August 25, 2015

Perry’s Iowa Campaign Chair Quits

  2:00 pm

You wonder how long Rick Perry is going to hobble along before deciding to call it quits himself:

The chair of Rick Perry’s Iowa campaign, Sam Clovis, is calling it quits… The Perry campaign stopped paying staff earlier this month… The campaign’s money woes played a part in Clovis’ decision, he told the AP — though he said it was not the only reason for his departure.

Iowa is critical to Perry’s dwindling chances, and Clovis — a radio personality and failed 2014 Senate candidate — was considered central to his hopes there.

Clovis said he is in negotiations already to be hired by another campaign.


Bush Campaign Cuts Paychecks, Aims to Rein in Spending

  10:30 am

Well, this can’t be a good sign:

Campaign officials asked workers to tighten their belts a few weeks ago, according to two people briefed on the matter. In some cases, staff members’ paychecks shrank, these people said.

The cuts were not a result of fund-raising shortfalls, these people said, but were intended to correct needless spending before the campaign gets into the heat of the election season…

Tim Miller, Mr. Bush’s communications director, acknowledged some targeted cutbacks, saying the campaign has tried to run “as lean and efficient an effort as possible with one goal: winning the Republican nomination.”

If that really was the case, I’m sure that conversation went over well: look, we really do have the money, we’re just not going to give you as much as we promised. “Tightening belts” and spending cuts are not the sign of a frontrunning campaign.

But wait… I thought Bush had over a hundred million dollars at his disposal, thanks to his Super PAC. He can’t be running out of money already!

[This is] a reminder that despite his giant “super PAC” bankroll, campaign dollars are ultimately more valuable… Though the super PAC backing Mr. Bush plans to engage in data analytics and activities traditionally done by the campaign itself, there are many things that only the campaign can do… Even in the era of outside groups, the regulated money of campaigns is still more valuable.

It’s almost like we’ve heard this somewhere before

Do I believe Jeb Bush is in the same trouble as, say, Rick Perry? Absolutely not. But if you combine the news of paycheck and spending cuts with the rumors that the donor class is getting very nervous about Bush and his numerous gaffes/missteps out on the trail, it certainly doesn’t paint a rosy picture for the campaign.


August 24, 2015

Trump Dissed By Those Who Know Him Best

  2:31 pm

From today’s New York Post, from an article by Fredric U. Dicker entitled “It Won’t Be Trump“:

A meeting was just held by 60 movers and shakers of New York Republican politics at the South Hampton estate of billionaire Wilbur Ross.   In attendance were Reince Priebus, Rudy Giuliani, and New York Republican state chair Ed Cox.  Other attendees included builder/developer Earl Mack, Tiger Fund’s Julian Robertson, and bio-fuels magnet John Catismatidis.   A source who attended:

“These are people who know Trump well,  people who have known Trump for years as part of the social   and financial fabric of the city.  They’ve worked with him, they’ve dealt with him, and they know that ultimately he’s going to crash and burn.”

“They see Trump as the kind of city slicker who is out there conning the rubes whom he calls the people.  But the expectation is that the popularity he’s developed will start to change as people really come to understand Trump’s past, his corporate bankruptcies, his 3 wives, his changed positions on abortion rights,  legalizing drugs, high taxes, banning assault weapons….that’s why so many people at the event just aren’t taking Trump all that seriously.”

“The consensus is that it won’t be Trump.”

Actually, according to Dicker, it was “almost unanimous.”

Trump is now trying to raise money, but it appears that he will have to raise it from the aforementioned “rubes.”  The wealthy probably aren’t going to be forthcoming.  One would think that someone who is “very, very rich” wouldn’t have to go hat in hand to others who are very, very rich.

David Karol, Professor of Government and Politics at The University of Maryland says:  “Trump is a loose cannon.  They don’t know what he’s going to do, they, being party insiders.  For them, every alarm is triggered with him.”

Karol says that “early endorsements in the invisible primary are the most important cause of candidate success in the state primaries and caucuses.”  He reasons that endorsers influence the outcome of the race by strengthening local ground games, promoting the candidate to fellow party leaders, and pitching the candidate to voters.

In 538’s interactive endorsement tracker, Jeb’s in the lead, and Trump’s not on the list.  In the New York Times’ tracker, Jeb’s in the lead and Trump’s 12th.  In Quinnipiac, Trump very recently had the worst favorables of anyone in the party except Chris Christie.  But as bad as his numbers are with Republicans, they are much worse with the population as a whole:

Trump:  minus 14 in Florida, minus 22 in Ohio, and minus 21 in Pennsylvania.

It’s not going to be Donald.


August 13, 2015

The Pro-growth Candidates

  2:11 pm

“The Republican party is not going to win this election unless it persuades the electorate that its primary principles of low marginal tax rates, lighter regulation, free trade, and a sound dollar are the best path to growth. Call it free market capitalism. Call it supply side. Call it entrepreneurship. Call it take home pay. But the endgame is growth and prosperity.”
Larry Kudlow

The fact is that 2% secular stagnation won’t get us out of our problems, or even keep us from going under. We already spend literally hundreds of billions of dollars every year just paying interest on our national debt. I’m sure the Chinese, Japanese, Saudis, and others who own much of that debt appreciate the extra income that gives them every year, but it’s not doing anything for US. And when interest rates go up to anything approaching historical interest rate levels it will cause a massive crisis in our economy, one that we’re not likely to come out of in good shape. $19 Trillion is a lot of money to owe.

But if we can move up to 4% GDP growth we can solve lots of problems, including balancing the budget within a few years. It will have to be conflated with cutting spending, of course, but we have some candidates who have that as one of their major objectives.

The Club For Growth PAC has announced it will act as a bundler for 5 Republican candidates who will grow the economy if nominated and elected. It will accept donations for Jeb, Scott, Ted, Rand, and Marco.

Club For Growth spokesman Doug Sachtleben said that donors will specify who they want their money to go to, with the money signaling that the donor supports the candidate’s “pro-growth polices.” Note that the CFG was instrumental in getting Rand, Marco, and Ted elected. The club wants its donors “to send a strong message about economic freedom as a central issue in the 2016 race.”

Meanwhile, the Koch Brothers and their vast network of major donors are similarly focusing on 5 main candidates: Scott, Jeb, Marco, Ted, and Rand. In addition to these, they also invited Carly to attend its major conference, held in Southern California recently, to appear before 450 people in its network who had already donated at least $100,000 each.

As for the Koch’s themselves, they have set aside $300 Million to be spent on electoral politics in 2016, and have said that these are the 5 who will benefit.  This out of the $900 Million they will spend on total political activity in the cycle.

The only way out of our massive societal problems is through. The country needs to significantly increase its capital stock and it can’t do that by inefficient and wasteful government expropriating trillions of dollars every year from people who are relatively efficient and productive.

The good news is that we have at least five candidates who want to reverse the flow and grow us out of our problems, and have been hand picked by very successful and intelligent human beings with the same aim.

Question: Who do you think can do it best? Extra credit for saying why.


August 11, 2015

Rick Perry and the Limitations of Super PACs

  10:52 am

As our own Matthew Newman reported earlier this morning, Rick Perry’s fundraising has dried up and he is no longer paying his campaign staff. There are a couple of angles I want to explore related to this story, because they can be quite instructive moving forward in this primary.

First, the steady drip of information coming out of Camp Perry is what may end up ultimately doing them in. Late yesterday afternoon, the story broke in the National Journal when it was revealed that Perry was no longer paying his South Carolina staff. Katon Dawson, Perry’s South Carolina director, tried to put a positive spin on the story, saying how the staff were happy to work on a volunteer basis “for a while”. One state, temporary issue.

Then a little later, reporters began asking Camp Perry about his staff in other early states. They began tweeting that Perry’s campaign was not responding to questions about whether or not Iowa and New Hampshire staff were getting paid. Eventually, the news broke: none of the staff in any of the early states were being paid anymore. The one state problem had grown to three states now.

Then it came out that Perry’s campaign manager Jeff Miller had told all the staff, with Perry’s blessing, that they were free to look for other jobs with other campaigns. Suddenly the temporary situation didn’t seem so temporary.

Then, the latest in a series of death by a thousand cuts: not only were the staff in early states going without a paycheck, everybody working at the Perry campaign, including at the headquarters in Austin, were not getting paid.

With each new update to the original story it kept getting worse and worse for the Perry campaign, until folks began writing his political obituary. But wait! Some pointed out that Perry’s Super PAC could ride in and save the day; after all, they were sitting on $17 million at the end of June. But there is a twist to how this brave new political world of Super PACs works, and it’s one that many have overlooked up to this point: Super PACs cannot coordinate with campaigns.

When the fundraising numbers for Q2 were being reported last month, we were very careful here at Race to separate the Super PAC numbers from the campaign fundraising numbers. For instance, Jeb’s campaign did not raise $130 million, it raised $11 million. Huckabee’s campaign did not raise $8 million, it raised $2 million. And Rick Perry, who was widely reported as having raised $18 million actually only raised $1 million. Their Super PACs raised the remainder of those totals, and the difference, as we are learning with the Perry campaign now, is much more than semantics.

Rick Perry’s Super PAC has $17 million, but they cannot use that money to pay the campaign staff who aren’t getting paid now. They cannot use that money to pay for travel expenses Perry racks up. They cannot use that money to pay the rent for their office space, or buy office supplies, or pay catering bills or phone bills or electricity bills or any other bills the Perry campaign accrues. Any of that would break the coordination law, and so they are left sitting on a giant pile of money watching their candidate sink like a rock. About all they can do at this point is run a bunch of national ads and hope it’s enough to get Perry into the grown-up debate on CNN next month — if Perry can even survive another month.

Oftentimes, it is only the financial reality of having to pay all those bills that forces candidates out of presidential races. This is the first campaign cycle where Super PACs were front and center, and everyone went crazy covering how this would change the face of politics — but this analyst wonders (and has wondered for quite some time now) if their importance is over-exaggerated. After all, what’s the point of having a $17 million Super PAC when they can’t do anything to save your floundering campaign? One wonders if some of these candidates (Perry, Huckabee, Jindal, et al) didn’t buy into the untested glamour of these Super PACs, leading them to not focus enough on traditional fundraising.

The most important number in our Fundraising Leaderboard has always been, and continues to be (even in the Super PAC age), Cash on Hand. That’s the pot of money candidates have remaining from which to pay their staff and all the other bills like the ones mentioned above. Six of our candidates entered Q3 with less than a million dollars on hand, which simply does not bode well for their chances:

  • Huckabee – $890,000 on hand
  • Fiorina – $990,000
  • Perry – $880,000
  • Santorum – $230,000
  • Jindal – $510,000
  • Pataki – $210,000

Out of that list, Fiorina is clearly in the best shape because of her debate performance and free publicity last week. That should lead to a fundraising boom for her. But looking down the list at the other candidates, it’s difficult to see how they run a national campaign with such little money. We’ve already seen how quickly Perry burned through $880,000. The other candidates can’t be far behind. The irony is Huckabee has a Super PAC with $6 million and Jindal has one with $9 million — but if those campaigns hit financial difficulty on the road ahead, we’re seeing now with Rick Perry just how powerless those Super PACs with large sums of money will be to actually help.


July 20, 2015

80% of Romney Bundlers Have Not Donated to Anyone in the Race 4 2016 Yet

  10:54 am

We’ve seen large numbers of undecided voters in the opinion polls already this campaign — but when it comes to the money people in the GOP, “undecided” appears to be an understatement. The New York Times tells us that of the approximately 1,000 bundlers (big money folks who fundraise on behalf of candidates) who backed Mitt Romney in 2012, only about 20% have donated any amount of money to any candidate this time around.

That’s a lot of money left sitting on the sidelines, and underscores how this race is developing: slowly. Voters and donors alike are hanging back, waiting and watching to see how things unfold. This is the largest field in history, and it appears that the money folks are waiting to see it winnowed a bit before committing to any candidate:

Those who remain uncommitted — hundreds of volunteer “bundlers” who could collect contributions from their friends and business associates — represent a huge pool of untapped campaign cash, potentially hundreds of millions of dollars, that could remake the primary campaign.

Some of the bundlers and donors said they had held back, in part, because the field was the strongest they had seen in years, with several viable contenders representing the party’s different generational and ideological segments.

Hundreds of millions of dollars, sitting on the sidelines waiting to be donated. It makes sense – why risk an investment in a market with a 16- or 17-way split when you could wait until the best bet became a little more clear? Of course, conspiracy theorists could argue that these bundlers are waiting for the Draft Romney movement and will fill the coffers of their old candidate with hundreds of millions of dollars when he jumps in the race — but those people may need an invitation back to reality. This is not the year for White Knight candidates; in fact, it is the worst year for a white knight in recent history. This nine figure sum of money is not waiting for a worthy candidate – it is waiting to discern which of the worthy candidates is the strongest bet.

Of the 20% of bundlers who have actually donated money to campaigns, the leader so far is, perhaps surprisingly, Jeb Bush. The approximate percentage of Romney bundlers who are backing various candidates this time around:

  • Bush – 12%
  • Rubio – 5%
  • Cruz – 1%
  • Graham – 1%
  • Fiorina – 1%
  • Everyone else – less than 1%

Of course, we need to add “Undecided – 80%” to the bottom of that list. If and when that money starts pouring in, we could potentially see a whole new race take shape.


July 17, 2015

Small Donors, Maxed Donors Show Breadth of Candidate Support

  12:00 pm

So we’ve seen the official fundraising totals in the thread below. Digging a little deeper in the FEC filings and looking at itemized vs. unitemized donations, we can paint a better picture of just how wide support is for each candidate.

The FEC makes a distinction between individuals contributing less than $200 and those donating more than that amount. This distinction is important both because it can display the breadth of support a candidate has and because it reveals the potential of each candidate to continue raising money in the future (remember, individuals can only donate up to $2700 to each presidential campaign; donors who gave $100 this quarter can give more later while a donor who gave $2700 this quarter is done for the rest of the campaign).

With that in mind, here are the percentages of each candidate’s fundraising haul that came from small donors (less than $200):

  1. Carson – 80.2%
  2. Paul – 64.7%
  3. Cruz – 47.0%
  4. Fiorina – 45.3%
  5. Trump – 40.7%
  6. Huckabee – 29.6%
  7. Rubio – 27.6%
  8. Santorum – 23.4%
  9. Clinton – 19.0%
  10. Jindal – 10.3%
  11. Perry – 8.4%
  12. Graham – 8.2%
  13. Pataki – 7.3%
  14. Bush – 3.3%

On the flip side, here are the percentages of each candidate’s donors who are already maxed out and cannot give any more this campaign:

  1. Carson – 2.9%
  2. Paul – 13.5%
  3. Cruz – 16.5%
  4. Fiorina – 24.4%
  5. Huckabee – 28.2%
  6. Rubio – 31.3%
  7. Graham – 31.4%
  8. Trump – 33.6%
  9. Santorum – 46.7%
  10. Clinton – 62.9%
  11. Pataki – 69.7%
  12. Perry – 71.2%
  13. Bush – 81.0%
  14. Jindal – 82.6%

A couple thoughts: Jindal, Perry, and Pataki are clearly not in a good position moving forward. Combined with their low poll numbers, their low percentage of small donors and high percentage of maxed out donors are more or less a death knell for their nascent campaigns. Perhaps surprisingly, Jeb Bush is not in a strong position after raising $11.4 million last quarter. With the tiniest percentage of small donors — just 3% — and one of the highest percentage of maxed out donors, he will have to significantly expand his donor base if he wants to continue raising at that clip.

On the other hand, Carson, Paul, and Cruz all have good potential moving forward. All three have decent fundraising and poll numbers already; to go with that, they have grassroots support and significant room for growth among their donors.

Finally, Hillary’s numbers don’t look incredibly strong. Just 19% of her fundraising came from small donors, and two thirds of her donors are already maxed out. She remains, of course, the inevitable Democratic nominee, and so will pick up funding from all the usual Democratic donors moving forward, but these numbers do display the lack of enthusiasm on the left many are feeling toward her coronation.


Q2 Fundraising Leaderboard — Final and Official Edition

  10:00 am

Plenty of numbers here for everyone to sift through:

2015 Q2 Fundraising Leaderboard
Rank Candidate Raised For Primaries (Q2) Other Revenue Cash on Hand Debt Super PAC $
1 Rubio $12.18 million $3.30 million1 $9.86 million $0 $32 million
2 Bush $11.43 million $8.35 million $0.40 million $104 million
3 Cruz $10.04 million $8.53 million $0.62 million $37 million
4 Carson $8.47 million $4.75 million $0 $20 million
5 Paul $6.93 million $1.59 million1 $4.16 million $0.72 million
6 Graham $3.71 million $1.53 million1 $2.58 million $0
7 Huckabee $2.00 million $0.89 million $0.01 million $6 million
8 Fiorina $1.70 million $0.99 million $0 $3.4 million
9 Perry $1.14 million $0.88 million $0 $16.8 million
10 Santorum $0.61 million $0.05 million2 $0.23 million $0.12 million
11 Jindal $0.58 million $0.51 million $0 $8.7 million
12 Pataki $0.26 million $0.21 million $0
13 Trump $0.09 million $1.80 million3 $0.49 million $1.80 million
Christie4 $11.0 million
Walker4 $30 million
Kasich4 $11.5 million

1Transfer of individual contributions from candidate’s Congressional fund
2Revenue from mailing list rental
3Personal loan from the candidate to their campaign
4Candidate not required to file an FEC report


July 14, 2015

Fundraising Numbers Roll In: Rubio Tops, Perry Disappoints, Jeb King of Super PACs

  9:28 am

As these numbers get reported and publicized, keep in mind that these are unofficial totals. The actual paperwork must be filed with the FEC by tomorrow, at which time we will get a glimpse of the official totals and be able to fill in our leaderboard completely. Until then, this unofficial board is quite telling. Also keep in mind that supposedly candidates cannot legally have any coordination with Super PACs once they are declared candidates. Theoretically, the Super PACs operate as completely distinct and separate entities, detached from the candidates and their campaigns. Since this is the first election cycle where Super PACs will play such a prominent role, it remains to be seen exactly how those vague campaign finance laws will actually play out in real life.

Some notes: Rick Perry is struggling during his second run at being a presidential candidate, raising just over a million dollars — less than Carly Fiorina. Making the debate stage is going to be absolutely critical for both of them; it is difficult to see how Perry or Fiorina continue on with dismal fundraising numbers if they are combined with no national exposure.

At the top of the pack, Marco Rubio has proven his status as a top tier candidate by pulling in the most direct campaign money so far. Jeb Bush almost matched Rubio’s total — and in much less time — putting the two neck and neck at the top. Governor Bush, of course, spent most of Q2 fundraising for his Super PAC before he announced his candidacy – a move which paid of in record setting numbers.

An oddity with the Rand Paul numbers: his campaign is simultaneously raising money for Paul’s presidential bid and Senate bid. The number the campaign released — $7 million — is the total for both contests, and Paul is refusing to say how much is for each. For now, he sits on the board at $7 million, but that number will go down tomorrow when we find out how much he actually raised.

Finally, I find it telling that candidates like Huckabee, Santorum, Graham, and Pataki haven’t announced their fundraising totals yet. Usually, that indicates disappointing numbers that are difficult to spin.

To the board…!

2015 Q2 Fundraising Leaderboard
Rank Candidate Raised For Primaries (Q2) Other Revenue Cash on Hand Debt Total Raised, All Quarters Super PAC $
1 Rubio  $12.1 million  $3.3 million1 $9.72 million $12.1 million $32 million
2 Bush  $11.4 million $11.4 million  $104 million
3 Cruz $10.0 million $14.3 million $37 million
4 Carson $8.3 million $10.5 million $20 million
5 Paul $7.0 million2 $7.0 million
6 Fiorina $1.4 million $1.4 million $3.4 million
7 Perry  $1.07 million $1.07 million $16.8 million
Walker $30 million
Kasich $11 million

1Transfer from candidate’s Congressional fund
2Total includes funds raised by joint committee; some of the total is for a Senate campaign.


July 7, 2015

Fiorina Reports a Disappointing $1.4 Million for Q2

  8:00 am

This will take the air out of the sails a bit for the upstart Fiorina campaign: they raised just $1.4 million in the second quarter. True, she had a shortened quarter since she launched in May, but the first quarter after launching is usually the easiest to raise money in for candidates. (And, Cruz raised over $4 million in just a week in Q1.) Carly’s Super PAC didn’t fare much better, bringing in just $3.4 million. To quote the National Journal:

The latest fundraising figures mean Fiorina’s campaign has little flexibility or money to hit the airwaves to bolster her standing. Fiorina never was expected to be among the top GOP fundraisers, but $1.4 million is below expectations.

Fiorina has been phenomenal on the stump and in interviews, but that has not translated into solid support in the polls or in fundraising yet — and with this punch to the gut, it’s rather difficult to see how she can claw her way into serious contention for the candidacy now.

2015 Q2 Fundraising Leaderboard
Rank Candidate Raised For Primaries (Q2) Other Revenue Cash on Hand Debt Total Raised, All Quarters Super PAC $
1 Cruz $10.0 million $14.3 million $37 million
2 Carson $8.3 million $10.5 million $20 million
3 Fiorina $1.4 million $1.4 million $3.4 million
Walker $30 million

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