Dialing for Dollars
Forget New Hampshire. The contest for cash is the first real primary
And strategic decisions made in the 2004 election may have set a precedent that sends spending higher still this time around. Back then, candidates George W. Bush and Sen. John Kerry both passed up government matching funds during the primary season-the first time that had happened since such funds became available in the post-Watergate era-because they wanted to avoid the spending caps attached to public money. "Bush was just setting the stage for an even larger leap this cycle," says Sheila Krumholz of the Center for Responsive Politics. "We're basically saying, 'You ain't seen nothing yet.'" For the '08 race, candidates who sign up for public funds in the primaries-a commitment that imposes a roughly $48 million cap on "base" spending to be eligible for a roughly $20 million matching grant-may be committing political suicide. The three Republican and three Democratic front-runners have all either announced or are expected to announce that they will opt out of public financing.
Clinton's campaign has gone even further, announcing that she would become the first major party candidate to forgo public financing in the general election since the system was instituted in the 1970s. Other candidates are considering following suit, and if Clinton wins the nomination it will very likely force the Republican nominee to do the same. Even the bitterly fought 2004 election saw Bush and Kerry participate in the public financing system for the general election. The system provided $75 million to each candidate and would increase next year to around $80 million. Unlike primary matching funds, general election public funds are grants that wholly replace private fundraising. "If you're going to opt out of the general election fund and you're going to raise $250 million just for the general, you can't wait till the spring or summer of 2008," says Michael Toner, a former chairman of the Federal Election Commission. "You have to start raising that money now."
This presidential cycle's front-loaded primary schedule is another added expense. Eight states, including California, have moved their primaries or caucuses up to Feb. 5, 2008, and roughly a dozen more are considering similar proposals. Those states include New York and Florida, which, along with California, are home to some of the most expensive TV advertising markets. "The primary will be over by the middle of February 2008," says Tom Loeffler, general chairman for Arizona Sen. John McCain's campaign. "That puts further pressure on candidates ... to raise as much money as possible early on." James Torrey, a New York fundraiser for Democratic Illinois Sen. Barack Obama's presidential campaign, has raised $100,000 just since mid-February, the equivalent of what President Bush's "Pioneers" were expected to bring in over the course of the entire 2004 primary. Torrey is convinced Obama has to be up and running in about 20 states by February 5: "What you need by way of staff in each state is formidable."
Torrey says the Democratic money chase in New York has already boiled down to a face-off between Obama and Clinton. Which means second-tier candidates face long odds accumulating serious war chests with the money that's left.
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