ARLINGTON, Va. – As the Democratic presidential candidates hunkered down for a lengthy – and costly – war of attrition for the nomination, aides to Hillary Clinton revealed Wednesday that she dipped into her personal fortune last month to lend the campaign $5 million, signaling potential financial vulnerability. Clinton’s campaign also disclosed that several senior staff members, including her campaign manager, were voluntarily working without pay.
The New York senator made the loan in late January during the run-up to Super Tuesday voting, in which she and Barack Obama fought to a draw in the near-national primary, with both campaigns on the day after still disputing which side eked out an edge in delegates won.
During January, Obama outraised Clinton by more than 2-to-1, bringing in a staggering $32 million in contributions to $13.5 million for Clinton and expanding his donor base to more than 650,000 contributors, according to aides to both candidates. Unlike the Clinton campaign, which depends heavily on wealthy contributors who have already reached the $2,300 legal maximum they can give to a candidate, Obama relies more on small-dollar donors who can keep giving.
“We now have a campaign in which Obama has a commanding financial advantage and she has become the financial underdog,” said Anthony Corrado, a political science professor at Colby College in Maine who studies political fundraising.
At a press conference in Arlington, Va., Clinton pledged that her campaign would have the resources to mount a serious bid as the race shifts to a series of state-by-state contests across the country that both candidates now expect to last through March, even April and possibly beyond.
“We intend to be competitive in states that look to be challenging, as well as ones that look like they will be very favorable for me,” Clinton said.
Howard Wolfson, Clinton’s communications director, said the loan “illustrates Sen. Clinton’s commitment to this effort and to ensuring that our campaign has the resources it needs to compete and win across this nation.”
Later, Wolfson said some staff members were skipping paychecks, including campaign manager Patti Solis Doyle.
Clinton began her bid with perhaps the most formidable network of fundraisers and donors in the Democratic Party. In addition to traditional fundraising based on cultivating well-heeled donors, Obama used the Internet to transform an enthusiastic following and interest in his barrier-breaking candidacy into a broad base of small-dollar donors.
Both candidates raised money at an unprecedented pace last year, with each campaign bringing in more than $100 million during 2007. But the two campaigns’ financial fortunes diverged in January, as Obama continued to tap his large donor list and also expanded it by 170,000 new donors.
The $13.5 million Clinton raised in January actually represents a step up in her fundraising pace.
But the larger flow of funds to the Obama campaign raises the financial pressure on Clinton, particularly in combination with the demands of first competing in Super Tuesday contests spread across some of the nation’s most expensive media markets and now sustaining a campaign that appears certain to drag on well past expectations.
Even before Tuesday, the Obama campaign was advertising in all of the states with primaries or caucuses in the coming week.
“In some ways now, they are driving the campaign,” Corrado said of the Obama campaign. “The Clinton campaign is being forced to try to match the resources in a more targeted way.”
Funding advantages do not necessarily translate into electoral successes. On the Republican side, Rudy Giuliani and Mitt Romney waged campaigns that were the best-funded for much of the year. John McCain, who is now leading, had to borrow money to continue his campaign in 2007.
In dueling press conferences, Obama and Clinton each sought to claim they had the momentum coming out of Tuesday’s primaries and caucuses. Obama won at least 13 of the caucuses and primaries in 22 states and American Samoa while Clinton won some of the largest states, including California and her home state of New York. The victor in New Mexico was not clear.
“We won big states and small states, we won Red States and we won Blue States and we won swing states,” Obama said.
Clinton called it “a great night” for her campaign.”