Section 1—The Nominating Process Money and the Election Process The great paradox of modern elections: Money is a corrupting influence but candidates

Section 1—The Nominating Section 1—The Nominating ProcessProcess

Money and the Election Money and the Election Process Process

The great The great paradox of paradox of modern elections: modern elections: Money is a Money is a corrupting corrupting influence but influence but candidates can’t candidates can’t do without it. do without it.


Campaign Spending Campaign Spending AmountsAmounts

In 2004 the cost of all elections was $2 In 2004 the cost of all elections was $2 BillionBillion

House and Senate Campaigns cost 1 House and Senate Campaigns cost 1 billion in 2000billion in 2000

Money is required for mailings, campaign Money is required for mailings, campaign staff, radio ads, web sites, buttons, etc.staff, radio ads, web sites, buttons, etc.

Biggest single item?Biggest single item? TV advertising—Runs approximately TV advertising—Runs approximately

$150,000 for 30 seconds in prime time.$150,000 for 30 seconds in prime time.


Sources of Campaign FundingSources of Campaign Funding

Private GiversPrivate Givers—have always been the major —have always been the major source of funding.source of funding. Small ContributorsSmall Contributors Wealthier persons Wealthier persons Candidates themselves Candidates themselves Special interest groups/Special interest groups/Political Action CommitteesPolitical Action Committees

((PACs)PACs). . Temporary organizationsTemporary organizations

Fund-raising activities by candidates and Fund-raising activities by candidates and partiesparties

Public fundingPublic funding—State and Federal funds given —State and Federal funds given to candidates under certain circumstances.to candidates under certain circumstances.


Regulating Campaign Regulating Campaign FinanceFinance

Federal Election Campaign ActFederal Election Campaign Act - -

Prohibits:Prohibits: Donations directly from Corporations, Labor Organizations and National BanksDonations directly from Corporations, Labor Organizations and National Banks Donations from Government ContractorsDonations from Government Contractors Donations from Foreign NationalsDonations from Foreign Nationals Cash Contributions over 100 DollarsCash Contributions over 100 Dollars Contributions in the name of another (Contributions in the name of another (straw donor schemes) schemes)

Federal Election CommissionFederal Election Commission Bi-Partisan Campaign Reform Act of 2002Bi-Partisan Campaign Reform Act of 2002..


Federal Election Federal Election CommissionCommission

The agency set up in 1974 by Congress to The agency set up in 1974 by Congress to administer federal election laws. administer federal election laws.

Is an independent agency in the executive Is an independent agency in the executive department. department. President can’t fire members President can’t fire members Members appointed by president and Members appointed by president and

confirmed by congress. confirmed by congress.


Federal Election Federal Election CommissionCommission

Laws overseen fall into four Laws overseen fall into four areas:areas: Timely disclosure of campaign Timely disclosure of campaign

finance datafinance data limits on contributionslimits on contributions limits on expenditureslimits on expenditures public funding for several parts of public funding for several parts of

the Presidential election processthe Presidential election process


Disclosure RequirementsDisclosure Requirements No gifts in the name of another.No gifts in the name of another. Cash gifts limited to $100.Cash gifts limited to $100. No gifts from foreign sources.No gifts from foreign sources. All advertising must bear the name of the candidate.All advertising must bear the name of the candidate. All contributions must be made through a single All contributions must be made through a single

committee.committee. Only the committee can spend the money.Only the committee can spend the money. All contributions above $200 must be identified by All contributions above $200 must be identified by

source and accounted for.source and accounted for. All spending over $200 must be accounted for.All spending over $200 must be accounted for. All contributes above $5000 must be reported to FEC All contributes above $5000 must be reported to FEC

within 48 hours. Also contributions over $1000 in the within 48 hours. Also contributions over $1000 in the last 20 days of campaign.last 20 days of campaign.

Any independent committee spending more than $250 Any independent committee spending more than $250 on behalf of a candidate must also file with FECon behalf of a candidate must also file with FEC


Limits on ContributionsLimits on Contributions

Individuals limited to Individuals limited to $2000$2000 to any one to any one candidate in the primary and the same in candidate in the primary and the same in the general election.the general election.

Limited to $5000 a year to single PAC and Limited to $5000 a year to single PAC and $25,000$25,000 to a national party. to a national party.

Total contribution limit to candidates and Total contribution limit to candidates and PACs is PACs is 95,000, 95,000, during any election cycle during any election cycle (the two years from one general election to (the two years from one general election to the next one).the next one).


The Role of PACsThe Role of PACs

Neither corporations nor labor unions can Neither corporations nor labor unions can contribute to any candidate running for a federal contribute to any candidate running for a federal office. office.

PACs are the political arms of special-interest PACs are the political arms of special-interest groups—business, labor, professional, cause, groups—business, labor, professional, cause, and other organizations that try to influence and other organizations that try to influence government policies.government policies.

Clout of PACs comes primarily from their ability Clout of PACs comes primarily from their ability to raise campaign money and their willingness to to raise campaign money and their willingness to give it out.give it out.

Are more than 4400 PACs today—Are more than 4400 PACs today—


The Role of PACsThe Role of PACs

PACs get money from contributors and PACs get money from contributors and members of the sponsoring organization. members of the sponsoring organization.

Are usually focused on narrow issues.Are usually focused on narrow issues. Distribute money to candidates Distribute money to candidates

sympathetic to their views OR have a sympathetic to their views OR have a good chance of winning. good chance of winning.

Spent more than $600 Mil. in 2004.Spent more than $600 Mil. in 2004. PACs are limited to $5000 to any single PACs are limited to $5000 to any single

federal candidate in an election, but they federal candidate in an election, but they can contribute to as many candidates as can contribute to as many candidates as they want. $15000 limit to parties.they want. $15000 limit to parties.


Limits on ExpendituresLimits on Expenditures

Buckley v. Valeo–Buckley v. Valeo– stated that limits on stated that limits on spending violate free speech.spending violate free speech.

Thus cannot limit:Thus cannot limit: how much candidates spendhow much candidates spend how much of their own money candidates spendhow much of their own money candidates spend how much third parties spend to promote a candidate.how much third parties spend to promote a candidate.

However, Presidential contenders who accept However, Presidential contenders who accept federal subsidies ARE subject to limits on their federal subsidies ARE subject to limits on their campaign spending. That is part of the deal.campaign spending. That is part of the deal.


Public Funding of Presidential Public Funding of Presidential CampaignsCampaigns

Fed. Election Campaign Act set up the Fed. Election Campaign Act set up the Presidential Election Campaign FundPresidential Election Campaign Fund. .

Money is used every four years to finance Money is used every four years to finance 1) the preconvention campaigns, 2) the 1) the preconvention campaigns, 2) the national conventions and 3) the national conventions and 3) the presidential election campaigns.presidential election campaigns.

Money is administered by the FECMoney is administered by the FEC


Public Funding of Presidential Public Funding of Presidential CampaignsCampaigns

Pre-convention PeriodPre-convention Period Primaries are funded by money raised by candidates Primaries are funded by money raised by candidates

plus money received from the FEC.plus money received from the FEC. To be eligible for the public funds and candidate mustTo be eligible for the public funds and candidate must

• raise at least $100,000 in contributions from INDIVIDUALSraise at least $100,000 in contributions from INDIVIDUALS• In lots of $5000 in each of at least 20 statesIn lots of $5000 in each of at least 20 states• Built from donations of not more than $250Built from donations of not more than $250

If meet this test, FEC will match the first $250 of each If meet this test, FEC will match the first $250 of each individual donation up to a total of half. Does not individual donation up to a total of half. Does not match contributions from PACs or political match contributions from PACs or political organizations.organizations.


Funding Presidential Funding Presidential CampaignsCampaigns

Each major party nominee automatically Each major party nominee automatically qualifies for a public subsidy-- 74.6 Mil. In qualifies for a public subsidy-- 74.6 Mil. In 20042004

If the candidate accepts the money:If the candidate accepts the money: Can spend no more than the amount of the Can spend no more than the amount of the

subsidysubsidy Can not accept campaign funds from any Can not accept campaign funds from any

other source.other source.


Soft MoneySoft Money

Nature of the problemNature of the problem Bipartisan Campaign Bipartisan Campaign

Reform Act of 2002Reform Act of 2002 Limits soft-money Limits soft-money

donations to political donations to political partiesparties

Limits what parties Limits what parties can spend on can spend on campaignscampaigns

Documents

Section 1—The Nominating Process Money and the Election Process The great paradox of modern elections: Money is a corrupting influence but candidates