How Obama Did It

Barack Obama was campaigning last October in South Carolina when he got an urgent call from Penny Pritzker, the hotel heiress who leads his campaign's finance committee. About 200 of his biggest fund raisers were meeting in Des Moines, Iowa, and among them, near panic was setting in. Pritzker's team had raised money faster than any other campaign ever had. Its candidate was drawing mega-crowds wherever he went. Yet he was still running at least 20 points behind Hillary Clinton in polls. His above-the-fray brand of politics just wasn't getting the job done, and some of his top moneymen were urging him to rethink his strategy, shake up his staff, go negative. You'd better get here, Pritzker told Obama. And fast.

Obama made an unscheduled appearance that Sunday night and called for a show of hands from his finance committee. "Can I see how many people in this room I told that this was going to be easy?" he asked. "If anybody signed up thinking it was going to be easy, then I didn't make myself clear." A win in Iowa, Obama promised, would give him the momentum he needed to win across the map — but his backers wouldn't see much evidence of progress before then. "We're up against the most formidable team in 25 years," he said. "But we've got a plan, and we've got to have faith in it."

More than seven months later, that faith has been rewarded. The 2008 presidential campaign has produced its share of surprises, but one of the most important is that a newcomer from Chicago put together by far the best political operation of either party. Obama's campaign has been that rare, frictionless machine that runs with the energy of an insurgency and the efficiency of a corporation. His team has lacked what his rivals' have specialized in: there have been no staff shake-ups, no financial crises, no change in game plan and no visible strife. Even its campaign slogan — "Change we can believe in" — has remained the same.

How did he do it? How did Obama become the first Democratic insurgent in a generation or more to knock off the party's Establishment front runner? Facing an operation as formidable as Clinton's, Obama says in an interview, "was liberating ... What I'd felt was that we could try some things in a different way and build an organization that reflected my personality and what I thought the country was looking for. We didn't have to unlearn a bunch of bad habits."

When Betsy Myers first met with Obama in his Senate office on Jan. 3, 2007, about two weeks before he announced he was forming an exploratory committee to run for President, Obama laid down three ruling principles for his future chief operating officer: Run the campaign with respect; build it from the bottom up; and finally, no drama. Myers was struck by how closely Obama had studied the two campaigns of George W. Bush. "He said he wanted to run our campaign like a business," says Myers. And in a good business, the customer is king. Early on, before it had the resources to do much else, the campaign outsourced a "customer-service center" so that anyone who called, at any hour of the day or night, would find a human voice on the other end of the line.

Meanwhile, Obama's Chicago headquarters made technology its running mate from the start. That wasn't just for fund-raising: in state after state, the campaign turned over its voter lists — normally a closely guarded crown jewel — to volunteers, who used their own laptops and the unlimited night and weekend minutes of their cell-phone plans to contact every name and populate a political organization from the ground up. "The tools were there, and they built it," says Joe Trippi, who ran Howard Dean's 2004 campaign. "In a lot of ways, the Dean campaign was like the Wright brothers. Four years later, we're watching the Apollo project."

Even Obama admits he did not expect the Internet to be such a good friend. "What I didn't anticipate was how effectively we could use the Internet to harness that grass-roots base, both on the financial side and the organizing side," Obama says. "That, I think, was probably one of the biggest surprises of the campaign, just how powerfully our message merged with the social networking and the power of the Internet." But three other fundamentals were crucial to making Obama the Democratic nominee:

A Brave New Party

In most presidential elections, the Iowa caucuses are an anomaly. Competing there is a complicated, labor-intensive undertaking that, once finished, is cast off as an oddity and never repeated. But in 2008 it became for Obama the road test of a youth-oriented, technology-fueled organization and the model for many of the wins that followed. It was also a challenge to history. The iron rule of Iowa had always been that caucusgoers tended to look the same year in and year out: older people, union households, party stalwarts — just the kind of folks who would seem more inclined to back Clinton or John Edwards — trudging out into the cold night for a few hours of political conversation. Instead, Obama saw the Iowa caucuses as a chance to put a stake through Clinton's inevitability. "Mission No. 1 was finishing ahead of Hillary Clinton in Iowa," recalls Obama campaign manager David Plouffe. "If we hadn't done that, it would have been hard to stop her."

But counting on new voters had proved disastrous for Dean in 2004. The Obama campaign knew that it would have to build a network of Iowans rather than supporters brought in from other parts of the country, says Plouffe, but "we didn't have to accept the electorate as it is." At bottom, Obama built a new party in 2008. It was difficult. Not until the morning of the caucuses did the campaign reach its goal of 97,000 Iowans pledged to support Obama that it thought it would need to win. Then came the real question: Would these people show up?

Show up they did, shattering turnout records. Obama prevailed with a surprising eight-point margin over Edwards, who came in second. Obama counts Iowa as his biggest victory, the one that foreshadowed the rest. "Voters under 30 participated at the same rates as voters over 65. That had never happened before," the Democratic nominee says. "That continues to be something I'm very proud of — how we've expanded the voter rolls in every state where we've campaigned. I think that means we can put into play some states that might normally not be in play."

The Iowa playbook, as everyone now knows, hasn't always worked. In Texas, for instance, the grass-roots operation counted on more African-American voters than actually turned out. In California, organizers expected more young voters. But while Obama rarely managed a clean win against Clinton in the big states — the ones that will count most in the fall — he kept winning delegates even when he lost primaries. By April, it became almost mathematically impossible for Clinton to catch him.

The Key-Chain Campaign
Atlanta businessman Kirk Dornbush has raised millions of dollars for the Democratic Party and its candidates over the past 16 years. Before campaign-finance laws banned unregulated soft money, he recalls, there were times he walked around with six-figure checks in both pockets of his jacket. But these days, he does much of his fund-raising in a much humbler fashion: selling $3 key chains and $25 T shirts at Obama rallies. At the first merchandise table Dornbush set up for a Georgia event, "we were just completely sold out," he says. "There were lines of people. It was unbelievable."

Dornbush's experience explains the second fundamental change Obama has brought to politics: his campaign was built from the bottom up. Even fund-raising, once the realm of the richest in politics, became a grass-roots organizational tool. At nearly every event this year, Team Obama set up little tabletop trinket shops, known as "chum stores" because all those little Obama-branded doodads aren't only keepsakes; they are also bait. Every person who buys a button or hat is recorded as a campaign donor. But the real goal of the chum operations was building a list of workers, supporters and their e-mail addresses.

A similar innovation came in fund-raising. Normally, it is only the big donors who get quality time with a candidate. But Obama devoted far more of his schedule to small-dollar events. In Kentucky, the month after he announced his run for President, the first such effort quickly sold out all 3,200 tickets at $25 a head — and produced the beginning of a local organization. "It's the difference between hunting and farming," says Obama moneyman Matthew Barzun, 37, the Louisville Internet-publishing entrepreneur who arranged the event. "You plant a seed, and you get much more."

Obama uses a different frame of reference. "As somebody who had been a community organizer," Obama recalls, "I was convinced that if you invited people to get engaged, if you weren't trying to campaign like you were selling soap but instead said, 'This is your campaign, you own it, and you can run with it,' that people would respond and we could build a new electoral map." The chum stores, the e-mail obsession and the way Obama organizations sprang up organically in almost every congressional district in the country meant that by the time Obama's field organizers arrived in a state, all they had to do was fire up an engine that had already been designed and built locally. "We had to rely on the grass roots, and we had clarity on that from the beginning," says Plouffe.

By contrast, the Clinton campaign, which started out with superior resources and the mantle of inevitability, was a top-down operation in which decision-making rested with a small coterie of longtime aides. Her state organizers often got mixed signals from the headquarters near Washington. Decisions from Hillaryland often came too late for her field organization to execute. Obama's bottom-up philosophy also helps explain why he was able to sweep the organization-heavy caucus states, which were so crucial to building up his insurmountable lead in pledged delegates. What was not appreciated by many at the time: while Clinton spent heavily in every state she contested, Obama's approach saved money. Says Dean-campaign veteran Trippi: "His volunteers were organizing his caucus victories for free."

Obama Means No Drama
The team that Obama put together was a mix of people who, for the most part, had never worked together before but behaved as if they had. Some — like chief strategist David Axelrod and adviser Valerie Jarrett — came from Chicago and had advised Obama in earlier races. Axelrod's business partner Plouffe had worked in former House Democratic leader Dick Gephardt's operation; deputy campaign manager Steve Hildebrand, who oversaw the field organization, had come from former Senate majority leader Tom Daschle's. Daschle's former chief of staff Pete Rouse served that same role in Obama's Senate office, from which the candidate also brought aboard communications director Robert Gibbs, who had briefly worked for John Kerry. Obama tapped the business world as well, filling key operational posts with executives who had worked for Orbitz, McDonald's and other firms.

And yet, Obama says, they all had the same philosophy. "Because I was not favored, that meant that the people who signed up for this campaign really believed in what the campaign was about. So they weren't mercenaries. They weren't coming in to just attach to a campaign," he explains. Temperament mattered too. "It was very important to have a consistent team," Obama says, "a circle of people who were collaborative and nondefensive."

Like the team around Bush, Obama's is watertight. Leaks are rare, and for all the millions Obama has raked in, Plouffe keeps a sharp eye on where it is going. Consider the salaries: Clinton spokesman Howard Wolfson was paid almost twice as much in a month — $266,000 went to his firm, according to her January campaign filing — as the $144,000 that Obama paid Gibbs for all of last year. Obama staffers are expected to double up in hotel rooms when they are on the road and are reimbursed by the campaign if they take the subway (about $2) to the downtown-Chicago campaign headquarters from O'Hare International Airport but not if they take a cab (about $50). Volunteers are asked to take along their own food when they are canvassing.

How will a team that has been living off the land fare against the kind of GOP operation that was so effective at turning out the traditional Republican base in 2004? John McCain's campaign manager, Rick Davis, flatly declares that what got Obama the nomination "is not a general-election strategy" and contends that Obama's operation will be weak against McCain's crossover appeal in such states as Ohio, Michigan, Wisconsin, Minnesota and Nevada.

Maybe so, but compared with McCain's, Obama's operation has been a model of efficiency — and executive function. Obama has already changed the way politics is practiced in America — and he is poised to keep doing so. After delivering his dramatic victory speech in St. Paul, Minn., Obama walked offstage and spent the next 45 minutes signing dozens and dozens of his books that had been brought to the Xcel Center by admirers. When he finished, he happened to see fund raiser Dornbush and told him, "Enjoy the celebration tonight." Then Obama took a few steps, turned around and added, "But it's right back to work tomorrow."