There’s another budget crisis in Washington, and it’s unfolding inside the Democratic party. The Democratic National Committee remains so deeply in the hole from spending in the last election that it is struggling to pay its own vendors.
It is a highly unusual state of affairs for a national party — especially one that can deploy the President as its fundraiser-in-chief — and it speaks to the quiet but serious organizational problems the party has yet to address since the last election, obscured in part by the much messier spectacle of GOP infighting.
The Democrats’ numbers speak for themselves: Through August, 10 months after helping President Obama secure a second term, the DNC owed its various creditors a total of $18.1 million, compared to the $12.5 million cash cushion the Republican National Committee is holding.
Several executives at firms that contract to provide services to the party — speaking anonymously to avoid antagonizing what remains an important if troubled client — describe an organization playing for time as they raise alarms about past-due bills falling further behind. And senior strategists close to the DNC say they worry the organization appears to have no road map back to solvency. “They really thought they could get this money raised by the summer,” one said, “but the fact is, from talking to people over there, they have no real plan for how to solve this.”
DNC national press secretary Michael Czin says the committee is working with vendors on a case-by-case basis to pay down their tabs. And filings show the organization over the last five months has made $4.5 million in payments to the Amalgamated Bank and appears to be hewing to a $1 million-per-month installment schedule now. “While we work to retire our debt, we’re not taking our foot off the pedal and are making the investments that will help ensure that Democrats are successful in 2014, 2016, and beyond,” Czin said. He pointed to ongoing work by the DNC’s National Finance Committee, which met over the weekend in Colorado to discuss fundraising strategy.
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