The current presidential cycle is one of the most unconventional election cycles ever experienced. For me, voting for the next U.S. President is like choosing a soccer coach for my teenage daughter. One option is “Coach Clinton” who will provide everyone equal playing time and will make sure that each team member’s mother brings a snack after the game. I am not sure how many games the team will win, but I am fairly confident that we will have a great party at the end of the season no matter how well the team performs.
The second option is “Coach Trump,” who will not likely give equal playing time to the players but will only put the best ones on the field (unless they’re Mexican or Muslim – those players wouldn’t get to play no matter how good they were). He wouldn’t care about snacks at the end of the game or whether the kids had fun. However, I do expect the team would perform well on the field and most likely have a winning season. Though, if there is ever a coach that would get in a fight with a referee or the other coach, it would be “Coach Trump.”
The reality of this hypothetical choice lies in the amount of funding the coach can raise for the team. The way I see it, whoever has the most money will have the advantage in terms of advertising and promoting their message to voters. In fact, the last time a candidate with the most campaign money lost was in 1976 when Gerald Ford lost to Jimmy Carter. Currently, the Clinton campaign is outraising Team Trump by a 3:1 margin. According to Federal Election Commission (FEC) filings, Trump has raised roughly $37 million in individual contributions, and Clinton has raised roughly $231 million in individual contributions (individual contributions include contributions made by individuals, Native American tribes, partnerships, sole proprietorships, LLCs, PACs, Super PACs, and Hybrid PACs).
As you can see from the chart below, there’s been a huge incremental increase in donations since 2000. The outrageous campaign spending started following the 2010 Citizens United case when the Supreme Court upheld a corporation’s (and union’s) ability to donate unlimited amounts of money to help persuade voters while not donating directly to campaigns. After Citizens United, the SpeechNow.org vs. FEC case led to the creation of “Super” PACs (Political Action Committee) which could accept these donations and are allowed to use the money to create commercials and advertisements so long as they don’t directly coordinate with the campaign. Super PACs get to publish the negative ads while the candidate stays squeaky clean and act as shadow campaigns for the candidates.
So, who’s going to win the U.S. Presidential election in November? Well, if history repeats itself, Secretary Clinton will win because she has more money. However, if voters decide what kind of coach they want for their kids based on the candidates’ personalities, experience and track record, we may find ourselves with another nail-biter like the 2000 election. After all, money isn’t everything, just look at the Refugee Olympic Team. They’re competing out of sheer grit and determination without the money and resources of a stable homeland.
Kendall Capital is a wealth management firm providing financial advisory services in the Washington, DC area to individuals and families with assets of more than $500,000.