Unit IIElection Process

FEC – Federal Election Commission BCRA – Bipartisan Campaign Reform

Act Hard money = Federal money

Political donations raised from federally permissible sources within the limits established by BCRA

Soft money = Nonfederal money Political donations made in such a way as

to avoid federal regulations.

Beginning of time—Civil War: No regulation Civil War—1910

Gilded Age Exceptionally scandalous politicians nationally

Boss Tweed 1868: 75% of money used in congressional elections

through party assessments 1867: Naval Appropriations Bill

First federal effort to regulate campaign finance Aimed at stopping the political shakedown naval yard

workers for political contributions Prohibits officers and employees of the fed. gov’t from

soliciting contributions 1883: Civil Service Reform Act (Pendleton Act) prohibits

the same solicitation of all federal workerswww.mit.edu/~17.251/finance.ppt

Corrupt Practices Acts of 1911 and 1925 Set disclosure requirements for House

and Senate Elections Spending limits ($25k for Senate; $5k for

House) Ridiculously weak and regularly violated

1971 Federal Election Campaign Act (FECA)

1976: Buckley v. Valeo (1976)www.mit.edu/~17.251/finance.ppt

Buckley v. Valeo, (1976), was a case in which the Supreme Court of the United States upheld a federal law which set limits on campaign contributions, but ruled that spending money to influence elections is a form of constitutionally protected free speech, and struck down portions of the law. The court also stated candidates can give unlimited amounts of money to their own campaigns.

Original ProvisionOriginal Provision Effect of Effect of Buckley v. ValeoBuckley v. Valeo

Expenditure limitsExpenditure limits

Overall spending limits (Congress and Overall spending limits (Congress and president)president)

Struck down partially Struck down partially (freedom of speech)(freedom of speech)

Limits on the use of candidates’ own resourcesLimits on the use of candidates’ own resources Struck down entirely Struck down entirely (freedom of speech)(freedom of speech)

Limits on media expendituresLimits on media expenditures Struck down entirely Struck down entirely (freedom of speech)(freedom of speech)

Independent expenditure limitsIndependent expenditure limits Struck down entirely Struck down entirely (freedom of speech)(freedom of speech)

www.mit.edu/~17.251/finance.ppt

Original ProvisionOriginal Provision Effect of Effect of Buckley v. ValeoBuckley v. Valeo

Contribution limitsContribution limits

Individual limits: $1k/candidate/electionIndividual limits: $1k/candidate/election AffirmedAffirmed

PAC limits: $5k/candidate/electionPAC limits: $5k/candidate/election AffirmedAffirmed

Party committee limits: $5k/candidate/electionParty committee limits: $5k/candidate/election AffirmedAffirmed

Cap on total contributions individual can make to Cap on total contributions individual can make to all candidates ($25k)all candidates ($25k)

Struck down (freedom of Struck down (freedom of speech)speech)

Cap on spending “on behalf of candidates” by Cap on spending “on behalf of candidates” by partiesparties

AffirmedAffirmed

www.mit.edu/~17.251/finance.ppt

Purpose In 1975, Congress created the Federal Election

Commission (FEC) to administer and enforce the Federal Election Campaign Act (FECA)

the statute that governs the financing of federal elections.

The duties of the FEC, which is an independent regulatory agency, are to

disclose campaign finance information enforce the provisions of the law such as the limits and

prohibitions on contributions, oversee the public funding of Presidential elections.

Government FEC – Federal Election Commission

Campaign Committees Candidates

National Party Committees State & Local Party Committees Separate Segregated Funds

PACs connected to corporations, unions, etc. Nonconnected Committees

All other PACs 527s Individuals

Federal Election Campaign Act (FECA) 1975

Bipartisan Campaign Reform Act (BCRA) 2002 Major changes

under BCRA

The Bipartisan Campaign Reform Act (BCRA) of 2002, also known as "McCain-Feingold," after its sponsors, is the most recent major federal law on campaign finance, which revised some of the legal limits of expenditure set in 1974, and prohibited unregulated contributions (called "soft money") to national political parties. ‘Soft money’ also refers to funds spent by independent organizations that do not specifically advocate the election or defeat of candidates, and are not contributed directly to candidate campaigns.

In General The financing of federal

elections Specifically

Disclosure of financial activity

Contributions Receiving and Giving

Expenditures Candidate support

activities Federal election

activities

Federal Funds Collected from permissible sources Subject to contribution limits

Levin Funds For state and local party committees only Collected from any entity except fed

cand. Only used for certain types of FEA

Nonfederal Funds Subject to state law only May be used to pay for expenses related

to not federal elections

Federal Money Most limitations Federal, state and local

elections Levin Money

Fewer limitations Some Federal election

activities, state and local State Money

Typically, fewest limitations

State and local elections only

Federal “Hard Money”

LevinQuasi-Fed $

State“Soft Money”

It depends! Candidate

Candidate specific activities

Contributions to other candidates, parties or causes

DNC/RNC Federal candidates Allocated nationally

State Party Committees Federal, state & local

candidates Allocated statewide

PACs Support candidates,

parties that agree on specific issues

527s Separate campaign