Small Donors' Clout in Doubt

Aided by user-friendly online tools, small donors have upped their campaign giving. Why aren't they having more of an impact on the Presidential primaries?

by Catherine Holahan

Rogers Cadenhead wants to have an impact on this year's Presidential election. So he's heeded online appeals for contributions, making $25 to $40 donations to candidates including Senator Barack Obama (D-Ill.), former Senator John Edwards (D-N.C.), and Representative Ron Paul (R-Tex.). "The allure of one-click participation in democracy was too hard to resist," says Cadenhead, a 40-year-old computer book author and the publisher of the liberal-leaning political blog the Drudge Retort. "I'm not the kind of person who gets called for real donations."

Cadenhead and millions of individuals like him are nonetheless being courted by the candidates. Presidential hopefuls are grabbing their attention—and contributions—with donation requests embedded in blogs, e-mails, social networks, YouTube (GOOG) videos, and their own Web sites. This year's candidates have received more donations under $200 than any prior group of Presidential hopefuls, says Steve Weissman, associate director for policy of the Campaign Finance Institute (CFI), a nonpartisan research organization associated with George Washington University.

Large Donors Still Dominate

The field has tapped into the public's growing frustration with corporate and other interest groups that attempt to influence election outcomes through large donations. "The race has been dominated by special-interest groups and lobbyists for too long," says Athena Sheth, a 24-year-old science student at Broward Community College in Florida who gave for the first time this year and is urging others on Facebook to do the same. "I feel like we can take back the direction of our nation if we put our hands in it."

The problem is, deep-pocketed donors have also upped the ante, raising questions as to how much sway smaller contributors will really hold in this year's election. Overall, the ratio of large donors to those who give $200 or less has remained relatively the same as in prior elections. On average, 21% of campaign donations are coming from small donors this year, according to campaign financial reports through the third quarter analyzed by the CFI. In the last two Presidential elections, the averages for the same period were 18% and 20%, respectively. "The claim that the Web is producing a flood of donations that are giving small donors more clout is unproven," Weissman says.

Candidates are loath to turn away deep-pocketed donors. This year's election may go down as the most expensive in history. By the end of the third quarter of 2007, the last for which data are available, the Presidential contenders had collected more than twice the amount generated in the same period during the last two elections. The top six candidates alone raised more than $340 million by the end of the third quarter, according to the Center for Responsive Politics (CRP), a nonpartisan, nonprofit research group that studies campaign finance. Candidates must report fundraising totals for the fourth quarter by Jan. 31. "There is no question that more small donors are active," says Weissman. "But it has been counterbalanced by candidates really intensifying their large donors."

What's more, candidates backed by larger numbers of big donors are raking in more money—and performing better in the polls—than hopefuls who are most reliant on small-time giving. The candidates who have the highest proportion of donations of $200 or less include Representative Dennis Kucinich (D-Ohio) (70%); former Senator Mike Gravel (D-Alaska) (60%); Representative Duncan Hunter (R-Calif.) (54%); and Paul (50%), according to contribution data through the third quarter of 2007. Senator Hillary Clinton (D-N.Y.), former Governor Mitt Romney (R-Mass.), and former New York City Mayor Rudy Giuliani (R) each have less than 15% of their contributions coming from small donors. Edwards, Obama, former Governor Mike Huckabee (R-Ark.), and Senator John McCain (R-Ariz.) have 31%, 28%, 25%, and 22% of their contributions coming from small donors, respectively.