Big Donors Still Rule The Roost
Big donors still rule the roost in federal elections, despite all the buzz this election cycle about the increasing importance of small donors. While there is deserved excitement about the ability of candidates such as former Vermont Gov. Howard Dean and Gen. Wesley Clark to raise large amounts of small contributions over the Internet, not to mention Sen. John Kerry’s and President George W. Bush’s recent upsurge in such contributions, the sobering fact is that big donors dominate federal elections, and these donors represent a narrow, elite swath of the American population.
Few Americans can afford to write a check of more than $200 to a political campaign, yet these comprise the vast majority of contributions collected by federal candidates. In sharp contrast, in Arizona, where the Clean Money/Clean Elections public funding system is in place, candidates are collecting their small ($5) contributions from a far more diverse group of voters.
Congressional Candidates Rely on Big Donors For Majority of Campaign Cash
- More than 80% of the total individual contributions collected by House and Senate campaigns in the 2004 election cycle through June 30 came in the form of contributions of more than $200. 1
- More than three times as much campaign cash flowed into House and Senate campaigns from individual contributions of $1,000 and above than of individual contributions of $200 and below. These $1,000 plus contributions comprised 60% of the individual contributions collected by House and Senate candidates.
- Senate candidates in open seat races collected 69% of their total raised from individual contributions in chunks of $1,000 or more. Forty-four percent of their contributions came from contributions of $2,000 or more. (For more details go to http://www.publicampaign.org/pressroom/pressreleases/release2004/10_29_04_smalldonor_table.pdf)
Presidential Candidates Trolled for Money From Big Donors
- Two-thirds of the money raised from individual contributions in the presidential race came in chunks of $200 or more.2
- Presidential candidates collected more money in large contributions early in the election cycle, thereby cementing the importance of the “wealth primary,” in which the candidate who raises large sums from big donors early is considered “viable” and candidates who don’t are written off as losers. Before Super Tuesday, Sen. John Kerry (D-MA) collected 66% of his cash from $1,000+ contributions, and Bush 75% of his pre-March individual money from such contributions. 3
- In raw dollars, totals from contributions of more than $1,000 increased by $181 million in 2004 compared to 2000; contributions below $200 increased substantially less, by $152 million.4
- Information on size of individual contributions tells only part of the big-donor story. Candidates rely on super-bundlers—wealthy volunteers who “bundle” contributions from their colleagues, friends, and families. Members of this elite group are typical CEOs of major corporations, lobbyists, and other well-connected people who expect policy paybacks from their fundraising.
- President George W. Bush has a total of 548 Rangers and Pioneers who have pledged to raise $200,000 and $100,000 apiece, respectively.5 Sen. Kerry has relied on 564 “vice-chairs” and “co-chairs” who bundle $100,000 and $50,000 respectively.6
Narrow Elite Funds Federal Political Campaigns
- Only 0.33% of the U.S. population gave a contribution of more than $200, and less than ¼ of that amount, 0.08%, gave a more than $2,000.7
- Just 10% of contributions come from neighborhoods that are majority people of color, and nearly half come from wealthy neighborhoods.8
- The top contributing zip code to all presidential campaigns—including both the Bush and Kerry campaigns—was 10021, on Manhattan’s exclusive Upper East Side, which was the source of $4.2 million.
- The zip code 10021 was the source of more campaign cash for presidential campaigns than:
- 377 zip codes nationwide with the largest percentage of African Americans, containing a total of 6.9 million people ages 18 and over, 75 times more people than live in 10021;
- 365 zip codes nationwide with the largest percentage of Latinos, containing a total of 8.1 million people ages 18 and over, 89 times more people than live in 10021.
- Fewer people are contributing more money in the 2004 elections versus the 2000 elections. The percentage of the U.S. population giving $1,000 or more to candidates, parties, and PACs was slightly larger in 2000 than those giving $2,000 or more in the 2004 elections—0.12% v. 0.08%. But thanks to the hike in the maximum allowable contribution to candidates, from $1,000 to $2,000, the actual dollar amount contributed remained about the same as it was in the 2000 election—$1.1 billion. In other words, a smaller number of people are more important to campaigns than ever.
Arizona Clean Money Experience Shows More Diverse Group of Donors
- In Arizona, where Clean Money/Clean Elections is the law for state-wide races, gubernatorial candidates must collect 4,000 $5 contributions to qualify for public funding. This new system has dramatically diversified the donor pool to statewide candidates.
- A study by the Arizona Clean Elections Institute of gubernatorial races in the 1998 and 2002 election cycles shows that Clean Money gubernatorial candidates were able to seek these $5 contributions in communities where they had the closest ties, not those where the most wealth is concentrated.9
- Overall, the source of contributions in Arizona largely shifted from wealthy counties and other states to Arizona counties with greater diversity. For example, candidates raised more of their $5 contributions in rural counties, as opposed to urban, wealthy counties. In contrast, candidates who accepted private funds collected most of their campaign contributions in the two counties where wealth is most concentrated—Maricopa and Pima—with their next largest source being out-of-state donors.
- The Arizona study found that candidate Alfredo Gutierrez was able to qualify for Clean Elections funding while collecting 59% of his qualifying contributions from zip codes where the number of Latino residents was above average.
- Contributions from low to middle income zip codes increased significantly while those from the wealthiest zip codes decreased. Clean Elections candidates secured up to 68% of their contributions from zip codes with per capita incomes below $40,000, and an average of six percent from zip codes with per capital incomes above $100,000. In contrast, candidates who raised their funds from private sources secured less than half as much (30%) of their contributions from zip codes with per capita incomes below $40,000, and collected more than twice as much (an average of 13%) of their contributions from zip codes with per capita incomes above $100,000.
- Clean Elections more than tripled the number of contributions to gubernatorial campaigns, from 11,234 in 1998 to 38,579 in 2002.
- In 2002, voters in Arizona gave 90,000 qualifying contributions to candidates, triple the number of private contributions made. In Maine, another Clean Elections state, in 2002, voters gave 30,000 qualifying contributions to candidates, five times the number of private contributions.
For more information on the Arizona and Maine Clean Elections systems and Clean Elections activity in other states, contact Public Campaign at 202-293-0222 or visit our website at http://www.publicampaign.org.
------1).Federal Election Commission. Complete data for Congressional campaigns are available through June 30, 2004. Note also this is an underestimate of the power of large donors, as the data do not aggregate contributions by contributor. In other words, the contributions of one person who gave $25 ten times to a single candidate, for a total of $250, would appear in the “$200 and below” column rather than the “more than $200” column.
2) News Release, The Campaign Finance Institute, October 4, 2004. Figures cover 2004 election cycle through August 31, 2004.
6) Associated Press, September 30, 2004.
7) http://www.opensecrets.org/overview/DonorDemographics.asp?cycle=2004; based on October 2004 download from the FEC.
8) http://www.colorofmoney.org. “Wealthy” defined as a zip code where more than 24.6% of households make $100,000/year or higher, twice the national average.
9) “Reclaiming Democracy in Arizona: How Clean Elections Has Expandedthe Universe of Campaign Contributors,” Clean Elections Institute, July 16, 2004.