The Electoral-Industrial Complex: Fortunes Made by Consultants on Campaign Spending
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When the information on just how lucrative our elections are for the ad placement agents and strategists who manage them, I suspect this anger will go through the roof. And it should, on both sides. If the arms race continues to bulk up, we may have to add “electoral” to the familiar line about the military-industrial complex.
Some of the biggest winners in the most expensive election in U.S. history weren’t the politicians, but the private consultants who brought in tens of millions of dollars in fees for advertising, fundraising and other campaign activities.
In the presidential race alone, the two main media firms working for President Obama and Republican challenger Mitt Romney earned profits for handling more than half a billion dollars of campaign advertising, according to disclosures and ad tracking data. Neither company is required to report how much it received in compensation for that work, but their combined cut could easily be $25 million or more at standard industry rates.
Other big earners were the digital strategy companies, telemarketing firms, air charter services, pollsters and consultants who saw a spike in business in a presidential contest that cost at least $2.6 billion. The surge in spending was a financial boon for everyone from the specialized producers that make political commercials to the local television stations that broadcast them.
Elections have veered into the realm of the tribal, somewhat disassociated from policy and more geared toward amping up tribal alliances and denigrating the other side. It costs lots of money to sustain a narrative of this sort, to paint a picture of a competing brand that’s so rich and easily identifiable. And someone has to place the ads.
The numbers are pretty staggering. American Rambler Productions, which ran Mitt Romney’s operation, amassed over $160 million. For the Obama campaign, the number increased to $306 million. Most went to broadcast ads, but salaries come out of that. The Romney campaign paid two firms $22 million just for fundraising services.
Both sides are incredibly invested in explaining away the numbers as confusing and not reflective of where the money sent in by donors actually went. But the explosion of money in the system almost certainly made its way into the strategists’ pockets. And for what purpose? If you can think of one memorable campaign ad that transformed the race, you’d actually be lying. TV advertising has a short shelf life and doesn’t have the same impact in a multi-channel, multi-platform universe, anyway. But it’s certainly an easy repository for the media planners to sink their money into.