President Donald Trump’s campaign found it harder to raise money from small-dollar donors in the final months before the election, spending 77 cents of each dollar it received in the third quarter on future fundraising efforts, according to federal disclosures that highlighted the funding gap with Democratic nominee Joe Biden.
Spending by the campaign’s grassroots fundraising arm, Trump Make America Great Again, to pursue small donors was far higher than throughout his re-election campaign, when it spent 47 cents per dollar raised.
Over the last three months, TMAGA paid $181 million of the $235.7 million it raised from small donors to vendors for more fundraising expenses, the organization’s latest filing with the Federal Election Commission shows.
The need to reinvest such a high percentage of donations into raising even more money suggests that Trump is having difficulty getting contributions from his existing base and so is working to expand his reach to other small-dollar donors.
No other presidential campaign sets up a separate fundraising arm for grassroots donations, so a comparison to other campaigns is difficult. But TMAGA had more success not only in 2016, but earlier this year. In 2016, TMAGA spent 37 cents for every dollar it raised, and in the last 18 months, it spent on average 47 cents for every dollar it raised. The third-quarter numbers show a sharp drop in return on investment for fundraising spending.
After a string of good fundraising months in the spring and summer, Trump’s campaign saw its total receipts drop to $61.8 million in August, down $10.3 million from the previous month. Transfers from Trump MAGA to the campaign, which made up more than half of its fundraising in July, fell to $11.8 million.
As Labor Day approached, the committee spent even more on raising money from small-dollar donors, a tactic that is more expensive per dollar than courting big donors. In the month of September alone, Trump MAGA spent $71.6 million on fundraising while sending just $9.2 million to Trump’s campaign.
Meanwhile, Trump scaled back some television advertising and even abandoned advertising in the key states of Pennsylvania and Michigan for a period. The campaign announced Thursday that his re-election effort raised $247.8 million in September.
READ MORE: Trump Campaign Slashes Ad Spending in Key States in Cash Crunch
Conversely, Biden and the Democratic National Committee are flush with cash. The campaign and the DNC raised $748 million in August and September alone, about $290 million more than Trump over the same period. Biden started October with $432 million in the bank while Trump had $251.4 million.
The Trump campaign didn’t respond to questions about the high rate of spending compared to fundraising for the small-donor group.
Trump is being forced to play catch up in fundraising at the same time he is trying to play catch up in the polls. Consistently behind Biden in national surveys, he is now down 8.9 percentage points down in the RealClearPolitics polling average and behind but by narrower margins in key battleground states just two weeks before Election Day.
On Saturday, he dismissed the fundraising deficit as part of a strategy to avoid being beholden to big donors.
“Biden is raising a lot of money because they’re promising all these things to all these people,” the president said at a rally in Janesville, Wisconsin, on Saturday. “I could have more money. The problem is, if you do that, when they call you in two months, three months, four months because they need something, you’ve got to take their call and you’ve got to do it,” he said.
READ MORE: Trump Attempts a Positive Spin on Fundraising Deficit to Biden
Trump Make America Great Again was the cash cow for the campaign in 2016, bringing in money from small donors buying up Make American Great hats and bumper stickers. Operating expenditures were about 37% of total revenue in the third quarter of 2016 compared to this year’s 77%.
This year, most of TMAGA’s spending went to American Made Media Consultants, LLC, a company that works solely for the campaign as a middle man to hire other vendors.
The campaign declined to say who runs AMMC and its murky reporting was the subject of a July complaint by the Campaign Legal Center. At the time, campaign spokesman Tim Murtaugh said the group “builds efficiencies and saves the campaign money by providing these in-house services that otherwise would be done by outside vendors.”
The campaign paid AMMC $112 million in the third quarter, more than 10 times as much as the next biggest vendor, WinRed Technical Services LLC, which received $11.2 million to process contributions to Republican candidates and causes.
AMMC spent some $98.3 million in 2020 on digital ads seeking donations. It also paid $23 million to get people’s online contact information, a move designed to beef up Trump’s list of supporters who he has repeatedly been asking for money for four years.
READ MORE: Biden Campaign Says It Will Raise $234 Million Before Election
Republican strategist Bryan Lanza, who served as deputy communications director of Trump’s 2016 campaign, said late spending on fundraising could double as voter outreach. Financial return on investment isn’t the only metric at this point in the race, he said.
“You’re burning through a lot of cash, but you’re also getting people to buy into your campaign,” he said, adding that identifying voters, getting them involved and turning them out is the goal. “It looks challenging but you got to understand that the whole point of a political campaign is to be bankrupted on Election Day. It is normal for the spending to increase exponentially the closer you get to election because you don’t want to sit on money.”
Trump has a different fundraising arm that collects money from big donors, but most of that money goes to Republican Party committees because the donations are larger than the legal limit for the campaign.
That arm, Trump Victory also transfered a small portion of the $119.5 million it raised in the third quarter to the campaign. Contributors included real estate developer Geoff Palmer, who gave $765,000, GOP mega donor Richard Uihlein, who gave $580,000, TD Ameritrade founder Joe Ricketts gave $315,000 and his wife Marlene Ricketts gave $300,000.
— With assistance by Mario Parker, and Josh Wingrove