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A New Front in the Cash War A New Front in the Cash War

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A New Front in the Cash War

Obama is still a champion fundraiser, but outside groups will narrow the advantage.

photo of Reid Wilson
July 13, 2011

There is no question that President Obama will have more money to spend on his reelection bid than the Republican presidential nominee. But his opponent’s bank account won’t be his biggest concern. Instead, it will be spending by outside organizations intent on turning the campaign into a negative referendum on the incumbent’s first term.

Obama is off to a fast fundraising start. His campaign manager, Jim Messina, announced in a web video to supporters early Wednesday that the team raised more than $47 million in the second quarter of the year. The Democratic National Committee raised another $38 million last quarter, adding to the haul. (Campaign-finance law allows donors to write a single check, up to $35,800, to a joint account that divides the cash between Obama’s campaign and the DNC.)

That means that Obama’s campaign alone raised more than the entire GOP field. Mitt Romney led the GOP pack, raising $18.25 million during the quarter. Tim Pawlenty and Jon Huntsman raised just more than $4 million each; former Godfather’s Pizza CEO Herman Cain raised $2.5 million; and Newt Gingrich pulled in $2 million. Even penciling in the total of Rep. Michele Bachmann, R-Minn., which could be as much as $10 million, means the entire field still lags behind Obama.


The certainty that Obama will continue to out-raise the field—and the possibility that Republicans will fight for their party’s nomination until late in the primary calendar—raises the prospect that Obama’s campaign will be able to attack the eventual GOP nominee relentlessly from the outset.

But in his message to supporters, Messina didn’t focus on the GOP totals. Instead, he warned Obama fans that the biggest threat will come from outside organizations that are planning to spend hundreds of millions of dollars.

“GOP outside spending for 2012 could be as much as $500 million, but these groups don’t report anything,” Messina warned. “We’re not allowed to see any of those numbers…. This is a whole new ballgame, like we’ve never faced before.”

There is some dispute about the amount of money those groups could spend. The largest, American Crossroads, has said it hopes to spend $120 million over the next year; a few others, like American Action Network and Americans for Prosperity, will spend amounts in the high tens of millions. But most other outside groups won’t come anywhere close to that.

What’s more, Democrats have their own outside groups, including Priorities USA, the organization set up by former Obama aides to focus on the presidential race. Some players, including Crossroads president Steven Law, predict that Democratic groups will actually outspend their Republican counterparts next year.

But the fact is that Obama’s team—and its allies—must fend off a much larger army than the one he faced in 2008. And unlike in 2008, those groups will do their best to make Obama himself the issue.

Crossroads is already on the air with the initial stages of what it says will be a $20 million advertising blitz this year that focuses on Obama’s economic record.

Other campaigns have seen this influx of massive outside spending before, though on a much smaller scale. For instance, between August 1 and Election Day in 2010, Republican and Democratic groups spent a combined $27 million on the race for Democratic Sen. Michael Bennet’s seat in Colorado.

The outside spending became so overwhelming that Democrats even made it a talking point late in the 2010 campaign, complaining of “shadowy” organizations run by well-worn bogeymen like Karl Rove and the Koch brothers (the arguments didn’t have any success with voters).

“There’s no doubt that we’re operating in a new fundraising environment when contributions from hundreds of thousands of Americans can be countered by unlimited contributions from special interests, like oil and gas companies that want to preserve their tax breaks and subsidies,” said Ben LaBolt, a spokesman for the Obama campaign.  “We do not underestimate this challenge. That’s why we’re spending so much time building out our grassroots donor base to ensure that it is as expansive as possible, and we’re finding folks who can give again.”

Obama’s team has hardly been caught by surprise. Instead, Democrats have worked to harmonize their efforts to an extent not seen since post-Watergate reforms built up walls prohibiting coordination between distinct political entities. Obama’s team has run the Democratic National Committee since he won the party’s nomination in 2008, and the outside organizations on their own side are taking their messaging cues from what comes out of the White House. In short, the litigation that Republicans instigated to bring down restrictions on campaign financing has also helped Obama build his defenses.

Traditional fundraising has always been one of Obama’s strongest suits. Messina said the 552,000 first-quarter donors, who take up 15,000 pages of Federal Election Commission documents, gave an average of just $69, an amount far lower than the average contribution in 2008. That means Obama can return to the well repeatedly as he approaches the final months of the campaign; people who give $20 early in the campaign can easily give another $20 later.

In 2008, the Obama campaign raised more than any other political campaign in American history. In 2010, he has already shattered the records that George W. Bush set for early fundraising. But the president will need to sustain that pace. Even if a Republican nominee emerges penniless after a drawn-out primary fight, outside organizations will be there, on both sides, to attack and defend at will.

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