How US election fundraising is working out for Biden and Trump

Americans invest staggering amounts of money in their electoral processes, with the 2020 election cycle reaching a monumental $4.1 billion, a significant increase from the $1.6 billion spent in the 2016 presidential election, as reported by the Federal Election Commission (FEC). The ongoing election campaign is poised to surpass this figure, indicating a rising trend in political expenditure.

Presidential campaign funds derive from diverse sources such as individuals, political parties, and political action committees (PACs). PACs, independent entities legally distinct from candidates and parties, pool contributions to advocate for or oppose candidates while coordinating efforts, including funding advertisements that align with their candidates’ stances.

The exorbitant costs of U.S. political campaigns stem from their extended duration and expensive advertising. Post-election, preparations begin promptly for subsequent midterm congressional elections and the next round of presidential primaries, contributing to the perpetual cycle of fundraising.

The FEC continuously updates financial data on the 2024 presidential election, revealing that candidates have amassed over $397 million and spent nearly $294 million since January 2021. Republicans lead fundraising with $225 million, while Democrats follow with $103 million. In terms of spending, Republicans have utilized $191 million compared to Democrats’ $48 million, reflecting disparities attributable to fewer significant Democratic contenders.

Notably, Joe Biden faces minimal Democratic competition, while the Republicans commenced with nine candidates certified by the Republican National Committee. CBS News highlights Biden’s fundraising outpacing Donald Trump’s in January, further emphasizing the financial dynamics between the two parties.

Approximately 18% of the population contributed to the 2020 presidential election, with smaller individual donations likely fueled by party or candidate affiliations. Corporate donations to PACs supporting candidates often serve a strategic purpose, minimizing risk by supporting both sides. For instance, ExxonMobil allocated 58% of its political donations to Republicans and 42% to Democrats in 2020.

Donald Trump encounters challenges in fundraising, trailing Biden’s contributions by mid-February. Income disparities between Republican and Democratic states, compounded by stronger Democratic support in wealthier states, pose additional hurdles for Trump’s individual donations.

An intriguing facet is the influence of “dark money,” anonymous donations from affluent individuals via “super PACs.” In 2020, Democrats received significantly more dark money than Republicans, with Biden securing $174 million compared to Trump’s $25 million. Nikki Haley’s notable financial support from donors in her Republican nomination challenge adds an interesting dimension to the funding landscape.

Legal issues further complicate Trump’s financial standing, with fines totaling $83 million following a guilty verdict in a sexual assault case and a $355 million fine in a separate case related to his business empire. The FEC closely monitors campaign finance, warning against illegal use of funds to settle fines.

Despite potential financial disparities, research indicates that campaign spending significantly influences voter turnout rather than shifting support between candidates. As the 2024 campaign unfolds, the Democrats’ financial advantage may impact the election’s outcome, with the potential for either Joe Biden or Donald Trump to secure victory.