The end of the large dollar donor in US politics? Not at all

Barack Obama raised unprecedented amounts of money from small dollar donors (under $200) in 2008. That one you’ve heard before. He also, mind you, raised unprecedented amounts of money from large dollar donors ($1000 and up). That’s sometimes left out of the story.

The omission of this proven track-record with large dollar donors has led some to claim, usually on the basis of anecdotal evidence, that Obama and the DNC, high on the grassroots funding successes of Dean and later Obama, have abandoned their traditional big-time funders in New York (and California).

They haven’t. And why would they?

First of all, they haven’t stopped cultivating large donors. Obama hasn’t, the DNC haven’t, and candidates at all levels certainly haven’t either. It seems safe to predict that large donors will donate the plurality of individual contributions in the 2010 mid-terms, just as the Campaign Finance Institute found that they did to Obama in 2008 (for the general election, 34% of individual donations came from donors who gave $200 or less, 23% from donors who gave between $200 and $1000, and 42% from donors who have $1000 or more). Looking at House candidates in 2008, the Campaign Finance Institute found, quite predictably, that they relied much more on large dollar donors than Obama did. Without breaking it down by party or incumbency, just look at the raw numbers: donors who gave $200 or less contributed 8% of individual contributions to House candidates, between $200 and $1000 11%, over $1000 35%. (The rest comes from political action committees (36%) and from other sources, including self-funding (10%)). Internet or no internet, the total percentage of donations that come from small dollar donors have consistently declined from 15% in 2000, 12% in 2002, 10% in 2004, 9% in 2006, and to 8% in 2008. Small dollar donors gave $10 million less in absolute numbers to House candidates in 2008 than in 2000! (Interestingly, the numbers for the Senate are a little different, still a decline, but slight and less consistent.) Democratic Party operatives at all levels are at least aware of these numbers, and they would have to be rather high on new technology hype to fail to realize that it would be rather short-sighted not to keep on cultivating the usual fundraising circuits.

Secondly, why would they stop? Small dollar donors and large dollar donors aren’t, after all, mutually exclusive alternatives. They surely have different implications for who political operatives and candidates feel they need to represent, but from an operational point of view, cultivating both is simply a matter of capacity and organizational priorities (as the Republican success with courting small dollar donors via direct mail while pulling in large dollar donors by the barrel full at the same time have demonstrated for a long time). (OK, the candidate’s time is limited, and you can’t schmooze at a $1000-a-plate fundraiser while giving your stump speech to a couple of hundred activists who have donated $50 dollars for the cause (not that many congressional candidates even have the second option, given how disconnected from politics many people feel).) Back to Obama 2008 and the starting point for this post—not only did his campaign raise unprecedented sums from small dollar donors, they also raised unprecedented sums from large dollar donors (for partial numbers, see this).

New technologies and organizational priorities offer political campaigns new opportunities for courting small dollar donors in larger numbers across the country, and at lower overhead when well done, than have been the case in the past. For those candidates who chose to embrace this, and who appeal to the kinds of people who donate money to politicians, this can be a game-changer (see Nancy Scola’s post on TechPresident on a number of spectacular examples). But this important development and disgruntled complaints from a few former big-time funders who don’t feel they get the attention from national Democrats that they should get (as the Washington Post article linked to above suggests, often because they are politically toxic for one reason or other), shouldn’t lead us to conclude that we are witnessing the end of the large dollar donor in American politics. We are not.

(cross-posted on TechPresident)


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