Certainly, American governments don’t come cheap and never have. That much was never more apparent than back in 2020 when Joe Biden and Donald Trump went head to head in a presidential contest where the final tally in the battle for the White House and control of the Senate and the House came in at an eye-watering $14.4 billion.
While most Americans in principle would likely agree with former president Barack Obama’s assertion that “it should be the power of our vote, not the size of our bank account, that drives our democracy,” things simply don’t work that way in US politics – or any politics for that matter.
With a rematch of the 2020 contest between Biden (below) and Trump most likely on the cards, already this year’s While House race is running true to form on the financial front even if the polls have yet to reflect that.
According to a recent Bloomberg/Morning Consult poll, Trump is leading Biden in seven swing states – Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania and Wisconsin. But 53% of the registered voters surveyed said they would be unwilling to vote for Trump if he were convicted of a crime.
For his part, Trump might be closing his grip on the Republican nomination but as new campaign financial records filed with the US Federal Election Commission (FEC) last week have revealed, his campaign is haemorrhaging millions in donor money to cover his mounting legal expenses stemming from multiple lawsuits and four criminal cases.
Fundraising has always been one of Trump’s strong suits and in fact, the more scandal-ridden he has been, the more money supporters appear willing to give. Currently, that remains the case as donations to his presidential campaign fighting fund continue to come in at a fast pace.
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The problem for Trump (below) though is that almost as fast as such sums come in, out they go again to shore up the cost of the numerous legal battles that beset him. According to recent data released by the Federal Election Commission (FEC) and analysed by The Economist, Trump raised more than $75m in the second half of 2023, up from nearly $54m in the first, bringing his haul in 2023 to $129m.
As The Economist’s analysis highlights, much of this money was raised while Trump was mired in headline scandals. For example, in the two weeks after his indictment in March on allegations that he concealed hush-money payments to adult-film actress Stormy Daniels, the campaign raised $15.4m.
Then again when Trump was indicted in June for allegedly mishandling classified documents, he took in another $6.6m in less than a week. By August, after the former president was charged with trying to overturn the results of the 2020 presidential election in Georgia, he raised $9.4m.
After surrendering to authorities in Atlanta, Trump’s mugshot was released to the public, and the Trump campaign put the photo on T-shirts and mugs. The result was that an estimated 85,000 contributions were made – roughly 10 times more than Trump groups receive on a typical day – bringing in almost $4.3 million.
But welcome as this news was at the time – and adept as Trump’s team have been at turning his legal woes into a fundraising tool – his campaign has been burning through cash at an incredible rate and by far is the biggest cost to his campaign network.
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Early in 2022, such expenses amounted to around $500,000 a month, or less than 10% of total spending. Since then the cost of defending Trump against criminal charges – that include 91 felony counts in total – and lawsuits has mushroomed to more than $5m per month.
To put this in some kind of perspective, the latest FEC report shows that in the final three months of 2023, more than 50 cents of every dollar donated to Trump went toward his defence.
Amidst these legal battles, the exact net worth of Trump remains a topic of debate. Forbes’s assessment in September 2023 placed Trump’s net worth at $2.6bn, while Bloomberg’s estimation in November 2023 was slightly higher at $3.1bn. Trump’s personal wealth is primarily derived from his real estate ventures in New York City along with his collection of golf clubs and resorts as well as his liquid assets and personal belongings.
But while he remains the frontrunner to win the GOP’s presidential primary after he secured victories in early voting states Iowa and New Hampshire and remains poised for victory in states like South Carolina, it’s Trump’s capacity to sustain his campaigning war chest that is making some Republicans uneasy right now.
Some wonder whether in fact it could become a serious liability. Last Thursday, during an interview on CNN, Trump’s ex aide Alyssa Farah Griffin was the latest to issue a warning that Trump’s campaign may face financial woes heading into this year’s election.
“We are reaping what we’re sowing, and yeah, he’s going to enter the general election not with the money he needs to win,” Griffin said. She then went on to say that Trump is running for president in order to “stay out of jail” and is using his campaign’s donors to “pay off his legal fees”, but noted that Republican voters do not seem to care.
During her CNN appearance, Griffin – who has openly expressed support for former United Nations ambassador and South Carolina governor Nikki Haley, Trump’s chief Republican rival – added that Republican voters believe in “a different set of facts” and would “honestly rather risk losing with Trump than winning with Nikki Haley” in November’s election.
In a recent attempt to extinguish Haley’s campaign, Trump has warned donors that they will be “barred” from his “Maga camp” if they make further contributions to her campaign, raising the stakes for her billionaire backers a day after she was defeated in the New Hampshire primary.
“Anybody that makes a ‘Contribution’ to Birdbrain, from this moment forth, will be permanently barred from the Maga camp,” Trump wrote in a post on his social media site Truth Social, using a characteristically derisory nickname for Haley.
Several significant donors have been drawn to Haley because of her hawkish foreign policy views, messaging on abortion and potential to turn the page on Trump.
A number of deep-pocketed Wall Street financiers have thrown themselves behind Haley – among them WhatsApp co-founder Jan Koum who gave $10m, as well as billionaire investors Paul Singer and Ken Griffin, who each gave $5m, and insurance broker Pat Ryan and his wife Shirley, who chipped in another $5m.
Their donations have again highlighted the crucial role played by PACs and super PACs or Political Action Committees – organisations in the US that raise money privately to influence elections or legislation, particularly at the federal level.
Last week, The New York Times broke the story that the preeminent super PAC Future Forward, helping to reinforce Biden’s re-election bid has reserved $250m in television and digital advertising in top battleground states in hopes of carrying the message from the Democratic convention in August through election day.
By reserving ads early, the super PAC is expected to be able to negotiate better rates than those that buy later and to secure some of the most coveted time slots.
This will be of real concern to the Trump team after the release last week of data from the 2024 US presidential candidates’ campaigns and the PACs showed that Biden led Trump in the 2023 money race, with his campaign and affiliated committees ending the year with $118m of cash on hand, compared with $65m for the former president. In all, Biden’s fundraising operation took in roughly $13m more than Trump-affiliated PACs.
According to The New York Times, the latest announcement by super PAC Future Forward of its $250m television and digital advertising campaign aims to target some of the same demographic groups of more disaffected and disengaged Democrats that the Biden campaign itself is focusing on include younger voters, Hispanic voters and black voters. The spend of $250m is more than an independent expenditure group spent for the whole of the 2020 election. To put this vast sum in context, the leading super PAC backing Trump in 2020 spent a comparatively modest $150m by comparison.
“The stakes of this election could not be higher, and by election day, every battleground voter will know it,” said Chauncey McLean, the president of Future Forward’s super PAC, as cited by The New York Times “We’ll run a cost-effective and data-driven programme of unprecedented scale to re-elect Joe Biden.”
Trump, Biden and their affiliated super PACS raised comparable amounts in 2023 – about $189m and $202m, respectively. But Biden groups have that $118m cash on hand, while Trump groups have just $66m – a difference equal to the sum the latter have spent on legal advice.
But good news as all this is for the Biden campaign, some observers say that the president – who faces only nominal competition in the Democratic primary race – has not garnered the sort of imposing financial advantage some in his party had anticipated.
This too especially given that Trump has had to deploy financial resources not only to keep his Republican rivals at bay but pay enormous legal fees. That said, team Biden and the Democrats clearly remain upbeat about the latest financial position of their campaigning war chest.
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“While Donald Trump lights money on fire paying the tab on his various expenses, Team Biden-Harris, powered by grassroots donors, is hard at work talking to the voters who will decide this election and building the campaign infrastructure to win in November,” TJ Ducklo, a Biden campaign spokesperson, said in a statement cited by The New York Times.
As the 2024 election looks likely to be a rematch of 2020 – when Biden became the first candidate to raise more than $1bn from donors – already the White House incumbent has been able to count on contributions of at least $500,000 from 15 donors in the final months of last year.
Among the largest of these donors were the Hollywood mogul Steven Spielberg and his wife, Kate Capshaw ($929,600 each); the technology executive Mark Pincus ($929,600); the financier George Soros ($653,000); Avram Glazer, whose family owns the Tampa Bay Buccaneers and a majority stake in Manchester United ($538,289); Eric Schmidt, the former Google chief executive ($500,000); and Shonda Rhimes, who created the television show Grey’s Anatomy ($100,000).
And so as the 60th US presidential election gets down to serious business in the coming weeks and months, the campaigning funds of both Trump and Biden are set to take a hammering.
While Trump continues to attract the support of major donors who fill the coffers of Maga Inc, there’s no escaping the fact that so much of the funding is being lost when it could be instead be benefitting his White House bid. This in turn has provided a stark insight into how his courtroom battles have not just defined his campaign but begun to undermine it.
Meanwhile, Biden, for his part, can take heart that he embarks on this political contest with almost as much in the kitty as he had when winning back in 2020.
But while massively significant as any substantial fighting fund is to a US presidential contest, it’s not everything and Biden will want to see his good fortune reflected in polling results which till now remain disappointing.
This in itself is something of a puzzle to some US political observers who point to the fact that only nine months out from election day on November 5, the US economy is in fair shape with inflation down and job numbers up.
If Obama’s (above) assertion that it should be the power of the vote, not the size of the bank account that drives American democracy does prove to be right, then we will have to wait until November 5 to find out if that indeed is how the American people see it.
Meantime though, Donald Trump and Joe Biden will doubtless welcome every dollar that drops into their respective campaign war chests.
