Related Resources On NationalJournal.com National Journal Cover Story: "The Rock Star and the Rest" (4/29/05) · National Journal Cover Story: "Hillary, Inc." (10/17/03) · National Journal Cover Story: "The Internet and Democrats" (7/1/05) · National Journal Insiders Poll: 2008 Presidential Nominees (4/30/05) [PDF] · On The Trail: "Can Hil Top This Bill?" (11/16/05) · Poll Track: National Polling On Potential '08 Match-Ups Additional Resources On The Web Sen. Hillary Clinton's "HILLPAC" · Former Sen. John Edwards' "One America Committee" PAC · Sen. John Kerry's "Keeping America's Promise" PAC · Former Gov. Mark Warner's "Forward Together" PAC · Sen. Evan Bayh's "All America" PAC · Sen. Joe Biden's "Unite Our States" PAC · Gen. Wesley Clark's "WesPAC" · Gov. Tom Vilsack's "Heartland PAC" · Gov. Bill Richardson's "Moving New Mexico Forward" campaign Web site · Sen. Russell Feingold's "Progressive Patriots Fund" PAC

By Marc Ambinder, National Journal
© National Journal Group Inc.
Friday, April 21, 2006

Evan Bayh eased back in his plane seat and read a memo that his political advisers had tucked into his briefcase. It contained biographical sketches of the dozen or so fellow Democrats whom the ambitious Indiana senator was on the way to meet in Dallas. That same mid-December weekend, 2,000 Florida Democrats gathered in Orlando to hear several potential presidential candidates give their early proselytizing spiels. Bayh had been invited, but begged off. For a first-time presidential candidate like Bayh, developing a network of supporters dedicated to raising massive amounts of money is such an imperative that passing up the chance to impress 2,000 top political activists in a critical state wasn't difficult. In the words of a Bayh consultant, "We need to think long-term."

At this stage of the 2008 race, Bayh's biggest hurdle is that most Democrats with a proven ability to round up $50,000 or more in contributions are already in the camps of other candidates, mostly Hillary Rodham Clinton's. Another segment of the Democratic donor world remains faithful to 2004 presidential standard-bearer John Kerry or to one of his competitors for the 2004 nomination. Through his donor and e-mail lists, Sen. Kerry can communicate with 3 million Democrats in an instant.

Bayh is also up against several other would-be 2008 candidates who, like him, are just beginning to construct their fundraising platforms. Bayh and former Virginia Gov. Mark Warner, for example, find themselves competing for many of the same mega-donors, especially for those who worry that Clinton is too much of a lightning rod to ever win the White House.

Just as presidential candidates now automatically try to replicate George W. Bush's success with his Republican corps of fundraising "Pioneers," the current crop of Democratic wannabes also apparently intends to follow Kerry's example by opting out of primary-season federal matching funds -- and the state spending caps that accompany them. Leading Democratic politicos have come to believe that spending more in Iowa than the matching system allowed was critical to Kerry's winning that state's first-in-the-nation caucuses -- and to his clinching the nomination.

"For [2008] candidates to be taken seriously, they're going to have to opt out of the campaign finance system," says Fred Hochberg, a longtime Democratic donor from New York City who was deputy administrator of the Small Business Administration during President Clinton's administration and is now a dean at the city's Milano New School for Management and Urban Policy. "Nobody is going to be hemmed in."

The nearly universal estimate among Democratic fundraisers and strategists is that to be competitive in Iowa this time around, a candidate will need to have raised $40 million. That's double what top-tier Democratic campaigns aimed to raise by the time of the Iowa caucuses in 2004. And that's where people such as Nancy Jacobson, Bayh's finance architect, come in.

Jacobson has scoured lists of donors to Democratic campaigns and various interest groups to pinpoint contributors she thinks are the least likely to have strong ties to Bill and Hillary Clinton and the most likely to develop an affinity for Bayh. A large portion of Bayh's ripest prospects, Jacobson assumes, began to give big bucks after 1996 -- that is, after Bill Clinton's last run for the presidency. And Jacobson thinks certain traits increase the likelihood that a contributor will become a Bayh loyalist -- being pragmatic, for example, or being a business owner, or young, or Hispanic, or female. And the fewer ties to established Democratic constituencies, such as the trial bar, the better.

Jacobson was finance chairwoman of the Democratic National Committee during the Clinton years and is a former finance chair of the centrist Democratic Leadership Council. She also chaired a Democratic PAC called Next Generation, which seeks a particularly pragmatic brand of younger donors. Already, she's scoring some successes for Bayh. Says another Bayh adviser: "In every presidential campaign ... in terms of the donor community, there are people who are going to become the superstars, and we're figuring out who those people are who are ready to move up to the next level."

When Bayh is dispatched to try to make the sale, he takes along his maps. And he methodically describes how he might -- heck, how he will -- go from Iowa (with surprising labor strength) to New Hampshire (which tends to upend front-runners, like Clinton) to South Carolina (where momentum will help him, although he expects it to be a tougher state than Iowa or New Hampshire) and on to the nomination. He goes on to discuss proposed changes to the Democratic nomination calendar. And the former Indiana governor makes sure to remind his prospects that he has won election five times in a red state. At the end of the meeting, if he gets a commitment, great. If not, he'll try again later.

"The nice thing about 2008 is that there are so many more donors," says Stephanie Schriock, who was Howard Dean's finance director in 2004 and now is a fundraising consultant based in California.

The top 10 Democratic presidential campaigns raised a combined $140 million before Iowa in 2004. A recent study [PDF] by the Institute for Politics, Democracy, and the Internet at George Washington University and the Campaign Finance Institute reported that many first-time givers didn't even have to be asked in 2004. They found their own way to a party or campaign Web site and typed in their credit card numbers.

With Hillary Clinton already setting an astonishingly fast pace for 2008 with donations being funneled into her 2006 Senate re-election campaign, other Democratic hopefuls are under intense pressure to prove they won't be priced out of the contest. The competition for commitments -- even backup commitments -- is fierce. One major Democratic donor likens his friends to a school of fish that darts in a new direction at the slightest change in current. That's why several candidates -- Bayh and Warner are the most explicit -- ask to be a donor's second choice if first is no longer an option.

Before deciding whether to join a given team, donors want to hear a candidate's game plan. Potential contenders are "being forced to develop their strategies now in order to be able to give the outlines of their campaign to the donors," said Carl Chidlow, who was deputy finance director for Kerry in 2004.

Team Hillary
From Hillary Clinton, there are no nods and few winks. Even when pressed by donors to hint at her 2008 intentions, she politely demurs and insists that she'll make that decision later -- probably by the beginning of 2007. Her studied reluctance to telegraph her intentions in the midst of a Senate re-election bid in New York is belied by the firepower her political team is amassing for her. Her "Senate" campaign includes some of the party's most agile professional fundraisers -- Patrick Hallahan, Sara O'Keefe, and Dan Turrentine, all mentored by Terry McAuliffe when he ran the DNC.

The Clinton brain trust also includes Nancy Eiring, a specialist at grassroots fundraising; Matt Felan, who has strong ties to Southern Democrats; and Maureen White, who spent four years as the DNC's finance chairwoman and whom one colleague describes as the "Queen" of New York fundraising. Capricia Marshall, who was a social secretary in the Clinton White House, was just hired as finance director.

Orchestrating it all are McAuliffe, whose role is unofficial, and Patti Solis Doyle, the campaign's executive director, along with such outside advisers as Maggie Williams, Hillary Clinton's chief of staff during the White House years, who interviews most major hires. The fundraisers work out of New York and Washington. They oversee sophisticated and expensive databases of demographic and donor data. The Clinton money folks are particularly keen on finding donors who don't usually contribute to Democrats -- Republican women in the Midwest and the South, for example. The Clinton campaign does this by cross-referencing voter lists and membership rosters of interest groups and then assembling invitation lists for fundraisers in places like Kansas, Kentucky, and Texas.

This sophisticated microtargeting of possible donors foreshadows both the promise and the formidable tactical challenges of a Clinton presidential run. Voters of all political stripes tend to know what they think of her, which would constrain her ability to reposition herself as the campaign evolved. So a Clinton presidential campaign -- should there ever formally be one -- will probably spend millions partitioning swing voters into dozens of subgroups and then telegraphing a different message to each.

As of March 31, Clinton had raised $39.3 million from a universe of more than 250,000 donors. She now has nearly $20 million in the bank, having raised $6 million in the first quarter of 2006. According to two of her top donors, she aims to have $25 million on hand after this November's election. (Others close to Clinton say there is no fixed target for how much cash she wants to have at that point.)

As part of the Clinton team works on expanding its midlevel donor base, another focuses on preserving the allegiance of mega-fundraisers. With several of Clinton's 2008 rivals aggressively courting these key donors, the team's message boils down to "She's gonna win -- don't cross her." The assumption that New York's junior senator will be their party's nominee -- and that she will reward loyalty and punish betrayal -- is pervasive among the party's major donors. "Everybody is scared to death of her, and they don't want to alienate her," says a Democrat close to Clinton's finance team. "They'll hedge their bets."

Almost every month, heavyweight consultants and strategists brief top Clinton donors about her Senate campaign. Hillary and Bill Clinton regularly host smaller get-togethers in their Chappaqua, N.Y., and Washington, D.C., homes. The former first lady generally speaks for a few minutes about the state of her Senate bid and then opens the floor to questions. "She was so extraordinarily well informed, and she blew me away," said Jeffrey Volk, a New York investment banker who worked for Richard Nixon in the 1970s. "On TV, she comes across looking brittle. She doesn't come across like that in person."

The Clinton campaign makes it clear that it wants donors to show up at such gatherings, not just open their checkbooks. "We're keeping track," a Democrat close to Hillary Clinton acknowledges.

"She looks them in the eye," a member of her money squad said. "It's hard to say no when you're sitting a few feet from the [former] first lady and the former president and they are asking you what you think."

At least for the moment, Clinton is such a mega-force within her party that even some major fundraisers allied with other 2008 camps are leery of skipping her get-togethers. Lawyer Fred Baron, who served as Sen. John Edwards's finance chairman in 2004, was identified by The Washington Post as having attended a meeting of Clinton's national finance team. Baron has long, close ties to the Clintons. According to an Edwards adviser, Baron made sure to send advance word to the former senator from North Carolina that his attendance didn't signal that he had changed sides.

The Other Hopefuls
Bayh is largely, but not entirely, ignoring the first tier of Clinton legacy donors. Other candidates have different approaches. When Warner started to prospect for donors and was asked to compare himself with Clinton, he'd boast, "I can win. She can't."

A Democrat close to Clinton says that Warner was instructed to "knock it off." And he did. "He was led into more-political prognosticating," says a Warner adviser. "Now he's gotten out of that." The blocking and tackling goes both ways. Warner supporters complain that Clinton surrogates routinely trash their guy for lacking foreign-policy credentials.

In wooing donors, Warner now emphasizes his pragmatism. He notes his success in winning the votes of many rural white Virginians in 2002, and he cites his like-minded successor's election as evidence that middle-of-the-road politics remain popular.

Warner tunes the pitch to his audience. To Wall Street investment bankers, he says that a Warner presidency would make deficit reduction a top priority. In talking to telecommunications executives -- his Rolodex includes nearly all of them -- Warner draws on his background as a venture capitalist who made a fortune off cellphones and is very conversant about the years-long bottle up of telecom reform legislation.

Warner is now reviving his practice of hosting "Happy Hours With a Purpose." As governor, he held these informal gatherings at hotel bars across Virginia, as a way of touching base with local black elected officials and young black entrepreneurs. Soon, his staff began to invite Asian-American professionals.

He later used the events to assist the gubernatorial campaign of his eventual successor, Lt. Gov. Tim Kaine. Warner will soon sample the fare at taverns across the country. An aide to Warner is quick to say that the purpose is not fundraising, but in the next breath says that Warner wants to build a more diverse network of donors -- a network that is not entirely white and wealthy.

Of the 2008 candidates who have sought the presidency before, Edwards is playing his cards closest to his vest. According to several donors who dined with him recently, he wanted to kibitz about the other candidates, not ask for contributions. Unlike Clinton, Edwards has neither an excuse nor an obligation to spend his time raising money for a Senate account. Unlike Kerry, he can't insert himself into the news based on his current performance in office. What Edwards can do is enhance his resume. His work with the University of North Carolina's poverty center takes him across the country and has allowed him to aggressively raise money for other Democrats -- more than $5 million since 2004. He's worked with Republican Jack Kemp on a Russia project of the Council on Foreign Relations. And he has labored to win the favor of several key service unions whose political muscle he admires.

Edwards raised $21 million from individuals in 2004. And that track record, according to two close advisers, signals to Democrats that if he mounts a second campaign, he'll have plenty of money. Edwards's rivals speculate that he will again rely on Baron's network of trial lawyers.

Kerry's advisers, meanwhile, say he's retained the fidelity of many major fundraisers. Kerry was slow to recognize the value of Dean's innovative Internet tactics in 2003, but he is making the Internet his 2008 launching pad. His campaign staff maintains and updates an enormous list of online donors and activists and has plans to put them to work for candidates in the 2006 election. Last year, Kerry raised money from 125,000 people.

Meanwhile, Sen. Joseph Biden of Delaware is casting about for trial lawyers who might remember and reward his service as the chairman of the Judiciary Committee. The six-term senator is characteristically blunt when speaking to donors, many of whom know him from his long tenure in Democratic politics and his 1988 presidential campaign. Donors who have spoken to him speculate that his interest in running this time is as much about his intense desire to shape the Democratic perspective on national security issues as it is about wanting to be president.

Iowa Gov. Tom Vilsack's public pitch to potential supporters turns into a Horatio Alger story. He packages his humble origins with talk of shared social values, such as hard work, what he calls the "American bargain." In more-intimate gatherings, he endorses a view widespread among Democratic governors that, yes, only governors (especially those in the Midwest) have cross-regional appeal. Vilsack benefits from his time as head of the Democratic Leadership Council, and Jerry Crawford, the finance chairman of the Democratic Governors' Association, is one of Vilsack's closest friends. New Mexico Gov. Bill Richardson, now the chairman of the National Governors Association, is beefing up his finance team by hiring Colleen McCarthy (who is engaged to one of Clinton's top fundraisers). Sen. Russell Feingold of Wisconsin is searching for top-quality money people to add to his political action committee's staff.

In 2004, retired Gen. Wesley Clark was so tight with President Clinton's political and financial supporters that rivals nervously speculated that his candidacy was designed to keep Hillary Clinton's 2008 donors away from everyone else. Clark's status as a five-star draw on the 2006 campaign circuit testifies to his enduring popularity among Democratic primary voters. Advisers to Hillary Clinton speculate that Clark has already begun to ask donors to make him their second choice should the New York senator stumble.

If Richardson joins the presidential contest, he'll find himself in opposition to the Clintons for the first time. Richardson served in the Clinton administration as secretary of Energy and as ambassador to the United Nations. He touts himself as the total package: a Hispanic tax-cutting governor of a red state who has national security credentials.

Of all the men in the pack behind Hillary, Kerry has by far the largest war chest. His PAC raised $1 million this quarter, while his Senate account took in nearly $500,000. Kerry still has $15.3 million left over from 2004. This cycle, Bayh's fundraising efforts have grossed about $5.8 million. His cash-on-hand war chest is the third-largest, with $10.8 million. This quarter, Bayh raised more than $460,000 for his 2010 Senate campaign account and $420,000 for his PAC.

Warner has accumulated nearly $5.2 million since opening his PAC in late 2005. He raised $1.9 million this quarter and has $3.2 million in the bank. Biden's PAC collected $156,000 for the quarter. Between his PAC and his campaign account, Biden has nearly $3 million in the bank.

Vilsack's PAC has $2 million and says it raised $400,000 during the first quarter. Clark's PAC raised $37,000 for the quarter and has about $22,500 on hand. His 2004 presidential account has $388,000 but owes $260,000. Richardson is not currently raising money for a PAC or campaign account. Edwards isn't actively fundraising for himself; his PAC has just $7,000 on hand.

Web Power
Kerry isn't the only one banking on the Internet -- and for good reason. The George Washington University study suggests that online givers in 2004 tended to be younger than traditional donors and were principally motivated by a desire to defeat Bush. Before they helped Dean raise nearly $25 million during the primary season and then helped nominee Kerry raise tens of millions more, few strategists thought that Internet money could bankroll a campaign.

For 2008, Kerry, Edwards, Warner, Feingold, and Clark are already vigorously tapping the Internet. They court leading liberal bloggers as fiercely as they pursue many mega-donors. Kerry, Edwards, Warner, and Clark constantly update their own Web sites and contribute postings to some of the nation's most popular blogs. Edwards's wife, Elizabeth, posts her opinions, sometimes to the chagrin of her husband's more cautious advisers. (Soon after the 2004 election, she contributed to a hyperliberal site called Democratic Underground and, in counseling patience and hope, quoted a passage from Thomas Jefferson trashing the "reign of witches" behind the 1798 Sedition Act.) The Edwardses have even invited a small group of popular bloggers to their Georgetown town house for dinner. And Clark has a regular podcast.

Members of MoveOn.org contributed more than $140 million online to 2004 candidates, according to a study by the organization. If MoveOn endorses a presidential candidate in 2008, it might be able to quickly steer several million dollars to her or him. But Eli Pariser, MoveOn's executive director, warns candidates: "The endorsement would be the result, not the cause." He explained, "What would have to happen is that some candidate [would have to] launch such an exciting campaign that it tips our hand."

Pariser advises 2008 candidates to build an infrastructure capable of harnessing the passion of the netroots. Support "can snowball very quickly. And if a given candidate really hits something on the mark, there's a possibility of all of a sudden having a wave of support and money crash in within hours or minutes or seconds."

In one way, Clinton's candidacy relieves her opponents of a traditional burden. In past election cycles, Democratic presidential contenders competed to see who could raise the most early money, because "front-runner" status was the prize that usually went along with winning that unofficial contest.

Heading into 2008, there is no pressure to be first, because Clinton has a lock on "front-runner" for the time being. So, for the men chasing her, the bar is lower: They merely need enough money to compete. And although "enough" is probably in the pricey neighborhood of $40 million, it is within the realm of the possible.

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