Who's winning the money chase? Third-quarter fundraising totals are in, and the candidate who has broken all records is--no surprise--George W. Bush. But the top Democratic fundraiser, former Vermont Gov. Howard Dean, merits a special prize. His fundraising is likely to have the biggest impact on the campaign finance system.

Dean raised nearly $15 million last quarter, almost half of the $34 million raised by all nine Democrats still in the race.  Dean's closest competitors--Sen. John Kerry, followed by Rep. Dick Gephardt, Sen. Joe Lieberman, and retired Gen. Wesley Clark--came in at just $3.5 million to $4 million each.

Dean's total is important because, according to research by Northeastern University political scientist William G. Mayer, the candidate who raises the most money by the end of the year before the presidential election always gets his party's nomination. (The lone exception was former Texas Gov. John Connally, who at the end of 1979 had raised more than Ronald Reagan, the eventual Republican nominee.)

About 169,000 people gave Dean money in the third quarter. Their average contribution was $73.69. Bush outpaced Dean in the number of contributors and in their average contribution, which the Bush campaign said was $280. That put Bush's haul for the third quarter over $50 million. And Bush doesn't even face a primary challenge.

Joe Trippi, Dean's campaign manager, is proud that in each quarter this year, the average size of Dean's campaign contributions has been getting smaller--$168 in the first quarter, $88 in the second quarter, $74 in the third--while the total raised each quarter has gone up. What does that mean? Trippi says, "We have so many supporters across the country who are giving small amounts. Most of them have the ability to give to us again, or to find friends, or co-workers, or family to give to us in the future."

Trippi sees a sharp contrast with the Bush campaign. "The Bush donors are being hauled off to big dinners and bundled into these huge amounts," he said. "Our donors are giving a small amount, but there are so many of them that it adds up." In the third quarter, it added up to more money than any Democrat had ever raised in a single quarter--even more than Bill Clinton collected in 1996, when he was a sitting president.

Trippi is proud that only about 1 percent of Dean's contributors have "maxed out" at the legal limit of $2,000. That means the Dean campaign can go back to its donors again, and again. The Bush campaign has big shots, 100 "Rangers," who have raised a minimum of $200,000 each, and 185 "Pioneers," who have raised at least $100,000 each, by "bundling" contributions from friends, colleagues, and employees.

Dean's campaign works differently. "It's apparently bringing in people who have not contributed before and who have not been connected with campaigns," said Larry Noble of the Center for Responsive Politics. "It's aimed perfectly at a new generation of potential voters and contributors."

How does the Dean campaign do it? Answer: the Internet. Dean raised $7.4 million--half his total--on the Internet in the third quarter. By comparison, Bush raised about $1.5 million on the Internet, or about 3 percent of his total. "My campaign is about empowering people," Dean says. And the Internet is how he does it. Trippi says, "There's only one medium in the world that allows 2 million Americans to contribute $100 in one day if they decide to do it. And that's the Internet."

There's a calculation behind that example. Bush is expected to end up raising an astonishing $200 million. For Dean, 2 million contributions at $100 each would equal $200 million. Trippi says, "I really believe there are 2 million Americans who will give $100 to get rid of George W. Bush."

That's wildly optimistic, but it does signal some big changes in campaign financing. The Dean campaign figured out how to make the Internet pay off politically. For the past 25 years, Republicans have become specialists in drawing small contributions from large numbers of donors, mostly angry conservative activists. Dean's base in "the wired Left" could now become a competitive donor base--one that rewards candidates who appeal to voter anger and passion, as Dean does, further polarizing American politics.

"I think the Internet is going to have as much impact from this day forward as television did after the Kennedy-Nixon debates in 1960," Trippi predicts. It could have another kind of impact as well.

"One question is whether Dean is going to stay in the public-funding system, which would limit how much he can spend in his primary campaign to $45 million," Noble points out. "If he can raise more than that--and it looks like he's on target to do it--I think he's going to drop out of the public-funding system for the primaries."

If Dean becomes the first Democrat to decline public funding, he will then be able to spend competitively with Bush, who has already indicated he will opt out of the system.

It's the law of unintended consequences at work: The Internet could kill off public funding.

William Schneider is a resident fellow at AEI.