John McCain's campaign has been hurt by his stance on immigration

Carl Hulse:

The presidential campaign of Sen. John McCain, the Arizona Republican who once seemed poised to be his party's nominee, acknowledged that it was in a political and financial crisis as a drop in fundraising forced it to dismiss dozens of workers and aides and retool its strategy on where to compete.

The campaign said the decline in contributions had left it with $2 million. It said it had raised just $11.2 million over the past three months, despite McCain's pledge to do better than his anemic $13 million showing in the first three months of the year.

McCain's advisers laid blame for his most recent spate of problems on his close association with the recently defeated immigration bill, which prompted a sharp backlash against his campaign from conservatives already skeptical of his ideological credentials.

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McCain's aides expressed hope that with the immigration battle over, the campaign could recover its momentum as the focus shifted to other issues, like federal spending.

"The decisions we made today were not easy," said Terry Nelson, the McCain campaign manager, who said he would no longer accept a salary. While refusing to go into detail about the depth of the cuts or exactly how many staff members had been fired, Nelson said "every department" was affected; Republicans close to the campaign said that at least 50 and as many as 80 people were being let go, out of a staff of around 150 people.

Campaign strategists said McCain's ability to raise money was severely limited in recent weeks by the backlash over his support of the immigration legislation, which collapsed last in the Senate. They said McCain now was looking to raise half of what he once expected - $50 million this year - and was retooling the campaign to save as much money as possible for TV advertising and travel.

"Clearly, we didn't meet our goals for the second quarter in fundraising, which I largely attribute to the immigration legislation that has dominated the news for the past two months, and his position is not too popular with our small donors," said Charlie Black, a senior Washington political strategist who is a volunteer adviser to McCain. "We have got to restructure the budget and the organization."

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