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The New York Times
Nov. 23, 1999

Cheap Online Fundraising Is a Boon to Political Groups

By Rebecca Fairley Raney

In politics, conventional forms of fundraising like direct mail have become so expensive that for some groups, a $25 donation barely pays for itself.

For political groups that are taking to the Internet to raise money for candidates, the low cost of online fundraising is making small donations worthwhile -- a shift that could motivate these groups to broaden their appeal beyond the interests of the wealthiest donors.

"This low-dollar level is going to become much more important to us," said Simon Rosenberg, founder of the New Democratic Network, which started taking donations online last week. Before Internet fundraising, he said, "it was just too expensive to reach out to those folks."

The Internet lets groups reach voters via e-mail and Web sites, which are much less expensive than direct-mail solicitations and printed brochures. The electronic processing of online donations also helps to keep costs down. And the Internet gives groups a chance to target audiences that may not respond to direct mail. For example, the New Democrats are using the Internet to reach young, moderate, nonpartisan voters who work in the technology sector and embrace the group's social and economic ideals.

Some online political groups allow people to make a donation to a group of candidates who share a position on a particular issue. Experts in online politics say this "bundling" of donations speaks to the reality of politics on the Internet. Early experiences in Internet campaigning have shown that the online public is more likely to rally around issues than around candidates and parties.

These issue-focused political action committees started getting attention on the Internet earlier this year during the impeachment of President Clinton. Two notable groups -- Move On (www.MoveOn.org) and the House Managers Political Action Committee -- were created in cyberspace.

The founders of Move On, Joan Blades and Wes Boyd of Berkeley, Calif., started by sending out 100 e-mail messages to friends and family members stating their position that Congress should abandon the impeachment process, censure the president and move on. The effort snowballed until 300,000 people signed up for e-mail updates. Move On formed a political action committee to collect donations for a handful of Democratic candidates who plan to run against members of Congress who backed impeachment. Supporters have donated $400,000 so far.

Cheaper online fundraising "means that average citizens can become an important source of funds for candidates," Blades said in an e-mail interview.

The House Managers PAC had a similarly spontaneous birth during the impeachment debate. The committee was formed after people began sending money to show their support for the 13 Republicans in the House who led the drive to impeach the president. Jeff Hartley, a spokesman for the committee, said the donors include a man on Social Security who mails $1 a month to each of the House managers.

Hartley and two others formed a Web-based committee to collect the money. Aside from one advertisement published in The Washington Times, the group has not promoted itself. To date, it has collected about $60,000.

Some traditional political groups are finding that Internet outreach is expanding their appeal by attracting younger donors.

The National Republican Senatorial Committee, which raises money for Republican candidates for the Senate, dates back to World War I. As is the case with many political groups, most of the donors who respond to the committee's direct mail solicitations are older than 60. But when the group started raising money online last month, with a site that features a page called "StopHillaryNow.com," the results were inspiring.

"Our average e-member is 34 years old -- and that is prime," said Stuart Roy, a spokesman for the group. "Obviously a younger donor base means they're going to be around longer."

The experience of Roy's committee is reflected in the findings of a study released in September by the Democratic consulting firm Craver, Mathews, Smith and Co. The study found that roughly 25 percent of adults in the United States are involved in social causes and also use the Internet. While nearly two-thirds of traditional donors to social causes are older than 60, the average age of Internet activists is 42, the study said.

The National Republican Senatorial Committee also has the advantage of having a large audience that it can direct to its online offerings. The committee sends out up to a million postal mailings to supporters each month, and now, every mailing includes the address of the group's Web site. A month after the committee started promoting its Internet outlets, 20,000 people had signed up for its e-mail updates.

"The people who normally respond to us in the mail will start giving electronically," Roy said. "It's going to make the cost of raising money much cheaper."

Of course, established committees like the NRSC and the New Democrats have a big advantage when it comes to online fundraising: they already have supporters. With the sheer volume of information available on the Web, political start-ups still face uphill battles in attracting interest.

Tom Horn learned this in July when he started a site called DefeatTheDemocrats.com. Horn, a programmer in Sunny Valley, Ore., had planned to build a formal political action committee around the Web site but never registered because, he said, "I never made the thousand bucks" that would require him to file under federal election law.

"We're a failure," he said with a chuckle. "We are a Cold Fusion programming company that decided to get into a business we didn't know anything about. It was just like vanity publishing in the end."

Horn's experience supports the view that political factions formed on the Internet will not threaten traditional political practices any time soon.

"Some of these smaller groups barely have the resources to keep going," said Paul M.A. Baker, assistant professor of public policy at Georgia Tech. "In reality, without a certain amount of capital, there's not enough money to undertake a new initiative."

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