Long before issues emerge and nominees are chosen for the 2004 elections, Republicans are opening a huge advantage in ready cash.
New campaign finance laws, plus control of the White House and Congress, have given President Bush and his party an unprecedented edge in all-important "hard money." Strategists in both parties and independent experts believe Bush is likely to raise three to five times more than his Democratic opponent in this type of contribution, which can be used for any purpose in a campaign.
Republican campaign committees are positioned to raise at least twice as much as their Democratic counterparts, enabling them to help GOP candidates up and down the ballot by expanding the party's successful grass-roots organizing efforts and coordinated advertising campaigns.
"The spending advantage will be enormous," said veteran Democratic strategist Harold Ickes. "Not overwhelming -- because that means it's hopeless -- but enormous."
The Center for the Study of Elections and Democracy at Brigham Young University, which studied campaign spending in the 2002 elections, concluded that the GOP's hard money advantage provides "an ominous warning for Democrats in the 2004 election cycle."
Ironically, much of the Democrats' financial dilemma stems from their success in passing the McCain-Feingold campaign finance law last year, party fundraisers believe. The measure, which received minimal support from congressional Republicans, prohibits the national political parties and federal candidates from raising and spending "soft money" contributions.
Soft money contributions are unlimited donations often made directly from corporate or union treasuries, and from rich people. Hard money contributions can be made only by individuals and political action committees. Individuals can give candidates $2,000 and political parties $25,000 in hard money; PACs can give candidates $5,000.
In the most recent election cycle, nine of the top 10 "soft money" donors backed the Democrats, including Haim Saban, creator of "Power Rangers," who gave $9.3 million; television station owner Fred Eychaner ($7.4 million); the American Federation of State, County and Municipal Employees ($6.6 million) and the Service Employees International Union ($4.7 million), according to PoliticalMoneyLine.
Thanks to these superdonors, the Democratic Party's senatorial, House and national campaign committees essentially matched their GOP counterparts -- $245.8 million to $250 million -- in soft money in the 2002 election cycle.
Under the new law banning soft money in national campaigns, however, these Democratic supporters now can give only relatively small sums to federal candidates and party groups. This increases the importance of hard-money fundraising, where Republicans traditionally have excelled. The new law, which took effect in November, raised the maximum legal hard money contribution to candidates from $1,000 to $2,000 per donor.
In the 2002 election cycle, GOP campaign committees outraised Democrats in hard money by $332 million to $163 million. Looking to 2004 and beyond, Republicans have a much larger pool of reliable donors and a more effective operation for finding new contributors.
"The Republican Party just has a much broader base of large and small donors, and on average they give more," said Anthony Corrado, a campaign finance expert at Colby College in Maine.
No one has used this advantage more effectively than George W. Bush. In 1999 and 2000, as governor of Texas, he raised about $100 million in hard-money donations for his presidential campaign and shattered all records. At least $60 million came in $1,000 donations, much of it collected by "Pioneers," supporters charged with raising at least $100,000 each. Bush tapped as many donors willing to give the maximum hard-money contribution as did all his competitors combined.
"If just one-third of them double up and give the new maximum of $2,000 each this time, Bush will start with a base of $80 million," Corrado calculated.
One Pioneer, GOP lobbyist Ed Rogers, said that should be no problem now that Bush is a president seeking reelection. "I don't think the step from $1,000 to $2,000 will be consequential," he said. "There's no gag factor there."
Republicans also have far more small-check donors, who give, on average, $20 more apiece than their Democratic counterparts. "Twenty dollars per gift, times 30,000 more donors -- pretty soon you're talking real money," Corrado said.
The bottom line: Few if any experts believe Bush will raise less than $125 million for the primary phase of the 2004 campaign. Some people believe the number might be far higher. "I take it as an article of faith that he will raise $225 million to $250 million," Ickes said. "Or maybe much more."
The same experts say the most successful Democratic presidential contender -- whoever it turns out to be -- won't come close to that amount. No Democrat in a presidential campaign has ever raised enough hard money to opt out of the public financing system, as Bush did during the 2000 primary election and is virtually certain to do again next year. Most, if not all, of the 2004 Democratic contenders are expected to take public subsidies during the primaries -- which means they must agree to spend no more than about $44 million before the midsummer nominating convention.
The eventual Democratic nominee may need all of that money just to prevail by March or April. From that point until the party convention in late July, the winner may be nearly broke, while Bush is awash in cash. He and his party can use that money not only for his campaign, but also to help GOP candidates at the congressional and state levels.
The national Republican Party made such efforts in 2002, contributing not only to gains in the House and Senate, but also to the unexpected retention of a majority of governorships and to winning a plurality of state legislatures, ending 50 years of Democratic dominance.
The power to set the legislative agenda -- now firmly in Republican hands -- is always important in winning the support of lobbyists, corporate executives and trade association executives who can encourage their clients, employees and their members to make donations.
"The business community writ large is going to be very supportive of this president," said Bruce Josten, executive vice president of the U.S. Chamber of Commerce.
Ickes and other Democratic strategists are looking into establishing "independent" groups that could receive soft money donations to air "issue ads" in support of their party's candidates. While the new campaign finance law will not allow the candidates to coordinate with such groups, "there's no great mystery to figuring out what messages the candidate wants to send," Ickes said. "Just pick up the paper and watch TV."
A provision of the new law, however, would ban such advertising within 60 days of the general election. If courts uphold that provision, such groups would be of limited value.
What appears certain, experts said, is that special-interest groups -- such as labor unions, abortion rights groups and the National Rifle Association -- will use the cash they once sent to the political parties as soft money to air ads and organize voters directly. These groups' leaders might enjoy that power, Corrado said.
"I don't think [AFL-CIO President] John Sweeney liked sending that money to the Democratic National Committee, anyway," Corrado said. But such a system is likely to be less efficient than a coordinated campaign run by a party and its candidates.
Democratic National Committee Chairman Terence R. McAuliffe, perhaps the most renowned fundraiser of the 1990s, has vowed to boost DNC hard-money fundraising by $100 million to fill the gap left by the ban on soft money. He said his staff is pressing the party's large individual donors to give the maximum allowable to party headquarters -- $25,000 per person per year, under the McCain-Feingold law.
He said the money will go into a separate "Presidential Trust Fund" devoted exclusively to help the eventual nominee. He is also urging presidential candidates to ask their top donors to give to the fund.
"Any major contribution check that comes into this party, that money is now going into an account which will be given to the nominee the day they are nominated, maybe March 10 ," McAuliffe said.
McAuliffe and others say that advancing the primary process will give the party more time to raise cash -- especially from supporters of defeated candidates who would want to establish ties with the nominee. But McAuliffe's earlier efforts to wean his party from soft money have been marginally successful. Hard-money contributions to the DNC rose by just $7 million from the 1997-98 election cycle to 2001-02.
The likely Republican money edge may add further leverage at a time when the political terrain is already favorable. Analysts in both parties believe the GOP is well-situated to expand its majorities in both the House and Senate next year. Democratic strategists rating the most vulnerable Senate seats in 2004 list a dozen that are held by Democrats, and five in Republican hands.
In the House, some analysts feel the 10 most vulnerable seats are held by Democrats representing districts that voted strongly for Bush in 2000.
Many leading Democrats argue that no amount of fundraising will save Bush and his congressional comrades from a laggard economy.
"I can envisage a scenario in which 2004 would not be a hostile or bad year," Democratic lobbyist Lawrence F. O'Brien III said, citing rising unemployment, the troubled stock market and the president's controversial tax cuts.
He added, however: "The one thing I find immutably troubling is the money."