Time to Change the Party

by Patrick Ruffini :: February 26th, 2008 1:31 am

If you’re a Republican operative who has worked in Presidential politics, possibly the defining moment of the past decade was nine years ago this July, when George W. Bush’s campaign announced a record $37 million fundraising haul for the first six months of 1999.

It’s difficult to forget the “wow” factor behind that number, but it was positively revolutionary at a time when the biggest fundraising quarter in history was Bill Clinton’s $13 million as an incumbent President. And remember that the contribution limit back then was $1,000, not $2,300.

The Bush campaign did not invent the idea of bundling, but by marketing it better (Pioneers) and introducing public rewards and incentives, they tapped into a level of giving that had not been seen before in Presidential politics. This is what happens when the best minds in politics think outside the box and refuse to be bound by old conventional thinking.

The same moment for a similarly placed Democratic or progressive activist would have come in June 2003, when Howard Dean put his fundraising total up live online, and challenged his supporters to blow his goal away. The Bush model was able to raise more money in the short run, but four years later, we have an opportunity to judge which of these models has proven the most relevant in this particular electoral moment. The result has not been good for Republicans.

Going into 2004, changing the GOP gameplan would have been crazy and stupid. A little bill called McCain-Feingold was supposed to help things further by doubling the contribution limit, all the while banning the soft money contributions from billionaires and entertainment moguls that the Democrats depended on. People in-the-know marveled at how the Bush campaign would be able to raise $200 million, which each of the Democratic Seven Dwarves would squabble over $10-$20 million in scraps.

In the winter of 2003, the biggest immediate threat was not the Internet fundraising machine being built by the Dean campaign — which, though it lapped the Democratic field, was only able to find enough hard dollars to match the Clinton-Gore campaigns of the ’90s and 2000. It was George Soros, Peter Lewis, and the Democrat 527s who pledged to more than match the Bush campaign dollar for dollar. That was the concern outwardly.

Historically more significant than Dean is the fact that John Kerry, a man so unloved that the biggest viral sensation around him was the website JohnKerryIsADouchebagButImVotingforHimAnyway.com, was able to raise three times as much as Dean online. Looking back, you can see this not just as a reflection of the incredible animosity and hatred of President Bush, but as a sign that this was just the tip of the iceberg. If a “douchebag” like Kerry could do this much, what could someone who actually tapped into the grassroots passion and energy of a major political party do?

The central fact surrounding Kerry’s online fundraising success was the sense of urgency and mission that spawned it. As Kerry/MoveOn Internet guru Zack Exley wrote last July:

The Kerry campaign, on the other hand, had the perfect fundraising ask: “Bush is going to outspend us two-to-one unless you chip in.” As Kerry began to close in on Bush’s fundraising numbers, the campaign could say, “Chip in again to completely level the playing field for the first time in decades.”

Unfortunately for the Kerry campaign, almost no one expected parity in fundraising. The Bush camp had planned way ahead for a massive campaign. The Kerry camp had planned for one half as big–and late changes due to a rush of unexpected money can only accomplish so much.

Zack is right. The Bush campaign did not raise more only because we didn’t need to. Raising $20 or $30 million more atop an already well-honed campaign would have yielded little incremental benefit. Better to focus on the end product: votes, and harness the relatively untapped potential of the Web for mass mobilization. (Still, there is the acute realization that these efforts don’t often get as much credit as they should because they don’t revolve around the most quantifiable metric in politics, or in any field, for that matter. Money.)

Despite the desperate straits the Kerry campaign was in when they began the general election, they were able to achieve near parity financially in just five months, and half of that surge was online. The Kerry campaign was able to do the seemingly impossible: climb the mountain the Bush Pioneers had seemingly conquered for a generation four years earlier, and do it with a significant assist from harder-to-wrangle low-dollar donors.

The campaigns of John McCain, Mitt Romney, and Rudy Giuliani all went into 2008 with the same goal in mind: capture as much of the Bush Ranger & Pioneer establishment as possible and raise $100 million in 2007. The spirit of 1999 lived on. Unfortunately for the campaigns, it was more like the spirit of the 1999-era stock bubble. Virtually nobody questioned the assumption that the high dollar fundraising boom would go on forever, considering the storm clouds of a closely divided field with no heir apparent (people like to invest in a sure thing) and a demoralized base.

Instead, the Bush establishment fractured five or six different ways — four ways to the various frontrunning GOP candidates, with the largest contingent sitting on the sidelines and a few donating to Obama. And without an establishment unified enough to force its will, establishment support became more of a crutch than a real asset for any campaign that depended on it.

The candidates hoped against all hope that they could replicate the same disciplined, unified structure, and clear the field of all opposition. This was not going to happen with the number of evenly matched candidates that there were. This is why John McCain 2000 was so much more controversial than John McCain 2008: then he was dislodging a sure thing people had spent $100 million to build up. When he came out of nowhere this time, he was dislodging nothingness.

So, the candidates decided to subsist instead on a third generation copy of the Bush machine rather than the more nimble, guerilla-style, network-warfare style campaign that an open field called for. This was the result.

• John McCain 1.0, broke and left for dead

• Mitt Romney spending $50 million of his sons’ inheritance on a failed makeover attempt destined to fail in an era of reality TV and YouTube
• Rudy Giuliani spending so much time fundraising at high dollar events that he couldn’t campaign in his natural breakout state, New Hampshire
• Fred Thompson turning back on his initial instinct to be the savvy net-warrior to wage a cookie cutter Washington campaign

Put all the pieces together, and you have a coherent narrative about how turning away from a grassroots, authentic, new media-ish campaign turned out to be fatal or nearly fatal for each of these campaigns. And in the redemption of John McCain and in the frustrating success of Mike Huckabee’s shoestring campaign, you will find a compelling story about the triumph of lean, word-of-mouth, buzz-driven campaigns.

But no epitaph will be as definitive about the passing of the old style of politics as that of Hillary Clinton. Though the nature of commentators and activists on the right is to focus primarily on what is happening in our own house, perhaps the most valuable lessons can be gleaned from what is happening in theirs.

A year ago, Hillary too was “inevitable.” She had the establishment. She had the bundlers. She had Terry McAuliffe, a guy who would wrestle alligators for the big checks. She had the superdelegates. She had the Bush model perfected down to a t. She had the full weight of the most beloved figure in the Democratic party behind her.

In 1992, 1996, 2000, and 2004, it would have been enough. Not this time.

It is presumptuous to ascribe this failure to any one cause, and equally as foolhardy to draw sweeping conclusions from the unique Obama phenomenon. But something like this was bound to happen sometime soon. All throughout this period, a new medium has been rising, serving as a great leveler of status-driven advantage in politics and media.

Those who still minimize the impact should consider these numbers. Obama has received 10.9 million votes. The “Yes We Can” video has 11 million views. Clinton has been voted for 10.3 million times. The Hillary 1984 video has 4.8 million views. John McCain has gotten 5-6 million votes. Drudge is read by 3 million people in any given month. Clinton probably has 2 million emails — about 20% of her vote, and Obama probably has 3 million, nearly 30% of his. The political web is now reaching the vast majority of the primary electorate with dozens of touchpoints throughout the cycle — few of them controlled by the campaigns themselves — and is reaching all the people who will do anything beyond vote in a general election.

With all of this, it is increasingly difficult to control the battle space with TV advertising, mail, and phone calls. If 30% of your universe is reading Drudge, if 70% of your likely voters are seeking out YouTube clips of you, the impact of push media fades by comparison. Yes, the impressiveness of these figures ebbs in a general when low-information voters come in, but that only makes the cash cow that is your online network all the more important in generating resources for paid media when it matters.

I go back to the fact that the Democrats were successful in building a new machine because they needed to be. Dean, Kerry, and Obama were evolutionary steps in this process. McCain-Feingold had just killed off the only financial advantage they had. They had to find something better, and did. Starting in January 2007, we were in the same position with the fragmenting of the old establishment the Democrats were in during 2003. Today, we really need to get good, and the threat is existential.

The situation right now is that Obama can raise $60 million a month through November, even with $10 million a month online, McCain could do $20-30 million. Think Kerry had a good pitch with Bush outraising him 2 to 1? McCain could be outraised 3 to 1.

What does McCain do? Though largely untapped, the amount he can raise from the Bush network is finite and limited, and the field as a whole ran up against these limits in 2007. He can and should do what he needs to go raise money, but just as much energy, creativity, and sweat equity needs to go into turning seven figure online fundraising months into eight figure months. Top Republican strategists certainly sees this as a problem, but not the singular strategic and existential threat to the future of the party. If they did, we would not have seen so much agitprop messaging in the primaries and a realization that one million people on your email list is just as important as $100 million.

Complicating matters further is the fact that the existing GOP low-dollar fundraising base is hostile to McCain. Immigration may not matter in the voting booth, but it matters in direct mail fundraising. For better or worse, McCain-Kennedy is the bookend to McCain-Feingold in killing off traditional fundraising. McCain-[Insert Running Mate Here] needs to be the solution, by bringing in a new coalition of donors and activists. The challenge is tough but not unprecedented: Obama, Huckabee, and Ron Paul all found a donor base that didn’t fit the mold of conventional left-right activists.

What does this mean for the horserace? I am not a big fan of fundraising for fundraising’s sake. Diminishing returns set in. But I think a plausible scenario is that Obama uses a 2 or 3 to 1 cash advantage is to expand the map: to play in 25 states rather than McCain’s 15-20. The most effective TV ads are those that are uncontested. Could Obama run virtually uncontested advertising in Colorado, Virginia, North Carolina, Louisiana, and Georgia to move the numbers starting in March? And organize the African American vote in the South? Or more likely, concentrate on building insurmountable leads in true swing states like Wisconsin, Iowa, and Minnesota and force him to defend GOP-leaning Missouri and Florida?

All of this — the massive resource advantage Obama now enjoys — is the result of a decision to trust in a fundamentally more deeper and more resilient medium for building support for his campaign: a word of mouth network that can only be corralled online. Hillary Clinton trusted the establishment and is on the brink of losing. The GOP candidates who leaned on the party’s Wise Old Men lost.

The emergency is no longer off in the distant future. It is now. And it’s time to step up and change.

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