Counting the Campaign Cash

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Left: Ross D. Franklin / AP; Cheryl Senter / AP

Sen. John McCain and Sen. Barack Obama

It's that time again, the end of another quarter, and another moment of reckoning, as the presidential contenders prepare to report how much money they have raised and spent. Officially, the paperwork doesn't have to be filed with the Federal Election Commission until July 15 (the end of the second quarter is June 30). But the initial numbers are likely to trickle out over the weekend, especially from campaigns that have good news to share.

In one way, presidential politics works very much like Wall Street: actual results can be less important than beating expectations. So as the second quarter winds into its final hours and the campaigns prepare to report their fundraising totals, every one of the leading contenders is playing down the size of his or her own haul and talking up the competition. That all but guarantees there will be some surprises. But here's what the political pros are watching for:


Illinois Senator Barack Obama has already dropped a big piece of news. His total number of donors, which was an impressive 104,000 for the first quarter, has exploded in the past three months to nearly 250,000. Many of the individual contributions are miniscule by the standards of big-time presidential politics. Obama has been appearing at campaign events where the cost of admission is as little as $25, and his campaign sponsored a contest that gave contributors of as little as $5 a chance to compete for dinner with the candidate. And, borrowing a move from the social networking sites, the Obama operation has made it possible for supporters to set up personal fundraising webpages that allow them to solicit their family and friends for contributions on behalf of the campaign. According to Obama aides, at least 10,000 supporters now host their own pages.

What this means for the total size of Obama's haul this quarter is still unclear. The campaign is saying it expects to raise in the neighborhood of the $25.7 million it brought in for the first quarter, a figure that is almost certainly low-balled. But Obama aides are also insisting that the $40 million number that some of his competitors are throwing around is absurd. "The only people talking about our numbers are people who don't know," insists Obama spokesman Bill Burton.

Hillary Clinton's campaign, meanwhile, says it too expects to raise an amount in the vicinity of its $25.8-million first-quarter contribution total—another figure that is probably an underestimate, especially given the strength of Clinton's unparalleled fundraising with the party's traditional big donors. She is also making unusually large inroads for a Democrat into Wall Street and corporate America.

Much of Clinton's money is expected to come from contributors who will now have given the maximum allowed under law—and who, therefore, will not be giving in future quarters. "I don't think the Clinton campaign has focused as much on small donors as they should," worries one of its fundraisers.

Meanwhile, former North Carolina Senator John Edwards is believed to be struggling for funds. His wife Elizabeth made a highly publicized attack on conservative commentator Ann Coulter this week, which the campaign instantly turned into a fundraising appeal. Having raised $14 million in the first quarter, Edwards has set a $9 million goal for the second—a sign, under the widely accepted rules of the expectations game, that his take will be at least that high. Edwards campaign officials say that total, while lagging Clinton and Obama, will keep the candidate on track to raising $40 million by the Iowa caucuses. They believe that will be enough to wage a campaign focused almost exclusively on the four early states of Iowa, New Hampshire, South Carolina, and Nevada.

As for the rest of the Democratic field: New Mexico Governor Bill Richardson, who has begun moving up in the early-state polls, is hoping for a respectable total that would give him some much-needed momentum. Matching the $6 million that he raised in the first quarter would probably do that. Richardson has also been relatively frugal, which means he may end the quarter with nearly as much cash on hand as Edwards. Finally, if Senators Joe Biden and Chris Dodd do poorly, it may be a sign that one or both of them should begin thinking seriously about getting out of the race.


Overall, the Republicans' fundraising is expected to run well behind that of the Democratic candidates. Former Massachusetts Governor Mitt Romney, the first-quarter GOP champ with nearly $21 million raised, is downplaying his prospects this time — and his announcement this week that he intends to loan his campaign money from his personal fortune bears that out. The expectation is that the loan will probably bring his total receipts above $20 million. The Romney campaign is also saying its report will show it has been spending heavily, building an operation that now totals around 200 employees and investing more than any other on early advertising. Meanwhile, frontrunner Rudy Giuliani's operation has been mum on its finances, though its competitors say they expect the former New York mayor to have pulled in something around $20 million for the quarter.

One big question is how badly onetime frontrunner John McCain is lagging the field. He had vowed to beef up his fundraising operation after a disappointing $13.4-million showing put him in third place for the first quarter. However, McCain's stance in favor of comprehensive immigration Reform — which is hugely unpopular with the Republican base — is making that difficult. Though his June calendar was packed with around 30 fundraising events, word among Republicans activists is that they have been lightly attended. If he fails to raise even $10 million, it will add to the perception that his campaign has entered a death spiral from which it will be difficult to recover. McCain also had spent heavily in the first quarter, leaving him with only $5.2 million cash on hand, which was less than half of what Romney and Giuliani had left. The campaign says it has worked to reduce its expenses, by, among other things, paying its contractors less.

One big mystery is how well former Tennessee Senator Fred Thompson is doing. The "Law and Order" star is doing well in the polls, but because he is officially only "testing the waters," and has not formally entered the race, he will not have to file a report with the Federal Election Commission until October. As for the other GOP contenders, none is expected to raise much more than $1 million, further cementing the perception that their chances of breaking into the top tier of candidates are small.