Which Republicans are running out of money?

Six Republican presidential candidates are trailing in the polls and spending money faster than they're raising it. Who might drop out soon?

(AP Photo/Chris Carlson, File)
Republican presidential candidates, from left, former Arkansas Gov. Mike Huckabee, Sen. Marco Rubio, R-Fla., Sen. Ted Cruz, R-Texas, retired neurosurgeon Ben Carson, businessman Donald Trump, former Florida Gov. Jeb Bush, Wisconsin Gov. Scott Walker, businesswoman Carly Fiorina, and Ohio Gov. John Kasich, appear during the Sept. 15 Republican presidential debate at the Ronald Reagan Presidential Library and Museum in Simi Valley, Calif.

Half a dozen Republican presidential candidates are edging toward financial crisis, raising the specter that some may be forced to drop out of the sprawling field of contenders.

They all spent more than they took in during the third quarter, according to campaign finance reports filed on Thursday. The six are: Kentucky Sen. Rand Paul, former Arkansas Gov. Mike Huckabee, Louisiana Gov. Bobby Jindal, former New York Gov. George Pataki, South Carolina Sen. Lindsey Graham and former Pennsylvania Sen. Rick Santorum.

Together, they raised $6 million but spent more than $9.5 million during the summer on everything from postage to travel
to campaign rallies. All six are trailing badly in the polls. 

"They are living on the edge," said Lawrence Noble, former general counsel to the Federal Election Commission. "We are getting close to the time when a lot of these candidates are going to say, 'We can't do it, it can't be done,'" said Noble, now a senior attorney with the Campaign Legal Center, a campaign finance non-profit.

Campaigns have tipping points: the moment when a candidate does the math and realizes that he does not have enough money on
hand or the prospect of more money from donors to stay in the race. One telling sign is the "burn rate" - jargon for how much
a candidate spends versus how much he is raising. If the burn rate is high and donor enthusiasm low, then trouble ensues.
The math is simple, said Austin Barbour, who ran Rick Perry's fund-raising Super PAC before the former Texas governor
dropped out. Barbour is now a senior adviser to the campaign of former Florida Governor Jeb Bush.

When direct donations to campaigns are lackluster, as in the case of these six candidates, there may not be enough money to cover basic operating costs like travel, staff salaries and office equipment. Those costs are not typically covered by big money Super PACs, which are supposed to operate independently of the campaigns.

"It's really tough to survive with such little money," Barbour said. "It puts a lot of pressure on a campaign because
no one wants to put their candidate in debt."\

The third quarter reports show the challenges. Any burn rate over 100 percent is considered dangerous by campaign finance
experts. Pataki's was 226 percent, Graham 188, Paul 181, Jindal 144, Huckabee 110 and Santorum 101.

Of those, Paul and Graham have the most money in the bank, with $2.1 million and $1.7 million respectively, while the rest
are money-challenged. Pataki, for instance, had less than $14,000 on hand as of Sept. 30, less than the $17,600 billionaire candidate Donald Trump spent on yard signs in the third quarter alone.

The campaigns dismissed the suggestion they were in financial trouble. Rand Paul's campaign stressed it still had the $2.1 million on hand. A Pataki staffer said his burn rate was just the "cost of a campaign for President." And the Huckabee campaign said  their candidate was experienced at running campaigns on shoestring budgets. Spokesmen for Santorum, Graham and Jindal did not respond to requests for comment.

To be sure, tight budgets at this point in the race do not mean the campaigns are doomed. A candidate could have a breakout
moment, like former Hewlett-Packard CEO Carly Fiorina, whose fundraising soared after a good debate performance. Candidates
can also lend themselves money, as Democratic frontrunner Hillary Clinton did when she ran low during the 2008 White House

But the Republican candidates are bedeviled by another math problem. There are 14 Republicans vying for their party's
nomination for the November 2016 election, more than double the number at this point during the 2012 election. "The Republican field is way too large, there simply isn't enough money to go around," said Noble.

Small donors are the lifeblood of any campaign and candidates will live or die by their ability to tap into a broad base of supporters willing to contribute up to the maximum of $2,700.

Retired neurosurgeon Ben Carson, who is one of the front-runners in the Republican race, reported nearly 22,000
donors in the last quarter who have given more than $200 so far in the campaign. Bush had 7,300.

In contrast, Pataki had fewer than 80 donors last quarter; Jindal had under 300; Graham had nearly 650; Santorum under 300,
and Huckabee more than 800. Among these five, Paul had the most, with more than 3,500.

The candidates could conceivably win the patronage of a millionaire or billionaire, who could funnel unlimited amounts
of money into their Super PAC. But these fund-raising groups are prohibited from carrying out certain campaign activities and are
therefore of limited help.

For example, Wisconsin Governor Scott Walker had a Super PAC with money in the bank, but after burning through $6 million in three months his campaign's coffers were bare and he was forced to drop out in September.

Perry, who quit the same month, hemorrhaged money and ended the third quarter with just $45,000 on hand. His Super PAC
returned $13 million to its donors.

There are even some Jeb Bush backers who are getting nervous. The Christian Science Monitor's Peter Grier notes that his burn rate in the third quarter was 85 percent.

His campaign raised just over $13 million for the third quarter, but it spent $11 million. If it were a public for-profit business, numbers like that could cause its stock to tank.

No wonder Bush has moved to cut staff salaries and reduce other expenses. From the beginning, he concentrated on building a full-service, front-runner campaign. But that’s not the position he is now in.

(Reporting By Michelle Conlin, editing by Paul Thomasch and Ross Colvin)

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