Buying ‘champagne with beer money’: a look at Castro and O’Rourke’s falling fundraising

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AUSTIN (KXAN) — Texans and Democratic presidential candidates Julian Castro and Beto O’Rourke are falling behind the rest of the pack in the inter-party struggle to take on President Trump in November 2020.

Financial documents released this week from the two campaigns can tell a troubling story when you look at their major competitors.

Julian Castro, former San Antonio Mayor and Obama-era HUD Secretary, has $1.1 million in his campaign bank account, according to financial documents from the Federal Election Commission. Throughout the race, he’s raised $3.9 million and spent $2.9 million.

He reported a large influx of donations after a well-regarded debate performance in late June, doubling his intake from the first quarter to the second. In April, May, and June, his campaign raised $2.8 million. According to a detailed FEC report, Castro’s team spent big on digital advertising.

Castro’s campaign spokesman Sawyer Hackett told KXAN they’re optimistic after the second quarter because they were the Q2 candidate with the most donations under $200, a sign of broad support among voters. Castro plans to hire new staffers in early voting states, like Iowa and New Hampshire, and at the headquarters in San Antonio according to Hackett.

O’Rourke has more money than Castro, but has spent more than he took in during the last three months; an early sign of campaign troubles according to political observers.

In a memo to supporters, O’Rourke’s campaign manager Jen O’Malley Dillon highlighted positives of the last three months but also laid out where they go next.

The positives for O’Rourke: nearly all of the fundraising in the past three months came from small online donations under $200 and half of their donations were from new donors.

“When you look at our fundraising in aggregate, we’re in a great position,” said O’Malley Dillon. “I won’t sugarcoat it: we have work to do, but we have the resources we need to execute our strategy.”

The campaign’s strategy focusing on early voting states like Iowa then hopes to win a bunch of delegates from O’Rourke’s — and Castro’s — home state of Texas.

According to a campaign newsletter, O’Rourke is launching 11 field office in Iowa, bringing his total paid staffers up to 44 in the state; an expensive move.

O’Rourke, the former El Paso Congressman, took in less money than he did during the first quarter. He raised $3.6 million in the April, May, and June according to FEC documents. His campaign spent $5.3 million, a high “burn rate” — the ratio campaigns gain to spent among politicos.

“He’s spending for champagne on a beer budget, that’s what O’Rourke’s doing right now. He’s got to figure a way to cut cost and bring in more money,” said Brian Smith, a political science professor at St. Edward’s University.

Smith says O’Rourke needs a financial boost similar to what he received after a viral video in 2018, in his run against Cruz, showed him describing his thoughts of players kneeling for the national anthem. He brought in more than $80 million for that race for the U.S. Senate. Cruz eeked out a victory then.

“It is hard to do because there are so many candidates out there and it’s going to be really hard for him to break out of the pack without shooting himself in the foot or be seen as pandering too much,” said Smith.

He still has $5.2 million in his campaign coffers; nearly five times Castro’s amount but not enough to compete with the top-tier in the Presidential race.

Vermont Senator Bernie Sanders, Massachusetts Senator Elizabeth Warren, and South Bend Mayor Pete Buttigieg have $20 million or more in their campaign war-chest after the second quarter.

“We’re starting to see a separation between the five or six candidates at the top and the rest of the field. When candidates realize they can’t raise any more money when they’ve asked all their friends, they’ve given the max, then it’s time to drop out,” said Smith.

The Democratic candidates will face each other in another nationally televised debate at the end of July. After that, the Democratic National Committee raised the stakes for the September Houston debate; candidates must have 130,000 individual donors and be at 2% or more in four national polls.

O’Rourke has qualified; Castro has not, still needing to reach 2% in four polls.

All far short of the incumbent Trump, who reports $56.7 million for his reelection bid. The election is far off, November 2020.

Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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