Candidates Raise Millions ... How Do They Spend It? Millions of dollars are being raised by the various presidential candidates. But how is it all getting spent? To find out, Michele Norris talks with Jeanne Cummings, Chief Lobbying and Influence writer for The Politico, about campaign expenditures.
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Candidates Raise Millions ... How Do They Spend It?

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Candidates Raise Millions ... How Do They Spend It?

Candidates Raise Millions ... How Do They Spend It?

Candidates Raise Millions ... How Do They Spend It?

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  • <iframe src="https://www.npr.org/player/embed/12011541/12011544" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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Millions of dollars are being raised by the various presidential candidates. But how is it all getting spent? To find out, Michele Norris talks with Jeanne Cummings, Chief Lobbying and Influence writer for The Politico, about campaign expenditures.

MICHELE NORRIS, host:

On to presidential politics now - the campaign money totals for the second quarter are now in. The numbers are impressive and so is the spending. Senator Barack Obama led the Democratic pack with $33 million this quarter. That brings his total to a record-breaking $58.5 million. Senator Hillary Clinton is not far behind, with $27 million raised this quarter and a total of $53 million.

For the Republicans, the money is also pouring in. Former Republican Mayor Rudy Giuliani leads his party, raising $18 million this quarter. Former Governor Mitt Romney raised $14 million and Senator John McCain, a disappointing $11 million.

Now, we are wondering what does all that money buys? So we're joined by Jeanne Cummings. She's a correspondent with Politico.com. She covers campaign cash.

Jeanne, the candidates are raising mountains of money. How fast are they spending it? What's the so-called burn rate?

Ms. JEANNE CUMMINGS (Correspondent, The Politico.com): The burn rates are pretty high this season. Unlike previous cycles, when candidates at this stage in the second quarter were building up big blocks of cash in the bank to spend on advertising and travel in the fall, they're spending it this year from the get-go because the campaign's moving fast. So we have candidates spending three and a half million dollars a month. And in the case of Mitt Romney, the biggest spender in the group, he's spending $4 million a month.

NORRIS: That's a lot of money. How are they spending all that money? What's the biggest expenditure?

Ms. CUMMINGS: For almost all of them, the biggest expenditure is payroll. They're all building their staffs right now. And when you hire staff, you take on extra costs, like insurance and benefits and payroll taxes. And so take John McCain. In the first quarter, his salary levels were $1.5 million for three months. It doesn't sound so bad. When you add in almost a million dollars of payroll taxes and more than a half a million dollars in benefits, the actual cost was double, $3 million.

NORRIS: What about consultants, polls, advertising? Where does that fit into the spending?

Ms. CUMMINGS: Frankly, that will come later for all of the candidates except one, Mitt Romney. He is the only one who is spending money on what are considered political projects. He has spent about $5 million on television advertising. He is a consultant's dream. He's spending nearly a million on fundraising consultants. He's spending more than half a million on get-out-to-vote consulting. He has a very heavy budget for consultants. You don't see that with the other ones. You see far more bare bones, building operations - rents, furniture, payroll - that sort of thing.

NORRIS: For all the money spent on consultants, what is the going rate for a consultant? How much do you actually pay for a contract? And what do those consultants do?

Ms. CUMMINGS: Well, it's hard to tell because each one of them is negotiated. And at the beginning of this year, the consultants were negotiating pretty high rates, a couple hundred thousand dollars a month in some cases, I think.

NORRIS: Did you say a couple hundred thousand dollars a month?

Ms. CUMMINGS: Yes. The McCain campaign had contracts that were worth millions. And that was the first thing that they cut. And so there are some very big contracts out there. And these are the people, for instance, that are consultants to, maybe, both run the campaign and oversee the advertising for it. And basically, what these people do is, say, you're a fundraising consultant, what you do is you come in and guide the campaign. You map out where to go, what kind of events might work, how to invite, who to invite to help guide the campaign in raising money.

To get out the vote, consultants would come in and help you develop lists of voters that you later want to contact, perhaps look into registration.

NORRIS: So with so many candidates on both sides, Republicans and Democrats, it sounds like it's probably a full-employment economy for consultants.

Ms. CUMMINGS: It certainly has been. I have to admit, I think that the McCain implosion send a chill through the system. And we were seeing sort of inflation of salaries in the beginning because there were so many candidates vying for the best people, and those best people could cut pretty good deals. But now that I think the candidates and the other campaigns have seen what happened to McCain, I think it's kind of shaken the field a little bit and brought some reality here that someone of that stature could run out of money because they had mismanaged it. We just haven't seen that in any modern-day campaign.

NORRIS: Jeanne Cummings, thanks so much for talking to us.

Ms. CUMMINGS: You're welcome.

NORRIS: Jeanne Cummings covers campaign cash for Politico.com.

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