12.2 Campaign Funding and PACs How do interest groups affect the political process?

Funding Election Campaigns is Pricey Running for mayor of a medium-sized city can cost tens of thousands of dollars Senate 2006: 10 different campaigns spent over $27 million each Presidential Elections 2008 election: close to $1 billion

Where Campaign Money Comes From… Individual Donations: Largest source of contributions—many small, individual donations can add up to become large amounts of $$ Donations under $200.00 are not required by law to be reported by PACs, political parties or campaigns Fundraisers, soliciting donations online or through mail, or candidates may donate to their own campaign

Where Campaign Money Comes From… Contributions from PACs (Political Action Committee) 2nd most important form of campaign funding The amount of money that comes from PACs depends on the candidate and the interest groups that endorse him or her

Where Campaign Money Comes From Political Party Contributions: Committees within a political party that the candidate represents may contribute money, but there are laws limiting the amount of money a political party can donate to their candidate

Where Campaign Money Comes From Public Funding—Presidential Campaigns ONLY The $3.00 Tax Check-Off Citizens filing taxes have the option of checking a box on their tax return that donates $3.00 to the Presidential Election Campaign Fund The donation is voluntary for both tax payers and presidential candidates If a candidate chooses to take the public funds, there are caps on other spending for the campaign Barack Obama was the first major party candidate to refuse public fund

Group Discussion Question If you were to eliminate ONE of these sources of income to cut down on corruption, which source of income would it be? Individual Donations Political Party Contributions PAC Funding Public Funding ($3.00 on tax returns)

Campaign Finance Laws 1907: Congress banned corporations and national banks from making campaign contributions (Tillman Act) 1940s: Labor unions were not allowed to contribute to election campaigns (Taft-Hartley Act) 1971: Federal Election Campaign Act (FECA) Requires all candidates, PACs, and political parties to report contributions they receive that exceeds a specified amount

Campaign Finance Laws 1974: FECA was amended and strengthened 1.) Limits set on campaign contributions from individuals 2.) Creating the system of public funding for presidential elections 3.) Creating the Federal Election Commission (FEC) to enforce FECA and administer the public-funding program

FECA and “Soft Money” Amendments to FECA allowed political parties to spend unlimited amounts of money on activities that did not support specific candidates Instead, the money can be used on “party-building activities” Voter registration drives, party bumper stickers, television ads supporting party principles This money donated to a political party instead of a candidate’s campaign is called soft money

Using Soft Money to Create Issue Ads Issue Ads- advertisements that support or oppose candidates’ views without specifically calling for their election or defeat Issue advertisements don’t use language such as “vote for,” “vote against,” “support” or “defeat” a candidate Rather, they try to define the character, qualifications or record of a candidate https://www.youtube.com/watch?v=hs8cGwMIq60

Bipartisan Campaign Reform Act 1996-2002: $1.5 billion in soft money was spent on issue ads in election campaigns The BCRA was passed and the legislation banned soft-money contributions to political parties for advertising and limited the ability of interest groups to air issue ads of their own

PACs Find Loopholes in Campaign Finance Laws PACs (Political Action Committees) were originally created to get around the Taft-Hartley Act—The act that banned labor unions from donating to political campaigns Individual contributions to national PACs are limited to $5,000 per donor, per year However, PACs organized in individual states often have no donation limits

Influence of PACs Supporters of PACs claim that they give interest groups and their members a greater voice than they would have if PACs did not exist While this is true, a $5,000 donation from a PAC usually has much more influence on a candidate’s campaign and the office they hold than a $5,000 individual donation Many believe PACs hold too much power, but PACs are likely here to stay as long as campaigns continue to be so expensive

527 Groups 527 Group- Tax exempt organization created to influence an election Named after a section of U.S. tax code that allows certain kinds of groups to pay no taxes If 527 groups are connected to a political party or a campaign and they must obey campaign finance laws HOWEVER, some 527 groups operate independently and do not make contributions to a party or candidate, they are not bound by any spending restrictions Swiftboat Veteran’s for Truth was a 527 Group https://www.youtube.com/watch?v=V4Zk9YmED48

Impact of 527 Groups 527 groups are often blamed for the increasing amount of negative campaign ads attacking candidates The wisdom of these wealthy, small groups is often questioned as well Supporters of 527 groups promotes freedom of speech and limiting funds to 527 groups violates donor’s right to express their views

Activity-Government Honors Review the information in 12.2 about campaigning finances, its abuses and attempts at reform Create your own campaign finance reform proposal Work individually or in groups to draft a bill that would in some way change the current system of campaign financing Should be a bill that is Constitutional—Would pass Supreme Court judicial review Will have to present to classmates on your next block day (10/12/2017)

Activity: U.S Government Work in your groups to come up with 3 problems in campaign finance today. Then come up with 4 ideas for campaign finance reform using the notes you took in class today, and pgs. 369-375 in your book. The changes can be in the form of laws, or the formation of other groups to combat campaign corruption or anything else you can think of… We will be going over your answers in class