1. Money and the Election Process
Chapter 7.3
Money and the Election Process

2. What Does it Cost? How does it all work? 1990-92: $1Billion
Radio and Television Time
30 minutes of network time: $500,000
30-second prime-time spot: $150,000
Professional campaign managers and consultants
Newspaper advertisements
Pamphlets, buttons, bumper stickers, & posters
Office rent
Polls & data processing
Mass mailings
Travel & Food

3. Why People Give Belief in the party or candidate
Access to government: making friends
Political appointments
Social recognition
Policy-making influence

4. Sources of Funding Private and Public Sources (mostly private)
Only 10% of voters contribute money to finance campaigns
Small contributors: $5 - $10
Wealthy Individuals and Families
Candidates
Ross Perot (1992): $65 Million
Political Action Committees (PACs)
Temporary Organizations
Government Subsidies

5. PAC Contributions Corporations and unions cannot contribute
PAC’s – the political arm of special-interest groups
4,000 PAC’s today
PAC members donate money to the PAC treasury, which is used as campaign contributions
No more than $5000 per election (to as many people as they choose)
2000 Election: PAC’s gave $400 million

6. Regulating Campaigns The Blur of Campaign Financing (Super PACs)
Campaign finance laws
Disclosure Requirements
Limits on Contributions
PAC Contributions
Limits on Expenditures
Public Funding (Subsidies)
The Federal Election Commission (FEC)

7. Disclosure Requirements
Requirements are so detailed that candidates now have at least one CPA
No one can make a contribution in the name of another
No cash gifts of more than $100 and foreign sources
All contributions must be made through a single campaign committee
$200+ must be identified by source and date
$5000+ must be reported within 48 hours

8. Limits on Contributions
No more than $2000 to any primary or general election
No more than $5000/year to any PAC ($25,000 to any national party)
Before this law it was far more generous
Nixon Re-election (1970):
W. Clement Stone - $2 million to Nixon
Richard Scaife - $1 million

9. Limits on Expenditures
Buckley v. Valeo, 1976
“Money is speech.”
Spending limits only apply to those who accept government money (FEC money)
Why is there a spending limit?

10. Public Funding of Presidential Campaigns
$3 per tax return / $6 on a joint tax return
Minor party candidates can receive public funding if:
They have won 5% of the popular vote in the last election
They win at least that much of the total vote in the current election (Ralph Nader, 2004)

11. Hard Money, Soft Money
Hard money – money raised and spent to elect candidates for Congress and the White House
Soft money – funds given to party organizations for “party-building activities”