A Wide Net For Campaign Cash

Internet surfers who get to Evan Bayh's Web site now can do more than read the Indiana Senate candidate's biography, see his commercials, and learn about his stances on issues. They can also type in their credit card numbers and send him contributions.

Bayh, the state's former governor, has collected a grand total of $250 so far. But experts say the future for such sites is bright. In a trend becoming more prevalent during this campaign cycle, several candidates are actively seeking online contributions.

While it has its pros and cons, most experts believe the future of Internet fundraising is promising.

A June study conducted by Elaine Kamarck of the Kennedy School of Government at Harvard University showed that 16 percent of U.S. Senate candidates and 9 percent of gubernatorial candidates have the ability to raise contributions electronically via credit card.

"Given the low cost of establishing a Web site, it would appear that even a small number of contributions as a result of Web access would make the establishment of the Web site worthwhile," Kamarck said in her study.

Tom Sugar, Bayh's campaign manager, said only $250 in online contributions have been received so far. But he feels that it will become a major force as people begin to trust the medium.

"People feel there are many opportunities to show financial support for Evan Bayh and at the end of the day, they don't feel safe," Sugar said. "It's certainly something we'll always offer people."

Unlike fundraising dinners, calls, and mailings seeking donations, online fundraising can be done 24 hours a day and seven days a week, said Mike Connell, former GOP campaign fundraiser and strategist and current president of New Media Communications.

The Internet will attract a new type of campaign contributor, said Connell, whose Cleveland-based company has aided the online efforts of two GOP gubernatorial candidates, Jeb Bush in Florida and Robert Taft in Ohio.

"It's going to open up a whole new audience for fundraising ... It's going to open up your young, credit-card-using demographic," he said.

Just as the Internet could help broaden the base, it could help cut down on the costs associated with raising campaign cash.

PoliticsOnline, a Charleston, South Carolina-based online company, has launched Instant Online Fundraiser, which allows campaigns to set up online fundraising operations. There, people can offer campaign contributions by credit card through the Internet and the funds will be placed in a campaign bank account directly.

The only cost is a 10 percent fee taken from each contribution to the campaign, said Phil Noble, president of PoliticsOnline.

"Within literally a few minutes you can have secure credit card contributions to your campaign and it costs less than nothing to use," Noble said.

In order to comply with Federal Election Commission regulations, onors are required to disclose certain information about themselves in a form the Web site provides.

Despite these advantages, some candidates have been unable to take full advantage of the Internet's potential for fundraising because of several obstacles still in the way.

Connell said that "social attitudes" are holding back the full-scale growth of the medium. "We're waiting for the American public to be ready to feel comfortable giving money online," he said.

Connell said banks are more traditional in their thinking, and thus are slow to embrace the medium.

"The (banking) industry looks at it and says, 'is this safe?' They're proceeding with caution," he said.

Noble said PoliticsOnline was fortunate to have a bank, First Union, that agreed to set up a secure account for them. He said some banks won't do that. "Banks are reluctant to give customers the keys to the vault," Noble said.

Regardless of the present difficulties, online political fundraising appears to have a bright future.

"The Internet's going to have a profounder effect on politics than TV, but it's going to take time," Noble said.

©1998 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed
  • CBSNews.com staff CBSNews.com staff

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