes. Direct comparisons to what other candidates spent are difficult, because candidates have different travel schedules and records filed with the Federal Election Commission do not always make it clear exactly how many flights each campaign took. But it appears that Mr. McCain’s air travel bill was hundreds of thousands of dollars higher than some rivals who took corporate flights.

The campaigns that take corporate flights are well aware of the benefits. Mr. Romney’s campaign actively solicited corporate jets as a way to save money. “One key way in which we can cut costs is by increasing our pool of private planes,” his campaign wrote in an e-mail message it sent to supporters earlier this year.

Critics say the practice allows executives who have already contributed the maximum to candidates to keep providing them valuable help.

“It’s a way of gaining access and influence, a bonus on top of campaign contributions,” said Meredith McGehee, the policy director of the Campaign Legal Center, a nonpartisan, nonprofit group that has lobbied against the use of discounted corporate jets. “It is a back-door subsidy that evades campaign contribution limits, but is done legally.”

Ed Kammerer, a lawyer who specializes in business aviation, represents a number of clients who have been asked to let candidates use their planes.

“There is a lot of solicitation from candidates,” Mr. Kammerer said. “I can tell you from my own experience that there are owners of planes who say that candidate XYZ wants to use my plane, and how can I delicately say no? I’d prefer not to, and I need something to hang my hat on.”

Campaigns that take corporate jets say that the Federal Election Commission allows it and that the companies are not seeking special benefits. Maria Comella, a spokeswoman for the Giuliani campaign, said: “We do everything within the rules and regulations of the F.E.C. That’s the bottom line.”

A spokesman for the Romney campaign, Kevin Madden, said, “There is no expectation of anything in return.”

Mr. Obama, an Illinois Democrat, and Mrs. Clinton, a Democrat from New York, who take only chartered planes now, are also the only candidates who currently get Secret Service protection, which means that they travel with a bigger entourage. An official with the Obama campaign noted that the campaign did not use corporate jets even before Mr. Obama began getting protection. And while the government pays the airfare for the agents, the official said, the campaign must get larger, more expensive planes — which can drive up costs.

The biggest expenditure for private jets this year was the more than $430,000 the Edwards campaign paid Mr. Baron, its finance chairman, for the use of his Hawker 800. Mr. Baron, who is known for litigating multimillion dollar asbestos cases, is a past president of the Association of American Trial Lawyers. His political relationship with Mr. Edwards, a fellow trial lawyer, goes back to 2002, when Mr. Baron donated $200,000 to Mr. Edwards’s New American Optimist political committee and Mr. Edwards began to fly around in planes provided by Mr. Baron.

Eric Schultz, a spokesman for the Edwards campaign, said Mr. Baron was reimbursed at an amount equivalent to a first-class ticket.

Mr. Richardson has paid more than $15,000 this year for flights to Foxtrot partners, which The Albuquerque Journal reported was affiliated with a local developer that had sought highway improvements from the state. Katie Roberts, a spokeswoman for the campaign, said that Mr. Richardson flew commercial when he could, and that when he took corporate jets there were “no expectations” from the companies that provided them.

One person who had provided Mr. Romney with a corporate jet, but may not in the future, is J. Richard Blankenship, a Florida investment banker and former ambassador to the Bahamas. He provided air transport for Mr. Romney three times in February and March, but has since switched his support to Mr. Giuliani.



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