The 2026 midterm cycle is anticipated to be the most expensive in U.S. history, with candidates raising money at an unprecedented pace. This influx of cash has made campaign finance a significant focus for voters, with major donor groups influencing primary races on issues ranging from Israel policy to artificial intelligence and cryptocurrency.
However, campaign spending alone does not guarantee electoral success. In the recent Democratic Senate primary in Michigan, outside spending reached record levels, yet Abdul El-Sayed secured the nomination despite a significant financial disadvantage. Similarly, billionaire Tom Steyer's self-funded campaign for governor in California, which exceeded $200 million, did not result in a win.
The increasing flow of money into politics has fueled concerns about corruption, and the campaign finance system has become more complex. In June, the Supreme Court's decision to strike down limits on how much political parties can spend in coordination with their own candidates further blurred the distinction between direct candidate fundraising and party expenditures.
Danielle M. Thomsen, a professor of political science at the University of California Irvine and author of the forthcoming book "The Money Signal: How Fundraising Matters in American Politics," has extensively studied the role of money in elections. She notes that while fundraising is a crucial signal of viability, its direct impact on election outcomes is nuanced.
"The bulk of my research is looking at U.S. House primaries, and I think you could probably draw similar conclusions for Senate primaries," Thomsen explained. "After a certain stage, largely through money and advertising and voter outreach, and campaigning, after that point, money might matter less because voters become more familiar with choices. But this is a really steep hurdle in most congressional primaries."
Thomsen elaborated that many primary contests are characterized by low information among voters. When voters have access to other relevant information about candidates, it can sometimes override financial advantages. She also highlighted that significant spending by both candidates in the Michigan primary made that race a unique situation.
Fundraising as a Prerequisite
Research suggests a minimum level of funding is necessary for candidates to be considered viable. For non-incumbent successful candidates in open seat primaries, the average fundraising in the first quarter is between $300,000 and $400,000. Challengers to incumbents who lose or struggle often raise between $200,000 and $300,000 in their first quarter, a figure that can be a strong showing in many districts. "Early money in particular is a prerequisite," Thomsen stated. "And that’s not going to mean that if you raise a lot of money, you definitely will win. That’s never been the case and that’s still not the case. But it does matter for who is seen to be seriously in the mix, who is perceived to be relevant."
Thomsen's perspective aligns with the view that fundraising functions as a signal of a candidate's viability and strength to the public, party leaders, and the media. While some scholars focus on endorsements as another indicator, the material impact of money—funding advertisements, office infrastructure, and staff—is also recognized.
Self-Funding and Donor Sources
An examination of campaign finances reveals that wealthy candidates are more likely to win, not only because they are more likely to run, but also because they tend to raise early money, particularly large-dollar donations, which yield greater returns in subsequent quarters. However, candidates who exclusively self-fund typically do not fare as well as those who receive financial support from others, especially from large-dollar donors.
Many candidates supplement their campaigns with their own funds; approximately 40 percent of non-incumbent general election winners self-fund at least $10,000. This prevalence of self-funding as a supplement can disadvantage candidates who lack personal wealth. While fully self-funded campaigns are often unsuccessful, a small number of candidates have won by self-funding over 90 percent of their first-quarter expenses, though these exceptions are rare and the candidates are invariably wealthy.
Early campaign funds are predominantly sourced from individual contributors, with most donations over $200 being itemized. The upper class significantly influences campaign finance, with non-incumbent general election winners receiving about 50 percent of their early money from max-out donors who contribute the maximum allowable amount. These donors are often described as politically engaged, upper-middle-class individuals with connections in politics. Many are not repeat donors, contributing to only one candidate per election cycle. This early funding period is often referred to as the "friends and family quarter."
The Impact of Outside Spending and Small Donors
While the concept of diminishing returns for campaign spending has long been theorized, political science has not definitively established a specific threshold where increased spending ceases to be beneficial or becomes detrimental. Regarding outside groups pouring money into races, Thomsen noted a lack of robust research on potential backlash. She suggested that in many instances, voters are unaware of the sources of campaign funding, which limits the potential for negative reactions. However, in specific cases, such as the Michigan primary, external spending became a significant narrative factor. For prominent "celebrity" candidates like Elizabeth Warren, Bernie Sanders, and Alexandria Ocasio-Cortez, their stance against big money is a core part of their public persona.
The rise of small-dollar fundraising in the 2010s was seen by some as a democratizing force against big money. However, research indicates that small-dollar donors often lean towards the ideological edges of the political spectrum, being more liberal for Democrats and more conservative for Republicans. Despite the attention on small-dollar donations, the majority of funds raised by candidates still comes from itemized, large donors.