Coming off an impressive win in Iowa and taking the once inevitable frontrunner down to the wire in her firewall state, it is clear that Obama is well-positioned to become the next President of the United States.  As the people of Iowa and New Hampshire demonstrated, the American people desperately want change they can believe in.  Barack Obama is the candidate to deliver that change by bringing people together, standing up to the special interests, and telling people what they need to know. 

Our campaign now turns its focus squarely to Nevada and South Carolina, and February 5th. Today, we kick off the next phase of our campaign in New Jersey, an important February 5th state.

Fundraising

In the 4th Quarter of 2007, our campaign raised $23.5 million – over $22.5 million of which is for the primary election. In that quarter, we added 111,000 new donors for a total of 475,000 donors in 2007. 

In the first 8 days of 2008, we raised over $8 million and gained 35,000 new donors. Since midnight last night, we have raised another $500,000 online.  We continue to build a grassroots movement that makes us best-positioned to compete financially in the primaries and caucuses coming up.

Nevada

We have built the same caucus operation in Nevada as we did in Iowa, with focused and effective precinct captains in over 95 percent of the precincts in the state, and multiple captains in many precincts. We have also been reaching deep into the electorate, securing commitments to caucus from habitual Democratic voters, general election voting Democrats and Independents. 

In a significant boost to our efforts, we received the endorsement of the SEIU local in Nevada late last night.

This is the first time Nevada has had a precinct caucus so organization is paramount, both in terms of shaping the overall electorate as well as the added challenge of getting voters to locations that are unfamiliar to them.

South Carolina 

We have seen dramatic movement in South Carolina since Iowa, resulting in healthy double-digit leads for Senator Obama in recent public polling.  We have by far the strongest organization in the state according to neutral observers and believe that, as the gateway to February 5th, South Carolina will provide our campaign enormous momentum heading into those twenty-two states. 

Obama also has the support of several key political figures in South Carolina, including former Governor Jim Hodges, Charleston Mayor Joe Riley, and former party chairs Joe Erwin and Dick Harpootlian.

February 5th

We now have staff in nineteen of the twenty-two February 5th states and will be adding to the remaining three – Delaware, Arkansas and Connecticut – by the end of the week.

In the six caucus states – Colorado, Minnesota, Kansas, Idaho, Alaska and North Dakota - we have been engaged in heavy organizing and voter contact.  In many of these states, our opponents are not engaged in any organizing.  We firmly believe you cannot build a caucus operation in a matter of four weeks, so we are at a decided advantage in these states where we have already identified tens of thousands of Obama supporters and where, in the last five days, the number of new volunteers and supporters has exploded.  

We are in the process of mailing past caucus-goers and our ID-ed supporters in those states.  We are also preparing aggressively for vote-by-mail in states like California and Arizona, where we have mail pieces hitting this week and an exhaustive phone program in place to identify supporters and make sure those ballots are returned.

In all of the February 5th states, we have active chapters at most colleges and universities and are pursuing support from independent voters aggressively where they are permitted to participate, which is in most of the states. California and New Jersey, two states the Clintons have pointed to as firewalls, both will have healthy independent turnout in the Democratic primary. 

We expect to see a great deal of movement to Obama from superdelegates in the coming days, seriously eroding the Clintons’ existing advantage in this universe.

To fully execute a robust February 5th strategy, it will take tens of millions of dollars.  Our financial picture is strong and growing stronger by the day, which will allow us to have a significant paid media presence to go alongside our grassroots operations in our target February 5th states.

We expect, as we begin to see significant national poll movement, that there will also be positive poll movement in the February 5th states.  Obama saw substantial gains in the individual February 5th state polls in December opening up a lead in Georgia and seeing a seriously tightening race in California. 

We will be releasing later today our final fourth quarter 2007 estimates, as well as some numbers for the first eight days of January for both dollars raised, as well as number of total donors and new donors acquired in these periods.

The coming weeks will be challenging and no doubt filled with more haphazard and relentless attacks, but we believe we could not be better positioned for the next twenty four states.  Our goal is simple – to win as many states as we can in the next twenty-eight days.

Heading into the final stretch before the Iowa caucuses, millions of dollars in third party spending are pouring into the state in an unprecedented attempt to benefit the campaigns of John Edwards and Hillary Clinton.  For Clinton, AFSCME, EMILY’s List and the AFT have spent over $2.6 million to assist her campaign – even as AFSCME attacks Obama for a position on health care mandates that they themselves have.  The groups supporting Edwards have spent over $2 million including efforts organized by one “independent” organization run by one of Edwards’ highest-ranking political aides which newspapers reported today received a questionable 11th-hour donation of $495,000 just days ago.

We have both the financial and organizational resources to compete aggressively in all four early states and through February 5th.  However, there is no doubt that the size of the spending and its underhanded nature deserve further scrutiny.

John Edwards

John Edwards, who is running in large part on a recently adopted campaign platform of taking on the big corporate interests in Washington, is relying on a former aide to run an unregulated 527 operating outside campaign finance limits to support his candidacy. 

Even as he was decrying such influence last week, his former campaign manager was spending $750,000 on television ads in Iowa.  If Edwards can’t stand up to his own former aides how can stand up to the special interests in Washington? 

Nick Baldick, who ran his campaign in 2004 and was on the campaign’s payroll as recently as June, is now running Alliance for a New America.  The Alliance for a New America has spent $1.5 million to help Edwards in Iowa, while the group Working for Working Americans, funded by the Carpenters Union, has spent more than $500,000 supporting Edwards, bringing the total spent on his behalf in Iowa to $2 million.   

In their most recent financial disclosure, the Alliance for New America revealed that they had raised $495,000 from Oak Springs Farms, LLC. Oak Springs is funded through the assets of Rachel Mellon, who is 97-years old.  According to the available records, which go back to 1980, she has never donated to a political candidate until a contribution was made in her name to John Edwards this year.  Mellon's involvement in the decision to donate to the Edwards campaign is unknown. The Washington Post reported yesterday that Alexander Forger, who has power for attorney for Mrs. Mellon, is a major supporter of John Edwards’ candidacy. Crain's Business Journal reported in February that Forger and "a group of prominent New York lawyers" hosted a fund-raiser for Edwards at Essex House -- the Central Park South address where his office is located. Forger has also personally donated $4,600 to Edwards' campaign, according to FEC records.   This is not the first time Forger has used Oak Springs Farms to support Edwards; in 2006, he made a $250,000 contribution to Edwards’ One America 527 group.

While Edwards has said he doesn’t want this group to run ads, he has not called his former employee and friend and asked him not run these ads.  And according to the New York Times, this group was started after consultations with Edwards’ campaign manager and other senior members of the campaign.

These latest revelations make it clear why Edwards was able to announce that he could accept public funds while still spending all he needed to spend in Iowa.  His campaign simply exploited the biggest loophole in the campaign finance system in order to get public matching funds while arranging through allies to benefit from a 527.  That’s how they avoided the spending limits that are a condition of the public matching funds.

When John Edwards applied for matching funds, he agreed to spending limits in return for the public money he is now receiving. But at that time, the Edwards campaign was actively involved in discussions about the establishment of an “independent” 527 effort, to be conducted outside the federal financing requirements.  Members of the SEIU, which is funding the 527 that has spent the vast majority of the money in IA on his behalf, described consultations with senior Edwards staff and a visit to the campaign in Iowa, all intended to assure that the project delivered “the specific sort of support they’d [the Edwards campaign] like to see from us.”

Within weeks, the Alliance for a New America, a 527 group organized just to boost Edwards' last-minute media spending in Iowa, came into existence.  The group portrays itself as an issue advertising group, able to operate outside the legal restrictions of the federal campaign finance laws.  Its goal is to help Edwards, who is specifically promoted in its advertising. Consistent with the close coordination envisioned by the planners, key individuals involved in this organization and steering its activities are close associates of the Edwards campaign. 

Hillary Clinton

Of all of the candidates and interests groups participating in this campaign, the American Federal State County Municipal union (AFSCME) is running perhaps the most negative and misleading campaign. To date, they have spent $1.3 million on radio ads and direct mail – with over $300,000 spent on negative ads targeting Obama – and are reportedly readying a negative television campaign against Obama.

The ads have mischaracterized Obama’s universal health care plan. AFSCME has attacked Obama’s plan for not including an individual mandate, when it is the official position of AFSCME to oppose an individual mandate.  The President of AFSCME testified at a Congressional hearing in 2006 that “we are concerned with the direction reform efforts have taken in some states.  For example, the Massachusetts reform model attempts to achieve near universal coverage through the use of individual mandates.” 

Clinton also has benefitted by spending from Emily’s List and the AFT, who have spent $485,777.43 and $799,618.59 respectively on her behalf.

This unprecedented level of outside spending could impact the outcome in Iowa and New Hampshire, and we believe voters in these states deserve to know exactly how much is being spent, where it’s coming from, and who’s benefiting. 

TOTALS 

CLINTON

AFSCME: $1,333,456.96 (includes $309,545.60 explicitly against Obama)

AFT: $799,618.59

Emily’s List: $485,777.43

Total: $2,618,852.98

EDWARDS

Working for Working Americans/Carpenters: $526,440.76

Alliance for a New America (SEIU): $1,530,411.77 (this includes $769,000 that has not formally posted)

Democratic Courage: $20,410.00

Total: $2,077,262.53

In recent weeks, we have seen an important shift in the campaign, and fifty-one days before the Iowa caucus, Barack Obama is strengthening his position in the Democratic presidential nominating race, while other candidates are stagnating or weakening. Voters in Iowa and New Hampshire are beginning to focus on the race more intently and are increasingly making decisions.  And as they do, Senator Obama is profiting at Senator Clinton’s expense.

Even in Nevada and South Carolina, where the electorates are not as broadly engaged, the race is moving in a positive direction for Barack Obama’s campaign.

Obama received an important boost at the Iowa Jefferson Jackson Day Dinner on Saturday night where his organization outperformed all of the other candidates, and his speech was the best received by the audience and important caucus observers like the Des Moines Register’s David Yepsen.

Late last night your extraordinary efforts closed the gap in resources between us and the Clinton campaign. We had expected that the drive would continue into next week, but the overwhelming response from so many of you accelerated that timetable.

The success of this drive is a clear example of how we can change politics together. Tens of thousands of ordinary people stepping up to close the gap, determined to make your voice heard above that of the special interests and Washington lobbyists.

Since this election began, you have made our campaign more competitive than anyone believed we could or would be. Now that we're in the home stretch it's going to become even more clear that you can help determine the outcome of this election.

People out there are hungry for change that they can believe in, and we know the more people learn about Barack Obama, the better we do. Your time, your dollars and your willingness to reach out to people on behalf of this cause will make the difference.

The first contest will likely occur in less than 80 days. We look forward to working with you in these closing weeks to elect a President we can trust and believe in who will unify us and will connect people back with their government.

Thanks for all you do.

It has been about a month since our last memo updating you on the progress of the campaign. In that time, the campaign has entered the critical post-Labor Day phase where the pace will pick up and the public will become more engaged in the campaign.

Barack kicked off this new phase of the campaign with an important speech at a Labor Day rally where he framed the critical choice that voters face in this election. This speech had two key elements: First, he took the issue of experience head on, making the point that he "may not have the experience that Washington likes, but he has the experience that America needs" to bring change. Second, Barack talked about how it is not going to be enough to change parties; we have to change our politics. Our problems and our failures on big issues like health care, energy, and education pre-date the Bush Administration and real change requires a President who is capable of truly transforming our politics.

As someone who has spent 20 years in public service, standing up to the special interests and bringing people together to enact change, Barack is the only candidate with the right kind of experience in this race. Barack and the campaign will take this case to voters in the four early states and the February 5th states in the coming weeks and months.

Earlier this week, the campaign launched two new powerful ads in Iowa that further this case. You can see the ads by clicking here: "Believe" and "Mother".

It is important to take a moment every once in a while to reflect on all the progress we have made together in this campaign.

When we got into this race as a largely unknown candidate new to the national political stage, we never expected that nine months later at this stage of the race, we would be in a tight three way race in Iowa; leading in the money race; have the largest grassroots organization in modern political history; and have an organizational advantage in the early states and February 5 over a quasi-incumbent from the most powerful political machine in modern political history.

While the press remains focused on the simplistic and erroneous view of national polls as predictors, the Obama campaign has several structural advantages:

• Barack is the candidate with the message and biography that is most in synch with the electorate -- according to a Gallup poll in September Democratic voters prefer change to experience by a margin of 73 percent to 26 percent;
• The largest organizations with the most experienced staff and enthusiastic volunteers in the 4 early states;
• An unexpected financial advantage that allows the campaign to compete in multiple contests at the same time;
• The most donors by far in the race, who as the election draws nearer will get even more active on our behalf, giving us financial sustainability;
• A significant organizational advantage in February 5th states.

Iowa is fundamentally a close three-way race with Obama, Clinton and Edwards all within the same range in most public polling. In the last month, public polls have shown each of the three candidates leading. But the truth is, caucuses are very difficult to poll, particularly in a year where turnout will likely explode with many new attendees. So instead of focusing on the polls, we are much more focused on the growth of our hard count (number of committed supporters) statewide and we remain ahead of schedule in that regard. And there are other positive trends that have emerged that are worth noting.

Because we will likely enter the caucus with thousands of potential first-time caucus attendees committed to Obama, organization is paramount. Last weekend’s Harkin Steak Fry -- Senator Tom Harkin’s annual event, where six of the Presidential candidates attended -- showcased the strength of the Obama Iowa operation in the first head-to-head battle of organization. It is estimated that 5-6,000 people attended who were committed to candidates. Of that number, approximately 3,000 Obama Iowa supporters attended. It was described by many press accounts as akin to an Obama rally. That shows not just our organizational strength, but a real commitment from our county and precinct leaders, as well as our committed supporters. Our dominating presence at the Steak Fry is an example of the enthusiasm gap that we enjoy over our fellow candidates. Our supporters will drive for hours and walk for miles to help elect Barack to the White House. "Organization plus Enthusiasm" is a time-tested formula for success in the caucuses and that is the path we are on.

Below is a picture of the Obama supporters entering the Steak Fry:

As Ben Smith of the Politico put it: "Iowa field operatives make a big deal of "visibility' -- making sure their campaigns have high profiles at high-profile events. On that note, you could mistake Tom Harkin's steak fry for an Obama rally. It was in fact preceded by an Obama rally, and the train of Obama supporters behind a marching band stretched for at least a hundred yards. His campaign said he'd given out 2,000 T-shirts, a number that seemed plausible." LINK

On a related point, polls consistently under-represent in Iowa, and elsewhere, the strength of Barack’s support among younger voters for at least three reasons. In more than one survey, Barack’s support among Iowa young voters exceeded the support of all the other candidates combined. First, young voters are dramatically less likely to have caucused or voted regularly in primaries in the past, so pollsters heavily under-represent them. Second, young voters are more mobile and are much less likely to be at home in the early evening and thus less likely to be interviewed in any survey. Third, young voters are much less likely to have a landline phone and much more likely to rely exclusively upon cell phones, which are automatically excluded from phone surveys. So all of these state and national surveys have and will continue to under-represent Barack’s core support -- in effect, his hidden vote in each of these pivotal early states. Of course, there are organizational challenges associated with maximizing this support, but we are heavily focused on that task.

It is also clear that the importance of Iowa has only grown over the course of this year. The Democratic story coming out of Iowa is likely to be a much bigger story than the GOP contest, ensuring maximum velocity for a strong showing. Clinton will pay a severe price for not winning Iowa - national front runners always do. The average New Hampshire bounce on the Democratic side has historically been just under 20 points. Our internal data and most of the public polls show Obama with a solid foundation, despite having done no TV advertising or even direct mail. Those activities will begin in the near future. The demographics of the state would suggest that we will be able to build on our foundation as we begin to devote significant resources there, turning New Hampshire into a tight race over the coming months and almost ensuring that a positive Iowa result will result in a New Hampshire primary win.

Nevada is less formed than the other early states, but since it is a caucus, our focus has been on building precinct organizations. We already have 2,000 volunteers in the Nevada, which is far and away the deepest volunteer organization in the state.

There was one recent poll in South Carolina that showed Clinton with a sizable lead, but we believe that was an outlier. It had her with a healthy lead in the African-American vote, which is not what we believe to be the case. In fact, a public poll of just African-American voters was released last week that showed Obama with an eight point lead, which would result in a much closer contest in the entire primary electorate.

We believe South Carolina is now a very competitive two-way race, with Edwards, who won this contest in 2004, in a very distant third. Momentum will likely be king in South Carolina, but we are building an unprecedented grassroots organization to maximize our vote and to help provide the margin in a close contest.

We have begun to deploy staff and build organizations in some of the February 5th states. We currently have staff in California, Colorado, Missouri and Minnesota and will have staff in over a dozen other states by the end of October. While momentum will likely be the dominant factor in deciding votes on February 5th, we plan to marry that momentum with the strongest organization and most financial resources in these February 5th states to emerge from that day with the most delegates and states won.

The State (Aaron Gould Sheinin)
Obama taking grass-roots approach in S.C.: Democratic presidential hopeful Barack Obama is using cyberspace, the U.S. Mail and the equivalent of political Tupperware parties to build a more extensive grass-roots campaign than S.C. Democrats ever have seen before, observers say… "The Obama campaign is doing a more extensive grass-roots effort than has ever been done in South Carolina before," said Democratic Party chairwoman Carol Khare Fowler, who is not supporting any candidate in the Jan. 29 primary. LINK

Denver Post (Karen Crummy)
Obama beefs up Colorado support: Democratic presidential candidate Barack Obama, the only candidate with ground troops in Colorado, is organizing a significant grassroots campaign in the state, according to his campaign manager. "This will be a delegate by delegate battle," said David Plouffe in Denver on Thursday. "Because we have had success financially and enthusiastic grassroots supporters we can starting getting things in place for February 5th states." LINK

Santa Barbara Independent (Chris Meagher)
Barack Obama Rocks Santa Barbara: Presidential candidate Barack Obama rolled into Santa Barbara on Saturday with the message that’s become the backbone of his campaign: Hope. More than 3,000 people were in attendance at Santa Barbara City College to hear the popular democrat share his plans for the future, touching on such issues as health care, education, and the war in Iraq. LINK

New York Times (Michael M. Grynbaum)
Obama Urges Wall Street to Protect the Middle Class: Senator Barack Obama chastised Wall Street executives yesterday as failing to protect middle-class interests and called for increased federal oversight of credit rating agencies, including a government investigation. In an appearance at Nasdaq offices in Midtown Manhattan, Mr. Obama, a Democratic presidential candidate, praised America’s free-market impulse but lamented what he characterized as its recent toll on the middle class. LINK

Portsmouth Herald (Michael McCord)
Obama unveils tax cuts for middle class: Presidential hopeful Barack Obama became the first Democratic candidate to unveil a detailed middle class tax-cut proposal, one that he believes will restore "fiscal responsibility and a sense of fairness." In a speech titled "Tax Fairness for the Middle Class," delivered Tuesday in Washington, Obama said his five-part $85 billion plan would cut taxes for more than 150 million Americans (including as many as 800,000 in New Hampshire), cut all taxes for seniors making less than $50,000, institute a mortgage tax credit, simplify the tax code and crack down on tax havens, and close corporate loopholes. LINK

The Atlantic (Marc Ambinder)
At SEIU, Obama: Rocked The House: ...SEIU's members are temperamentally suited to Obama; he is a longtime friend of Chicago's SEIU Local 880 and worked closely with the union as an organizer and later as a state legislator. Obama entered the ballroom to cheers, but he left to a sustained chorus of chants: "Obama!, Obama!" The SEIU president, Andy Stern, had to calm his members: ""Everybody take your seats, please. We have other candidates."