NOTE: Please unrecommend this everyone. It's gotten enough play today and there are other, important diaries that deserve to be on the rec'd list more. Thanks!
So there's been a lot of discussion today around the blogosphere, spurred by this NY Times article, about Obama and his donors. The article's implication is that it is novel and new to take down donor names for selling t-shirts.
This was then grabbed onto by Jerome Armstrong who, once again, posted a piece on Obama (as he does every day) in the guise of "honest observer," ostensibly lauding the Obama campaign for developing this novel strategy. Of course, in doing so, Jerome found a way to diminish the feat of signing all those small donors. And therein lies the problem - so many are leaping all over this story to prove that Obama has been somehow "sketchy" or using "creative accounting" with his donors.
But there's one fact that so many ignored around the web today. The reason the Obama campaign counts these people as donors is because...IT'S THE LAW.
First, let's begin with this clause from the FEC:
Yet another way of making a contribution is to purchase a fundraising item or a ticket to a fundraiser. The full purchase price counts as a contribution. If you pay $100 for a ticket to a fundraising event like a dinner, you have made a $100 contribution (even though your meal may have cost the committee $30). Or, if you pay $15 for a T-shirt sold by a campaign, your contribution amounts to $15 (even though the T-shirt may have cost the committee $5).
Now, notice something, selling a t-shirt (or any product) is to be counted as a contribution, the same as a meal. Yet, all those who are huffing and puffing over this story, do they get upset over their candidates' use of meals to fundraise?
But then there is the question, why does Obama count these sales and not other campaigns? The answer? Because other campaigns generally don't sell these items directly because they don't think they can do so profitably.
From an Obama aide:
Campaigns that don't expect to have this level of interest among small donors tend to outsource their campaign material sales to vendors. For example, the Clinton campaign has contracted with Financial Innovations to sell their paraphernalia. Financial Innovations makes all of the profit from those sales and takes the loss if no one buys the materials.
To our knowledge, the Obama Campaign, because of the tremendous grassroots enthusiasm, is the only campaign to feel they could generate sufficient interest in T-shirts and other materials to not contract with an outside vendor.
So, in sum, Obama sells items directly to small donors because they think they can do so profitably, and in doing so directly, they are required BY LAW to report them as contributions.
Now, I wasn't sure what the fuss was about, because someone paying to attend a speech or for Obama merchandise is willingly giving money to the campaign. But for those who saw something devious or under-handed about it, take a look at the law.
UPDATED: From Geekesque: According to the Obama campaign the number of donors counted by merchandise sales is one half of one percent.