January 31, 2023

Online fundraising has slowed in much of the Republican Party in recent months, an unusual withdrawal of small donors that has sparked a frenzied stampede among Republican political operatives to understand why — and reverse the sudden decline before it destroys the chances of the party this fall.

Small dollar donations typically increase as the election approaches. But just the opposite has happened to many Republican entities in recent months, including all major party committees and former President Donald J. Trump’s political operation.

The total amount donated online fell by more than 12 percent across all federal Republican campaigns and committees in the second quarter compared to the first quarter, according to an analysis of federal data from WinRed, the leading online Republican donation processing portal.

More alarming for Republicans: At the same time, Democratic contributions rose. Total federal donations to ActBlue, its Democratic counterpart, increased by more than 21 percent.

The overall Democratic fundraising lead online increased $100 million from the last quarter of 2021 to the most recent three-month period, records show.

Adding to the problems of raising funds for Republicans, Mr. Trump is still the party’s dominant fundraiser and yet virtually none of the tens of millions of dollars he has raised has been spent on beating the Democrats. Instead, the money has funded his political team and retaliatory agenda against Republicans who crossed him.

The current political climate is favorable for Republicans as President Biden’s approval rating hits new lows. But nearly a dozen Republican strategists directly involved in fundraising or overseeing campaigns have expressed concerns about how the downturn in fundraising could limit their party’s profits.

The fact that Wall Street billionaires and other industry titans have cut seven- and eight-figure checks for Republican super-PACs works in the party’s favor, offsetting some of the party’s struggles with small dollars that some attributed to inflation and others to deceptive tactics that turn off supporters over time.

For the Republican Senate Committee, online fundraising fell $6.7 million in the most recent quarter, from $17.7 million to $11 million. Top Republican Senate candidates, even those whose fundraising has soared, are lagging far behind their Democratic rivals in the money race.

The money gap is so wide that Georgia Senator Raphael Warnock, an endangered Democratic incumbent, has raised more online in the past quarter — $12.3 million — than the combined WinRed quarterly broadcasts of Republican Senate nominees or presumptive nominees in seven major Matches: Georgia, Wisconsin, Florida, Nevada, Ohio, North Carolina and Pennsylvania.

Money alone won’t win political races, and for years Republicans have become accustomed to following Democrats in online fundraising. Democratic donors, for example, have poured over $200 million into losing Senate races in Kentucky and South Carolina over the past cycle — and neither race came even close.

But the drop in online donations less than four months before Election Day — not only compared to Democrats but compared to the previous quarter — has still sent shockwaves of fear across Republican circles.

Eric Wilson, director of the Center for Campaign Innovation, a conservative nonprofit focused on digital politics, have a recent survey carried out of Republican fundraisers and found that 70 percent fell short of expectations.

“There is a perfect storm going on that has really slowed down grassroots fundraising,” said Mr. Wilson.

Some Republicans blamed inflation. Some blame tech platforms. Others accused certain campaigns and committees — most notably the very aggressive Trump operation — of simply overfishing and polluting a limited donor pool for everyone.

Mr. Trump’s PAC often sends out more than a dozen daily fundraising emails and relentlessly seeks out new donors via text message and by renting conservative email lists. At times, the operation relied on deceptive and manipulative tactics. As one Republican said in Mr. Wilson’s survey, “Republicans are struggling to increase revenue from online fundraising because the big dogs eat all the food in the bowl.”

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Two strategists involved in other down-ticket Republican races, speaking on condition of anonymity so as not to anger the Trump team, said the former president’s hiring of donor lists has sometimes excluded other 2022 candidates or reduced them to less. has forced favorable terms when prospecting for new contributors.

Some Republicans polled their donors to ask why they weren’t giving, and according to people familiar with the results, inflation was the best answer. During a private donor retreat last month, Republican National Committee chair Ronna McDaniel also blamed inflation for the slowdown in small donations.

Yet the role of inflation is hotly debated in digital circles, as it has seemingly failed to affect Democratic donations, which have boomed, especially in the wake of the Supreme Court’s overthrow of Roe v. Wade.

“They have a lot of motivating factors,” Mr. Wilson said of the Democrats.

Some Republican strategists said their small donor base is particularly sensitive to price increases because their small donors are increasingly working-class or dependent on fixed incomes. A New York Times analysis of nationwide campaign contributions for 2020 showed that compared to Democrats, Republicans raised a much higher proportion of their money in zip codes, where the median household income was less than $100,000, as part of the evolving reshuffle. between the two parties.

But when it comes to mega-donors from billionaires giving to super-PACs, the Republican Party easily outperforms Democrats in 2022.

The Senate’s top Republican super PAC had nearly $40 million more cash on hand than its Democratic counterpart going into July. The House Republican super PAC’s cash advantage was even greater: nearly $70 million.

Kenneth C. Griffin, the chief executive of Citadel, a giant hedge fund, has poured nearly $50 million into several federal super-PACs ahead of the 2022 election, including $10 million for the main Senate branch and $18.5 million. in the super-PAC of the House.

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Stephen A. Schwarzman, the chairman of Blackstone, another hedge fund, has contributed a combined $20 million to the main house and Senate Republican super PAC this year. Timothy Mellon, the heir to the banking fortune, and Patrick R. Ryan, who became a billionaire through the insurance industry, each contributed $10 million to the main House GOP super PAC.

And Miriam Adelson, a physician whose husband, Sheldon Adelson, had long been one of the party’s most generous donors until his death last year, made her first $5 million donation from the 2022 cycle this month.

Democrats have had fewer donors at that level. And some of the party’s biggest backers in the past, most notably Michael R. Bloomberg, the billionaire former mayor of New York City, have largely sat on the sidelines of the super PAC wars of 2022.

While Mr Bloomberg has often contributed closer to the election, he wrote an opinion essay this year warned that the Democratic Party was headed for an “extermination,” barring a “course correction.” He has only given $1.5 million so far to a super PAC that he uses for federal races; most of that amount went to a single Democratic primaries in Georgia.

For Republicans, raising funds for House candidates has been a relatively bright spot as a growing number of candidates are raising significant funds online. As of this point in 2020, only 28 Republican candidates and incumbent House officials had raised more than $500,000 with WinRed, according to data collected by the National Republican Congressional Committee. Now that number stands at 94.

But the House Republican leadership has not been immune to the overall slowdown. Representatives Kevin McCarthy of California and Steve Scalise of Louisiana, the two top Republicans in the House, have each seen a sharp drop in WinRed donations. Fundraising in their main accounts focused on smaller donors fell about $2 million combined, or about 25 percent, in the most recent quarter.

Andrew Fischer, Bea Malsky and Rachel Shorey contributed to research.