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Democrats Closing Fundraising Gap With Republicans

Rep. Rahm Emanuel (D-Ill.), right, is considered an effective fundraiser. With him is Cincinnati councilman John Cranley, who is running for Congress.
Rep. Rahm Emanuel (D-Ill.), right, is considered an effective fundraiser. With him is Cincinnati councilman John Cranley, who is running for Congress. (By Al Behrman -- Associated Press)

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RNC Chairman Ken Mehlman, whose committee has seen a 10 percent fundraising drop, compared with 2004, said Internet fundraising has allowed Democrats to reach a new group of liberal donors and narrow the GOP's edge with individuals. But he said his party still holds a solid financial lead because of money raised by state parties.

Still, the trends at the national level are diminishing what in past years has been a powerful GOP asset: the ability to overpower opponents with expensive television advertising and voter-mobilization campaigns in House and Senate races.

Republicans concede that Democrats are doing a better job than ever of raising money for House and Senate candidates. They have done so in part by borrowing longtime GOP tactics, such as pushing for small donations from activists -- on the principle that small gifts can add up -- and pressuring elected members from safe seats to give financial help to colleagues. Democrats say they are also tapping into widespread grievances among voters against President Bush and the Republican Congress.

Amy Walter, a nonpartisan political handicapper for the Cook Political Report, agreed that Republicans' problems appear to be at the grass roots. "This mirrors the problems Republicans could have with turnout," she said.

The Democratic fundraising success runs contrary to what many analysts predicted after the campaign finance system was overhauled at the end of 2002. Under the McCain-Feingold campaign law, rich individuals, corporations and labor unions were prohibited from contributing limitless "soft money" to political parties. At the time, it was widely expected that Republicans would benefit most because they had a more effective program for raising money from both political action committees and individual donors.

But the 2004 presidential election offered the first clues that Democrats could neutralize, if not overcome, the Republican money edge. Starting with then-presidential candidate Howard Dean (Vt.), Democrats raised more money over the Internet than strategists in either party anticipated. (Unlike phone banks or direct mail, Web-based fundraising has little overhead or solicitation costs.) In the general election, Democratic nominee John F. Kerry (Mass.) kept pace with Bush in head-to-head fundraising, raising $326 million to Bush's $367 million.

The Democratic Congressional Campaign Committee offers a case study of how Democrats are starting to catch up at the congressional level. Chairman Rep. Rahm Emanuel (Ill.) is widely considered the most effective fundraiser Democrats have placed in that job in years. A veteran of the Clinton White House, Emanuel has pressured Democratic members to give more money to their at-risk colleagues and has intensified efforts to squeeze more money from individual donors. In 2002, at this point in the election, the DCCC had raised $6.5 million from donors who gave less than $200. This year, Emanuel has tripled such donations to nearly $21 million. Other Democratic committees also have experienced growth.

"They have been so bad they can only get better," said National Republican Congressional Committee Chairman Thomas M. Reynolds (N.Y.). "What you have seen is Rahm put them on a path to do so."

Over at the NRCC, which has spent more than $55 million building a list of smaller donors in recent years, contributions from individuals are not increasing much. In 2002, the committee had raised $27 million from less-than-$200 donors at this point in the election, compared with $30 million now.

Carl Forti, NRCC spokesman, said Republicans are victims of their own success. He said the NRCC in particular spent so much money on direct mail and other techniques targeting individual donors over the past decade that they essentially "maximized our potential return."

Not all Democrats are pleased with how their party is managing its money. Some big donors privately complain that Dean, now Democratic National Committee chairman, is spending too much cash too early, while Emanuel has faulted Dean for not aiming enough DNC resources at states with the toughest races this fall.

The DNC has experienced a 3 percent increase in fundraising, compared with an equivalent point in 2004, a rate of growth that lags far behind those of the party's Senate campaign committee (66 percent) and its House campaign committee (45 percent).

Some of the nation's biggest companies, which typically invest more in the majority party, might start hedging their bets in the months ahead in case Democrats win back the House, according to a top Bush fundraiser, who requested anonymity. But FEC data do not show an across-the-board shift in business support away from the GOP.

One of the biggest surprises of this campaign season is the fundraising performance of Democrats in open House and Senate races, which are often the most competitive because the incumbent is not seeking reelection. In recent elections, Republicans held a decisive fundraising edge in these contests. Not this time. In Arizona's 8th Congressional District, which handicappers consider among the most competitive in the nation, Democrat Gabrielle Giffords has raised almost $600,000, more than twice as much as Republican Steve Huffman.

Political researcher Zachary A. Goldfarb contributed to this report.

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