Aristotle's misleading ad
Friday, March 2, 2007 at 05:24PM
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This month's Campaigns & Elections Magazine sports a fake front cover with a claim by Aristotle that "FEC Docs Reveal Huge Fundraising Advantage Tied to Software." Democrats and Republicans, they say, "raised up to $324,620.04 more by using Aristotle" than if they had used NGP. They base their ad, they say, on electronic filings by congressional campaigns in the 2006 cycle. I understand that Aristotle has also emailed the same ad, as well.

Does this fundraising disparity based on software sound like a plausible claim to you?

Their figures are derived by adding up all campaigns using information from FEC reports that also indicates which compliance software package the campaign uses.

It took me only a few minutes to discover why their figures are misleading.

I broke those same numbers down by party:

For Democrats: (NGP chooses not to service Republicans)

Average dollars raised by candidates using NGP (N=175) $1,269,307.75

Average dollars raised by candidates using Aristotle (N=33) $960,777.91

Conclusion: Far more Democratic candidates used NGP and NGP clients raised significantly more money than Aristotle clients on average.

For Republicans: (Aristotle serves either party)

Average dollars raised by candidates using NGP (N=0) $0.00

Average dollars raised by candidates using Aristotle (N=143) $1,568,806.08

Conclusion: Republican candidates in 2006, more incumbents, majority party, did well.

Ouch for them, a reverse of their big claim:

where there is a fair comparison, NGP clients raise more.

Note that, even though looking at their data by party and following Aristotle's logic (look up ecological fallacy) eviscerates their claim to superior software results, I do not maintain here that the numbers necessarily prove anything about software. As anyone who knows anything about political fundraising can attest, the dollars raised by a campaign is the result of many factors. What explains variation in fundraising by congressional candidates? Some important variables include:

1. Party (in the 2006 cycle, Republicans were advantaged by being in power)

2. Incumbency (plenty of studies show that incumbents have easier access to money)

3. Competitiveness of the race (heck, it is easier to raise money if it matters)

4. Tenure in Congress (I imagine that members who have been around longer can raise more)

5. Committees (membership in certain committees helps raise PAC funds)

6. Sponsorships (backing by groups like the National Rifle Association help)

7. Ideology (certain political positions make it easier to fundraise)

8. Candidate skills and experience

9. Other: (fundraising tools, employment of professional fundraisers, professional website, willingness of candidate to make fundraising calls, etc.) A multivariate regression that controlled for these variables might shed some light; though you would have to be sure to correct for simultaneity, because it is just as likely (or more likely) that good fundraisers choose good software, as that good software makes good fundraisers.

My educated guess about what explains why more Democrats use NGP than Aristotle is that over the course of a decade candidates have found us to be more helpful. Numerous candidates, including some of the biggest names in politics, have switched from Aristotle to NGP. And I would further guess that our candidates raise more on average because candidates in races that were close overwhelmingly chose NGP in the last cycle.

If you have made it through all these words, then I congratulate you and leave you with this parting thought -- consider what an advertisement like this tells you about the company that designed and paid for it.

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