Money Can’t Buy You Love – Not in Campaigns, at Least

(Bloomberg Opinion) -- We need to recalibrate our understanding of campaign fundraising. Far more money is available now than ever before in presidential politics. Exhibits A and B:  Beto O’Rourke pocketed about $6 million in his first day of being an announced presidential candidate. Senator Bernie Sanders had a similar, but slightly smaller, first day. They are way ahead of the other candidates, the most successful of whom raised about $1 million. 

But this early good news for Sanders and O’Rourke might not turn out to be much of an advantage in the longer run. 

Skeptics can point to a long line of candidates who raised plenty of money and ended up with very few votes, from John Connally in 1980 to Phil Gramm in 1996 to Jeb Bush in 2016. On the Democratic side, Howard Dean initially raised tons of cash and benefited from plenty of grassroots enthusiasm in 2003, but fizzled once actual voters had their say in the primaries. 

One reason that money is no guarantee of winning is that spending shows diminishing marginal returns. Voters are reluctant to choose a candidate they’ve never heard of, and they’re especially more likely to vote for candidates if they know and like something about them. That’s a major source of incumbency advantage in U.S. House elections; even normally straight-ticket voters may cross party lines to vote for a known incumbent against an unknown challenger. Learning who the candidate is and learning a few things about him or her makes it far more likely a voter will support that candidate. But after that, voters are unlikely to absorb a whole lot more.  For congressional challengers, that means the first round of ads can really help level the playing field, but then there’s less and less that electioneering can do. 

Money, therefore, matters a lot in elections in which only one candidate raises and spends substantial sums. That happens in lots of down-ballot primary elections. It even happens in general elections at those levels. Moving up the ladder, however, it’s increasingly unlikely that only one candidate will spend money – and also less likely that campaign materials will be the major source of information about the election because there’s a lot more media coverage. All of that makes money less important. In presidential general elections, then, since voters know all about both candidates from the months of news coverage leading up to the election, paid ads and other electioneering just aren’t very likely to change anyone’s minds.

Presidential nominations have been sort of a middle ground. On the one hand, there’s plenty of media coverage. On the other, there are no party cues to make the decision easy for voters, so new information provided by expensive electioneering is probably more likely to change minds than it is in any general election. And these primaries and caucuses have relatively low turnouts, which probably means that extra money spent on identifying supporters and getting them to the polls can have a relatively large payoff. So money spent, and therefore money raised, may be a good test of how a candidate is doing.

Money also matters in presidential nominations because, as The Fix’s Aaron Blake points out,  just the fact of fundraising success usually counts as news in the nomination process. That’s important because all candidates – especially with the huge field the Democrats have in this cycle – are always looking to get more media attention. I’d add that without any clear way to assess the state of play, reporters are drawn to anything that seems to give objective reasons to pay attention to one set of candidates over others, and fundraising totals have the feel of hard facts. That means the “free” media fundraising can earn may actually be more important than the paid media it buys.

At least, that’s how things have been. But what do huge fundraising totals mean in a campaign finance world that appears to be shifting from scarcity to an abundance of money? O’Rourke’s $6 million seems like a lot, but we just finished a record-shattering U.S. House election cycle in which raising $2 million or more was suddenly normal, not extraordinary. 

We know that several candidates are going to have good moments over the course of the campaign. They’re going to release ads or short video clips that go viral. They’re going to have standout appearances in debates. They’re going to get attacked by President Donald Trump by name (or ugly nickname). And in the new world of campaign finance abundance, they’re going to raise lots of cash off of those moments. 

But even huge amounts of money don’t mean there won’t be winnowing: The very fact that money is so easy to raise when things are going well makes it as sensible as ever to spend on the early states, which means that only those who do well in Iowa and New Hampshire (and then Nevada and South Carolina) will be able to raise the next large chunks of money to spend on the next round of primaries and caucuses. 

But beyond that? I wish I knew how the era of abundant campaign money will play out, but the truth is no one – not academic analysts, not journalists, and not the campaigns themselves – can make that prediction. Perhaps  a few candidates will raise so much, and that will get them so much media coverage, that it will be impossible for the others to get any traction. Or perhaps lots of candidates will have enough to run serious campaigns, and the extra, stratospheric totals that a few of them can raise will be subject to severe diminishing returns and won’t buy them very much at all. We’re probably going to be off the charts, so it’s just very difficult to extrapolate based on previous nomination battles. 

So kudos to O’Rourke and Sanders, but the media should beware of paying too much attention to fundraising this cycle. 

To contact the editor responsible for this story: Max Berley at mberley@bloomberg.net

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Jonathan Bernstein is a Bloomberg Opinion columnist covering politics and policy. He taught political science at the University of Texas at San Antonio and DePauw University and wrote A Plain Blog About Politics.

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