Mass. rich help both parties

By Bob Hohler, Globe Staff, 08/16/99

ASHINGTON - Steven and Barbara Grossman have reached a rare milestone in American politics. In the fund-raising frenzy of the 1990s, the Newton businessman and his wife, a Tufts University professor, have given more than $1 million to the Democratic Party and its candidates.

The Grossmans, heirs to the Massachusetts Envelope empire, embody the stereotype of Massachusetts as a bastion of affluent liberals bankrolling the Democratic machine.

But several wealthy Republicans are burying that image under a crush of campaign dollars. In a struggle for political supremacy that has pitted neighbor against neighbor and business partner against business partner, the state's top GOP contributors are racing Grossman and his Democratic allies to help finance the multimillion-dollar campaigns for the White House and Congress in 2000.

Most of the Republican backers are little known. But behind the scenes, some of them are playing major roles in national politics, including:

John W. Childs, a Boston investor who has effectively served as the Republican counterbalance to Grossman. Childs and his wife, Marlene, have contributed more than $820,000 to the GOP cause in the 1990s, and the Republican Party is counting on them to contribute an additional $1 million over the next four years.

John A. Kaneb, an oil magnate who owns H. P. Hood Inc. and part of the Boston Red Sox. Kaneb and his wife, Virginia, have given Republican candidates and committees more than $520,000 during the decade, including $340,000 in 1997 and 1998 to help the GOP maintain control of Congress.

Herbert F. Collins, chairman of Boston Capital Partners Inc., who has made the largest single political donation in Massachusetts this year, $40,000 to the Repubican Party. In the 1990s, Collins and his wife, Sheila, have donated nearly $440,000 to the GOP and and its candidates.

Unswayed by the failed push in Congress to ban ''big money'' in politics or by the referendum in Massachusetts last year to establish public funding for campaigns for state offices, the state's titans of political giving are emerging among the nation's most prolific contributors of the decade.

Amid the explosion of large, unregulated contributions known as soft money, many of the top Massachusetts donors are giving more than ever in this year of record-setting political fund-raising.

''Unless small groups of passionate Democrats like myself and many others are prepared to step up and be significant funders of the party, we risk creating such an imbalance in the system that it would have a negative effect on our ability to get the job done politically,'' said Grossman, the former chairman of the Democratic National Committee.

Childs gave the GOP more than $515,000 in soft money in 1997 and 1998, more than any other Massachusetts donor gave either party. Only four individuals in the country donated more soft money than Childs over the two years, including Richard M. DeVos, the Amway founder, who gave the Republican Party $1 million.

Unlike Grossman, an ardent public advocate for the Democratic cause, Childs shuns public attention. He and the state's other top Republican contributors did not respond to requests for interviews.

''My theory has generally been: Don't talk to people and they won't write about you,'' Childs said in a rare interview in 1995 with the Globe.

Childs and Thomas H. Lee, his former business partner, apparently had no trouble working together and financing rival political parties. Childs split from Lee's investment firm in 1995 to start his company.

While Childs was providing financial fuel for Republicans in the early 1990s, Lee was donating part of the $520,000 that he has given the Democratic Party and its candidates over the decade.

Notable among the current business partners with clashing political interests are Collins and John P. Manning, the president of Boston Capital Partners.

Six months before Collins gave his $40,000 check to the Republican Party in February, Manning hosted President Clinton at a $25,000-per-person fund-raiser for the Democratic Party at his Beacon Street townhouse near the Public Garden. Manning donated $50,000 to the event, boosting his personal contributions to the Democratic Party and its candidates above $600,000 for the decade.

Next door to Manning's townhouse are the headquarters of Thomas A. Kershaw, owner of the Hampshire House. While Clinton was dining at Manning's townhouse, Kershaw's business interests were providing Kershaw with the income to help fund the Republican attack against the president's party.

That week, Kershaw wrote checks for $8,500 to various GOP candidates and committees, part of his $351,000 in personal giving over the decade. Kershaw's companies also have given nearly $30,000 to the Republican cause.

Amid the fund-raising free-for-all, some of the state's biggest donors have decided the current campaign finance system is broken beyond repair. Prominent among them is Arnold S. Hiatt, retired chairman of the Stride Rite Corp., who gave the Democratic Party a check for $500,000 three weeks before the 1996 election.

Disgusted with the campaign-finance scandals that followed the election, Hiatt helped launch a push for publicly funded elections and funded that effort rather than political parties.

As a result, the only contribution that Hiatt or his wife, Anne, made last year to a political party or candidate was $1,000 to Senator John F. Kerry.

Although Congress has rebuffed the push for publicly funded elections, the initiative has gained momentum or succeeded in several states, including Massachusetts. ''Contrary to the conventional wisdom, there is a crescendo of interest in true campaign finance reform,'' Hiatt said.

Grossman agreed on the need for change. But like donors in both major parties, he said he is not willing to suspend his giving ''and leave the entire battlefield monopolized by the other side.''