[Posted By WLS]
Bracketed by the end of Obama’s Pleasant Hawaiian Holiday on Friday and the Showdown at Saddleback on Saturday night, the Obama campaign quietly announced Saturday morning that it had raised $51 million in July, and had cash on hand totaling $68 million. That seems like they were expecting it to be treated as bad news by the press– which it is – and were hoping that it would quickly drop off the radar screen with the coverage of Saddleback – which it did. If they thought his fundraising was a blowout story, they would have played it up and gotten some positive press.
You can see that they think it was bad news by the fact that they led off the press release with a comment about the number of new donors – 65,000 – rather than the fundraising numbers themselves. The new donors total is a non-issue – anyone could have anticipated that a large number of former Clinton supporters would gravitate to the Obama camp in June and July.
If my memory is correct, the campaign previously announced that it had raised $52 million in June, and had $72 million cash on hand. Now math has always been hard, but the college engineering professor who gave me a C- would probably agree that Obama’s campaign spent $4 million more than he raised in July, meaning that his monthly burn rate right now is about $55 million – and that was in a month when he spent 9 days in Europe and the Middle East, a big chunk of which was paid for by taxpayer dollars (appropriately). Lets call his burn rate right now about $2 million a day.
McCain raised $27 million in July, and has $21 million to spend at the beginning of the month. The difference is that McCain must spend all his remaining money before the GOP convention, after which he will receive $84 million from the FEC.
The RNC raised $26 million in July, and has $75 million on hand to start August. But with McCain needing to burn through his cash, the RNC can sit quiet and save its money for the stretch run. So its possible with August fundraising the RNC could be sitting on a cash pile of better than $100 million after the convention. Combined with McCain’s taxpayer funds, the GOP candidate will have about $185 million for the 10 weeks from the convention to election day.
If Obama burns through $60 million in August (at $2 million a day, including convention costs), he’ll have only $8 million left from the money he started the August with. He’s already spent a week in Hawaii this month, directly raising only about $3 million in two events he held there. If he raises $50 million again for the month – not a certainty with falling poll numbers, declining fundraising, and doubts beginning to be expressed about his readiness for the job – he’ll have only $58 million in his own money on Sept. 1.
The DNC began August with $28 million, after raising $27 million during the month. If the DNC raises another $30 million in August, it might have $50 million left after the convention. So Obama and the DNC start off the general election campaign after Labor Day with a combined total of $108 million — or about $80 million less than McCain and the GOP.
Obama can continue raising money, while McCain can’t (though the RNC can). But Obama’s attendance at fundraisers – including ones like George Clooney is hosting in Switzerland – takes Obama off the campaign trail. Fundraising takes place at parties and dinners with a few hundred check-writers, and not at campaign events where thousands or potential voters show up. There’s a reason why candidates don’t want to raise money in the 10 weeks of the general election campaign, and the Obama camp is starting to see it.
Remember that when Obama announced this fundraising gambit in early June, some of his supporters projected that he might raise as much as $250-300 million after he became the presumptive nominee. In the first 60 of the 150 days (2/5’s for those challenged by large numbers) between becoming the presumptive nominee and election day, he has raised $103 million. So the $300 million number seems out of the question – he would need to increase his fundraising pace by better than 40% to raise another $200 million from Aug 1 to Oct. 31. Since fundraising will begin to start competing with campaigning after September 1, the lower end of the range is probably also no longer realistic either — he would have to maintain the same fundraising pace he is on now. If the new realistic total is $220 million, then he’ll raise only another $120 million between Aug 1 and Oct. 31. That would give him a total of $188 million to spend between Aug 1 and Oct 31 (he began Aug. with $68 million). But if he is burning $2 million a day, he needs $180 million just to break even over that same period. And that amount would not allow for increases above current spending levels as election day draws nearer.
We know Obama has built a huge campaign staff in anticipation of running a 50 state strategy – and has paid campaign staffers in no-win states like Utah and Texas. I expect those plans are under serious review. That strategy has kept his advertising limited in places like Nevada and Colorado, where his early leads have become current polling deficits. I was in the Reno area last week, and it is being bombarded with ads from both candidates – but McCain is easily running twice as many ads as Obama, both on radio and TV. I thought it was curious that Obama’s first post-Saddleback appearance was in Reno – and although it was proclaimed publicly to be a “townhall” event, in actuality it was invitation-only and the invitations went out to union leaders and labor activists. That’s a strange call unless your support in the state is slipping and you’re really trying to rally the troops who feel the race beginning to slip away.
When Obama begins to alter his spending habits, and paid staff are eliminated in places like Texas, and ads quit running in places like Indiana and North Carolina, the press is going to notice that Obama’s 50 state strategy is no more. The questions will then begin about whether Obama’s decision to opt out of public financing was wise or foolish. I think the GOP money guys are laughing right about now as Obama and his camp continue chasing dollars as much as voters.
Update: Interesting local TV News story out of Denver yesterday about prime up-front tickets to Obama’s Invesco Field speech being sold by the Obama campaign for $1000 a pop, even though the campaign has trumpeted the fact that attendance is free for those given tickets. Could the fund-raising opportunity be the real reason the speech was moved to Invesco? Given my complete inability to successfully embed a video, I’m dubious about whether this works, but here it is.
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If that doesn’t work maybe DRJ can fix it, or you can look for it over at the weeklystandard blog.
An interesting point brough up by the piece is that the ability to purchase these special tickets is restricted to big donors who are solicited and given a special address on the Obama website. A general member of the public cannot get to the website page to make the purchase. As the reporter notes, once she started making inquiries on the topic, the special page was shut down, and now says that tickets are no longer available.