Iowa Independent first reported Fallon’s intent to challenge Boswell in December. By January, when Fallon officially announced his candidacy, many saw potential for an upset because of the his unexpected success during the 2006 gubernatorial campaign. In that race, Fallon placed a close third, but he won more votes in the counties comprising Boswell’s congressional district than his opponents did because of a wide margin in Polk County.

But the three-way race in 2006 turned out to be no barometer for the two-way contest this year.

Boswell began with a vast campaign account and maintained his fundraising advantage until the end. He accepted money from political action committees (PACs), while Fallon did not. Fallon did receive support from online activists across the country. Democracy for America and the blog OpenLeft helped him raise over $75,000 online — likely the highest online fundraising total in Iowa history. Still, Fallon fell far short of the $700,000 fundraising goal he set for himself when he announced his candidacy.

Although Boswell did not campaign as actively as Fallon throughout the district, his staff worked diligently behind the scenes to encourage supporters to vote absentee. Fallon, who spent the majority of his money on a large staff of organizers, did worse than expected on this count. In rural Mahaska County, for instance, Boswell received 13 times more absentee ballots than Fallon (the margin was 131-10). In Iowa County on the district’s eastern edge, Boswell won the absentee vote 66-6.

Because of high personnel costs, Fallon’s campaign was unable to afford to advertise by mail or on television. Boswell, on the other hand, sent voters a slew of negative mailings, several attacking Fallon for endorsing Green Party “spoiler” candidate Ralph Nader in the 2000 election. He also used the “franking privilege” afforded members of Congress to send two positive mailings to his constituents for free. And in the final week of the campaign, Boswell received help from an unaffiliated political organization classified as a “527,” which sent mailings to voters that made exaggerated claims about Fallon’s supposed support for sex offenders and methamphetamine users.

Fallon did have one bright moment in the contest, when he received the endorsement of the Des Moines Register. Many expected that the endorsement, combined with what appeared on financial disclosure reports to be an aggressive effort to get out the vote, could springboard Fallon to victory.

But Fallon had trouble gaining traction from the beginning of his campaign. His criticisms of Boswell received generally little press coverage, perhaps because the same issues had been argued ad nauseam during the year-long Iowa caucuses, or perhaps because Fallon’s relationships with most members of the Democratic Party establishment across the state had become strained during his years in the state legislature. Fallon’s message was also drowned out by the ongoing presidential race, which consumed most of the space that newspapers and television newscasts devoted to political coverage. He received the most press attention of the campaign after Iowa Independent revealed complicated campaign finance questions related to his unregulated political advocacy organization, I’M For Iowa.

Fallon’s lack of positive media attention coupled with disappointing fundraising numbers prevented him from communicating his message to voters, but his resounding defeat indicates that even so-called “high information” voters, who were well informed about both candidates, broke in Boswell’s direction.

Boswell now faces a general election challenge from Republican Kim Schmett, a member of the conservative establishment who worked for former U.S. Rep. Greg Ganske in Washington, D.C. Schmett has raised just over $50,000 to date.

Leonard Boswell, on the other hand, even looks as if he could have been sent from central casting to play the part of good old boy politician. And his campaign finance course has been traditional, too. He hauled in more than $540,000 in PAC contributions during 2007.

So how come Fallon is losing ground on, of all issues, campaign finance?Campaign finance was supposed to be one of Fallon’s signature issues in his Democratic primary challenge to incumbent Boswell in the 3rd Congressional District. Fallon has long refused PAC and lobbyist donations, and during his legislative campaigns turned down donations of over $100.

But Team Boswell has the experience to live carefully within the letter of the law, while Fallon looks at though he’s got his fingers in the till for paying himself a subsistence salary while he shut down his gubernatorial campaign. And his grass-roots I’M For Iowa effort, while fully in the spirit of what campaign reform is supposed to be about, may not be within the letter of the current law. Campaign finance law is tricky about letting money and lists slop over from one effort to another.

There’s no good spin on this for Fallon. The worst interpretation of the salary question is hypocrisy, and his best defense is to embrace the charges. Community organizing (hot buzzword) takes time, he could say, and money, and isn’t a salary paid by small-dollar campaign donors preferable to an outside job with potential conflicts of interest? That may or may not fly. The money and list issues may be Fallon’s bigger problem, as it makes the campaign look like amateur hour.

The Legislature’s relatively quick action on proposals to ban personal salaries from campaign committees could be in part due to Fallon’s relatively unpopular status under the dome. That’s in sharp contrast to the amiable Boswell’s personal popularity with legislators during his 20-year state Senate career. The party power structure quickly united behind Boswell to fend off the Fallon challenge; note the quick endorsement of Boswell by party leaders who often stay out of primaries, with Tom Harkin topping the list.

Back in 2006 during his gubernatorial run, legislators expressed their off-the-record contempt for Fallon. “Grandstander” was the rap. Maybe some legislators were irritated by his lone votes on 99-to-1 roll calls.  Most of them were backing Mike Blouin (the seeds of that particular mutual discontent may be sprouting in the collective bargaining standoff with Gov. Chet Culver). That grudge about Fallon’s Ralph Nader endorsement in 2000 runs pretty deep too, even though Al Gore carried Iowa and even though Fallon has repeatedly apologized and denounced the endorsement. The Nader thing has allowed Boswell to undermine the whole premise of Fallon’s candidacy by putting the “I’m a better Democrat” card in the incumbent’s hand. Which is really funny, considering that in 2006 Boswell had a voting record to the right of Iowa Republican Jim Leach.

There’s a supreme irony here, that Ed Fallon is losing points to Leonard Boswell on campaign finance reform. But in the end, Fallon got into the mess himself. As he has his whole career, he was living on the edge of the acceptable, and Iowa’s Democratic establishment is eager to kick him now that he’s down.

But the FEC denies confirming any facts in relation to a specific campaign.Fallon’s press release did not attribute the determination to any specific individual at the Federal Elections Commission (FEC), nor did it provide a direct transcription of the Information Services department’s answer to the campaign’s inquiry.

According to FEC spokesperson George Smaragdis, it would have been against commission policy for an employee to answer such a question as it related to any specific campaign.

“No Commission employee made any determination relative to the specific circumstances of any campaign,” Smaragdis told Iowa Independent in an emailed statement.  “Only the Commission can make such a determination.”

The commission, which currently lacks enough appointed members to issue rulings, has not yet considered any legal questions related to the contested Democratic primary between Fallon and current US Rep. Leonard Boswell.

Although Fallon claims that Boswell has accused him of violating FEC regulations, neither Boswell himself nor the numerous news reports of the story have gone as far as to claim Fallon acted illegally, and Iowa Independent’s story noted that FEC regulations do not appear to explicitly prohibit connections between a for-profit general partnership like I’M For Iowa and a federal congressional campaign.

Rather, Boswell and others have so far only alleged that Fallon’s financing practices raise ethical questions — namely, whether a federal candidate should be allowed to raise unlimited, undisclosed donations for a personal business that then uses its resources for the purposes of his or her political campaign.  Fallon’s critics have stopped short of alleging anything illegal.

In light of Fallon’s history of adhering to stricter campaign finance standards than required by law and his long-standing emphasis on campaign finance reform, operating in an apparent ethical gray area may be seen as particularly damaging to his campaign.

More pictures below the fold.

Obama reiterated his campaign promise to enact universal health care by the end of his first term as president. During his speech, Obama provided the audience with an overview of his health care plan and, when it came to calling out the big drug and insurance companies for their role in exacerbating the health care premium boon, Obama pulled no punches: “In the richest nation on Earth, it is simply not right that the skyrocketing profits of the drug and insurance industries are paid for by the skyrocketing premiums that come from the pockets of the American people.”

Drawing on the experiences of Amy and Lane Chicos of Decorah, Obama helped highlight the current ills of the health care system and how it fails hardworking people who play by the rules but may face bankruptcy should a medical emergency arise. In the Chicos’ case, Lane was diagnosed with cancer when he was 21. In his 17-year battle against cancer, Lane lost a lung, a leg bone and part of a hip, but managed to overcome the cancer. Today, however, in the face of bankruptcy, Lane faces the new battle of somehow paying his family’s $1,000-per-month health insurance premium. Obama acknowledged the Chicos’ plight, reaffirming that they are not alone, “Over half of all personal bankruptcies are now caused by medical bills.”No Americans are immune to the skyrocketing costs of health insurance premiums. “Health care premiums have risen nearly 90 percent in the past six years. That’s four times faster than wages have gone. Eleven million insured Americans spent more than a quarter of their salary on health care last year,” said Obama.

Obama recognized he’s not the first person to call for health care reform: “Every year, candidates offer up detailed health care plans with great fanfare and promise, only to see them crushed under Washington politics and drug and insurance industry lobbying once the campaign is over. These industries have spent more than $1 billion on lobbying and campaign contributions over the last 10 years to block the kind of reform we need.”

Additionally, Obama cites administrative costs and antiquated record-keeping as other causes for the continuous spike in health care premiums: “One out of every four dollars we spend on health care is swallowed up by administrative costs.” Again, Obama holds the drug and insurance industries responsible for the brunt of these costs. “Since President Bush took office, the single fastest-growing component of health care spending has been the administration costs and profits for insurance companies. Coming in a close second is the amount we spend on prescription drugs. In 2006, five of the biggest drug and insurance companies were among the 50 most profitable businesses in the nation. One insurance company CEO received a $125 million salary that same year and has been given stock options worth over $1 billion.”

To combat what Obama called the biggest obstacle in reforming health care, part of his plan is dedicated to breaking the stranglehold that a few of the big drug and insurance companies have on the health care market. Under Obama’s plan:

We will make generic drugs more available to consumers, and we will tell the drug companies that their days of forcing affordable prescription drugs out of the market are over.

In the last 10 years, there have been over 400 health insurance mergers. Right here in Iowa, just three companies control more than three-quarters of the health insurance market. These changes were supposed to increase efficiency in the industry. But what’s really increased is the amount of money we’re paying them.

This is wrong, and when I’m president, we’re going to make drug and insurance companies compete for their customers just like every other business in America. We’ll investigate and prosecute the monopolization of the insurance industry.

Sen. Obama shakes hands with crowd members after speech

9:33 and live from University of Iowa Hospitals and Clinics with the Obama health care event.  This is today’s national centerpiece — “biggest event since the announcement” says one staffer.  Seven TV cameras so far.The Obama camp released some details early.  The broad outlines: