Money and Campaigning The Maze of Campaign Finance Reforms Federal Election Campaign Act (1974) Created the Federal Election Commission (FEC) to administer campaign finance laws for federal elections Created the Presidential Election Campaign Fund Provided full public financing for major party candidates in the general election Required full disclosure and limited contributions

The Maze of Campaign Finance Reforms Soft Money: political contributions (not subject to contribution limits) earmarked for party-building expenses or generic party advertising The McCain-Feingold Act (2002) banned soft money, increased amount of individual contributions, and limited “issue ads.” 527s: independent groups that seek to influence political process but are not subject to contribution restricts because they do not directly seek election of particular candidates

Campaign Finance Reform Federal Election Campaign Act: 1. Tightened reporting requirements for contributions 2. Limited overall expenditures Challenged in 1976 in Buckley V. Valeo Supreme Court struck down as a violation of free speech, the portion of the act that limited the amount individuals could contribute to their own campaigns Soft Money: money raised for campaigns (not subject to any contribution limits)

McCain-Feingold Act Banned soft money contributions Increased amount that individuals could give to candidates from $1000 to $2000 and can rise with inflation Barred groups from running “issue ads” within 60 days of a general election if they refer to a federal candidate and are not funded by a PAC

Money and Campaigning The Proliferation of PACs Political Action Committees (PACs): created by law in 1974 to allow corporations, labor unions and other interest groups to donate money to campaigns; PACs are registered with and monitored by the FEC. As of 2006 there were 4,217 PACs. PACs contributed over $372.1 million to congressional candidates in 2006. PACs donate to candidates who support their issue. PACs do not “buy” candidates, but give to candidates who support them in the first place.

Political Action Committees Loopholes with PACs Any interest group can now get into the act by forming its own PAC to directly channel contributions of up to $5000 per candidate in both the primary and general election

Buckley V. Valeo Extends right of free speech to PACs and can now spend unlimited amounts indirectly, that is, if such activists are not coordinated with the campaign Plays a major role in paying for expensive campaigns

Citizens United v. Federal Election Commission http://www.oyez.org/cases/2000-2009/2008/2008_08_205 By a 5-to-4 vote along ideological lines, the majority held that under the First Amendment corporate funding of independent political broadcasts in candidate elections cannot be limited. The majority maintained that political speech is indispensable to a democracy, which is no less true because the speech comes from a corporation. The majority also held that the BCRA's disclosure requirements as applied to The Movie were constitutional, reasoning that disclosure is justified by a "governmental interest" in providing the "electorate with information" about election-related spending resources. The Court also upheld the disclosure requirements for political advertising sponsors and it upheld the ban on direct contributions to candidates from corporations and unions.