Friday, May 09, 2008

Obama will not rule out easing Clinton campaign debt

This is from The New York Times:

Updated WOODBURN, Ore. – Senator Barack Obama said today that he would not rule out the possibility of helping Senator Hillary Rodham Clinton retire her campaign debt to bring her into the fold and unify Democrats. But he said no discussions have taken place yet.

“Obviously, I’d want to have a broad-ranging discussion with Senator Clinton about how I could make her feel good about the process and have her on the team moving forward,” Mr. Obama said. “But as I said, it’s premature right now. she’s still actively running and we’ve still got business to do right here in Oregon and in other states.”

Mr. Obama stressed that it was premature to talk about lending aid to his rival, declaring: “That’s not a conversation that we’ve had because our working assumption right now is that we’re still in the middle of a race.”

To keep her campaign afloat, Mrs. Clinton has lent herself money several times in recent weeks, amounting to about $6 million within a month or so. The debt that her campaign has accumulated has become a focal point of questions surrounding the future of her candidacy. Speculation has spread – by supporters of both candidates – about whether Mr. Obama throwing a financial lifeline would help bridge the divide between the partisans and offer Mrs. Clinton an exit strategy.

Mr. Obama suggested today that there would be some precedent for helping erase her debt.

“I think historically after a campaign is done and you want to unify the party – particularly when you’ve had a strong opponent,” Mr. Obama said, “you want to make sure that you’re putting that opponent in a strong position so that they can work to win an election in November.”

Update on Debt: If Mr. Obama and Mrs. Clinton would happen to broker a deal to help pay off her campaign debts – this remains a big if, aides said, because nothing has been formally discussed – the money would not be taken from Mr. Obama’s campaign account. Instead, he would have to make a fund-raising appeal on her behalf, asking people to contribute.

The remarks by Mr. Obama earlier today stirred alarm among several contributors. They said they did not give money to him simply so he could turn it over to Mrs. Clinton.

Advisers to Mr. Obama sought to tamp down concern over the discussion. On one hand, they are trying to extend an olive branch to Mrs. Clinton and her supporters, whom they will need if Mr. Obama becomes the nominee. On the other hand, they do not want to alienate loyal contributors who were responsible for Mr. Obama’s fund-raising prowess.

For now at least, the latter hand – not helping pay off the debt – seems to be the most likely course of action.

What we're probably seeing here is the beginnings of a negotiated settlement between the Clinton and Obama campaigns to bring Hillary Clinton out of the race. Clinton could continue to campaign in West Virginia, and in Kentucky, where Clinton has scheduled a May 9th fund-raising event in Louisville. Kentucky is holding its primary on May 20th--the same day that Oregon is holding its primary. And while the Kentucky polls are showing Clinton well ahead of Obama, averaging 62 percent to 28 percent, the Oregon polls are showing Clinton's lead eroding quickly, averaging 36 percent to 28 percent. In fact, both Rasmussen and Survey USA are showing Obama leading Clinton by 51-39, and 50-44 percent. So the question becomes how long will Hillary Clinton campaign before she runs out of money? Because if Clinton is planning to suspend, or withdraw, from the race, the best time will be after she wins a victory and gracefully concedes the nomination to Obama. And while all this latest campaigning is taking place for the media publicity, both campaigns could be negotiating the deal for Clinton's exit strategy.

Of course, this is all speculation.

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