Does Obama’s Record-Setting Fundraising Mark the End of Public Campaign Financing?

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Sen. Barack Obama has raised a record campaign war chest after becoming the first presidential candidate to opt out of the government financing system since its establishment in 1976. Obama has spent nearly $188 million on advertising in the general election, doubling Sen. John McCain’s $91 million. We speak to Bill Buzenberg of the Center for Public Integrity. [includes rush transcript]

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This is a rush transcript. Copy may not be in its final form.


We turn to the issue of money in the 2008 race. The Washington Post is reporting today the record-shattering $150 million in donations Barack Obama raised in September represents only part of his financial advantage over John McCain.

The Post reports newly released campaign finance records show that Obama and the Democratic Party committees supporting his campaign had $164 million remaining as they entered the final weeks of the presidential race, compared to the $132 million available for McCain and Republican Party.

The advantage is compounded by Obama’s ability to continue to raise money through the election, because he decided not to participate in the federal financing program. Obama is the first presidential candidate to opt out of the government financing system since its establishment in 1976.

While there’s been a lot of talk about the number of small internet donations Obama has received, the Post reports a review of his FEC filings reveals only a quarter of the $600 million he has raised has come from donors who made contributions of $200 or less. That’s slightly less as a percentage than President Bush raised in small donations during his 2004 race.

Meanwhile, The New York Times reports Obama is days away from breaking the advertising spending record set by Bush four years ago. Obama spent nearly $188 million on advertising in the general election. John McCain spent $91 million.

Bill Buzenberg joins us now, executive director of the Center for Public Integrity, where he heads up the group’s “Buying of the President” project.

Welcome to Democracy Now!


Thank you. Glad to be here.


It’s great to have you with us. Can you talk about whether campaign finance reform is dead and what exactly is happening in this campaign, the records that are being broken, Bill?


We’ve never seen as much money in any presidential campaign as this one. Of course, you could say that every year, every four years, so… Multi-billion dollars, we’re talking about. It’s huge.

But there’s something very different. Obama, yes, has raised — I think the figure — the Post had it a little low. I calculate more like $260 million from individuals giving less than $200. So, he has raised, yes, something like $600 million, a lot of it from these small contributors. So it’s something we have never seen before.

If you go back, Bill Bradley, eight years ago, in 2000, started raising money on the internet. Remember, Howard Dean raised something like $41 million on the internet. This is way above anything anybody ever thought would happen, and he’s been very, very successful at it.

There are some concerns, though. He is also raising money from those same major bundlers. Tremendous amounts of money are coming from bundlers who put together $50,000, $100,000, even up to $500,000. So it isn’t true that it’s all small money; it’s a combination. He has been able to maximize both small and, effectively, large contributors.


Bill Buzenberg is executive director of the Center for Public Integrity. Is campaign finance reform dead?


I think we are seeing it will be dead, completely dead, next time around, if there’s not major reform. John Kerry was reminding us and warning us about this in 2004. Remember, he took money from the public financing system both for the primary and for the general and didn’t have enough money in the general to respond to some of the Swift boat things because of that. So, clearly, it was on its last legs.

Remember, neither candidate took this money in the primary; after saying they would take public financing, they didn’t. Both said they would take it in the general, and then Mr. Obama opted out, not to do it. It’s been a great advantage for him not to, because of the money that he’s raised. But next time around, can you imagine any candidate sticking with the public financing system at the level that it’s at? John McCain gets $84 million for his entire campaign for the general election. That’s what he can spend. Mr. Obama is spending much, much more than that. And he —


You know, I was watching Newt Gingrich on television saying —- this is what he’s been saying to the Republicans for a long time, you know, the whole story of the McCain-Feingold campaign finance bill that, of course, he was against. And he said, finally, Republicans and Democrats will understand now, and he was saying this is a good thing -—




— that it’s over, and Barack Obama’s fundraising has convinced all of this.


I think it’s over unless there is some major reform. And in truth, it’s — you know, sometime we have to look at the money going into the advertising and, you know, just look at what they do in England when they have actually free air time for candidates running for office. We’re spending so much money into advertising, which is wonderful for all the networks and all the local television stations, and they’re thrilled to have a presidential campaign spending this much money. But sometime we have to get a hold of this. We are allowing not just individuals, but all of these special interests to pour tons of money into a campaign.


But what about that, Bill? I mean, we’re not seeing very much conversation about this on the networks about this amount of money that’s going in, because it’s going to them.


It’s going to them. You’ll never see them comment on it. I do know that every local television station I’ve ever been to, I ask them, “Well, how do you do in election years?” And they say, “Oh, we buy all new cameras. We buy new sets. You know, it’s tremendous. It’s a huge benefit to us.” The commercial broadcasters are cleaning up this year like never before, and you will never hear them questioning this system that allows so much money to come, in fact, to them.


What about this? The New York Times analyzing donors who wrote checks of $25,000 or more to the candidates’ main joint fundraising committees, this very serious issue, that they are saying both Obama and McCain have managed to skirt campaign finance laws, the biggest portion of the money coming from the securities and investments industry, including executives at very — at the, you know, big firms like Bear Stearns, Lehman, AIG, all involved in scandal now.


Well, we’ve set up — both campaigns have set up committees on the side to allow, essentially, more money and to give really a lot of money — we’re talking $30,000, $40,000, $50,000, $60,000, $70,000 a contributor can put into these “victory funds” or “fund for change.” Both campaigns have these. This is $300 million, has been raised in this way. And you’re right. Most of that money — most of that money is coming from the securities and investment industry. You know, this ought to tell people this is a very worrisome process going on right now.

There are, you know, other money coming in. Lawyers, in the case of Obama. He also gets more entertainment money. Oil and gas — you have to remember, 80 percent of the oil and gas money, the fossil fuel money, goes to the Republicans, and they’re getting money on that side. So, we basically have all of these different windows where money is flowing into these campaigns at the levels we have never, ever seen before.


And the proposal, how you think campaign finance reform could be effective?


I’m not here to advocate some solution, but I do know that there has to be — that we have to have the parties — and, of course, the parties have not be willing to do this, because they feel they will have an advantage next time, and they want to keep that window, that possible advantage, open. But we need a reform process, or a multi-billion-dollar campaign — can you imagine, we’ll be talking about trillion-dollar campaigns in the future, which is just, you know, enormous amounts of money.

And what’s wrong with this is this is — after this election, the people who have bundled and put together big pots of money are going to come back, whoever is elected, and they’re going to be looking for access and influence. And you know what? We have big issues about climate change and healthcare, and tremendous amounts of money have already flowed into the campaigns on those issues, and we’ll see more afterwards.

And don’t forget Congress. There’s also tremendous money flowing into members of Congress running for re-election right now, too.

So it’s — you know, if we want to pull this back, this has to be reformed in some way. I love a system where, you know, you could give $200 or less, or you could take as many $100 donations from individuals as you’d like, and that’s a big part of Obama’s campaign, and it’s been a great advantage to him. But just remember, it’s also — it’s also big money as well as this small money. And he gets much more small money than McCain does, but both of them are taking large amounts of money to these special committees for change, which are joint committees made up to the party. And they say, well, the money goes to the states, therefore it’s not really going to the candidate; it goes to field offices. But in truth, it’s helping both campaigns tremendously.


Bill Buzenberg, I want to thank you for being with us, executive director of the Center for Public Integrity.

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