It's a good bet that there was an air of smug satisfaction in President Barack Obama's Chicago headquarters last month when both sides in the White House race posted their end-of-April cash-on-hand numbers.
Obama for America and the Democratic National Committee had a combined $139 million in the bank while the newly minted presumptive GOP nominee, Mitt Romney, and the Republican National Committee had a total of $44 million. And $35 million of that was the RNC's. Mr. Romney's coffers were nearly bare.
Fast forward to June 7. The Obama campaign announced the combined Democratic effort had taken in $60 million in May, primarily from an extensive schedule of presidential fundraisers (including $15 million from a dinner at actor George Clooney's).
That afternoon, Team Obama received an unwelcome surprise when the Romney campaign and RNC announced they raised a combined $76 million during May.
Once Mr. Romney became the GOP nominee, the Obama high command should have expected to be outraised for a month or two. That happens virtually every time after a challenger secures his party's nomination. For example, Sen. John Kerry outraised President George W. Bush from March to June 2004.
But the flurry of fundraisers on Mr. Obama's calendar (11 in May and 24 in June, according to CBS News's Mark Knoller) suggest Team Obama was trying to forestall that or minimize the disparity between its fundraising totals and Team Romney's.
The Democrats' official fundraising numbers, released on Wednesday, showed that the $95 million cash-on-hand advantage Obama and the DNC had over the Republicans at the end of April had been cut by two-thirds at the end of May to $33 million. This is in part because the Obama campaign is burning through its war chest so fast and in part because of the impressive $107 million that the Romney campaign and the RNC announced they had on hand at May's end.
This is significant because in 2008, Mr. Obama won partly because he outspent Sen. John McCain by $325 million between June and November ($850 million to $525 million). This was especially important in historically Republican states like Indiana, North Carolina and Virginia, where Mr. Obama outspent Mr. McCain on television by ratios of up to 7 to 1.
But the dawning awareness that Mr. Obama may have little or no cash advantage in the campaign's last five months is not the end of the bad news for the president.
On May 7, his campaign announced a $25 million ad buy in nine battleground states. That made strategic sense: Use the Obama campaign's mountain of cash to frame the election after an expensive primary exhausted Mr. Romney's war chest.
What Mr. Obama didn't count on is the ongoing aggressive policy debate with third-party groups highlighting the shortcomings of his policies. For example, Crossroads GPS (a group I helped organize) had $22 million of ads in May and June challenging the president's agenda while urging grass-roots support for its conservative "New Majority Agenda."
According to public data, between the start of the Obama ad barrage and July 4, the Obama campaign will have spent $58 million on ads with an additional $10 million spent by outside groups on the left (principally Priorities USA and Planned Parenthood).
Meanwhile, center-right groups will have spent $51 million advocating changes in the Obama administration's policies (with over half from Crossroads GPS). There's also been $15 million in election ads from Romney for President.
With his political problems mounting, the president needs to buy his way to re-election. But his schedule is increasingly filled with less productive events. For example, he recently attended six fundraisers in Maryland and Pennsylvania that yielded a little over half-a-million dollars per event. The president is learning the hard way that there is a finite number of million dollar-plus fundraisers that any candidate can have, and he has chewed up most of his opportunities.
The president's team was hoping for a repeat of 2008, when financial muscle made it possible to spread out the battlefield and make a (successful) play for more states. That won't happen this time. The Obama campaign is spending its money too fast. And Mr. Romney is successfully marshaling resources so his campaign can make the fall campaign competitive in every battleground state. Mr. Obama is in a precarious position as the campaign enters the summer.
This article originally appeared on WSJ.com on Wednesday, June 20, 2012.