Campaign Finance
What is it?
• The amount of money a candidate raises and
spends on campaigning for elections
Campaign Spending
• Running for public office costs money
• Money is absolutely necessary for running for
office
– Without money you will not get elected
Problem
– The obtaining and spending off campaign funds
can be corrupt and excessive
Campaign Budgeting
TV and radio= 40-50%
Polling= 5-10%
Paid Staff= 5-10%
Candidate Travel= 5-10%
Fundraising and solicitation= 20-25%
**Average Total amount spent= $1 Billion**
**2012 Presidential Election = aprrox. $6 Billion**
2008 and 2012 Campaign Spending
• 2008 Presidential Campaign Spending
• 2012 Presidential Campaign Spending
Sources of Funding
1. Small Contributors– Those who give $5-$100 in cash
– 10% people actually do this
2. Wealthy Individuals of Families– “Fat Cats”
– Can give up to $2,500 per candidate per election
– Can give up to $5,000 per year to any PAC or interest group
– Can give up to $10,000 per calendar year to state of local party committee
– Can give up to $30,800 to a National Political Party
– Can give up to $117,000 total over 2 years
3. Candidates
– Individual candidates use their own money
– Ross Perot (1992) holds all time record, used $65
million of his own money
4. Political Action Committees (PACs and Super PACs)
– Funding vehicles through large corporations
– Channel money to candidates
– Individuals can give no greater than $5,000 to
PACs
– No regulations on PACs, or how many a
corporations can have
5. Temporary Organizations
– Groups formed for the immediate purpose of getting the candidate elected
– Fund-raising
• Dinners, door to door, receptions, phone
6. Party Donations
– Democrat and Republican parties can give to their candidate
• Soft Money = money given to the political party, indirectly give money to the candidate
• Hard Money = money given directly to candidate
7. Federal Funding
– Public Funds
– Government gives money to each candidate
whose party has received at least 5% of the
popular vote in a previous election
Regulating Campaign Finance
Federal Election Commission (FEC) – 1974
• Composed of six members, 3 Democrats and 3 Republicans– Appointed by President and approved by Senate
• Enforce limits on individual and organization contributions
• Administers federal funding for candidates
-5% rule
• Places limits on campaign expenditures
• Records contributions and money spent by each candidate
Ways around the FEC
• Donate large amounts of money to the Political parties
– Indirectly goes to candidate you want (ear mark)
• Issue Advocacy Ads
– Special Interest groups, Corporations, PACs, Super PACs
– Create commercials and ads supporting the candidate
• Cannot say for or against candidate
• Must say at the bottom which candidate the ad is for
• Does not have to include who financed the ad
• Donate large amounts of money to PACs
– Can donate to as many as you want
Challenging FEC rules
Buckley v. Valeo – 1974
Question?
• Should the Federal government limit the amount of your own money you can spend on your campaign?
Answer
• No, this is violation of the 1st Amendment, freedom of expression
Watergate Scandal
– Brought campaign finance under investigation
– Reason for stricter laws and regulations