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Public financing system is 'creaky,' Obama says

Barack Obama, in Indianapolis, said he had not decided whether to take part in public financing for the fall race. Barack Obama, in Indianapolis, said he had not decided whether to take part in public financing for the fall race. (Alex Brandon/Associated Press)
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Associated Press / April 12, 2008

Barack Obama gave another signal yesterday that he might opt out of the public financing system for the fall presidential race, saying that the three-decade-old system is "creaky."

The Democratic front-runner is rewriting all the fund-raising records, capitalizing on a huge number of small donations made online to bring in about $234 million from 1.3 million contributors through the end of March.

Ironically, that success has put him in a tough spot because he had earlier pledged to take part in public financing, which would provide about $84 million for the general election campaign from $3 checkoffs on tax returns, but prevent him from raising other money.

"The amount of money raised through the public financing system may be substantially lower than the amount of money that can be raised over the Internet, which presents candidates then with some pretty tough decisions in terms of how they want to move forward if they want to compete in as many states as possible," he told reporters while campaigning in Indiana.

Obama told donors at a Washington event earlier this week that his fund-raising is like a "parallel public financing system," a remark that set off speculation that if he is the nominee he would be the first presidential candidate to forego federal funds in three decades.

But Obama said yesterday he had not made a decision, and said that if he's the nominee, he would meet with John McCain, the presumptive Republican nominee, to discuss ways to reduce the influence of outside groups in the election.

McCain is taking steps to accept the public funds, and is keeping the pressure on Obama to keep his pledge. "I would be glad to join him on reform," McCain told reporters yesterday in Dallas. "That doesn't change the fact that he committed a year ago to public financing if I would. In direct contradiction to his rhetoric, he's now saying well, he may not do it."

Obama pointed out that participation has declined in the $3 income tax checkoff, reducing the amount of money in the public financing fund. Obama himself, however, did not check off the $3 designation on his 2005 return, and did not do so on his 2006 return until an amended filing.

The Illinois senator, who had checked off the box in previous returns, said it was an oversight.

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