THE MONEY CHASE

By MICHAEL DUFFY NASHVILLE

It's a good thing the tennessee State Highway Patrol doesn't issue citations for high-speed pursuit of matching funds. By the time Lamar Alexander wheeled his red Buick Reatta convertible down Nashville's "Music Row," he could have been ticketed twice and would have been in danger of losing his license as he headed for his third fund-raising meeting of the day. The former Tennessee Governor got up before dawn that morning in New Hampshire, flew to Nashville and then addressed his 40 top local financiers at a genteel Governor's-mansion lunch. He later huddled with country-music star Ray Stevens (A-hab the A-rab) to plan the entertainment for a $2 million fund-raising dinner this Monday and then dashed to a small arm-twisting reception on Nashville's storied southwest side around dusk.

For Alexander it was just another day in the 1995 campaign, a marathon of mendicity that will do much to determine which G.O.P. hopefuls will survive to compete in the 1996 campaign. Like his counterparts in the race, Alexander calls fund raising "the 1995 primary" and says he needs to raise $20 million by the end of this year. Privately, fund raisers in his camp (and others') admit the real target is closer to $30 million. To pull it off, Alexander will attend 296 fund-raising events this year--a daunting schedule that is designed to raise, as Alexander's finance chairman Ted Welch coolly puts it, "a mil every 10 days." To the men who yearn to be Commander in Chief, the endless money grubbing is something to be endured, not enjoyed. As Alexander says, "I feel like a trained dog."

Now that the G.O.P. primary campaign is under way, money is the first order of business--and often the second and third. Pennsylvania Senator Arlen Specter spends four hours every morning cold-calling prospects, sometimes making a joking promise to suburban Philadelphia lawyers that if he loses, he won't come open a law office in their neighborhood. Phil Gramm has been traversing the country with a slickly produced slide show designed as much to intimidate opposing fund raisers as to shake the tree for himself. This week Bob Dole is preparing his third direct-mail drop in nearly as many months. And while candidates like to boast about the number of days they've spent in hurdling snowdrifts in New Hampshire and sampling sausage in Iowa, they're less forthcoming about the many trips to beg in New York City, Los Angeles, Miami and Aspen, Colorado, where the real money is.

The calendar is the chief culprit: because the Republicans and the states have shoehorned 35 primaries into 29 days in February and March 1996, candidates will have to compete simultaneously in many more places than in the past. The squeeze will force hopefuls to rely heavily on TV and radio advertising, and that takes money--lots of it. This year all the Republicans must set aside time to raise money from skeptical donors who barely know them. As a result, much of the time candidates normally spend meeting voters, discussing issues and formulating positions must now give way to schmoozing affluent donors. As Alexander notes, "I'd be a much better prepared President if I spent less time on Wall Street and more time on Main Street."

Raising $20 million isn't cheap: in 1995 alone most campaigns will spend roughly $5 million setting up an organization and moving the candidate around the country, $3 million for accounting and legal fees and $4 million in fund-raising costs. That will leave $8 million in the bank at year's end. But because an average of 36% of all contributions is matchable by federal funds, candidates who raise $20 million this year can expect a sudden infusion of $7.2 million on the first of next year.

How are the camps getting to $20 million? The preferred forum is the large, $1,000-a-head event at a big hotel or convention center, like Gramm's kickoff dinner in Dallas, which raised $4 million. The big events raise the most money, partly because they have the lowest average cost. Thus Alexander's 2,000-person event Monday night in Nashville should bring in $2 million in ticket sales before being offset by $150,000 to $180,000 in expenses. But that is not the bottom line. Because the first $250 of every $1,000 ticket is eligible for federal matching funds after Jan. 1, 1996, the Nashville dinner will eventually yield an additional $500,000. Total take for the evening: more than $2.3 million. Alexander plans to hold 28 such dinners; Gramm has been holding at least one fund-raising event for every day he is on the road.

The basic task is the same: erect an old-fashioned pyramid of donors in which each operative identifies 10 to 20 people who can each give $1,000, the maximum allowed by law. Each donor is then pressed to identify another 10 to 20 friends to do the same. The complex task of assembling so many names helps explain why veteran fund raisers, who boast networks of anywhere from 2,500 to 10,000 potential donors, have been courted so heavily by Dole, Gramm and Alexander in 1994 and 1995. "The objective is to find 20,000 people to give you $1,000 each," says Wayne Berman, a top G.O.P. fund raiser who is being wooed heavily by both Dole and California Governor Pete Wilson

Of course, not everyone can give $1,000, so fund raisers contrive all sorts of ways to meet their targets. With a list of nearly 100,000 names, Patrick Buchanan, for example, will rely more heavily than his rivals on direct mail.

While the cost of mail is much higher than conventional fund-raising dinners-roughly 30% of every dollar raised by direct mail goes to paying for the postage and printing-a higher percentage of the take is matchable because the contributions are typically under $100 each. Dole will raise about a third of his money through direct mail, said finance director Jo-Anne Coe. Dole's camp won't divulge how much the mail has yielded so far, but Coe reports that "it's just going gangbusters." Alexander may soon hold $100-a-head receptions in small towns for younger donors who aren't able to make the full $1,000 contribution. "If you did 100 people," notes Larry Bathgate, a veteran G.O.P. fund raiser based in New Jersey, "it's a $10,000 event to start. When it's matched, it's a $20,000 event."

Then there is the house party: because federal election law allows donors to hold receptions at their homes for a candidate (and exempts the cost of food and wine from the $1,000-a-person limit), living rooms are increasingly the low-cost venue of choice. Donors invite anywhere from 25 to 50 friends and their spouses over for cocktails, with an eye to raising $1,000 from each. The total take for such an event could reach $100,000-and at no cost to the campaign. After the federal matching funds kick in, the total grows to $125,000. "Everybody doesn't know 50 couples with $2,000," says Bathgate. "But everybody knows 20 people who can bring five to 10 more. So you start going through sisters and brothers and nephews and nieces and aunts and uncles and their accountants, lawyers and business partners." Two or three house parties a day begin to add up.

It was to a house party that Alexander hurried last month at the end of a long day of fund raising. Nashville attorney Joe Barker and his banker wife Patricia had agreed to find 25 people to buy $1,000 tickets to this week's dinner. With less than a month to go, the Barkers were still shy of their quota, so instead they invited 40 friends over to hear Alexander give a sneak preview at no charge. Merlot and asparagus canapas were passed among the mix of Republicans, Democrats and independents. As usual, the candidate didn't ask for the cash. After speaking, Alexander turned the floor over to Joe Rodgers, his finance co-chair, to turn the screws. "For you in the room," said Rodgers, who raised money for Ronald Reagan and later became Ambassador to France, "this is the best opportunity you'll ever have to elect someone you know to be President. We want to raise $2 million at this dinner, and it is essential that we do this. That means everyone-and if you can afford it, your children too-give that $1,000. If you and your spouse haven't given, please do so." The tactic worked: by last Friday, with four days to go before the dinner, the Barkers had met their $25,000 quota and were a few tickets shy of $50,000. "And I'm still working on them," Joe Barker says.