Democratic presidential candidate and South Bend, Ind. Mayor Pete Buttigieg speaks during a town hall, Sunday, Dec. 8, 2019, at the Coralville Marriott & Conference Center, in Coralville, Iowa. (Joseph Cress/Iowa City Press-Citizen via AP)

Swarovski crystals, $900 cabernet and a Buttigieg fundraiser

December 13, 2019 - 7:10 pm

WASHINGTON (AP) — The Hall Rutherford wine caves in the hills of California's Napa Valley boast a chandelier with 1,500 Swarovski crystals, an onyx banquet table to reflect its luminescence and bottles of cabernet sauvignon that sell for as much as $900.

It is also where Pete Buttigieg, the Democratic presidential candidate, will dine privately with donors following a Sunday fundraiser hosted by Craig and Kathryn Hall, the winery’s billionaire owners, according to an invitation obtained by The Associated Press.

The fundraiser is both a measure of the unexpected success of the mayor of South Bend, Indiana, who has vaulted into the top tier of candidates and of the perilous optics of consorting with well-heeled donors that offers such a stark contrast with his more liberal rivals.

The event, which has not yet been listed on Buttigieg’s public schedule, will cap a week in which he agreed for the first time to disclose fundraisers for his campaign and allow news media to attend, a step he took after pressure from Massachusetts Sen. Elizabeth Warren and some progressive activists who charged that he has something to hide.

As Buttigieg's campaign has ascended, so has the scrutiny of him. He has raised more than $50 million and is among the leading candidates in polls both in Iowa and New Hampshire. His approach to raising campaign money, as opposed to that of Warren and Vermont Sen. Bernie Sanders, who rely on more small-dollar donors, offers a test of whether that issue actually matters to voters.

“Most voters don’t care how you raise your money because they are more focused on the issues that affect them day-to-day,” said Rose Kapolczynski, a Democratic strategist in California who was a longtime adviser to former Sen. Barbara Boxer. “But if your fundraiser sends a message that you are more concerned with the wealthy and big corporations than you are about regular people, that can cause problems.”

Craig and Kathryn Hall are prolific donors who split their time between Dallas and their California wineries. But they have also drawn notoriety over their past giving, as well as Craig Hall’s role in a 1980s savings and loan crisis.

Massive contributions to Democrats in the 1990s helped secure an Austrian ambassadorship for Kathryn Hall during Bill Clinton’s second term. Risky investments by Craig Hall, the chairman and founder of the Hall Group, during the savings and loan meltdown in the 1980s culminated in an over $300 million federal bailout and the resignation of House Speaker Jim Wright of Texas, a Democrat he turned to for help.

Federal regulators had been zeroing in on a series of Hall’s unpaid loans. To push back, the developer and bank operator turned to Wright, who was then ascending in the House leadership, to get them to back off, the AP reported at the time.

Wright held up legislation that would have given the struggling industry a $15 billion lifeline and told federal officials they had a “choice.” A few days later, the regulator overseeing some of Hall’s loans was replaced and the legislation moved forward.

Taxpayers eventually covered the cost of Hall’s default while the developer’s outreach to Wright played a central role in a congressional ethics investigation that toppled him from the speaker's office in 1989.

In 1993, the year Craig and Kathryn Hall were married, he agreed to pay a $100 million settlement and moved on.

The couple has since given a minimum of $2 million to Democratic Party committees and have donated substantial amounts to House Speaker Nancy Pelosi, according to an analysis of data from the Federal Election Commission. That total, though, is likelier higher because not all their older contributions show up in current FEC records.

In 1996, they were among a group of high-profile donors who attended a coffee at the White House with Clinton and donated at least $234,000 to Democrats while he sought reelection. Kathryn Hall was part of a group of contributors who were later rewarded with ambassadorships.

Buttigieg’s campaign did not say how the campaign became acquainted with the Halls, or whether he courted them as potential donors. Craig Hall did not respond to a request for comment made through his company.

In a statement, campaign spokesman Chris Meagher emphasized that Buttigieg doesn't solely rely on big-dollar donations and has received an outpouring of small amounts from everyday people, who gave on average $32 during the last three-month reporting period.

“We are proud to have the support of more than 700,000 grassroots donors across the country who are helping power this campaign,” Meagher said. “The only thing people are promised at an event with Pete is that he will use that money to beat Donald Trump.”

On Friday night, Buttigieg's campaign released a list of people who had raised at least $25,000 for the campaign.

More than any other White House contender, though, Buttigieg has emerged as a favorite of the donor class, whose patronage has given him the financial might to compete well into the primary.

It’s also stirred criticism from progressives that Buttigieg — a Harvard-educated child of academics — is a product of privilege who is out of step on issues such as income inequality, college debt and government-run health care, as well as calls to get big money out of politics.

Most leading contenders in the Democratic primary took steps to add transparency to their big-dollar fundraising months ago, if not forgoing such events altogether. Former Vice President Joe Biden allows media into his fundraisers. Warren doesn’t attend big-dollar events outside of those for the Democratic National Committee, which are open to the news media. And Sanders holds “grassroots” fundraisers that anyone can attend for $27.

Yet Buttigieg repeatedly declined to follow suit, even as some problematic donors generated negative attention to his campaign.

In October, he parted ways with a former Chicago city attorney who was helping raise money for his campaign after news stories detailed how the lawyer fought the public release of video footage that showed the death of Laquan McDonald, a black teenager who was shot by police 16 times. Earlier this year, Buttigieg refunded about $30,000 in contributions from federal lobbyists.

When previously pressed over whether he would open his fundraisers to the media, Buttigieg demurred and said the question was one for his campaign to answer — not him. But as pressure increased, he said he was considering the possibility, though he couldn’t say when.

That changed this week as the crescendo of criticism grew and as progressive activists attacked him as “Wall Street Pete.”

On Friday, Buttigieg dismissed the criticism of his big-dollar fundraising, noting Warren herself embraced big-money donors in the past, using some of that money to seed her presidential campaign.

"The thing about these purity tests is the people issuing them can’t even meet them,” Buttigieg said during an event at The Washington Post. “If doing traditional fundraisers disqualifies you from running for president, I guess neither of us would be here."

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Associated Press writers Alexandra Jaffe in Washington and Michelle R. Smith in Providence, R.I., contributed to this report.

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