McCarthy’s Money at Stake for House GOP in Speaker’s Downfall

California Republican Kevin McCarthy rose to the top of the party in part, by his prolific fundraising. Now that members of his own party led a successful effort to wrest the gavel from him, it leaves much uncertainty about who might step in to fill his fundraising shoes and what happens to McCarthy’s own remaining political money.

Whatever happens next, the historic ouster of a speaker may rattle the party’s donors, given the public spectacle of GOP infighting and dysfunction.

Asked about his fundraising prowess Tuesday, McCarthy said Democrats told him they were not going to support him for speaker because he could raise the money to oust them in 2024.

“I think their quote was, ‘Why would we help the person that becomes our executioner?’” McCarthy said.

He took a shot at Rep. Matt Gaetz (R-Fla.), who engineered his ouster, saying sarcastically, “I’m sure Matt Gaetz will give the NRCC a lot of money.”

Photographer: Nathan Howard/Bloomberg

Rep. Kevin McCarthy (R-Calif) walks to the House chamber on Oct. 3 before he was toppled as speaker.

McCarthy’s been an “excellent fundraiser,” said Sarah Bryner, research director at the nonpartisan OpenSecrets.org, which tracks political and lobbying money. “He appears to be very, very, very good at capitalizing on his position to rake in the big dollars.”

Bryner noted that unlike Democrat’s most recent speaker, Rep. Nancy Pelosi (D-Calif.), McCarthy does not hail from a district with mega-wealthy individuals.

Even some of the lawmakers who voted to oust McCarthy on Tuesday have received donations from his coffers or benefited from his fundraising, including Rep. Nancy Mace (R-S.C.) this year. His leadership PAC donated $10,000 to her campaign this year, according to FEC records.

GOP donors and lobbyists said that McCarthy has been among the best in fundraising for their party. Someone else likely could eventually fill the role, but that person would face a challenge to woo donors amid the chaos and uncertainty.

McCarthy held more than $9 million in his re-election campaign as of June 30, according to federal campaign disclosures. McCarthy’s Majority Committee leadership PAC held almost $4 million on Aug. 31, according to an FEC filing.

That’s just part of his largess to the party. McCarthy has already transferred millions of dollars to his party’s campaign arm and other coffers.

He also uses multiple joint-fundraising committees to help haul in donations for the National Republican Congressional Committee, other committees and individual members.

Additionally, he’s helped raise big money for outside groups aligned with the party, including the Congressional Leadership Fund, the chief super PAC for House Republicans, and its related nonprofit organization American Action Network, which runs issue advocacy ads.

CLF and AAN have hauled in $80 million, combined, this year, a record by $20 million, according to the group’s figures.

Dan Conston, who leads CLF, defended McCarthy on X, formerly Twitter, Tuesday, calling the effort to oust the speaker pointless. McCarthy, he wrote, is “popular with Republicans nationwide. He is far from a liability in swing districts.”

Other House GOP leaders raise big money, too, but not to McCarthy’s level. House Majority Leader Steve Scalise (R-La.), who is undergoing treatment for cancer, had hauled in $5.6 million to his re-election fund and his Eye of the Tiger leadership PAC had nearly $900,000 as of June 30, disclosures show.

Reps. Jim Jordan (R-Ohio), who chairs the Judiciary Committee; House Majority Whip Tom Emmer (R-Minn.); and House GOP Conference Chair Elise Stefanik (R-N.Y.) are also among their party’s top fundraisers, according to FEC disclosures.

Political Fortune Telling

As McCarthy’s future hangs in the balance, so does the future of his political fortune.

Michael Toner, a partner at the law firm Wiley and a former chairman of the Federal Election Commission, said that what happens to a speaker’s political funds depends on the lawmaker’s next step. Should he stay in office, then there would really be no change – a lawmaker could remain a candidate for office, even if no longer in leadership. (That’s what Pelosi did.)

If McCarthy resigns from office, he could do several things with his pile of political money. Toner noted that when ex-Speaker Newt Gingrich (R-Ga.) lost his gavel, he exited Congress altogether.

“There are options for what they can do with their political money,” said Toner, who chairs his firm’s election law and government ethics practice.

He noted that ex-lawmakers may donate unlimited sums to their party committees or to charities. They can also keep hold of the money, and use it for a future run for office or use it to dole out to other candidates, including if they go into lobbying or other private-sector gigs. They are prohibited from using re-election funds for personal use.

When it comes leadership PACs, though, no such personal-use restrictions exist, Toner said.

Bryner added that McCarthy, like all departing lawmakers, could transfer any of his political cash to super PACs.

He can also hang on to it and use it for a future run. Gingrich was a presidential contender in 2012.

“Probably, most likely, he will keep it and sit on it because you can hold onto a campaign committee for decades,” she said. “It’s not exactly like an interest bearing place to make money, but it’s there if he ever wanted to use it.”

McCarthy said he would continue to help the GOP in any way possible, including fundraising.

Zach C. Cohen in Washington also contributed to this story.

To contact the reporter on this story: Kate Ackley at kackley@bloombergindustry.com

To contact the editors responsible for this story: George Cahlink at gcahlink@bloombergindustry.com; Bennett Roth at broth@bgov.com