Obama Spending May Swamp McCain, End Republican Edge

[Ron Burgundy]

Bloomberg - April 11 (Bloomberg) -- Barack Obama will likely overwhelm John McCain in campaign spending, if the Illinois senator wins his party's presidential nomination, in what would be the first time in four decades a Democrat will enjoy such an advantage.

And he could do it whether he accepts federal campaign- finance limits or raises all the money privately.

Obama, the front-runner for the Democratic nomination, has amassed $234 million -- three times more than Republican McCain has raised. That puts Obama on the verge of shattering the fundraising mark set by President George W. Bush in 2004.

``There are not enough zeroes to define how badly we are going to be outspent,'' said Eddie Mahe, former deputy chairman of the Republican National Committee.

A look at last month's fundraising underscores the point: McCain had his best period in March, collecting $15 million; Obama brought in $40 million, following a record-busting $55 million haul in February.

Moreover, about half of McCain's supporters have given the maximum $2,300, compared with only a third for Obama, according to the Washington-based Center for Responsive Politics. That means many more of Obama's record 1.2 million donors can give again and again.

Now, Obama, 46, is faced with two choices: go private, becoming the first presidential candidate since 1976 to do so, or take public money, as he pledged to do shortly after his campaign began last year.

`Creaky'

Obama told reporters today in Indianapolis that the campaign-finance system is ``creaky'' and needs to be overhauled. He said nominees could raise more money through small online donations than through public funding, which would allow them to ``compete in as many states as possible.''

Should Obama opt out of the system, he will face only muted criticism, said Steve Grossman, a former Democratic National Committee national chairman who is a fundraiser for Obama's Democratic rival, Hillary Clinton.

``I don't think you get penalized when essentially you've gone from a system that was dominated by wealthy people and entities to a system where millions of people are funding it,'' Grossman said. ``That's democracy in action.''

No Obstacle

Yet even accepting government money, which limits each candidate to $84 million, wouldn't hinder Obama's fundraising.

That's because he'd be able to fill the coffers of the Democratic National Committee -- some political consultants say by as much as $500 million -- for the general election by asking his donors to give to the party instead of to him. The DNC would spend most of that money on his behalf anyway.

``If he were to send out an e-mail to that group of his and say, `The DNC needs $100 million this afternoon,' he would come damn close to getting it,'' Mahe said.

Obama said in November that if he won the nomination, he would participate in the presidential-financing system and ``aggressively pursue an agreement'' with the Republican nominee to take federal funds.

He said today that should he win the nomination he intends ``to have conversations with Senator McCain'' about how to prevent outside groups from drowning out the candidates if they take public funds.

`Committed in Writing'

McCain, 71, the presumed Republican nominee, drew a distinction between honoring a pledge and talking about outside spending.

``He committed in writing to taking public financing in the general election if I would; I committed to it,'' McCain told reporters in Dallas today. ``Now, all those other discussions might be interesting, and I hope over time, valuable, but the fact is that he's saying one thing and he's doing another.''

Clinton, unlike the other two candidates, has never said whether she would take public financing. The New York senator has also raised more money than McCain, though she lags behind Obama.

The last Democratic presidential candidate to far outspend his Republican opponent was President Lyndon Johnson in 1964. The Watergate-era campaign-finance abuses under Johnson's successor, Richard Nixon, including reports of secret slush funds, led a Democratic Congress to rewrite the rules for funding presidential races, such as providing federal funding to party nominees who agreed to forgo private money.

Republican Edge

For the first several elections after 1976, the Republican and Democratic candidates spent the same amount of money. When the political parties cranked up their fundraising, the Republicans generally gained an advantage.

Obama will erase that advantage, whether he chooses to take public money or not.

One drawback in having the party spend the money is the candidate surrenders a measure of control over strategy, because he or she can't tell the party how to spend the money.

``Obviously, they as the nominee can pretty much take over the party,'' said Peter Fenn, a Democratic consultant who isn't affiliated with any campaign. ``But sometimes things get a little muddled,'' and people start acting independently of the candidates when they move over to the party, he said.

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net .

source: http://news.yahoo.com/s/bloomberg/20080411/pl_bloomberg/ayfedoau37vc [link]