Show U$ the money

With the race for congress costing candidate’s millions of dollars, Barack Obama is out in force to get the cash for hi

Barack Obama, the US president, is spending much of August on a fundraising tour ahead of midterm elections in November. He’s raising big bucks for Democratic candidates across the country.

In the next two weeks he’ll rack up frequent flier miles and campaign cash in Atlanta, Chicago, Dallas, Milwaukee, Los Angeles, Seattle, Miami and more.

There’s an alphabet soup of official Democratic and Republican committees raising money – DNC, RNC, DCCC, NRSC, DSCC, NRCC, etc, all with the goal of collecting enough money to have a competitive advantage in the toughest congressional races.

According to the Center for Responsive Politics, the average cost of winning a House of Representatives race in 2008 was $1.1m. The average senate seat cost nearly $6.5m. 2010 is likely to be even more expensive. The Democratic National Committee has committed $50m to help Democratic candidates win this November.

Considering 100 or so House races and around a dozen senate races are competitive plus the gubernatorial races, Obama has a lot more $1,000-a-plate fundraising dinners to headline.

His approach this year is much different than 2008. During his presidential campaign, Obama amassed an army of small donors, but this year, he’s going the more traditional route of hitting up rich people for big donations behind closed doors.

Fundraising may be Obama’s most powerful weapon this year. Despite his ability to woo a crowd, he may be largely absent in many parts of the country. In areas with the toughest races, Obama is too unpopular and Democratic candidates won’t want to be seen with him, but that doesn’t mean they won’t take the money he raises.

Healthcare reform, the stimulus, and financial services reform aren’t playing well with many voters whose main concern is the nation’s 9.5 per cent unemployment rate. He acknowledged as much at Monday’s fundraiser in Atlanta.

Obama said: “You don’t think I’ve got polls that tell me what’s popular and what’s not? But for the last 20 months, my job has been to govern.”

Republican fundraising lagging

Republican candidates are also filling their coffers in an effort to gain majorities in the House and senate. The National Republican Congressional Committee has raised $39m this year.

But overall, Republicans are behind in fundraising. Business and special interest groups may be poised to pick up the slack where the Republican Party is lagging.

Since the US supreme court overturned 100 years of restrictions on corporate donations to political campaigns earlier this year, a yet unknown wave of money promises to flood the scene. For example, the Center for Public Integrity reports healthcare firms are considering joining financial forces to influence congressional races.

The LA Times reports mining companies are considering the same – all in an effort to elect members of congress who oppose regulation. Attempts to set rules on the new type of spending failed in the senate. The influence of money in politics goes beyond what can be raised by candidates or pooled by industry. There are a number of self-financed candidates running, mostly Republican, in places like California and Florida.

But a new study by the National Institute on Money in State Politics found historically, only 11 per cent of self-financed candidates win races. Apparently Americans prefer to give their own money to get their man elected (mostly rich Americans).

Does that mean former eBay CEO Meg Whitman’s $91m contribution to her campaign for California governor was a waste? She’s worth around $1.3bn, so she probably won’t miss it, but maybe it would have been better spent paying California teachers to make up for the state’s budget shortfall.

Right now the race between Whitman and former Governor Jerry Brown is a toss up.

So let the TV ads begin, the billboards go up and the campaign offices open their doors. Whether it comes from big donors, small donors or a candidate’s own bank account, money follows momentum in political campaigns.

Or maybe it’s the other way around: momentum follows money. Either way, 2010 promises to shatter fundraising records to be the most expensive midterm election in US history.

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