Barack Obama Fundraiding

New York Times: Obama Built Donor Newtork from Roots Up

CHICAGO — When Barack Obama announced to friends over brunch in 2002 that he planned to run for the United States Senate, one of their first questions was how he could possibly raise the necessary millions.

After all, two and a half years after he had taken quite a “spanking,” as he put it, in his bid to unseat an incumbent congressman, he was still struggling to pay off a $20,000 debt, eking out donations of $1,000 here, $2,000 there.

Improbably, Mr. Obama, running as something of an outsider, wound up raising $15 million and winning that 2004 Senate race. Now that he is running for president, his fund-raising prowess has helped make him the chief rival to Senator Hillary Rodham Clinton of New York.

[Aides said Monday that he had collected more than $20 million in donations in the first three months of the campaign, enough to ratchet up the anxiety in the Clinton camp, which announced it had raised $26 million. Mr. Obama’s campaign has yet to release precise information on its total donations or contributors.]

A look at his 2004 Senate race shows how he laid the foundation for his current fund-raising drive. Even as he cultivated an image as an unconventional candidate devoted to the people, not the establishment, he systematically built a sophisticated, and in many ways quite conventional, money machine.

Interviews and campaign finance reports show Mr. Obama drew crucial early support from Chicago’s thriving black professional class, using it as a springboard to other rainmakers within the broader party establishment. Soon he was drawing money — and, just as valuable, buzz — among wealthy Chicago families like the Crowns and the Pritzkers, as well as friends from Harvard Law School and the University of Chicago, where Mr. Obama taught constitutional law and his wife worked in community relations. As his popularity surged after his rousing speech at the Democratic National Convention in July 2004, big fund-raisers on Wall Street and in Hollywood hopped aboard, and grass-roots contributions began pouring in as well.

Mr. Obama has written that at the beginning he felt uncomfortable asking for money, but he developed a skill at cultivating donors, often with the same disarming directness he uses on the campaign trail.

“I met him on the first hole,” Steven S. Rogers, a former business owner who teaches at the Kellogg School of Management at Northwestern University, recalled recently about a golf game in 2001. “By the sixth hole, he said, ‘Steve, I want to run for the Senate.’ And by the ninth hole, he said he needed help to clear up some debts.”

Mr. Obama’s breakthrough in the 2004 Senate race was also made possible by a new wrinkle in the election laws. Faced with a self-financed opponent in the Democratic primary, Blair Hull, who pumped more than $28 million of his own money into the race, Mr. Obama was able to accept up to $12,000 from each donor, or six times the limit at that time.

As a result, nearly half of the more than $5 million that Mr. Obama raised in the primary came from just 300 donors. In a stroke of luck, he had just enough money to pay for a television advertising blitz in the final weeks as Mr. Hull’s campaign crumbled amid accusations that he had abused a former wife.

Some longtime Obama donors said they were glad to be able to exploit the financing loophole to help him.

James S. Crown, a senior member of the Crown family, said that despite the “formidable competition” in the Senate primary, he was so impressed after meeting Mr. Obama for breakfast in early 2003 that he quickly lent his support.

“I was just taken with his sensibility, his intelligence, his values and how he conducted himself during that campaign,” said Mr. Crown, who is Mr. Obama’s chief presidential fund-raiser in Illinois.

Mr. Obama appears to have such a firm hold on so many of Chicago’s big donors that Mrs. Clinton, who grew up in a Chicago suburb, did not even have a fund-raiser here during the crucial first quarter of this year. At the same time, Mr. Obama’s campaign says its grass-roots support is expanding rapidly, in part through $25-a-ticket fund-raisers designed for a new generation of donors.

Mr. Obama declined to be interviewed for this article. But in his book “The Audacity of Hope,” he sounded prescient about the dangers of the money chase, noting that he could not assume it “didn’t alter me in some ways.” At the simplest level, he wrote, it “eliminated any sense of shame” about asking for donations.

But, he added, he also worries that spending so much time courting wealthy donors has caused him to spend “more and more time above the fray,” away from the concerns of ordinary voters.

Mr. Obama, who grew up mostly in Hawaii, began making political contacts in Chicago as a community organizer in the 1980s. After graduating from Harvard Law School in 1991, he returned to Chicago and led a drive that registered more than 100,000 voters for the 1992 elections.