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RealClearPolitics HorseRaceBlog

By Jay Cost

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What's Going On at the NRSC?

I would like to comment on the First Quarter numbers that the National Republican Senatorial Committee (NRSC) reported a few weeks ago. Many people were surprised at the relatively disappointing take of the GOP's Senate organization. The NRSC pulled in only $9.1 million in the First Quarter of 2007. That is a little less than half of what its Democratic counterpart, the Democratic Senatorial Campaign Committee (DSCC), raised.

Why the disparity between the two organizations? Many analysts argued that the NRSC's money problem is due to the fact that the GOP is obviously in bad shape in the Senate. This, I think, is at least partially true. However, the exact causal mechanism behind this "bad shape" (for lack of a better term) is a little bit more subtle than many have appraised.

Part of the reason for the disparity might be that potential donors are refusing to donate to Republican candidates for the Senate because they are dispirited. In other words they think the party is doomed to lose in the next cycle, and so they do not feel like pulling out their checkbooks. This, unsurprisingly, was the argument of DSCC Chairman Charles Schumer, who told The Washington Post after the numbers were released, "The support for Democratic candidates and ideas is enormous and is propelling us to a big lead in fundraising." This might be true. However, there is more to it than this.

Another reason for the disparity is that Republican donors are choosing to give money to individual incumbents rather than the NRSC. As of the end of the First Quarter, the Republicans were defending 21 seats in the next election - almost twice as many as the Democrats. What is more, most experts expect 2008 to be a rough year for Republicans. This means that there are a large number of Republican incumbents who are actively worried about reelection. It is they, I suspect, who are partially depressing NRSC fundraising figures because they are crowding the market for dollars. Donors who wish to help the GOP cause in the Senate are more likely to give to incumbent members than they are to give to the NRSC. This is the case for two reasons.

First, it makes sense in our candidate-centered campaign environment. Republican incumbents are qualified candidates who know how to run winning campaigns. While it is true that the NRSC can and does offer assistance to incumbents, it is also true that one can expect an incumbent to know how to spend campaign dollars efficiently. And thus, it is the best use of money to give it to incumbents rather than the organization that will help the incumbents. The only way the party is able to aid candidates without legal limits is through independent expenditures, which are inefficient because the party cannot coordinate with the candidate. Thus, Republicans who wish to help Norm Coleman are better off contributing directly to Norm Coleman than they are contributing to the NRSC, which will spend on his behalf but without his consultation.

Second, Republican incumbents are interested in getting as much money as they can as soon as they can. They are thus actively attracting donors to their organizations. This kind of persuasion should not be understated. Republican incumbents are high profile individuals in the party. They are quite able to attract donors with relative ease. So long as most donors have in their minds a set amount they are inclined to give at any point in time - we can expect that, as they are pulled toward incumbent candidates, so they are pulled from the NRSC.

I do not really expect the NRSC to close the entire gap between the DSCC and itself. The logic of contributing to candidates rather than the CCC remains solid all cycle; endangered incumbents tend to crowd out the market for dollars all cycle. As new donors start to contribute, they will naturally gravitate to Republican incumbents rather than the NRSC - just as current donors are gravitating. So long as the GOP is playing defense in the Senate in 2008 - which I would say is darn close to certain - I imagine the NRSC will be the runt of the CCC litter.

Does this explanation account for the entire gap between the NRSC and the DSCC? No. It accounts for a portion of it, but not all of it. If we add the NRSC's receipts to the receipts of all GOP Senate incumbents, we find that the GOP Senate has raised about $23.6 million. The DSCC plus Democratic Senate incumbents have raised $29.4 million all told (not including the millions John Kerry transferred from his presidential committee). So, we have about a $5.8 million difference - as opposed to the $9.1 million that separates the DSCC and the NRCC. This difference increases to $7.6 million when we include the high profile Democratic challengers who are already in active pursuit of Senate seats, namely Al Franken and Katrina Swett. Thus, we have explained about $1.5 million, or 16.5%, of the total difference between the NRSC and the DSCC in this election cycle.

So, what explains the remaining gap? It might be that Republican donors are, as I like to say, dispirited. They think the party is going to lose, and they do not feel like contributing. This might be true.

Might there also be some "institutional" problems at the NRSC? Maybe. A lot of analysts, myself included, wondered if Elizabeth Dole might have been part of the NRSC's problem in the last election cycle. Is it possibly the case that the organization at the NRSC is inferior, and that even with her out and John Ensign in, it still has some problems? Maybe. I am not privy to any kind of information to allow me to make a determination. I will say that the DSCC has beaten the NRSC in fundraising in the two cycles since soft money was banned. That might be a sign that the DSCC has adapted to the post-soft money environment more efficiently than the NRSC.

One factor that might explain much of the remaining gap is that the DSCC has a large debt that it is endeavoring to retire. At the end of the last cycle, the DSCC had $6.6 million in debt, while the NRSC had only $1.3 million. As of the end of the first quarter of this cycle, the NRSC had paid down its debt and the DSCC had paid down a little over $1 million. It might be that the DSCC's greater debt induced it to begin fundraising earlier.

It is hard to say just much each, if any, of these explanations account for the remainder of the gap. One thing is for sure. Charles Schumer might have been partially correct, but he was also spinning the numbers at least a bit.

-Jay Cost