Romney's Money Woes

Published Jun 26 2007, 01:31 PM by David S. Bernstein

Part three of the Globe's Romney saga was fine, doing a pretty good job of explaining what his management/investment career was all about. I would have prefered if they had spent more time digging for details on that, and less on his missionary work, but that's OK.

Of more interest is the news from Scott Helman, which he broke yesterday on the web, that Romney has given more of his personal money to his campaign.

It's no surprise that Romney would spend his own money -- that's been expected. What's stunning is how soon he's been forced to do it. This is a major sign of problems in the campaign.

The initial $2.5 million or so that Romney chipped in was start-up money, to pay the bills and hire staff before the fundraising kicked into gear.

Since then, the campaign raised roughly $21 million in the first three months of the year, and is rumored to be on track with roughly the same for Q2, which ends this week. Romney's people have been reported saying that they will beat George W.'s 1999 record $37m mark of total raised through June 30.

I've written before about how fast Romney is blowing through that money, but nevertheless I'm amazed that he's already out this far in advance of the actual campaign season. I wrote in the May 23 issue of the Phoenix that "by the time you read this, he may have spent the entire initial $20 million" from Q1. Apparently I was right and then some.

I also wrote at that time that the pace of spending wasn't a problem -- since Romney clearly intended to ultimately pay out of pocket anyway. But I wish to revise and extend my remarks in light of this new information.

Blowing through his whole stash already means two things: 1) a serious attempt to win the nomination is going to cost him a lot more than I think he was expecting; and 2) it's taking much more of a sales job to get his numbers up than he was expecting.

This is a serious problem, if Romney has to cut back on spending for a while, especially with Fred Thompson entering the race. Plus, as I've written before, the several million dollars Mitt's planning to spend to win the Iowa Straw Poll in Ames on August 11 will not get him the return he hoped for, now that both John McCain and Rudy Giuliani have opted out.

I've continued to believe that John McCain would ultimately win the GOP nomination, and this development is very good news for that camp. The continued exposure of Giuiliani's ugly side is taking its toll. And I may be imagining it, but I have this feeling that Fred Thompson's appeal is already cresting and heading down.

By staying out of the way, McCain may be on his way to reclaiming his status as frontrunner....