In 2006, we were lucky that voters held Republicans accountable for Iraq and corruption. Luck is not the only thing on our side this time. While Republicans usually out-raise us in campaign funding, this election cycle we Democrats have sensed opportunity and reversed the relation. However, if we are to begin winning elections not by chance but because of our ability to consistently out-fundraise Republicans, we must first understand why, aside from rare, anomalous, instances, Republicans routinely raise more cash than we do. Upon analysis, the answer becomes glaringly obvious.
Our money comes largely from the salaries of our wage-earning donors, while Republican money comes largely from the profits wealthy donors earn selling Americans products. The way to end this major fundraising disadvantage is equally obvious; we need to beat the Republicans at their own game by selling our own products. The rest of this diary describes how, if we begin now, we can sell enough products to raise several million dollars for Democratic campaigns by October 2008, and if we keep working beyond November, we can raise at least $100-200 million dollars for the 2010 elections.
To anyone who thinks we're already trying to do this with BuyBlue and other "percentage of profit" schemes, let me be very clear that what I'm talking about is not the selling of products by individuals or corporations who donate 1%, or 5%, or even 20% of their profit to the Democratic Party. I'm talking about the big money we can raise by creating companies that donate the full 100% of their profit to helping elect Democrats. Before showing that this is doable by presenting some companies that already donate all of their profits to progressive causes, I'll briefly describe how product profits would flow from our company to the electing of Democratic candidates.
Let's say we start a company that sells food products to compete with the food products Philip Morris (they now call themselves Altria and spun off Kraft Foods in March, 2007) sold in North America in 2006 to generate $23 billion in net revenues. Our products are basically equal in quality to competing products, and we sell them for basically the same price. Why would shoppers buy our products over those of Philip Morris? Because, as is printed on each of our products' labels, and as our legions of bloggers will have plastered all over the Internet and elsewhere, we donate the profits from the sale of our products to organizations fighting global warming (or enhancing education or curing diseases, or addressing any number of other causes that the public broadly supports). So, our company markets the food products, and donates 100% of the profits to the Sierra Club. In October of 2008, the Sierra Club uses that money to pay for a barrage of TV ads that warn Oklahoma voters about Senate candidate and global warming denier, James Inhofe, and explain how dangerous he is to their children and grandchildren's welfare. The strategy is simple, effective, and legal.
Can we really expect to raise a lot of money for Democratic candidates by creating companies that give 100% of their profit away? Well, first consider that UNICEF (United Nations Children's Fund), who began selling greeting cards in 1949, has raised over one billion dollars for children this way, and that each year their greeting cards generate 130 million dollars in profits - http://www.unicef.ca/... - (If this link doesn't take you to "UNICEF CARDS AND GIFTS FACTS," right click on it, select properties, and copy and paste the url onto your address bar). UNICEF sounds too "institutional'? Well consider how college buddies Xavier Helgesen, Jeff Kurtzman and Chris Fuchs founded Better World Books in 2002, and have donated all of their $4.24 million in profits to the cause of literacy and education. Sounds like not enough money? Consider that the AAFES (The Army and Air Force Exchange Service), run by our U.S. Department of Defense, has been selling discounted products and services to our military personnel since 1900. It gives its profits back to the soldiers in the form of quality-of-life programs, and has generated over $2.3 billon from these products during a recent 10 year period.
Who else is selling products and giving all of their profits away? Well, Robert Kennedy Jr. founded a company in 1998 called Keeper Springs whose bottled water has raised over $500 thousand for clean water organizations. Actor Paul Newman's company, Newman's Own, has been selling food products since 1982, and has donated all of its over $200 million in profits to progressive causes. Even the Girl Scouts of America raise money by selling products; each year their brief cookie selling campaign earns them over $300 million.
Here are some other 100% profit-donating companies you can check out; Humanitas Wines, $30 thousand since 2001; Under One Roof, $3.8 million since 1990; Merit Telecom, over $185 thousand since 2000; Peacekeeper Cosmetics, over $85 thousand since 2001; Charles, Prince of Wales' Duchy Originals, £6 million since 1992.
I wanted to see for myself how many shoppers would prefer to buy their products from a company that donates its profits to a worthy cause rather than from a conventional company. So, two ladies and I stood in front of a supermarket, and we asked 100 shoppers the following question; "If your supermarket offered new food products that were equal in price and quality to the products that you now buy, and you knew that 100 percent of the profit from these new products would be used to end world hunger, would you buy these new products?" 92 of the shoppers said yes.
O.K., so maybe you're convinced that selling products would be a good way to raise millions of dollars to elect Democrats to the White House, Congress, and elsewhere. But, maybe you think this is out of our reach because selling a product is expensive, and it demands a lot of know-how. For an in-depth explanation of how not-expensive and not-involved this kind of enterprise really is, you might want to check out Paul Newman's book Shameless Exploitation in Pursuit of the Common Good: The Madcap Business Adventure by the Truly Oddest Couple wherein he explains exactly how he did it, or read this article as an intro. For now, know that Newman started his company with only $20,000 (he had earmarked $40,000 for the project, but only spent half that amount), and that he and his partner, Alex Hotchner, had absolutely no food marketing experience before they began. How'd they do it? Well, basically they formed an "S" corporation, and outsourced manufacturing and distribution. Also, their entire staff consisted of Alex and Paul, a part-time secretary and a part-time bookkeeper.
Now let's cut to the chase. A few paragraphs back I said that if we start now, our companies that exist to generate campaign funding for Democrat candidates could raise $100-$200 million in time for the 2010 election. Is this grandiose, wishful thinking or a realistic goal? Let's go through the numbers. We'll do a rough ballpark projection using Newman's Own as our model, knowing full well that as influential a celebrity as Paul Newman was in 1982 when he started the business, the Blogosphere today has far more clout and contacts to push products than Newman had 25 years ago.
In September of 1982, Newman launched his first product with $20 thousand. In 2007 dollars, that comes to about $42.5 thousand. So, let's say we invest about $2.12 million to launch 50 products. After its first year, Newman's product had earned one million dollars in profits. So, by launching 50 products next summer, we can expect to earn at least a few million dollars by November 2008, and $50 million by the summer of 2009. Newman launched a second product in February of 1983, and a third product in July of 1984. By the end of 1984, the three products had earned a total of $4 million in profit. (Newman's figures are on pages 205 and 206 of his book, Shameless Exploitation in Pursuit of the Common Good.... To access the online "Chronology" where Newman cites these earnings, first visit this "Search Inside" page, type "204" in the search box, click "GO," and then click the "from Back Matter" link. The $4 million figure appears on page 205.)
So from three products, Newman's Own earned an average of $148 thousand per month over 27 months. Extrapolating from these earnings, by the summer of 2010, our products would earn about $177 million ($148,000 times 24 months, times 50 initial products rather than one).
Not too shabby a fundraising drive by our company employees who would, of course, earn a decent salary for their labor. Remember, Newman outsourced manufacturing and distribution, and so would we. We would not have to own or rent a single factory or warehouse. We raise $177 million for Democratic candidates in two years by selling products to launch a major offensive against the Republican Party in 2009 and 2010. Sweet.
And that's the plan. Shoppers get the opportunity to buy from a company that donates its profits to organizations working on progressive causes rather than from companies that will probably use their profits to finance Republican candidates who'll oppose that work. The organizations our companies donate their profits to use that money to attack Republican candidates. We fight fire with fire, and win...Big.
What would all of this mean for the Blogosphere? Well, we've had major victories, and we're now a force that politicians ignore only at their peril. Championing, promoting, and setting up these fundraising companies would probably bring about the most forceful leveling of the economic playing field in the history of democratic elections. We would be restructuring our capitalist democracy so that it stops catering to the rich and powerful, and finally begins sufficiently representing the millions of us who are America. Let's get this done.
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