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MoneyBombs & Politics

Posted By Barry Ritholtz On November 7, 2012 @ 5:57 am In Legal,Politics,Video | Comments Disabled

This video of the Boston metropolitan area reveals the geographic distribution of political donations made by individuals throughout 2012.

On the Boston map, Individual donors flicker as a point that corresponds to the address they reported to the FEC.

The size of the point corresponds to the amount of money given to a candidate.
When studying campaign contributions, we identify two types of temporal bursts. We call both “moneybombs” because they reveal a temporal clustering.

The first type occurs when many small donations are given on the same day to a candidate. We call this a grassroots moneybomb.

The second are bursts of extremely large donations, that take advantage of campaign finance laws and allow individuals to donate more than the traditional $5,000 limit. We call this the Joint Committee moneybomb.

A grassroots moneybomb appears on January 19th, when Elizabeth Warren engages the wider Boston community. She received money from over 200 people, collecting $90,000. We see contributors throughout Newton, Jamaica Plain, and Belmont, as well as Cambridge and the Back Bay.

This puts her at the top of our rankings for the day.

On August 31st, we see a grassroots moneybomb supporting Obama from Harvard employees.
Obama collects more than $13,000 from 30 employees, most of them professors who gave $5000 or less.

We see a different type of moneybomb on June 1st, when two employees of Bain Capital donate over $145,000 to Mitt Romney, the founder of that company.

Individuals donating to these Joint Fundraising Committees are able to direct the first few thousand dollars to officially go to the candidates but the remaining money is rerouted to the national party and then various state committees, typically in battleground states.

The loophole that circumvents the traditional limit is used by both parties. However, in Boston, the Republicans receive more money in the form of these donations over $5,000.

This suggests that the new rules of the game may be benefitting Republicans more than Democrats.


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