The Election Process

1. The Election Process Module 6.2: Campaign Finance

2. A Typical Election Campaign

3. Campaign Finance • How to raise money for election campaigns • Most candidates spend > ¼ of campaign raising $ • Four ways to fund a campaign: • Candidate contributions • The candidate pays “out of pocket” • Individual Contributions • Supporters donate money • PAC Contributions • Political Action Committees raise funds for the campaign • Public Funding • Tax dollars • Qualifying parties and candidates eligible for “matching funds”

4. Questions for Discussion • Should there be a limit to how much $ any one candidate can pay out of pocket for his own campaign? • Should there be a limit to how much $ any one person can give to a campaign? • Should there be a limit to how much $ any organized group can give to a campaign? • Should election campaigns be publicly funded?

5. Timeline of campaign regulation • 1867: Naval Appropriations Bill • limits fundraising by naval officers • 1883: Pendleton Act • limits fundraising by all civil service employees • 1905: T. Roosevelt’s State of the Union Address • proposes public financing and ending corporate contributions • 1907: Tillman Act • prohibits corporate contributions, but is rendered unenforceable • 1910: Federal Corrupt Practices Act • establishes disclosure requirements for House Candidates • 1911 amendment extends to Senate Candidates • 1925 revision establishes limits to campaign funding, but is largely ignored • Remains until 1971

6. Timeline of campaign regulation • 1940: Amended Hatch Act • Sets individual contribution limit to $5K • Loopholes allow multiple committees for single candidates • 1943: Smith-Connally Act • Limits Labor Union contributions • Unions used dues to fund campaigns in 1936 • 1944: 1st PAC formed • PACs solicit voluntary contributions • 1947: Taft-Hartley Act • Makes Hatch and Smith-Connally limits permanent

7. Timeline of campaign regulation • 1967: 1st House Campaign Finance Reports • Law on the books since 1925 • 1971: Federal Election Campaign Act • Repeals Corrupt Practices Act • Establishes new regulatory framework • 1971: Revenue Act • Establishes public funding stream for Presidential Election Campaigns • 1974: FECA revised • Sets $1000 per camp/25 camp max limit on individual contributions • Sets $5000 per camp limit on PACs • Limits “Out of pocket” contributions to one’s own campaign • Limits “Independent Expenditures” to $1000 per camp • Ended ban on contributions from government employees • Ended limits on campaign ads • Creates Federal Election Commission

8. Timeline of campaign regulation • 1976: Buckley v. Valeo • Challenges FECA as violations of Free Speech • SCotUS upholds • disclosure requirements • Individual limits • Voluntary public funding • FEC • SCotUS strikes down • “out of pocket” limits • independent expenditure limits

9. Timeline of campaign regulation • 1976: FECA revised to conform to Buckley v. Valeo • Sets $20,000 limit on individual contributions to parties • Sets $5000 limit in individual contributions to PACs • 1979: FECA revised (Again!) • Sets $1000 limit on “in-kind” contributions • Raises minimum amount for reporting to FEC • Prohibits FEC from conducting random audits • 1979: Loophole in FECA • FECA silent on individual and PAC contributions to parties (‘soft money’)

10. Timeline of campaign regulation • 2002: Bipartisan Campaign Reform Act • Sets higher limits • Individual contributions ($2000) • PAC contributions ($10,000) • Sets limit to ‘soft money’ contributions • Addresses independent expenditures loophole • Previous legislation silent on independent advertising • BCRA seeks to regulate “Issue Ads” • “Stand by Your Ad” • Since 2002, States have gone beyond BCRA in efforts to regulate campaign funding