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Alexander Orders Campaign Cutbacks

June 3, 1999

WASHINGTON (AP) _ Former Tennessee Gov. Lamar Alexander has ordered drastic cutbacks in his presidential campaign staff and travel because of fund-raising problems, The Associated Press has learned.

The press and legal offices will be gutted in an effort to keep the campaign afloat long enough to see whether Texas Gov. George W. Bush falters this summer, campaign officials said today.

Bush, the early GOP front-runner, has raised more than $10 million this year, drying up potential resources for Alexander.

The sources said Alexander expects to have raised $2.5 million by the end of the second quarter, far below expectations.

``We need to adjust to reflect the difficulties in raising money in the wake of Bush mania,″ Tom Rath, a top Alexander consultant said in a telephone interview from New Hampshire. ``Until that subsides, and it may subside when (Bush) gets out on the campaign trail and we see what kind of candidate he can be, we need to do things to stay viable.″

Rath did not provide details, but three officials familiar with the cutbacks said the payroll was being significantly reduced. Among those leaving the campaign were communications director Steve Schmidt and his deputy, Jeff Macedo; research director Brian Jones; legal counsel Katherine Phillips, and several support staff.

Some of the departing staff will be retained as consultants, but at dramatically reduced pay rates, said the officials, who spoke on condition of anonymity.

In addition, Alexander will reduce his travel _focusing most of his attention on Iowa, the site of the first voting of 2000.

Schmidt, who confirmed that he is leaving the campaign July 1, said, ``The campaign is going to continue forward, making the changes to ensure that it has enough money to be in a position to win the early primary states.″

Alexander began running for the presidency almost as soon as the 1996 campaign ended. He finished a strong third in Iowa and New Hampshire four years ago, giving him an edge heading into the next campaign cycle.

He began the year with high hopes, planning to raise at least $15 million to establish himself as the leading GOP moderate in the race. Starting early, he established one of the strongest organizations in Iowa and New Hampshire.

But the Texas governor has frustrated Alexander’s fund-raising efforts. By the end of June, Alexander expects to have raised just $2.5 million _ compared to the $7 million or so he had planned to collect.

Alexander reported to the Federal Elections Commission that during the first quarter of 1999, he had raised $748,773 and spent $661,856. He had debts of $212,405.

Advisers said the cutbacks are designed to keep Alexander viable until at least August, when the former Tennessee governor hopes to fare well in the Ames, Iowa, straw vote. A strong showing, they believe, will slow Bush’s momentum and make fund-raising easier for Alexander.

``It’s just a very different environment that we thought we’d be in,″ Rath said. ``What will change the fund-raising environment is a change in the political environment.″

``We’re clearing cutting back on our national campaign staff ... to make the best use of our resources in Iowa and New Hampshire, where we believe this race is being run right now,″ Rath said. ``We’re trying to be lean as we can be, putting our resources in those two states.″

The cutbacks come just days after Alexander moved his communications staff from Nashville, Tenn., to Washington to be closer to the national political press corps.

Alexander is not reducing his fund-raising staff and tentatively plans to add staff in Iowa, officials said.

``I’d rather make these adjustments now rather than later. There’s nothing we’re doing now that can’t be undone″ if the campaign gets back on track, Rath said.

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