The Democratic National Committee had more debt than cash on hand when the general election started in September, a troubling fact few people have noticed to this point in the campaign.
We already knew that the Republican National Committee had more than 10 times as much cash as the DNC while the party's were holding their conventions, but a closer look at the DNC's August report shows it also took out $8 million in loans during that month -- which means it had more debt ($11.8 million) than cash on hand ($7.1 million).
It's not unusual for a campaign or campaign committee to take out a line of credit at the end of a close election -- Mitt Romney's campaign took out $20 million in loans to get through the primary season -- but the DNC's cash situation is significantly worse than it has been in recent election years.
In the 2008 presidential election, for example, the DNC had $17.7 million in cash and no debt at the end of August. It took out a $5 million loan after the election.
In 2004 at the end of August, the DNC had $55.7 million in the bank and no debt. It didn't take out any loans in the following months.
And in the last midterm election, in 2010, the DNC took out a $5 million loan in August and had $13.4 million on hand.
This year, though, appears to be the first time the committee has carried more debt than cash heading into the final two-plus months of the campaign.
The question from here is whether that represents a problem for Democrats and whether the DNC is going to have to continue to take out loans to stay above water. So far the committee has taken out $8 million of a $15 million line of credit, meaning it can take out more, but only to an extent (unless it secures more credit).
The national party committees, in a presidential election year, do benefit from a joint fundraising committee that raises money both for them and for their presidential candidate. But while Mitt Romney's joint committee has sent $86 million to the RNC since March, President Obama's joint committee has sent significantly less -- about $35 million -- to the DNC, including a total of zero dollars in August.
Much more of Obama's total fundraising, which is more dependent on small-dollar givers, has gone to his campaign, while Romney's fundraising, a majority of which comes from big donors, has gone to the RNC. This is because the candidates themselves can only accept up to $5,000 per donor, while party committees can accept just more than $30,000. So while only so much of big-donor money can go to Romney, small-donor money goes almost exclusively to Obama.
That financial reality means the DNC has had to lean much more on its own fundraising, but even there, it has been outraised $176 million to $111 million by the RNC this election cycle -- and $94 million to $51 million this calendar year.
Obama did raise a very strong $181 million in September for his campaign and for the DNC, but it's unclear how much of that sum will go to the DNC and whether it will bring the DNC out of the red.
The cumulative effect is that Republicans have a lot more money in their party committee ($76.6 million) than Democrats ($7.1 million) but less in Romney's campaign ($50.4 million) than in Obama's ($86.6 million).
That difference means the DNC hasn't been able to supplement Obama's advertising and has instead focused on the ground game in the key states.
The DNC has sent a significant amount of its money to state parties in recent months -- which suggests it feels confident that it will have the resources it needs to execute that ground game. If the committee was in real trouble, it probably wouldn't have transferred those funds.
But we'll know much more when we have September fundraising reports, which are due on Oct. 20. They should give us a sense for how much the DNC will have been able to fund their ground effort in the final month-plus of the campaign.
The DNC declined to comment for this post, citing a desire not to share spending strategy with its opponents.