Challengers Need $590,000 a Day to Match Obama Fundraising

Challengers Need $590,000 a Day to Match Obama
Republican challengers such as Tim Pawlenty would need to raise $590,000 a day until June 30 in order to match the amount of money Barack Obama received during the first half of 2007. Photographer: Laura Segall/Getty Images

Barack Obama raised $59 million for his presidential campaign during the first half of 2007. To match that, prospective Republican challengers to his re-election would need to take in roughly $590,000 a day until June 30 if they entered the race today.

The Republican field began to emerge yesterday when former Minnesota Governor Tim Pawlenty said he was setting up an exploratory committee to raise money for a possible candidacy. With some experts predicting that Obama could become the first billion-dollar candidate, every day that other potential contenders wait to follow suit will make it that much harder to match the president’s coffers.

“It would be extremely difficult, if not impossible, for the Republicans to raise as much money as Obama,” said former Republican National Committee finance chairman Al Hoffman Jr., a North Palm Beach, Florida, real estate developer.

Even so, that doesn’t mean the Republicans can’t mitigate an Obama funding advantage. Independent outside groups, such as Karl Rove’s American Crossroads, that helped the party win control of the U.S. House in 2010 are preparing for 2012. And prospective candidates are lining up major fundraisers and preparing efforts to attract small donors.


“All of the potential serious candidates have been laying that groundwork for a long time,” said former Republican Representative Bill Paxon of New York, a senior adviser at Akin Gump Strauss Hauer & Feld LLP. “Just because they haven’t actually started collecting the resources doesn’t mean they haven’t been working on building the infrastructure that will allow them to collect the checks” when needed.

That infrastructure includes forming teams of people to solicit money from wide circles of well-heeled donors. Such “bundlers” have been a staple of presidential campaigns since George W. Bush in 2000 became the first major-party nominee to be elected president after declining to limit spending for the primaries in exchange for federal funds.

“When they give the signal to go, the checks will be written and the money will be there,” said Frank Donatelli, a partner in the law and lobbying firm McGuireWoods LLP who raised more than $100,000 for 2008 Republican presidential nominee John McCain.

The longer the candidates wait to officially run, the longer they can avoid spending campaign funds on staff, office space and other expenses, Republican consultant Eddie Mahe said.

“The moment you start a committee, the overhead starts,” he said. “That’s what’s holding everyone back.”

Small Donors

This cycle’s prospective Republican candidates are also making plans to focus on small donors, following Obama’s 2008 example. Obama raised 54 percent of his money in contributions of $200 or less, according to the Center for Responsive Politics, a Washington-based research group.

“One is cognizant of that,” said Sam Fox, chairman of the St. Louis-based investment firm Harbour Group, who raised at least $200,000 for Bush. “A lot of attention will be paid to that particular aspect of raising money.”

At this point four years ago, virtually all of those who became the main contenders for both parties’ presidential nominations had announced plans to seek the White House. This time, besides Pawlenty, the closest step toward an official announcement came March 3 when former House Speaker Newt Gingrich of Georgia said he was setting up a website to raise money to explore a presidential run.

Other Republicans have been using political committees to raise and spend money on activities that could benefit a presidential quest. These include hiring staff, developing donor lists and traveling around the country to meet possible backers.

Palin’s Committee

Sarah Palin, the party’s 2008 vice presidential nominee, contributed $463,500 last year from her political action committee to Republican candidates and party committees, Federal Election Commission records show. Former Massachusetts Governor Mitt Romney’s PAC had nine people on its payroll at the end of 2010, with part of their salaries paid for by separate committees in five states that he set up to raise money.

Mississippi Governor Haley Barbour’s PAC this month hired Jim Dyke, a former communications director for the Republican National Committee, and Mike Dennehy, campaign manager for McCain’s victory over Bush in the 2000 New Hampshire primary.

Pawlenty, too, used his PAC to pay political consultants in Iowa and New Hampshire, where the opening contests in the nomination race are held.

“It strains credulity to believe these activities are for anything other than wanting to run for president,” said Paul Ryan, a lawyer with the Washington-based Campaign Legal Center, an advocacy group.

$3 Billion

Analysts who track fundraising, such as Craig Holman of Public Citizen, say they expect the 2012 presidential election to cost $3 billion -- almost 50 percent more than the $2 billion the Federal Election Commission said was spent in 2008 by candidates, the political parties and outside groups.

Obama, who raised a record $745 million in 2007 and 2008 for his presidential campaign and was the first major-party nominee to reject public financing for the general election, could raise $1 billion this time around, said Holman, who lobbies on campaign finance issues for the Washington-based advocacy group.

“He’s planning on it,” Holman said. “He thinks he’s got to raise a billion dollars to have a chance for re-election.”

Josh Earnest, a White House spokesman, declined to comment.

Obama hasn’t yet declared his candidacy, though he is taking steps to run. He rallied supporters at campaign-style events in Miami and Boston earlier this month and met with Democratic donors in Washington on March 16.

Outside Groups

While Obama’s eventual Republican challenger may not be able to match the president’s fundraising, the nominee can count on outside groups to help fill in the gap and promote the party’s cause. Such groups spent $185 million on behalf of the Republican message in the 2010 elections, almost $100 million more than Democratic-leaning organizations.

“These outside groups on the right had an election to run their system and see how it worked,” said Republican consultant Alex Vogel, a partner in the lobbying firm Mehlman Vogel Castagnetti Inc. “It did really well.”

Rove’s two Crossroads groups, which raised $71 million in 2010, said they would try to raise $120 million for 2012.

With the exception of American Crossroads, most of the Republican-leaning outside groups don’t disclose their donors, and Senate Republicans have blocked legislation that would require all funders of political ads to be identified.

“We are back to the Watergate era, where we don’t have any adequate system of disclosure,” Holman said. “We’re going to see more outside money than we’ve ever seen before.”

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