How did Kamala Harris’s campaign rack up a debt after record fundraising?

The $20m spent on celebrity concerts draws scrutiny amid reports of a matching debt despite $1bn in earnings.

US Vice President Kamala Harris waves during a campaign rally at Michigan State University
Democratic presidential nominee Kamala Harris waves during a campaign rally at Michigan State University in East Lansing, Michigan, US, November 3, 2024 [Carlos Osorio/Reuters]

It was a record-breaking fundraising campaign: Vice President Kamala Harris raised more than $1bn in less than four months, during which she strove to win the US presidency, after President Joe Biden withdrew from the race in July.

Now, as the dust settles on her failed bid, following her November 5 defeat to Donald Trump, a storm threatens to kick off over those very finances, after a Democratic National Convention (DNC) official declared that the Harris campaign was $20m in debt.

According to Open Secrets, the transparency nonprofit, the Harris war chest of more than $1bn dramatically dwarfed the approximately $382m that the Trump team pulled in during the same timeframe.

So how did the Kamala Harris campaign go from an overflowing treasury to debt?

Fast rise, steep fall

Soon after Biden pulled out of the presidential contest following a disastrous debate against Trump, the Democratic Party consolidated around Harris and her candidacy.

Quick off the blocks, her campaign raised $200m — 20 percent of the total $1bn drawn for her campaign — within the first week.

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The money kept flowing in, but was also being spent.

On October 16, when the Harris campaign last filed a pre-election statement with the Federal Election Commission (FEC), it had in excess of $180,000 left in the kitty.

But earlier this week, Lindy Li, a member of the DNC finance committee, told NewsNation, a cable news network, that the Harris campaign was now $20m in debt.

What did the Harris campaign spend money on?

The lion’s share of the campaign’s spend was on advertisements — roughly $654m, according to data from Adimpact, a company that provides advertising intelligence and data solutions.

But FEC filings show that the campaign also spent $20m — an amount almost identical to its reported debt — on concerts and celebrity appearances in the final days before the election.

A cadre of celebrities like Jon Bon Jovi, Christina Aguilera, Katy Perry, Megan thee Stallion and Lady Gaga performed at rallies in battleground states on the eve of Election Day. That may not have been the wisest investment, say some experts.

“Celebrity endorsements are highly overrated. Just because you like someone’s music doesn’t mean that that person has political clout with you,” Louis Perron, political strategist and author of Beat the Incumbent: Proven Strategies and Tactics to Win Elections, told Al Jazeera. “On top of that, young voters are notoriously unreliable to turn out and vote.”

And “if it were a payment for the endorsement per se, it would of course further devalue the endorsement”.

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FEC filings suggest that the campaign paid $1m to Oprah Winfrey’s production company.

Oprah has denied that she received any money. “Not true. I was paid nothing, ever,” the talk show star told TMZ.

According to a spokesperson for Harpo Productions, Oprah’s company, “the campaign paid for the production costs of ‘Unite for America,’ a livestreaming event that took place Sept. 19 outside Detroit, Mich.”

“Oprah Winfrey was at no point during the campaign paid a personal fee, nor did she receive a fee from Harpo,” the spokesperson said in a statement.

Still, according to the DNC’s Li, that is obfuscation. “[Oprah] may not have gotten pay, personally as a person, but it paid her company. I think this is a matter of semantics. She got paid,” she told NewsNation.

Oprah interviewed Harris at a town hall event in September and appeared at her last campaign rally in Philadelphia a day before Election Day.

Village Marketing Agency, which reportedly received $3.9m for its services, was among the companies that secured a substantial payout. The firm’s primary task was to mobilise thousands of social media influencers in support of Harris, aiming to increase her appeal among younger voters.

How was the Trump campaign spend?

Although the Trump campaign raised $382m in the period that Harris raised more than $1bn, outside groups like Super PACs (political action committees) contributed roughly $711m, according to data from Open Secrets in an October 26 report. Outside groups similarly contributed more than $600m to Harris — including that, her war chest amounted to more than $1.6bn.

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The America PAC, a Super PAC created by Elon Musk, an avid supporter of Trump, contributed $130m.

It focused on voter outreach and mobilisation efforts, including door-to-door canvassing. These activities are traditionally managed by the campaign itself and the political party, but the Super PAC was a key driving force behind increasing voter turnout for Trump.

Why did campaign fundraising go through the roof?

The 2024 US presidential campaign was not the costliest general election in the nation’s history. According to Open Secrets, the 2020 US presidential race between Joe Biden and Trump saw $7.7bn spent.

This year’s election saw a total spend of $5.5bn.

Still, these massive sums — more than the gross domestic products (GDPs) of many small nations — in campaign spending are driven by several factors, including the proliferation of Super PACs, the growing importance of digital marketing strategies, and the record-breaking fundraising efforts of each political party.

One landmark Supreme Court decision has also played a pivotal role. In 2010, Citizens United v FEC was decided by a 5-4 split decision.

The conservative nonprofit organisation Citizens United had contested campaign finance regulations after the FEC prevented it from promoting and broadcasting a film critical of presidential candidate Hillary Clinton ahead of the 2008 election. Citizens United won.

This ruling struck down restrictions on corporations and unions using their treasury funds for independent expenditures and electioneering communications. As a result, special interest groups gained the ability to allocate unlimited cash towards political campaigns, provided they remained uncoordinated with official campaign activities. The far-reaching consequences of this decision have fundamentally altered the landscape of political spending in elections.

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Source: Al Jazeera

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