The Fundraising Inequality: Can Hillary Clinton Save Democratic State Parties?

Online fundraising

In private meetings last week, Hillary Clinton pledged in New Hampshire to work with state parties in “early states” to help them rebuild. At first appearance, this would seem to be an amazing boon. The trope goes that Obama for America had so thoroughly cornered the organizing market that state parties were cast aside and crumbled in its wake. While not entirely untrue, there’s something much more insidious at play, and we have to examine the real root of the problem.

Why have state parties come to the brink of obsolescence? Short answer: Market Forces.

Large political entities – Super PACs, Joint Fundraising Committees, national and state-level campaigns – have money; small entities like state parties, state legislative and local campaigns do not. And in the realm of fundraising, much like investment or wealth creation, it takes money to make money. If a political entity has money, it can hire better consultants and attract more capable staff thus helping it raise even more money. This creates what I’ll call The Fundraising Inequality, a systematic divide between large and small entities similar to the economic concept of income inequality.

Priorities USA vs. Nebraska’s Priorities

There is a root problem in the Democratic Party today that manifests itself most clearly in the priorities of those small entities vs the large ones. The goal of any political entity is to win elections, but the methods for doing so at a state and national level are very different from those at a local level. Statewide coordinated campaigns tend to sweep in, ramp up quickly, get the job done, and sweep out. To Secretary Clinton’s point, I challenge you to point to a significant, lasting vestige of the Obama 2012 campaign in your state. This method is, in effect, throwing money at the problem which unfortunately tends to actually work pretty well, especially given that those entities are the ones with the money.

Winning state legislative races and local campaigns, however, requires harder, longer-term work. Candidates must be recruited and cultivated; committees must be empowered, built up, and trained; volunteers must be identified and coaxed into helping without burning out. All of that is a long-term process, one that requires investments, not just consultants. And pitching that value proposition to donors and volunteers is hard; they expect instant gratification in elections, not long-term party building.

Two Political Americas

The effect of this dichotomy couldn’t be more striking than it is today. Take Virginia, for example, a national battleground state where Democrats control all 5 statewide offices, yet Republicans hold a super-majority in the state House, a majority in the state Senate, and 8 of the 11 Congressional seats. And this isn’t unique – it’s happening across the county. Republicans now control 69 of the 99 state legislative bodies, and that’s a long-term trend that’s developed, not the recent result of some wave. To make matters worse, those wins are even more difficult to reverse due to gerrymandering by the parties in control at the state district level and a 10-year redistricting process.

Grab the Pitchforks?

Taken separately, no one entity or committee has done anything wrong, per se. You could consider the political fundraising landscape similar to an unregulated market full of individual actors doing what’s best for themselves. There’s no right or wrong, it’s just how things tend to shake out. But as Democrats, we know that income equality in the economy has real, deleterious effects. We balance that inequality with regulation and with graduated income taxes. However, no such analog exists in the political fundraising realm. What little regulation we have is whittled away every year, and without a constitutional amendment, it’s likely to only get worse. And so, the rich get richer, and the poor stay poor.

This is particularly problematic because we know that – to abuse the metaphor – “trickle down” or supply-side economics doesn’t actually work. In a purely theoretical market sense, you can’t expect individual economic actors to behave according to anything but their best interest. A Senate campaign isn’t going to “invest” money into the state party out of some altruistic sensibility because it has but a single mission: win that one election. And in their thirst for fundraising, they almost certainly cannibalize donations from the smaller entities.

Et tu, Hillary?

This, then, is exactly why we must treat Secretary Clinton’s announcement with extreme skepticism. The problem goes far too deep to simply spend it away. Much the same way that most people believe in limits on Welfare spending, we shouldn’t ask our presumptive nominee to just throw lavish amounts of money at state and local entities. That will lead to a similarly unsustainable dynamic as when the DNC spun up the 50-state Organizers Program in 2007 only to have it fall apart in 2009 for lack of continuing support.

Instead, we must collectively ask the Clinton Campaign to display a rare quality in a political entity: Long-term vision. Too many operatives in the political space don’t believe in the efficacy of state parties and the ability of local campaigns to run themselves. That’s all well and good, but until you empower those entities and help close the gap, this mentality equates to blaming the poor for a lack of upward mobility. But recognizing the problem is the first step toward fixing it.

The Clinton Campaign needs to lend its weight toward helping the state parties build themselves back up – the economic equivalent of job creation as opposed to subsidies. Rather than sucking all of the fundraising air out of the room, Clinton’s apparatus would do well to work directly with the DNC and state parties and lend the time and resources of the campaign toward helping those entities build their war chests. Because those relationships and fundraising channels will continue to exist beyond 2016, especially if cultivated by state and local entities, I would argue that it would be better for the Clinton Campaign to assist state parties in collectively raising half of a billion dollars themselves than it would to spend one billion on their behalf.

Welcome to the Machine

More than just fundraising, the Clinton Campaign will have access to data and technology resources that could revolutionize downballot campaigning. I say “could”, because history has not been kind on this front. The biggest failure of Obama for America as an organization was that what little technology actually made it out alive was almost worthless to smaller campaigns. The Clinton Campaign has a chance to right that wrong and start early.

Small campaigns and state parties rely on a handful of under-funded initiatives and start-ups for their tech needs. And all of those could be helped by infusions of capital both from the campaign and from outside groups like Democracy Alliance. New Organizing Institute, NGP VAN, Action Network, BlueLabs, ActBlue, DSPolitical, – this is just a small list of nonprofits and small companies doing cutting-edge stuff that can give smaller entities a leg up. And let’s not forget the DNC itself. As a services organization, it provides valuable resources downballot. Just image what it could do if programs like Project Ivy (bringing big campaign tech downballot) were actually funded and cared for.

What are we waiting for?

There’s too much at stake. If Secretary Clinton is genuine in her desire to revitalize the state parties, she can do so by investing in programs and companies that empower small entities not just to fundraise but to run the entirety of their operations more efficiently. We must champion the cause of the little guy – not just because that’s what we do as Democrats – but because it truly is in the best long-term interest of our Party. We must help the small political entities help themselves, and we must press the large funding groups to push progress on that front. For if we don’t, we’ll only see the Fundraising Inequality grow more extreme and more damaging in time.

Written by
Dave Leichtman
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  • It would really help if people could better see the reason for donating to the DNC, state and local parties. For example better tools and promoting things like election protection, voter registration, volunteer recruitment, candidate recruitment, training and support, social network training, talking to voters training etc.

    Why do we keep election protection such big secret? We do a ton of work to protect people’s vote but almost no one knows about it. The parties should be promoting it and other important work as reasons to donate to them. But also to let people know that we are protecting their vote against Republicans who are trying so hard to take it away.

  • I donated $50 dollars to Bernie Sanders through ActBlue last week. The receipt I received later showed I gave $25 to Bernie Sanders and $25 to DSCC. I gave no permission for any of the money to go to anyone but Bernie. I have no idea where the $25 to DSCC went. Since when has this kind of conduct been allowed?