AP USGOVERNMENTReviewCAMPAIGNFINANCE

  • Federal Elections Campaign Act (FECA) passed in 1974 – to control campaign costs/donations:
  • Federal Election Commission (FEC) established to enforce campaignlaws
  • Public financing of presidential campaigns – monies come from voluntary $3 contributions by taxpayers on taxreturns
  • P candidates can get federal matching funds from federal gov’t, in general election for each contribution of $250 or less – govt doubles all contributions of $250 or less but have to agree to a max. campaign spendinglimit
  • No $ for independents – only Ds &Rs
  • 2004 first year both candidates declined matchingfunds
  • 2008 McCain took them, Obama declined (and raised much more$)
  • Note: there are NO federal funds for congressional elections and no limits on how much they canspend
  • PACs can give $5,000 per candidate (most active in House elections); no aggregatelimit
  • Individuals can give $2,600 to acandidate
  • USED to have an aggregate limit of $123,200 BUT…
  • McCutcheon v. FEC decided in 2014 overturned aggregate limits on federal campaign contributions – now there is no aggregate limit – but SCOTUS kept the $2,600 per election limitonhowmuchindividualscangivetoanindividualpolitician'scampaign
  • Disclosure rules - candidates must report all contributions & how $ isspent
  • PACs advocating civil rights issues have grown themost
  • Buckley v. Valeo(1976) – lawsuit challengingFECA.
  • SCOTUS upheld FECA’s limits on individual contributions, the disclosure and reporting provisions, and the public financing scheme ---- said that limitations on donations to candidates were constitutional because of the compelling state interest in preventing corruption or the appearance ofcorruption.
  • BUT, the Court also held that portion of FECA limiting how much individual can contribute to his own campaign was an unconstitutional violation of free speech/expression (Perot spentover

$60 million on his ’92 campaign – more than Clinton & Bushcombined!)

  • Soft money – WAS a loophole in campaign contributions where unlimited $ could go to party’s general fund, not a specific candidate. Funds had to go to political parties for general election activities such as voter registration drives …..not a specificcandidate.

oMcCain-Feingold Act – BCRA (Bipartisan Campaign Reform Act) of 2002

  • prohibits softmoney
  • corporate/union monies can’t be used to pay for ads of federal candidates within 30 days of a primary or 60 days of a generalelection
  • "standbyyourad"provision-hearcandidate’svoiceclaimingresponsibilityfortheadand approving itsmessage

o527Organizations

  • Not regulated by McCain-Feingold (BCRA) or FEC – was a newloophole
  • Independent groups that do not “directly seek the election of a particularcandidate”
  • Unlimitedcontributionsallowedifpoliticalmessagesdon’tdirectlyendorsecandidateswith“vote for” or “voteagainst”…
  • Used to fund issue ads – MoveOn.org; Swift Boat Veterans forTruth

oSuperPacsCitizens United vs. FEC, 2010

  • independent expenditure-onlycommittees
  • CAN advocate for or against federal candidates but may NOT be made in cooperation with, or at therequestorsuggestionof,acandidate,thecandidate'scampaignorapoliticalparty.
  • Citizen’s United, 2010 – 5/4 SCOTUS decision that upholds SuperPacs and unlimited political spending by corporations & unions – based on 1stAmendment

Difference between PACs, SuperPACs, and 527s:

PACs / SuperPacs / 527’s
  • Created to funnel campaign contributions directly to candidates.
  • Annual donations are limited to $5,000 from individuals, whose names and contributions must be disclosed
  • Corporations cannot contribute directly to PACs but can sponsor a PAC for employee donations.
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  • Can raise and spend unlimited amounts on politics, but must operate independently of candidates and cannot contribute to individual candidates.
  • Donors must be disclosed to the Federal Election Commission
  • Corporations, unions
  • 1st Amendment free speech (Citizens United)
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  • Named for a section in the tax code, a 527 group can run political ads with unlimited individual and corporate contributions but must disclose donors to the IRS.
  • Can’t say vote “for” or vote “against” in the ad
  • Issue ads!