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)
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
Money and Campaigning
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
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.