WASHINGTON (CNN) -- The latest news from the McCain campaign is not good.
John McCain started this campaign as the establishment candidate. He's running in a party that usually nominates the establishment candidate. McCain made peace with his old rival, George W. Bush, and recruited some key Bush operatives and contributors for his campaign.
"We believed that we would raise over $100 million during this calendar year and we constructed a campaign that was based on that assumption," McCain campaign manager Terry Nelson said in a conference call. "We believe today that that assumption is not correct."
The McCain campaign raised a disappointing $13 million in the first quarter. That put McCain last among the six major contenders in both parties. Watch CNN Senior Political Analyst Bill Schneider explain why Sen. McCain got into trouble »
The second quarter results? Worse: $11.2 million.
What's next? Cutbacks.
"We've made a decision to restructure the campaign to help ensure we have the resources necessary to win the Republican nomination," Nelson said.
Some 50 or more staffers are being let go. Senior aides are taking a pay cut.
The campaign attributes its problems to a difficult fundraising environment for all Republicans this year, and for McCain specifically because of one issue.
"McCain people acknowledge that immigration has been the Achilles heel for the senator in this election," CNN Political Editor Mark Preston said.
Where does the McCain camp go from here? Back to the future.
"He's going back to what he did in 2000," Preston said. "He realizes that the way he is going to win this nomination is not by getting the establishment votes but rather a grassroots campaign."
The campaign says it intends to focus on the early primary and caucus states like Iowa, Nevada, New Hampshire and South Carolina.
The latest polls show McCain running third or fourth in all those states except New Hampshire, where he beat Bush in 2000. A recent poll shows McCain tied for second place in New Hampshire.
McCain used to have broad bipartisan appeal. Now Democrats are angry at him because of his support for the war in Iraq. And Republicans are angry at him because of his stand on immigration.
There's bipartisanship for you. E-mail to a friend