It didn’t matter whether they raised more money or not, most presidential candidates certainly boosted their spending in the second quarter of the year.
More on staff. More on travel. More on consultants.
Democrats outraised Republicans about $80 million to $50 million from April through June. But Republicans kept pace with Democrats on spending — nearly $50 million spent on both sides.
The Democrats’ money advantage was helped in large part by the extraordinary fundraising of Sens. Barack Obama and Hillary Rodham Clinton. He raised $32 million for the primary; she raised $21.5 million.
But even as they raised more money, the better financed Democrats were chary about spending it all.
Obama, the freshman senator from Illinois, spent half of what he raised in the second quarter. Clinton spent 60 cents for every primary dollar raised. John Edwards raised $9 million and spent $6.4 million.
That was not the Republican model. John McCain raised $11.3 million and spent $13 million. Mitt Romney had to lend his campaign $6 million to stay even with his spending for the quarter. The pattern was similar among GOP candidates with lesser finances. Only Rudy Giuliani, the Republican with the most cash on hand, kept his spending below his fundraising.
Obama and Clinton ended the quarter with $34 million and $33 million in the bank, respectively — formidable figures for two of the leading Democratic White House contenders.
The Republicans’ penchant for spending beyond their fundraising was especially apparent with McCain, the senator from Arizona. The McCain camp ended up spending more in the second quarter and raising less, even though their first quarter fundraising had left them with less cash on hand than Romney or Giuliani,
McCain’s payroll alone was the highest of all presidential candidates except for Obama’s for the first six months of the year. He ended the quarter with $3.2 million cash on hand and nearly $1.8 million in debts. McCain’s biggest debt was $750,000 owed to an Internet consulting firm connected to his new campaign manager, Rick Davis.
Payroll was by far the single largest expense — about $16 million total for all candidates in the second quarter. Romney spent the most of all on advertising — about $5 million. Consultants of all stripes were popular, particularly financial consultants, who earned a total of more than $3 million from various candidates.
Travel took its toll on budgets. Candidates altogether spent more than $8 million to get around the country. Some got better deals than others. John Edwards paid $230,660 to fly on a private jet owned by Dallas trial lawyer Fred Baron, Edwards’ national finance chairman.
Obama’s campaign paid nearly $3 million for travel during the quarter and spent about $1.3 million in telemarketing, one of its top single expenses. Clinton listed $1.1 million in travel expenses and $380,000 owed to an air charter company. She also listed a $421,873 debt to the firm owned by her pollster, Mark Penn, and $132,000 owed to the firm of her media adviser, Mandy Grunwald.
In fundraising, Obama and Clinton saw a virtual reversal of donors. While she relied heavily on Wall Street and high-finance money in the first quarter, it was Obama who tapped the banking and hedge fund crowd in the second quarter. Employees at Lehman Brothers, Goldman Sachs, and JP Morgan Chase gave heavily to Obama, while employees at two major law firms, DLA Piper and Kirkland & Ellis, were among Clinton’s top donors.
Obama, however, retained an advantage over Clinton in the number of donors who could still give to his campaign. About $3 our of every $7 raised by Obama’s campaign for the primary came from donors who have given the maximum $2,300 donation permitted by law. For Clinton, about three-fifths of her primary donations come from maxed-out donors.
Overall, attorneys topped the list of donor occupations for most Democrats, with homemakers not far behind. For Republicans, homemakers led the list, with attorneys not far behind. Homemakers are a common occupation in political fundraising because donors usually team up with their spouses to maximize contributions.
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