Why Did Ted Cruz Spend $122000 on His Own Books? – The New Republic
On Ted Cruz’s official campaign website, you can purchase a number of tchotchkes to show your support for Ted Cruz. The items range from T-shirts to hats, pullovers to bumper stickers, lapel pins to wine glasses. All of the items cost more than what you might pay for an unblemished version at your local convenience store, but there’s one item in particular whose cost stands out among the knickknacks.
For the eye-opening price of $85, you can buy a signed copy of A Time For Truth, Ted Cruz’s bestselling book, which came out in July to controversy when, despite strong sales, the New York Times left it off its bestseller list. Unlike most of the Cruz knickknacks, A Time For Truth seems more aggressively overpriced; at $85, it’s 303% higher than the full retail price for the book and 506% over its discounted price on Amazon.
Any piece of memorabilia signed by a celebrity is subject to price gouging. But in the case of the books sold by Cruz’s campaign, the donors are the ones paying for the goods, which are then resold to donors at high markups.
This highlights a growing trend of political candidates publishing books, then using those books or their publishers to essentially funds campaign activities—without actually calling it as such. Publishing books allows them to meet thousands of supporters and push their agendas, while holding onto the precious cash that acts as their campaign lifeblood.
In a recent filing to the Federal Exchange Commission, Ted Cruz’s presidential campaign lists a payment of $122,252.62 to HarperCollins. HarperCollins is the publisher of A Time For Truth, meaning those funds were likely used to purchase copies of Cruz’s book. Cruz was paid an advance that his literary agent, Keith Urbahn, confirmed to be “close” to $1.5 million. Urbahn is Donald Rumsfeld’s former Chief of Staff, and a founding member of the Javelin Group, a literary agency whose other founding member is Matt Latimer, formerly a speechwriter for Rumsfeld and President George W. Bush. (The Cruz campaign and HarperCollins did not respond to a request for comment.)
It is not uncommon for authors to buy books directly from their publisher, though not in the quantity that $122,000 suggests. Generally authors buy their own books for the following reasons:
- Personal use (gifts, etc.)
- Sale at non-traditional venues (e.g., bars and general stores that don’t have an account with the distributor)
- Professional sales (authors with regular speaking engagements often sell books following the event)
Publishers love when authors buy their own books. It’s immediate profit. The volume is generally modest, but in a low-margin industry like publishing, direct author sales are as high margin as it gets.
The average hardcover book costs between $2-$4 to produce, depending on volume and binding. That book is then sold to vendors at a discount and retails for $20-$30. Factoring in costs like marketing, editorial work, design, shipping, warehousing, and royalties, publishers make just a few dollars on every copy sold. And copies that fail to sell can be returned for full credit, meaning the publisher must eat the cost of producing those copies.
When authors buy copies directly from their publisher there are no returns, and authors make no royalties from those sales, significantly increasing the publisher’s margins while decreasing its risk.
Based on the $122,000+ that Cruz’s campaign paid HarperCollins, and considering the $27.99 retail price and the typical author discount of 50%, the Cruz campaign likely purchased 8,000-10,000 copies of A Time For Truth. That’s a hefty profit for HarperCollins and a huge profit for Cruz if the campaign is able to sell those copies at $85 a pop. In essence, the campaign is taking money from Cruz’s donors to buy books, many of which they will sell right back to those donors at a massive markup.
Yet, despite the ethical gray area, this may just be how campaigns are expected to fund themselves. Says CNN contributor and syndicated conservative columnist S.E. Cupp: “The idea of public service certainly takes a hit when lining one’s own pockets becomes at the very least a side-job of running for President. But as a book author and a capitalist, I fail to see the issue.”
This is hardly the first time a presidential candidate—or sitting president—has come under scrutiny for questionable book purchases. In 2011, Herman Cain’s campaign was found to have purchased $36,511 worth of Cain’s books from the candidate’s private motivational speaking company. Conservative commentator George Will called Cain an “entrepreneurial charlatan” and said he “used [his campaign] as a book tour, in a fundamentally disrespectful approach to the selection of presidents.”
According to a former senior policy advisor to a presidential candidate, “Every campaign wants to tout their candidate as a #1 New York Times bestseller. And campaigns will do whatever is possible to try to get that top spot, or raise the book two or three spots. And buying books in bulk is part of that.”
Ben Carson, running second to Donald Trump in most polls, recently suspended his campaign to embark on a tour to sell his new book A More Perfect Union. But he’s already running into trouble, as his publisher, Sentinel, is footing the travel bill, even though Carson’s book events seem closer to campaign events than book signings. He drew over 2,000 supporters to a signing at Books-A-Million in San Antonio—and participated in a brief Q&A with reporters—without having to deplete his war chest. Carson’s campaign website offers (unsigned) copies of his books My Life and Gifted Hands for $20—markups from their respective retail prices of $2.99 and $7.99.
In 2010, while on tour for his book No Apologies, Mitt Romney rejected traditional speaking fees, asking that organizations instead purchase the equivalent number of copies of his book. No Apologies landed atop the New York Times bestseller list—albeit with an asterisk denoting bulk sales.
In 2011, the government’s online procurement database revealed that the State Department had spent over $70,000 purchasing copies of President Obama’s books to be used as Christmas gifts and to stock foreign embassies, including $40,000 worth of Dreams From My Father for the U.S. embassy in Cairo. This equates to several thousand copies earmarked for that single embassy.
Using campaign funds to purchase a candidate’s own books is perfectly legal, however the legality of selling them has changed. In 1996, the FEC stated that Senator Al D’Amato could gift the book to donors or fundraisers, but only sell them if the book were self-published. Yet when Scott Brown instigated an FEC ruling for purchases of his book Against All Odds, it was ruled that he could resell the books. The FEC declared that candidates must purchase the books at fair market value (defined as “a bulk rate that is a standard fair market price that the Publisher, under normal industry practice, makes available on equal terms to other large purchasers.” That fair market price usually equates to a discount of around 50%).
And writing books can be quite a lucrative endeavor for politicians—and a chance to travel around the country while courting potential voters on the publisher’s dime. Marco Rubio received $800,000 from Penguin for An American Son. Hillary Clinton got millions for Hard Choices. And because Clinton’s book was released before she declared her candidacy, she did not have to dip into campaign funds for travel expenses. Those were footed, again, by her publisher.
Neither Rubio nor Clinton sells signed copies of their books on their campaign websites. (Nor do Donald Trump or Jeb Bush—though Bush does offer a $75 “Guaca Bowle”).
Book advances and royalties are considered personal income, yet campaign funds to purchase those books for premium resale come from public donations. And governmental gridlock is allowing politicians to push the boundaries of what is exactly legal in terms of campaign finance. Says the former presidential advisor: “Because the FEC is currently 3 Democrats and 3 Republicans, if they’re split on an issue there’s no resolution. And it’s been like this for the last few years. So if there’s a tie on a campaign finance question it means the person can just go ahead and do it because the FEC cannot force a response if there’s a tie. So candidates have really been able to push the envelope on what is and is not legal.”
One example of such envelope pushing is Carly Fiorina’s skirting the legality of coordinating with her super PAC “Carly for America” by publicly announcing her travel schedule weeks ahead of time, allowing the PAC to pick up the expenses. Another is a pro-Ben Carson Super PAC spending over $150,000 buying copies of his books—royalties from that sale that do go to Carson since they were not sold directly to the author. And while the FEC ruling states that any royalties due to the candidate for campaign purchases must be donated to charity, copies bought directly from a publisher by an author are already royalty-free, making that condition moot.
The FEC refused to rule on whether candidates could hold a fundraiser in a city where their publisher had paid for their travel expenses. It did state that candidates could buy their own books to gift to donors, meaning a donation from a low-income supporter could be used to buy a gift for a wealthy supporter.
Says the former presidential advisor: “There’s no difference between a candidate buying their books and using them to raise more money than charging people $200 for a dinner where they eat $5 worth of hummus. “
Adds Cupp: “Ultimately, candidates use any number of legal, admittedly self-promotional means of campaigning and reaching voters. Pushing your own book seems fairly inoffensive. As for selling them back to donors, if they’re willing to pay, why not?”
Which means that donors to political campaigns should be aware that their contributions may not necessarily go directly towards outreach, staffing, and advertising. They might just go toward books and hummus.
Jason Pinter is the Founder and Publisher of Polis Books and the bestselling author of six novels with more than 1.2 million copies in print in more a dozen languages. Follow him at @JasonPinter.