Campaign Finance

Public Funding OptionHow Does Public Funding for Campaigns Work? • To qualify candidates must agree to limit campaign

spending to a specified amount• FEC certifies the amount of public funds to which the

candidate or convention committee is entitled• U.S. Treasury makes payments from Presidential

Election Campaign Fund.– fund consists of dollars voluntarily checked off by taxpayers on

their federal income tax returns– checkoff neither increases the amount of taxes owed nor

decreases any refund due for the tax year in which the checkoff is made

As a result, candidates are increasingly NOT taking public funds…they can raise more on their own! (specifically presidential candidates)

Political Parties vs. Interest GroupsJames Madison did not distinguish between interest groups and political parties when he referred to both as “factions,” but today they differ in significant ways.

Political Parties

1. Political parties nominatecandidates to run for elective office.

2. Political parties focus on a broadrange of issues to appeal to a widerange of the electorate.

3. Political parties compete forcontrol of the legislative branchby trying to win the majority ofthe seats in Congress.

Interest Groups

1. Interest groups may supportcertain candidates for office, butthey do not nominate their owncandidates.

2. Interest groups often take a narrow focus on a specific issue, such as gun control, abortion, or the environment.

3. Interest groups compete forinfluence over elected officials sothat they decide public policy issuesin the interest group’s favor.

People join or create special interestgroups to encourage laws that suitthem. Special interest groups rangein size from one to millions. Theyrepresent businesses, faiths, regions,or ideologies.

Interest groups alert thenews media to issues and provide information in an attempt to influence public opinion.

Interest groups advisemembers on the policies and voting records of politicians so they can vote for the lawmakers that support their views.

Interest groups hire lobbyists to persuade lawmakers to support the group’s goals and ideas.

Lobbyists develop contacts to ensure they can reach key lawmakers.They persuade lawmakers to adopt theinterest group’s views, provide theinformation on the effects of specificlegislation and may help write bills.They sponsor opinion polls to demonstratesupport for an issue. They also helplawmakers raise campaign funds.

Lobbyists persuade political parties to add interest group’s issues to the party platform and arrange for soft money contributions to be made to the party.

Lobbyists alert interest groups to proposed legislation that affects them and reports lawmaker’s positions on key bills.

Parties give extra campaign support to candidates incrucial races.

A few well-known interest groups…

MADD Mothers Against Drunk DrivingNOW National Organization for WomenAARP American Association of Retired PeopleNAACP National Association for the Advancement of Colored PeopleNRA National Rifle AssociationNEA National Education AssociationABA American Bar AssociationAMA American Medical AssociationNARAL National Abortion Rights Action LeagueNRLC National Right to Life CampaignNORML National Organization for the Reform of Marijuana Laws

League of Women Voters * US Chamber of Commerce Sierra Club * World Wildlife Federation * Human Rights Campaign ZPG * PETA * Christian Coalition * Common Cause * AFL-CIO

Party Building Activities?

Political parties are allowed to spend as much money as they want as long as the money goes to “party-building” activities, such as voter registration drives, issues ads--that is, ads that support party positions on issues. This spending of soft money, unlike hard money (regulated) spent promoting specific candidates, is largely unregulated.

Soft money is often viewed as a king-sized loophole in campaign finance law.It is mainly comprised of “gifts” to political parties from corporations, laborunions, and wealthy individuals. Six-figure donations are not uncommon!

Soft money is increasingly used to pay for media advertising…and it is usedto get around legal limits on campaign contributions.

Major Campaign Finance RulesGeneral RegulationsThe Federal Election Commission (FEC) polices campaigns and has the power to investigate and prosecute violators. All contributions over $100 must be disclosed, giving the name, address, and occupation of the contributors. No cash contributions may exceed $100, and no foreign contributions may be accepted.

Contribution Limits

To a candidate orcandidate committee To a national To any other Total perper primary or party committee political committee calendargeneral election per year per year year

Individuals $1,000 $20,000 $5,000 $25,000

PACs $5,000 $15,000 $5,000 No limit

Campaign Spending…

• How much is too much?

• What are the pros and cons to unlimited contributions?

• Do you feel the ‘loop holes’ should be fixed?

2012 Campaign Financing• Funding Chart

• Citizens United v. Federal Election Commission – 2010– 5-4 Supreme Court vote

– Decision: outside spending by corporations in election campaigns is a constitutional right

– Majority- "political speech does not lose First Amendment protection simply because its source is a corporation."

– Dissenting- "substantial body of evidence" that outside spending by corporations "can be corrupting in much the same way as direct contributions."

Campaign Finance

General Election FundsCandidates are eligible for public funding of allcampaign costs associated with the general election if they agree to:

• limit spending to the amount received by the federal government.

• not receive private contributions if accepting public funding (1996 = $61.8 million).

Campaign Finance

Third Party CandidatesCandidates are eligible for matching public funds…

• if in the last election, the candidate received 5% or more of the popular vote.

• if no candidate ran in the last election, the candidate may receive public funding after the election is over if he/she receives 5% or more of the popular vote.

• the amount received is based on the proportion of the popular vote he/she receives.

Campaign Finance

Primary Matching FundsGovernment matches all contributions $250 or less if candidate meets the following criteria:

• show broad-based support by receiving at least $5,000 in contributions of $250 or less in 20+ states

• candidate must agree to national limit on campaign spending for all primary elections (1996 = $31 million)

• candidate must agree to spending limits for each state

• candidate cannot spend more than $50,000 of own funds

Soft Money Contributions to…

Republicans Democrats

1992 $49.8 million $36.3 million

1996 $138.2 million $123.9 million

Who are the big soft money donors?

To Democrats To Republicans

Seagram & Sons Philip Morris$1.71 million $2.538 million

Comm. Workers of America RJR Nabisco $1.13 million $1.189 Million

Walt Disney Co. Union Pacific Corp.$997,000 $707,393

Revlon Seagram & Sons$673,000 $685,145

MCI Worldcom Bell Atlantic$650,203 $649,854

History of Campaign Finance

• As you watch, chart the changes that have occurred in laws pertaining to campaign finance

Debate: Citizens United Case