Newt Gingrich ends his campaign today, neck-deep in debt. He is owing more than $4 million to businesses and campaign staff around the country who are beginning to fear they may never get paid.
According to The Washington Post, he will be officially ending his campaign with an announcement Wednesday in Arlington.
In a video released on Tuesday, he said he was giving supporters "insider advance notice" that he is officially ending his campaign. He said: "All of us have an obligation I think to do whatever we can to defeat Barack Obama. I want you to know that we're going to continue out there on the road. Callista and I will be talking, campaigning, making speeches, doing everything we can to help defeat Barack Obama."
In the video he thanked his supporters, saying their help was vital and pledged to work hard to avoid the "genuine disaster" that would come if Obama is re-elected president. He said: “I want you to know that we’re going to continue out there on the road, both Callista and I will be talking, campaigning, making speeches, doing everything we can to help defeat Barack Obama."
Analysts say the size of Newt Gingrich's debt is simply extraordinary, and attribute it to lack of fiscal discipline in the heady period of his polls surge and in the last month of his campaign when it was already clear that Mitt Romney would win the nomination.
ABC News reports Craig Homan, a government affairs lobbyist for the watchdog group Citizen Union, said: "He was reckless in running up these bills, especially in the last month or so of the campaign when it was quite clear that Mitt Romney would be the nominee."
Gingrich campaign had run into serious financial problems as early as last summer but the debts continued piling up faster in the last weeks of his campaign. Reports filed with the Federal Election Commission showed that by the end of March, he had run up bills of about $4.3 million, from $1.5 million at the end of February. The campaign raised $1.6 million in March, spent $2 million and posted a cash account balance of $1.2 million at the end of the month.
ABC News reports that Mitt Romney and the Republican National Committee have offered to help Gingrich settle his debts. Already, Gingrich campaign has anxious creditors breathing down his neck. According to ABC News, he is owing Moby Dick Airways $1.1 million for travel and charter flights; the Patriot Group, a Virginia security company, $449,502; and McKenna, Long and Aldridge, a law firm with offices in Atlanta, $183,658 for legal services.
Many of his creditors are small business who say they will suffer if they are not paid in time. ABC reports that Ryan Driscoll, project manager of a small company that provided stages, lighting and sound equipment, and which Gingrich campaign is owning $32,506, said: "We floated quite a bit of money , a lot of out-of-pocket costs that we covered. I am a little worried. Nobody wants to lose 32 grand."
Campaign staffers are also getting worried. Moshe Starkman, a former staffer, is still owed more than three months work. He said: "You hear the payment is coming 'next week,' or 'later,' or 'in a couple of days.' They always give excuses, I've had to spend my savings."
CBS reports Obama campaign on Wednesday, released an 80-second video containing clips from interviews and debates during the Republican primary where Gingrich criticized Romney on various issues. The ad stated: “Newt Gingrich: Frankly, not Mitt Romney’s biggest supporter."
Gingrich: 'My management team got excited'
Gingrich told ABC News that his "management team got very excited in Florida" and began spending freely in the bid to beat Romney in Florida's Jan. 31 primary. But he lost to Romney 46 percent to 32.
Gingrich said: "You know, Romney spent $20 million in Florida in three weeks, and I think some of our guys decided to try to match him and we didn't have Wall Street (support). I am going to spend some time paying it off. It is something I have done several times in my career."
Critics have noted that Gingrich's comment that "It is something I have done several times in my career," is dead accurate. Politico reported that Gingrich once personally owed hundred of thousands of dollars to the jewelry story Tiffany and Co. He also suspended his campaign to go on a luxury cruise in Greece with his third wife Callista.
According to ABC News, while Gingrich's debt is the highest, other Republican candidates had also accumulated debts by the time they were quitting the presidential race. Michele Bachmann owed about $1 million and Rick Santorum, $1.9 million.
Some former candidates are still owing, years after the end of their presidential campaign. Former New York City Mayor Rudy Giuliani, still owes $1.5 million four years after his unsuccessful presidential campaign and Hillary Clinton still has $245,000 in unpaid bills.
Democrat John Edwards still owes $333,500 from his 2004 presidential campaign and Sen. John Glenn (D-Ohio) probably holds the record among former presidential candidates. He still owed $3 million in 2004 after his failed 1984 presidential campaign. In 2005, he notified the Federal Election Commission he was unable to pay and was allowed to disband his campaign committee.