NATIONAL NEWS

How some WH hopefuls inflate their fundraising success

Apr 17, 2023, 9:08 PM

FILE - Republican presidential candidate, former ambassador to the United Nations Nikki Haley durin...

FILE - Republican presidential candidate, former ambassador to the United Nations Nikki Haley during a campaign stop Monday, March 27, 2023, in Dover, N.H. Haley, the former South Carolina governor became the first major Republican challenger to former President Donald Trump in February. She avoided disclosing how much her campaign raised in its initial days, bypassing what’s typically an early bragging point for candidates. (AP Photo/Charles Krupa, File)
Credit: ASSOCIATED PRESS

(AP Photo/Charles Krupa, File)

WASHINGTON (AP) — Long before ballots are tallied and reliable polls are conducted, one of the earliest ways to gauge the popularity of presidential candidates is with dollars.

Getting donors to part with their money is a key measure of viability, especially in the early stages of a White House campaign. Those who raise ample amounts of cash will have the resources to pay for ads, travel and hold events deep into the primary. Those who struggle, or run out of cash, often drop out.

Facing such high stakes, candidates often have an incentive to essentially juice their numbers to make themselves appear more competitive than they might be in reality. That’s especially true in the opening phase of the 2024 Republican presidential primary, where contenders are aiming to prove they can raise enough money to pose a threat to Donald Trump, a former president who has a reputation as a prolific fundraiser and is eager to retain his status as the GOP’s dominant figure.

At such an early stage, “this is just the one quantifiable realm where people can sort of compare themselves to the rest of the field,” said Liam Donovan, a Republican political strategist. “It’s a popularity contest by another means.”

Case in point is sexist and ageist remarks CNN anchor Don Lemon made about Haley, seeking to turn outrage into sympathetic dollars.

But last week, as the deadline loomed to file the first quarterly fundraising reports, Haley’s campaign blasted out a press release touting an $11 million fundraising haul – an impressive number for any candidate in a race that has been dominated by Trump.

“In just six weeks, Nikki Haley’s massive fundraising and active retail campaigning in early voting states makes her a force to be reckoned with,” Haley campaign manager Betsy Ankney said in a statement.

But once her fundraising reports were made public Saturday evening, some of those claims crumbled as it became clear Haley, who started her career as an accountant, and her campaign used a series of accounting gimmicks to artificially inflate her fundraising haul. In reality, she raised just $8.3 million, substantially less than her campaign claimed.

Haley’s campaign operates three separate political committees, which all raise money. To arrive at the $11 million figure, they double-counted money as it was transferred from one node of the operation to another — effectively treating money the campaign had already raised as new funds once they were transferred from one branch of her campaign operation to the next.

There’s nothing illegal in such an approach, and Haley’s campaign says it stands by the practice.

Fundraising disclosures suggest she’s not the only one to use such a gimmick. Joe Biden during the 2020 campaign. Trump did it, too, as recently as last year when he took credit for raising $9.5 million during the final quarter of 2022, even though he raised several million less.

“I’m a little bit surprised that this whole thing is getting the attention it is,” said Kevin McLaughlin, a veteran Republican strategist. “Everyone does this.”

Though he is not officially in the race, South Carolina Sen. Tim Scott launched his presidential exploratory committee last week, with an impressive $22 million sitting in the bank. If Scott follows through and formally joins the race, he will be entering with the largest campaign account balance of any contender in history.

Of course, the sum isn’t representative of a sudden groundswell of financial support for Scott. The two-term senator hasn’t faced a competitive race in years. Meanwhile, he’s benefited from his perch in the Senate, which has granted him access to a national pool of donors and enabled him to build a massive war chest.

It’s similar to the approach used by Sen. Elizabeth Warren during the 2020 Democratic primary. The Massachusetts progressive kept up a relentless fundraising schedule and courted major donors during her 2018 Senate reelection campaign. Then months later, she reversed course, and called on all of her rivals to give up going to glitzy, high-dollar fundraising events, which she suggested were inappropriate.

Many of her rivals struggled to raise money. Warren, however, seeded her White House bid with $10.4 million in leftover cash from her Senate run.

Florida Gov. Ron DeSantis, who is not yet a candidate in the Republican presidential primary, has a jaw-dropping $85.8 million left over from his 2022 gubernatorial reelection campaign. But under federal law, he is prohibited from transferring that money from his state campaign to a presidential campaign committee.

Under a gray area of campaign finance law, however, the money might be transferred to a super PAC supporting his candidacy, which can spend unlimited amounts of money so long as they do not coordinate their activity with a DeSantis’ presidential campaign.

Meanwhile, the governor’s allies are raising money for an expected run.

Never Back Down, a political committee that was recently formed to urge him to run, says it has already stockpiled $30 million. One wing of the group is running ads defending DeSantis and attacking Trump, while a separate arm of the operation is raising money that can be transferred directly to DeSantis, should he get in the race.

Trump’s campaign, meanwhile, reported raising more than $18.8 million between his main campaign account and a joint fundraising account over the first three months of the year. On top of the money he raised in that first quarter, his campaign said $15.4 million came in starting in April after he was indicted in New York for paying hush money to a porn actress who alleged an affair.

Trump has denied the allegation and has derided the criminal charges as politically motivated.

The former president’s fundraising has been fueled by small-dollar donors and his command of the news cycle, which makes it hard for any other candidate to recreate at the same scale, Donovan said.

He said candidates can use strong fundraising numbers to draw in even more contributions by attracting wealthy GOP donors who are looking for an alternative to Trump.

“There is a strong signaling that occurs at this stage in the process,” Donovan said. “Major donors and major contributors are looking around and taking stock of what everybody else is doing.”

“People want to back a winner,” he said.

___

Price reported from New York.

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How some WH hopefuls inflate their fundraising success