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Republicans at financial crossroads for ‘12
Question of paying off debt or saving to defeat Obama
Question of the Day
The Republican Party's national governing body, left in financial shambles by its previous leadership, is wrestling with a tricky calculus as it gears up for the 2012 campaign.
The Republican National Committee, which began this year nearly $25 million in the red, has to decide when to stop paying down a heavy debt load and start stockpiling cash to compete with the $1 billion some Republicans fear President Obama's campaign will have to spend next year, new RNC Chairman Reince Priebus said in an interview.
"We know we are on a good trajectory now to have our debt down to a place that we'll choose whether we want to continue bringing the debt down or to build up our cash on hand for next year," Mr. Priebus told reporters and editors at The Washington Times in a wide-ranging discussion Friday.
Although Mr. Obama appears never to have uttered the $1 billion claim, he did raise $750 million for 2008 and given his low job-approval rating even with independent voters, he may well need record fundraising to net enough money to make a good stab at refurbishing his image in TV ads next year.
But deciding to begin increasing cash on hand risks undermining the confidence of the RNC's traditional donor base that Mr. Priebus says he has worked so hard to restore. A late move to build up the party war chest risks leaving the RNC debt free but cash poor and vulnerable to Mr. Obama's re-election machinery.
And simply matching the president dollar for dollar in raising money for 2012 won't suffice for the RNC or the Republican presidential nominee.
"My job really right now is to maximize net dollars," Mr. Priebus said.
The RNC has grossed more major-donor money in the six months since Mr. Priebus defeated incumbent RNC chief Michael S. Steele than Mr. Steele raised in two years as chairman, Mr. Priebus said.
But the net income figure is the one that matters, and on that front Mr. Priebus said he has worked hard to restore major donor confidence in the RNC's fiscal integrity.
It costs almost nothing to raise each dollar from a person who gives several hundred dollars up to $30,800 a year per person, while costing 60 cents or more for each dollar donated by smaller donors. At times, Mr. Steele's RNC was actually spending more on fundraising than it was taking in, according to Federal Election Commission reports it filed. Those days are apparently gone, according to this year's FEC reports.
"Our net is actually pretty high," Mr. Priebus said. "We have either paid down debt or accumulated cash on hand away in excess of $15 million in the first 5 1/2 months of this year."
Mr. Priebus said he is careful not to take money from high-net major donor fundraising and put it into relatively low-return direct mail, phone banks and other small donor appeals. The Steele-led effort, having lost the confidence of big donors, resorted to spending more and more money on small-donor appeals, often actually winding up in the hole — a first in national party fundraising history.
Careful planning appears to have replaced desperation tactics at party headquarters a block south of the Capitol.
"We balance the small-dollar mail to the high net of major-donor fundraising so that at the end of the month we can put away $2 million cash on hand," Mr. Priebus said.
"Obama raised record sums in 2008 because he had a movement, and in politics a movement transcends everything," Mr. Priebus, who at times talks the language of a movement conservative but also appears careful not to usurp the party's top elected officials and candidates to set policy and shape the overall GOP message. "We had a movement in 2010 and look what happened."
He said the party is also experimenting heavily with social media outlooks such as Facebook and Twitter to amplify its message and connect with supporters,, but he stressed again that the bigger issue was having a platform and set of ideas worth disseminating.
The former Wisconsin Republican chairman said it is the GOP's collective leadership task "to have a message and create in environment so that once you have a social network that's worth a darn, that it can actually take off and grow."
Although American Crossroads, Republican Superfund other independent conservative committees not formally associated with the GOP are expected to raise hundreds of millions of dollars for 2012, only the RNC is legally entitled to finance the ground war that ultimately decides elections.
"We're the only committee that can directly advocate for the president, the Senate and House," said Mr. Priebus. "So when it comes to knocking on doors, voter contact, absentee ballots, direct advocacy, that's what we do. We're the army on the ground."
Mr. Priebus said he was on the phone all day, every day, spending 20-minute segments with old and prospective big donors, explaining why the RNC plays in irreplaceable role in the road to victory in 2012 and cultivating confidence that money donated will be effectively used.
Even while paying of millions of dollars owed to vendors and banks and socking away cash for next year's electoral war, the RNC has market testing a string of media messages ahead of the presidential race, releasing a different TV ad shot by a different ad agency in major battleground markets in each of the last four weeks.
"We did a real-time audit on how we are doing on social media. How we can drive traffic back to GOP.com," said Mr. Priebus, who calls himself a "social media guru."
The RNC is set to "partner with a new social media application I think going to take the country by storm," he added with mounting enthusiasm in his voice. "It's called 'Way In' and is real-time polling, real-time friends connections, an incredible tool, launching out of Silicon Valley. We're going to be coming out as partners."
© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.
About the Author
Chief political writer Ralph Z. Hallow served on the Chicago Tribune, Pittsburgh Post-Gazette, Washington Times editorial boards, was Ford Foundation Fellow in Urban Journalism at Northwestern University, resident at Columbia University Editorial-Page Editors Seminar and has filed from Berlin, Bonn, London, Paris, Geneva, Vienna, Amman, Beirut, Cairo, Damascus, Jerusalem, Tel Aviv, Belgrade, Bucharest, Panama and Guatemala.
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