In the age of "super PACs," a presidential campaign can die of thirst on the shores of the Great Lakes.
Gov. Scott Walker of Wisconsin was among the most successful fundraisers in his party, with a clutch of billionaires in his corner and tens of millions of dollars behind his presidential ambitions. But his swift decline and exit from the presidential race on Monday were a stark reminder that even unlimited money has its limits.
While a super PAC supporting him, Unintimidated, was relatively flush with cash — on track to raise as much as $40 million through the end of the year, according to people involved with the group — Walker’s campaign committee was running dry, contemplating layoffs and unable to find enough money to mount a last stand in Iowa, a state that once favored him.
Super PACs, Walker learned, cannot pay rent, phone bills, salaries, airfares or ballot access fees. They are not entitled to the preferential rates on advertising that federal law grants candidates, forcing them to pay far more money than candidates must for the same television and radio time.
Now, in a campaign that has already upended assumptions about the power of dynasties and the limits of celebrity candidates, Walker’s decline and fall hint at the systemic dangers of the super PAC-driven financial model on which virtually the entire Republican field has staked its chances.
Like Walker and former Gov. Rick Perry of Texas, who dropped out earlier this month in the face of a similar cash crunch, most of the Republican candidates still aspiring to their party’s nomination have reported far more money sitting in the accounts of super PACs backing them than they have in their own campaign accounts. All told, as of June 30, the most recent reporting deadline, Republican super PACs and other groups involved in the primary had raised about $256 million, compared with just $78.4 million for the candidates.
Indeed, many of the Republicans criss-crossed the country this spring and summer to win over billionaires like casino mogul Sheldon Adelson, investor Paul Singer and conservative industrialist brothers David H. and Charles G. Koch, and delayed their official campaigns to raise money for super PACs set up by their political allies. That also meant late starts in raising money directly for their own campaigns — and neglecting the hundreds of lower-tier wealthy donors and "bundlers" who help candidates raise so-called hard money for their campaigns, $2,700 at a time.
The extraordinary flow of money through super PACs and other outside groups, much of it coming from a few dozen megadonors, has obscured the drought facing many Republican campaigns. Much of the Republican donor establishment is waiting on the sidelines for a clearer picture of the race to emerge, hampering candidates’ efforts to bring in hard money, currency that a campaign needs to survive.
"You know how hard it is to raise this money at $2,700 apiece?" said Anthony M. Scaramucci, a New York financial executive who was a national finance chairman for Walker. "Unless you have the right messaging and appeal, you won’t get the smaller donors. You have to be able to go up-range into the big donor community and downrange into the smaller donor community."
While the campaigns will not be required to report their latest fundraising totals until mid-October, signs of belt tightening abound. Last month, aides to former Gov. Jeb Bush of Florida, whose super PAC pulled in more than $100 million through the beginning of July, ordered a round of cost-containment efforts, including pay cuts for some campaign workers.
Ray Washburne, a former Republican National Committee finance chairman who is now leading fundraising for Gov. Chris Christie of New Jersey, said Christie’s campaign had sought to manage his travel schedule carefully and to avoid building a large staff, as Walker had done.
"I think the whole super PAC deal is nothing until you get to Iowa," Washburne said. "Between now and then, you need to have hard money."
Appearing on a panel Monday as news of Walker’s exit broke, Terry Sullivan, the campaign manager for Sen. Marco Rubio of Florida, said that he had to personally approve any expense of more than $500 and that Rubio flew "95 percent commercial, always coach."
"Keeping control of the budget’s such an important thing," Sullivan said at the event, which was sponsored by Google and National Review.
Most of the candidates — with the prominent exception of Donald Trump, who is paying his own way — are now relying to a significant extent on super PACs to communicate with voters on their behalf in the five weeks remaining until the next Republican debate. This stretch, several Republicans predicted, will be a test of how effectively super PACs can prop up candidates who are otherwise limping in the polls, like Rubio and Bush.
Several super PACs, including groups backing Christie and Gov. John Kasich of Ohio, have invested heavily in advertising to promote their candidates, rather than negative ads attacking their rivals — the stock in trade of most super PACs during the 2012 cycle.
Other super PACs are placing their bets on grass-roots activism, using their cash to build get-out-the-vote operations intended to mimic and complement what the candidates are doing — usually with more money than the candidates can spend. A multimillion-dollar network of super PACs allied with Sen. Ted Cruz of Texas, for example, is focused on forming partnerships with anti-abortion groups to help Cruz with evangelical voters.
"I think there’s a lot of experimentation as to what super PACs can effectively do in different campaigns," said Dan Backer, a conservative election lawyer.!~neIP~!
The super PAC backing Bush is spending $37 million to introduce him as a proven conservative executive, on the theory that primary voters know relatively little about his record despite his family name. That sum amounts to three times more than Bush’s own campaign had raised through the beginning of July, an enormous investment that appears unprecedented for this early in a Republican primary.
"I think Jeb Bush, without a super PAC, would not be doing well at all," Backer said. "But $25 million can put out a lot of information to help change people’s minds."