WASHINGTON — On a balmy South Florida night in January, President Donald Trump's top campaign donors gathered at the Palm Beach estate of billionaire Bill Koch for a thank-you party hosted by Republican National Committee chairwoman Ronna McDaniel and Trump son-in-law Jared Kushner.
They had a lot to celebrate. In 2019, the Trump reelection effort, which is composed of the official campaign committee and several joint committees with the RNC, raised $463 million. While Democrats continued burning through money in a 20-candidate primary, Trump would enter the last nine months of the race with more cash than any incumbent in history.
"The president's war chest and grassroots army make his reelection campaign an unstoppable juggernaut," said Brad Parscale, Trump's campaign manager at the time.
But that was eight months — and more than 200,000 American lives — ago.
With less than six weeks before Election Day and voting underway in several states, Trump and the Republican Party trailed Democrat Joe Biden and the DNC in the crucial metric of cash-on-hand by about $140 million. This is a stunning reversal of fortune for the GOP and a situation many Republicans once considered unimaginable. The coronavirus is a major reason why.
The pandemic, which has killed a million people worldwide, has fundamentally changed the 2020 presidential campaign, particularly the money race. How the two general election campaigns have raised and spent more than a billion dollars (and rising) in campaign donations that they have collected this cycle could hardly be more different, though.
Trump has operated a major reelection effort since the day he was inaugurated, helping him build what Parscale once called a "Death Star." When the coronavirus pandemic put much of the nation on hold this spring, however, Trump was forced to cancel in-person campaign fundraising, cutting off a key source of donations: midlevel contributors.
These are donors willing and able to give $100,000 to a joint committee but who differ from the very highest echelon of donors, the $1 million and up club, in that they still demand visibility in exchange for their donations. Typically, this means a chance to rub elbows with fellow big donors at a cocktail party, to pose for photos with the candidate, and to have their name appear on a special list of supporters.
Unlike Biden, Trump has never really embraced the idea of virtual fundraisers, despite urging from strategists and donors who see them as cheap to put on and requiring relatively little from the candidate. In the end, Trump advisors said the president's reluctance to hold virtual fundraisers was mostly because he just didn't like them.
Meanwhile, Biden found himself unable to campaign in person this spring and behind the curve in building a sophisticated nationwide campaign operation. Biden kept his costs way down by going virtual, while the Trump campaign burned through cash.
The former vice president also raised millions of dollars through Zoom fundraisers, often appearing on screen to "chat" with several hundred people who had each paid $1,000 or more for the privilege of joining the call.
"For Biden's fundraising, I would argue [the pandemic restrictions] have been an advantage, and the numbers reflect that," said John Morgan, a Florida-based campaign bundler for Biden.
When Biden was finally able to start appearing and campaigning again in public in August he exploded onto the money scene, turbo-charged in part by pent-up donor demand. This, plus Democrats' excitement over his running mate, Sen. Kamala Harris of California, helped the campaign and its affiliated committees raise a stunning $364.5 million in August, more than any presidential candidate before him has raised in a month.
Biden is also spending this money very differently than Trump is spending his. Rather than invest in live door-to-door canvassing, Democrats this cycle have put their faith in phone conversations, texts and digital outreach, effectively betting that the voters they most need to reach don't want to talk to strangers at their doors.
Trump's campaign and the RNC, meanwhile, have continued to build an army of paid and volunteer in-person canvassers, putting their faith in a traditional "ground game" and increasingly, in traditional campaign rallies with the president.
While Biden leads in national and several swing state polls, both campaigns expect the race to be bitterly fought and the margin of victory razor-thin. So it won't become clear until some time after the Nov. 3 vote which candidate had the better strategy for raising and spending campaign cash.
The money race in 2020 has become a real-life experiment, one that pits traditional models of campaign financing against untested new models in a field trial that spans the entire country.
It was in March, when coronavirus infections skyrocketed from around 25 new cases a day at the start of the month, to 25,000 a day by the end, that both campaigns realized that they could no longer hold the kinds of events that are probably most important for any presidential campaign: intimate in-person fundraisers and large campaign rallies.
On March 11, Biden canceled several rallies and fundraisers, citing the virus. A week later, CNBC reported that Trump and the Republican National Committee would suspend fundraising events for the foreseeable future. Instead, a Trump campaign spokesman said the plan was to shift to virtual fundraisers, something Biden was also working on at the time.
But only one campaign followed through: The Biden campaign held more than a dozen virtual fundraisers with the former vice president in April and May, gradually improving with each one on the quality and execution of this new kind of political cocktail party.
"If you have a lot of people invited, we found that you have to provide a hook or some entertainment," said Patrick McHugh, executive director of Priorities USA, the highest-raising super PAC on the Democratic side.
And entertain they did: Amy Poehler, Nick Offerman, Jimmy Buffett, James Taylor, Billy Porter, Carole King, Melissa Etheridge and Kristin Chenoweth are just some of the celebrities who have helped make Biden's Zoom fundraisers more fun.
Biden also held a successful Zoom fundraiser with former President Barack Obama in mid-June, pictured below.
Yet while Biden was leaning in to Zoom events this spring, Trump appeared to be holding back.
The president waited until July 21 to hold his first virtual fundraiser. This was four months after Biden had started holding them in earnest, and even after Trump himself had already resumed holding in-person cocktail party events after a three-month hiatus.
That first Trump virtual fundraiser was a big success. His campaign said it raised $20 million in donations from more than 300,000 individuals during the event.
Biden, despite trailing Trump on practically every other digital metric (Facebook followers, online content viewers, Twitter interactions), steadily grew his Zoom fundraising over the late spring and summer. He also benefited from the fact that virtual events cost relatively little in candidate time and campaign resources.
"Instead of traveling with lots of down time to events that may or may not pan out, he has been able to focus on the debates, his message to America and building his transition team," Biden bundler Morgan told CNBC.
As Biden established a clear national polling lead over Trump, he also drew the support of Wall Street executives, many of whom had stayed on the sidelines during the yearlong Democratic primary.
In the past few months, Wall Street Democrats have contributed in ever greater numbers to Biden's joint fundraising committees, where donors can give upwards of $600,000. They've also focused on helping organize virtual fundraising events that have raised millions of dollars for the campaign and the Democratic National Committee.
Many of these donors have fared well financially under the Trump administration, with its massive tax cuts and laissez-faire approach to markets. But for many top Wall Street executives, the president's handling of the coronavirus tipped the scales in Biden's favor for them.
There were already signs in April that Trump's fundraising dominance was slipping away. That month, the Trump Victory effort reported raising $61 million. The Biden groups raised $60.5 million. The days of the "unstoppable juggernaut" were over.
Kimberly Guilfoyle, the national chair of the Trump Victory Finance Committee, told CNBC that the campaign "quickly switched to virtual fundraising" when the pandemic hit, "and we hosted a large number of online fundraising events that were driven by our Trump Victory Finance Committee members."
These events were private, however, and few details been released. In late May, CNBC reported that White House officials were taking part in the fundraising events as "special guests," skirting ethics laws that prohibit federal employees from using their official titles at campaign fundraisers. Among the officials participating was top Trump economic advisor Larry Kudlow.
What they didn't have, however, was Trump. With the president largely absent from the fundraising scene, it was easier for Biden to catch up than it would have been in a normal year.
By the end of June, Biden's campaign committees had about $50 million less than Trump's, $242 million in cash to Trump's $295 million. The next month, that $50 million deficit had shrunk to $6 million.
Then Biden had his incredible August, and entered September with $466 million in cash on hand. Trump's campaign, once seen as financially invincible, had $325 million, a gap of $141 million.
"As a fundraiser, I'm exasperated and galactically deflated that the enormous lead we had in February has dissipated," Trump donor Dan Eberhart told CNBC. "It's definitely a cause for alarm."
Democrats were equally shocked.
"If you'd asked me at the beginning of the year to make a list of 100 things that could go wrong for Trump, I don't think running out of money would be on it," said William Galston, a senior fellow at the Brookings Institution who has worked on six Democratic presidential campaigns.
Eberhart also defended the president, saying Trump had a "much more complicated path than Biden did in terms of how to keep raising money" while the pandemic raced across the country this spring.
"Trump had to walk this tightrope of, 'I'm leading the country, and I have a pandemic, and later he had the Black Lives Matter movement to contend with,'" said Eberhardt. "So to simultaneously be raising money while dealing with all these crises just looked bad."
Fundraising isn't the only part of the campaign finance equation that was unimaginably altered this year due to the pandemic. So were key decisions about how to spend all that money.
In the initial weeks of the pandemic, both campaigns looked like they were tactically responding to the outbreak in a similar way. As cases exploded in March, Biden and Trump announced they would suspend in-person campaign rallies and door-knocking efforts.
Biden and the Democrats used the next three months to change nearly everything about the nuts and bolts of the campaign, eschewing many of the ground-level organizing techniques that Obama pioneered in 2008, and instead opting to go almost entirely digital.
"Fundamentally, knocking on a door and not reaching anyone doesn't get you much except leaving a piece of [campaign literature] behind. You might as well send a piece of mail," Biden campaign manager Jen O'Malley Dillon said at a recent event hosted by Politico.
"I know the Republicans want to say, 'Oh we have, you know, a million door knocks a week.' Well, that doesn't really matter. What matters is the conversations you're having. We have over 2,500 staff across all of our battleground states directly engaging with voters. They're doing it over the phone, they're doing it via text, they're doing it online, they're meeting people where they are," said O'Malley Dillon.
Since the middle of the summer, Biden has slowly begun to do more events, and by mid-September he had resumed traveling several times a week to battleground states. But even with a ramped up schedule, the former vice president's political events bear little resemblance to Trump's rallies.
There are no big crowds, for one. Instead, the audience is usually made up largely of reporters covering the event, who are seated 6 feet apart. Everyone wears a mask, and Biden only removes his own when he's ready to speak into the microphone.
For the Biden team, this heightened sense of caution reflects both common sense and messaging integrity.
Ever since March, Biden's campaign and Democratic super PACs have made criticism of Trump's coronavirus response the centerpiece of their messaging. Like much of Biden's post-pandemic campaign, this is primarily an advertising effort conducted online and over the airwaves. Democrats and Republicans acknowledge it has been effective, and was deployed at a critical moment in the campaign.
"Trump had net approval early on in March because he was looking presidential and holding his daily briefings," said McHugh, of the Democratic outside group Priorities USA. "But we made sure that voters were getting the full picture of his failures as early as possible, and that we were up on the air with a counter message to his briefings in March and April and May."
Below is an ad that's widely considered one of the most impactful ads of the 2020 campaign cycle. Priorities USA began running it in March.
Eberhart, the Trump donor, also pointed to the early spring as a crucial moment in the presidential race, and he criticized the leading pro-Trump super PAC, America First Action, for not having been more proactive in the first months of the pandemic.
"They should have spent their money sooner to define Biden," he said. "And then, when Biden defined Trump [over coronavirus], they should have been ready to go. But they never responded the way they should've."
America First Action President Brian O. Walsh rejected Eberhart's critique. "America First Action began spending in the spring and hasn't stopped," he told CNBC.
With less than 45 days until Election Day, the pro-Biden effort, flush with cash, is outspending Trump on TV by a significant margin.
While the Biden campaign devised its general election strategy and its primary message as direct responses to the pandemic, the Trump campaign did the opposite.
In Trumpland, the pandemic was viewed not as the defining feature of this election, but instead as an obstacle on the way to making as many in-person contacts with voters as possible.
Practically from the beginning of the outbreak, the president downplayed the threat of the virus in public, and his campaign staff did so in private.
After working from home for several months this spring, Trump campaign aides returned to their Arlington, Virginia, headquarters in June, where employees do not wear masks or socially distance.
Trump also returned to the rally stage in June, for what was billed as a massive rally in Tulsa, Oklahoma. But when the expected crowds did not show up, the rally looked like a flop. A second rally a few days later at a megachurch in Arizona drew further criticism for flouting safety protocols.
Trump would not hold another rally again until the middle of August. But since then, he has held 15 live rallies, mostly at large, outdoor airport hangars. The Trump campaign calls them "speeches" now, instead of rallies.
Below is a crowd photo from a Trump rally in Henderson, Nevada, on Sept. 14.
The resumption of rallies for Trump translated directly into a surge in event-related expenses, according to Trump campaign filings that were submitted to the Federal Election Commission.
In August, Trump and the RNC spent $6.8 million on event expenses, along with additional money for rally-related security. Biden and the DNC, on the other hand, spent less than 4% of what Trump did on events that month, just $240,000.
The Trump campaign says it adheres to pandemic safety precautions by supplying free masks and hand sanitizer at all of its speeches. But these measures are undermined by the fact that once the rally is underway, Trump supporters are packed in shoulder-to-shoulder with one another, without any social distancing. Barely anyone wears the masks that are given out.
In a tacit acknowledgement of how risky these large events are, the Trump campaign requires anyone who attends a rally to sign a coronavirus liability release, promising not to hold the Trump campaign liable if they get sick.
Big rallies aren't the only campaign activity that has resumed. Across the country, the Trump campaign has spent the summer organizing in person meet-ups, door knocking, interest group events and volunteer training sessions.
In response to questions from CNBC about how the campaign has adjusted its ground-level organizing in response to the pandemic, the Trump campaign and the RNC said their volunteers and staff "are adhering to local guidelines and taking necessary safety precautions such as abiding by wearing masks and exercising social distancing."
The gulf between what the Trump operation says people are doing to stay safe, and what videos and photos actually show people doing is a wide one. Yet for Trump and his campaign, going all-in on live gatherings is a strategic choice, and they plan to continue reaching voters in person as much as they can.
"Trump campaign volunteers are safely knocking on more than a million doors a week and making millions more phone calls to voters because people appreciate the contact and want to hear directly from the campaign," Trump campaign spokesman Tim Murtaugh told CNBC.
Spokespeople for the campaign and the RNC specifically pointed to canvassing neighborhoods on foot as a hallmark of their election plan and a key difference between the Trump operation and the Biden campaign.
"It's widely proven that door knocking is the most effective and motivating way to turn out voters," RNC spokeswoman Mandi Merritt told CNBC. "Nothing can replace the face-to-face connection you can make with someone at the door, asking for their vote and talking about shared values."
Based on models of previous elections, Merritt is correct: Door-to-door contacts tend to yield more votes per 1,000 people contacted than phone calls do. However, there are some important caveats this year, according to a Vox.com analysis of the latest political science research on voter contacts, published earlier this month.
The first is that during a pandemic, it's reasonable to believe that people wouldn't be as receptive to strangers showing up at their doors to talk politics as they might have been in years past.
Another is that research shows door-to-door canvassing is most effective when a candidate has low name recognition, and the campaign volunteer can actually tell the voter about a candidate. Biden and Trump have near universal name recognition, however, which means most voters can't be persuaded to support them if they don't already.
Then there's the final stipulation. In the digital age, virtual outreach from people within social networks delivers more of an impact than door-knocking or TV ads.
"The most effective thing that anyone can do is go out and s--- post and talk to their friends and tell people what they believe and what they care about," said Democratic data analyst David Shor. "That's what politics is about."
--- CNBC's Brian Schwartz contributed to this report