It was always going to be a hard sell, getting wealthy Republican donors to pony up the kind of money Donald Trump will need to mount an effective modern-day presidential campaign. But the task will be a lot harder if donors believe that much of their money might wind up going straight to the bank accounts of the New York billionaire himself, as a report out today suggests it might.
Trump has long claimed that he is self-funding his campaign, and in a sense, that is true. The vast majority of the money collected by the Trump campaign so far has come from Trump himself -- an estimated $36 million at this point.
However, those funds were not donations, but loans. Because the campaign has legally borrowed money from Trump, he is in a position to demand repayment. And the campaign would have to sell an awful lot of “Make America Great Again” hats for it to be able to pay Trump back without dipping into the money it is now soliciting from Republican donors.
According to a report from NBC News on Friday, campaign officials said that while having the campaign reimburse Trump for the money he has loaned it is not currently under discussion, it has also not been taken off the table.
To be clear, Trump is perfectly within his rights to seek repayment of the loan. But this could make for some awkward conversations between Trump’s fundraisers and deep-pocketed GOP donors.
The idea that donation may, in whole or in part, go to repaying Trump “may deter some donors from giving,” said Michael Malbin, executive director of the Campaign Finance Institute in Washington. “There is a feeling among many donors to other causes that if you aren’t willing to put some of your own skin in the game, why should they?”
Like many other aspects of the Trump campaign, Malbin said, Trump’s financing scheme is unique.
“There is no precedent for any candidate self-financing at this level except Ross Perot and Steve Forbes,” he said, referring to the Texas billionaire who ran for the presidency in 1992 and 1996 and the heir to a publishing fortune, who ran in 1996 and 2000.
However, Malbin said, both Perot and Forbes donated money to their own campaigns rather than lending it.
The Trump campaign probably can’t afford to give potential donors any more reason for hesitation, Malbin said, because “Mr. Trump is heading into the election season with no campaign finance structure worth talking about.”
Trump only last week named a campaign finance committee chairman, and has not developed access to the broad networks of donors that most presidential candidates rely on.
“There’s no question that in the financial fundraising side of things, he is starting out way behind, and he does not have much time to get his organization up to speed,” Malbin said.
UPDATE: Donald Trump told MSNBC on Thursday that he has no intention of paying himself back the $36 million he has loaned his campaign. Campaign aides say he will convert the loan to a donation, but has not yet done so as of Thursday, according to MSNBC.