Obama Withdraws Public Finance Pledge to Gain Cash Advantage

By Anastacia Mott Austin

Despite pledging earlier this year to conduct his national campaign with publicly committed funding, Barack Obama announced this week his plan to refuse public finances and bankroll his entire national campaign with private funds.

What this means is that he’ll be able to rely on a larger cash flow, and his campaign will have much more say over where the money is spent.

This could potentially give Obama a double advantage over his opponent John McCain as fall approaches. The McCain campaign has struggled financially, and has said it would rely on public funding.

As it exists today, the public funding system allows for each candidate to spend approximately $84 million on his or her campaign. The candidates are not allowed to raise or spend money over this amount.

Since Obama’s campaign has been so successful in raising funds from private donors, many of them small contributions of less than $200, his campaign anticipates they will have no trouble raising more than the $84 million.

Part of the decision was no doubt based on the fact that the Republican National Party has amassed about four times the amount of cash that the Democrats have. Each party, as well as outside organizations, can spend as much as they like to try to influence the outcome of the election.

By committing to the public financing agreement, the Obama campaign would likely be at a disadvantage.

The problem for Obama is his earlier pledge to stick with public financing rather than private donations. In March of 2007 Obama said he would "aggressively pursue" an agreement with the Republican nominee to only use public funds for the general election, and forgo private donations.

The McCain campaign now says that Obama has broken his promise, and has "…failed to demonstrate the kind of principled leadership that Americans are looking for in our next President."

But Obama wants to win. His campaign hopes that his supporters will take the view that going back on his earlier statements is worth the extra funding he’ll receive as a result.

"Instead of forcing us to rely on millions from Washington lobbyists and special interest PACs, you've fueled this campaign with donations of $5, $10, $20, whatever you can afford," said Obama to supporters in a an online video feed. "And because you did, we've built a grassroots movement of over 1.5 million Americans."