PrintOctober 11, 2008
Is Obama Running out of Money?
This is an interesting post from WLS at Pat Patterico's site. He does some math and, based upon what we know and what we can surmise regarding how much Obama has raised and spent, it would appear that there is a good chance Obama went for an early knockout of McCain and planned on coasting the last month of the campaign:
Then I saw this Washington Post blog post yesterday at Chris Cizzila's "The Fix" that shows Obama spent nearly twice as much on television advertising in 17 battleground states as the McCain/GOP forces combined over 7 days from September 30 to October 6.
The math left me shaking my head. How can Obama spend $20 million in seven days, with a full five weeks left until the election, given the gross amount of money available to him? To continue spending at that same level through the election would require another $80 million.
Obama's campaign expenditures in the three summer months prior to the convention were $25.7 million, $57.2 million, and $56 million from June to August, respectively. Obviously that didn't include spending on television advertising at a clip of $80 million a month.
It's hard to know exactly how much Obama's campaign infrastructure (everything other than advertising) is costing, but when Palin was named VP, Obama was running an operation spending about $2 million a day. That would be $60 million a month - probably a little high if we're talking only about overhead, but if that number is $50 million a month, then the months of September and October are going to cost his campaign at least $100 million. And that doesn't even factor in whether there are increased expenses the week before the election for things like phone-banking and other GOTV efforts.
WLS then does a rundown of spending by the Obama campaign and concludes:
It looks like Obama saw an opportunity in the aftermath of the market meltdown in late September to put McCain away over the issue of the economy, and he went for it. He committed a significant amount of his total advertising budget over a very short span of time, and saw a significant shift in the polling both nationally and in the battleground states as a result.This strategy is not unheard of. Reagan did something similar in 1984. Most campaigns however. try to husband their resources for the last fortnight or so of a race in order to maximize the impact of their dollars on those last undecideds. This appears to be McCain's and the RNC's strategy as they probably have more than $100 million on hand for October.
It remains to be seen if this bump will be lasting or whether it will dissipate as others have in the past.
As WLS points out, this could explain Obama's half hour ad buy on network TV just days before the election. Many observers questioned that strategy but it makes sense if the above scenario is in play.
I expect McCain to close the gap anyway - barring some really horrible economic news. That is certainly a possibility but there are many economists and market watchers who believe that the government has all the tools now to deal with the crisis and that what's needed is a change in psychology more than any concrete action that needs to be taken.
We'll see about that in the coming week.
