Obama campaign fears being sharply outspent by GOP super PACs

The Obama campaign, which shattered all records for political fundraising in 2008, has concluded that it could be dramatically outspent this year by the GOP nominee and allied conservative groups, which are able to tap a deep well of money unavailable in previous contests, according to senior aides and advisers.

That revised analysis, spurred by a wave of outside spending in the Republican primaries, led to President Obama’s decision this week to throw his weight behind the efforts of a Democratic super PAC that has struggled to remain competitive without the clear support of the incumbent.

The move signals a remarkable turnabout for a politician who has spent much of his career railing against the influence of such groups on elections, calling them a “threat to democracy” during the 2010 midterms. It also underscores how much the landscape has changed since 2008, when Obama easily outdistanced his Republican opponent in fundraising.

Faced with conservative groups raising tens of millions of dollars in unlimited donations, officials said, Obama decided to cast aside idealism for pragmatism in an attempt to remain competitive in November. Aides say the issue came to a head during the Republican primary contests, as the potential size of GOP front-runner Mitt Romney’s super PAC war chest became more apparent.

“The combination of the sheer magnitude of what we were watching on the Republicans’ side, combined with the lack of any real ammunition on our side, was disconcerting,” said one Obama adviser, who requested anonymity in order to speak candidly about the decision.

The reversal, which called to mind Obama’s decision in 2008 to decline public matching funds, angered liberal-leaning activist groups already disappointed with the president’s mixed record on lobbying and campaign-finance reform. Republican leaders also piled on the criticism, accusing Obama of hypocrisy in deciding to embrace a system he has long opposed.

“Just another broken promise,” House Speaker John A. Boehner (R-Ohio) told reporters Tuesday.

But senior aides said Obama concluded there was no way to combat the wave of spending by conservative super PACs and other groups without playing by the same rules of fundraising. Even then, these aides insist, Democratic groups are likely to be outspent by those on the other side.

Longtime Obama adviser David Axelrod said there is an “array of guns pointed at us” from the Republican side.

“We were faced with a situation as to whether we could afford to play by two sets of rules,” Axelrod said on MSNBC. “And the answer is obviously no. . . . But that doesn’t mean that we believe that this is the best way for the system to function. The president will continue to fight for reform, but that won’t be in in this campaign.”

The Democratic worries come despite a blockbuster fundraising year for the Obama campaign, which with the Democratic National Committee raised $224 million. Obama’s campaign raised $745 million during the 2008 election cycle, and advisers have long expected that his campaign will at least approach that total again.

But Obama advisers and their allies now believe that Romney’s campaign could raise about as much as Obama by the time of the general election, combined with $500 million or more from American Crossroads and other conservative groups. It is unclear whether unions and other liberal groups would be able to fill the gap, they said.

The super PAC supporting Obama, Priorities USA Action, has also had trouble raising money without Obama’s explicit support, bringing in just $4.1 million last year — nearly half of it from Hollywood mogul Jeffrey Katzenberg. Restore Our Future, a super PAC supporting Romney, raised $30 million, including 11 donations of $1 million or more.

Obama’s advisers had long known of the potential power of the super PACS, but it was only in the past few weeks that the full impact became clear. Few of them had anticipated that super PACs would outspend the GOP candidates themselves in several of the early primary contests.

Campaign officials first saw the new power of outside money in Iowa, where Romney’s super PAC bombarded rival Newt Gingrich with negative ads, turning the former speaker from the leader there to a fourth-place finisher. But it was Florida’s primary, where spending by Romney and his super PAC gave the former Massachusetts governor an easy victory, that forced the action taken Monday, aides said.

“We always kind of knew it was coming, but not to that extent,” said another Obama adviser, who also spoke on the condition of anonymity. “We had been having an ongoing discussion for a while, but you looked at the absolute buzz saw that Newt walked into. He was up eight [points after South Carolina’s primary] and got blown out.”

Campaign officials talked through their options and went to Obama, describing the problem as they saw it and recommending that they explicitly encourage Democratic donors to start contributing to the Priorities super PAC, which is headed by former aides Bill Burton and Sean Sweeney.

News of the shift was relayed to members of Obama’s finance committee in a Monday night conference call, followed by a message to supporters from campaign manager Jim Messina. Under the new ground rules, Messina said, campaign aides and some Cabinet officials will appear at Priorities events but will not directly solicit money. Obama, his wife and Vice President Biden will encourage support but will not appear at events.

One Obama adviser said the decision has had an immediate effect. “Our donors get it,” the official said, adding that they now want to “go fight the other side.”

Deputy Editor, National Politics
Dan Balz is Chief Correspondent at The Washington Post. He has served as the paper’s National Editor, Political Editor, White House correspondent and Southwest correspondent.
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