Chapter 7 The Electoral Process Section 3 Money

Chapter 7 The Electoral Process Section 3 - Money and the Election Process

Fat Cat----rich political donor Section 1—The Nominating Process

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

Campaign Spending Amounts Ø The presidential race alone cost nearly $2. 4 billion Ø Candidates for Congress in 2008 have spent nearly $95 million from their own pockets to get elected Ø Money is required for mailings, campaign staff, radio ads, web sites, buttons, etc. Ø Biggest single item? l TV advertising—Runs approximately $150, 000 for 30 seconds in prime time.

Sources of Campaign Funding Ø Private Givers—have always been the major source of funding. l l l Small Contributors Wealthier persons Candidates themselves Special interest groups/Political Action Committees (PACs). Temporary organizations Fund-raising activities by candidates and parties Ø Public funding—State and Federal funds given to candidates under certain circumstances. Ø

Federal Election Committee Ø The agency set up in 1974 by Congress to administer federal election laws. Ø Is an independent agency in the executive department. l l President can’t fire members Members appointed by president and confirmed by congress.

Federal Election Commission Ø Laws overseen fall into four areas: (#5 GR) l Timely disclosure of campaign finance data l limits on contributions l limits on expenditures l public funding for several parts of the Presidential election process

Disclosure Requirements Ø Ø Ø Ø Ø No gifts in the name of another. Cash gifts limited to $100. No gifts from foreign sources. All advertising must bear the name of the candidate. All contributions must be made through a single committee. Only the committee can spend the money. All contributions above $200 must be identified by source and accounted for. All spending over $200 must be accounted for. All contributes above $5000 must be reported to FEC within 48 hours. Also contributions over $1000 in the last 20 days of campaign. Any independent committee spending more than $250 on behalf of a candidate must also file with FEC

Limits on Contributions Ø Individuals limited to $2000 to any one candidate in the primary and the same in the general election. Ø Limited to $5000 a year to single PAC and $25, 000 to a national party.

The Role of PACs Neither corporations nor labor unions can contribute to any candidate running for a federal office. Ø PACs are the political arms of special-interest groups—business, labor, professional, cause, and other organizations that try to influence government policies. Ø

Ø Clout of PACs comes primarily from their ability to raise campaign money and their willingness to give it out. Ø More than 4400 PACs today—

The Role of PACs Ø PACs get money from contributors and members of the sponsoring organization. Ø Are usually focused on narrow issues. Ø Distribute money to candidates sympathetic to their views OR have a good chance of winning.

Ø Spent more than $900 Mil. in 2004. Ø Limited to $5000 to any single federal candidate in an election, but can contribute to as many candidates as they want.

Public Funding of Presidential Campaigns Ø Fed. Election Campaign Act set up the Presidential Election Campaign Fund. Ø Money is used every four years to finance 1) the preconvention campaigns, 2) the national conventions and 3) the presidential election campaigns. Ø Money is administered by the FEC

Funding Presidential Campaigns Ø Each major party nominee automatically qualifies for a public subsidy-- 74. 6 Mil. In 2004 Ø If the candidate accepts the money: l l Can spend no more than the amount of the subsidy Can not accept campaign funds from any other source.

Funding Presidential Campaigns Ø For a minor party to qualify for public funds, the minor party must either l l l 1) have at least five percent of the popular vote in the last presidential election or 2) win at least that much of the vote in the election itself. Very few minor parties meet the qualifications

Hard Money v Soft Money Ø Hard money – money raised and spent to elect candidates Ø Soft money – raised for “party building activities” l l Voter drivers Campaigning

Ø Before the Bipartisan Campaign Reform Act of 2002, soft money was used to fund candidates through legal loopholes