Clinton disappointed as Obama closes funding gap

"This race for the White House has been brought to you by American Express..."

It hasn't reached that stage yet, but the money chase for the 2008 presidential election is already on track to collect an unprecedented $1bn total. By the time the Democrats and the Republicans have nominated a candidate in the spring, they will need to raise $500m (£246m) apiece to compete – a record sum.

The latest fundraising numbers are a big disappointment for Hillary Clinton, who had hoped to put clear water between herself and her closest rival, Barack Obama, whom she is trouncing in the polls. But when the figures for the third-quarter funds were posted on the Federal Election Commission's website yesterday, they revealed that the two were not very far apart.

Fundraising in US elections is closely scrutinised. The figures speak volumes about the shifting ground and the candidates' ability to stay the course in a contest that still has more than 12 months to run.

Mrs Clinton raised the most money this time and has $35m to spend on the primary, with lots more in reserve for the battle proper. But Mr Obama almost matched her with a $32m war chest for the primary fight ahead.

The Obama campaign is going on the offensive, hoping to make up lost ground. He has spent heavily on television advertising in Iowa, where the first primary contest takes place in January. He took a few swipes at Mrs Clinton, saying she is in the grip of "Washington lobbyists and special interests ". "She's even said that these lobbyists represent real Americans," he said in an email sent to millions of his supporters.

He appealed to them to overthrow the "most entrenched political machine in Democratic politics", thereby highlighting concerns about the dynastic nature of American politics. Mr Obama doesn't mind reminding voters that 40 per cent of Americans have only known a Bush or a Clinton in the White House.

Together the Clinton and Obama campaigns continue to crush their opponents – Republican or Democrat – in the fundraising stakes.

On the Republican side, the former New York mayor Rudolph Giuliani leads the pack. But there may be trouble ahead as the figures reveal that he has been spending more than he has raised, some $13.3m. All of this has gone on salaries, security and consultants, without a dollar being spent so far on advertising.

His closest rival, Mitt Romney, has collected some $18.4m in total, of which $8.5m came in the form of a loan from his personal bank account. He has already spent $21m in the past three months. The figures reveal that he spent $6m on television ads.

At the back of the Republican pack the one great surprise is the money pouring in to the anti-Iraq war campaign of Ron Paul. He raised $5.3m in the last quarter – nearly matching John McCain, who is running third in the Republican race – and has pulled in a total of $8.2m so far this year.