This year, the spending in two Senate campaigns–Arizona and Ohio–represent a departure from the conventional architecture of statewide campaigns. Republican candidates in these races have all but abandoned traditional fundraising avenues for a deluge of outside funding dollars unleashed by the notorious Supreme Court ruling in Citizens United 12 years ago.

Since that decision, budgets for big ticket campaigns have soared. Between 2008 and 2020, the amount spent Congressional races alone nearly doubled, approaching 6 billion–more than twice the GDP of the entire country of Belize. There’s no denying that these skyrocketing campaign budgets have transformed how modern campaigns are run. With millions of dollars reshaping high profile races, it doesn’t just matter how much is being spent, but who is doing the spending.

Before getting into the specifics of Arizona and Ohio, let’s parse some of the election legalese.

Campaign Spending

While campaign fundraising, especially outside spending, is notoriously opaque and fraught with legal jargon, OpenSecrets provides us with a pretty good definition of what we mean by campaign spending:

With this kind of spending, donors must be disclosed, contribution limits apply and organizations are allowed to coordinate their efforts to help elect a candidate. This is not dark money. These groups include candidate committees, political parties and traditional Political Action Committees (PAC).

via OpenSecrets

All contributions to federal candidates from nonconnected committees are subject to limits (shown below) and must be disclosed to the FEC.

Source: fec.gov

Traditionally, the bulk of positive communication (communication supporting a particular candidate) has come from official campaign spending, especially since the Bipartisan Campaign Reform Act of 2002. The bill includes a “Stand by Your Ad” provision, which requires candidates to identify themselves and state that they approve of the message. This applies to television and radio advertisements (though not digital) paid for by the campaign’s authorized committee.

When it comes to television advertisements, campaign committee dollars stretch a little bit further: FCC regulations stipulate that within 60 days of an election, broadcast and cable stations must charge candidates the lowest possible rates for advertising (known as “Lowest Unit Charge”). Since this applies only to television ads sponsored by a candidate’s authorized committee, campaign committees are broadly the most cost-effective vehicle for TV ad spending.

In Arizona and Ohio’s Senate races, grassroots fundraising has helped boost Democrats like incumbent Senator Mark Kelly of Arizona and Congressman Tim Ryan of Ohio. Of the more than $79 million raised by Kelly this cycle, about 43 percent were from donors giving $200 or less. Similarly, Ryan’s committee took in a total of $47 million, with 39 percent of these donations coming from small donors. 

Fundraising strategy is ultimately informed by the types of donors willing to open their wallets in support of a candidate, and a candidate’s donor base may have particularly deep pockets. This is certainly true for Kelly and Ryan’s Republican opponents, tech executive and Thiel protege Blake Masters of Arizona and venture capitalist JD Vance of Ohio. Both Republicans have each raised $12 million dollars to support their respective campaign committees, but in both cases about 20 percent of the total funds came from donors giving $200 or less.  

Individuals and corporations willing to put larger amounts of money behind a candidate (exceeding the FEC limits) must do so through other avenues, which brings us to outside sources.

Independent / Outside Expenditures

To understand the basics of outside spending and independent expenditures, we’ll need another working definition. From OpenSecrets:

Outside spending — sometimes referred to as independent or non-coordinated spending — refers to political spending made by organizations and individuals other than the candidate campaigns themselves. All outside groups that aren’t political parties — except for a few traditional PACs that make independent expenditures — are allowed to accept unlimited sums of money from individuals, corporations or unions. With these donations, groups may engage in a number of direct political activities, including buying advertising that advocates for or against a candidate, going door to door, or running phone banks. However, these organizations are not allowed to coordinate their spending with political candidates or parties. While some outside groups — like super PACs — are required to disclose their donors, others are not. These nondisclosing organizations are referred to as dark money groups.

via OpenSecrets

The Firewall 

Legally, independent expenditures are barred from directly coordinating with the campaign. Through what may seem like dubiously legal methods, the two entities are still able to share resources or signal to one another. For example, an independent expenditure wishing to cut an ad containing video footage of the candidate might know to look for B-roll in what is known as a “red box,” which is a publicly available (though often inconspicuous) web page containing those resources. Another example: since media buying is publicly reportable, the campaign and independent expenditure often track and plan ad reservations around one another’s reservations. 

Oftentimes, legal constraints placed on these groups result in some duplications of efforts by both the IE and the campaign apparatus. Independent expenditures, for example, often must pay for their own internal polling. Consultants and individuals involved with the independent expenditure may not advise the candidate or participate directly in strategy, and vice versa. 

Although all political advertisements must include some form of disclosure (“Paid for by Americans for Better Electoral Analysis”), an independent group’s nominal and statutory separation from the campaign/candidate makes it the most effective vehicle for negative messaging.

Campaign spending and independent expenditures are often slated for different purposes, though there is utility in resource distribution and allocation through both avenues. However, just as with flavoring a dish, how it’s going to taste is not determined by measurements of individual ingredients, but how they’re proportioned. Infusing a campaign with too much outside cash risks leaving a bitter taste in voter’s mouths.

Case study: Ohio

How it started…

While Citizens United kicked off an explosion in outside spending, historically, Senate races in Arizona and Ohio have kept closer to parity in the sum of money spent by a campaign and its associated IEs. 

In Ohio’s 2016 Senate race, Republican groups spent a total $30.4 million in independent expenditure in opposition to Democratic challenger Ted Strickland. Positive spending by the Portman campaign was almost dollar-for-dollar, with $26.5 million coming from the campaign, and $4.9 million in pro-Portman IE spending. 

On the Democratic side, there’s a similar balance. Outside money opposing Portman totaled $10.4 million and $5.9 million in support of Democratic challenger Ted Strickland, while Strickland’s own campaign spent $12 million.

How it’s going…

This year, we’re seeing a reversal of spending source ratios. Democratic Senate candidate and current Congressman Tim Ryan boasts an enormous campaign warchest ($47 million) compared to his Republican opponent JD Vance ($12 million). 

However, pro-Vance IE spending has worked to supplement this lackluster fundraising to the tune of $16 million–that’s a total of about $28 million in combined pro-Vance/Vance campaign spending. 

That’s still a pretty striking imbalance compared to Tim Ryan’s campaign and pro-Ryan IE total more than $50 million, one which Republicans have hoped to counteract with $35 million in anti-Ryan spending. Meanwhile, Democratic groups have put up more than $20 million in anti-Vance IE funds. 

The funding and resource deployment has shifted drastically since 2016—a stark departure from the traditional structure of a statewide campaign with huge structural and logistical implications.

Tim Ryan’s operation could not present a greater contrast. I counted 35 individual staff members (persons for whom there existed an expenditure marked “Salary”) in Tim Ryan’s most recent FEC filings, the bulk of whom work in field and organizing (volunteer recruitment and management for grassroots voter outreach such as door knocking). Compare that to Vance, who has a skeleton crew of 10 paid staffers. 

Legally, the Vance HQ has very little to do with the vast majority of the $63 million dollars being spent in the state on behalf of his bid for Senate. This effectively outsources the strategic decision making and spending decisions, and bars even the candidate himself from visibility into what is effectively his own campaign’s organization. 

Arizona: Dark Money in the Sunbelt

An almost identical story is playing out in Arizona, where Republican challenger Blake Masters hopes to oust incumbent Democratic Senator Mark Kelly. 

Contrasting reliance on spending by outside groups in this year’s Senate race paints a very different strategic picture than the one in 2018. While Sinema and McSally follow that 50-50 split observed in Portman’s Ohio race, Masters’s distribution of funds is like a copy-paste of 2022 Republican spending allocation in Ohio. Like Vance, Masters has $12 million in campaign, nearly $18 million in IE pro-Masters spending, and $37 million spent in opposition to his opponent. 

Conclusion: It’s a Bold Move, Cotton, Let’s See If It Plays Out

The ratio of positive IE / campaign messaging to negative IE spending does not come without strategic concerns. In both Arizona and Ohio, we’re not only seeing a huge increase in the total dollar amount spent on attacking a opponent, but Republicans in both races have dramatically shifted resource allocation to back negative messaging.

This is an even more interesting strategic play for Masters and Vance in particular. Both Masters and Vance have struggled with low favorability (AZ: NYT, OH: Marist), this paucity of positive message spending may tell us why they have struggled to bring those numbers up.