Campaign Finance Reform
Campaign finance refers to the money candidates and parties raise during election season and how they spend it. They are big buzzwords used during the season, so in this episode we delve into how candidates get the money they need to spend to win an election.
One of the ways a campaign can raise money is through a non-profit organization. They are allowed to run advertising, but cannot dedicate all of their resources to a candidate. At least 51% of their resources must be dedicated to social welfare
Another way a candidate can raise money is through a Political Action Committee, otherwise known as a PAC. The contributions of a PAC go directly to candidates. Corporations cannot donate to a PAC, but can sponsor one, such as a PAC for their employees to donate to. Contributions to a PAC are limited to $5,000 per individual.
There is another version of a PAC, called a Super PAC. A Super PAC can raise unlimited amounts of money, but it doesn’t go straight to the candidate. And the candidate cannot dictate how Super PAC money is spent.. Instead, Super PACs can pay for advertisements, bumper stickers, phone banks, etc. These funds do not have to disclose, since the money isn’t going to the candidate.
Campaigns and Super PACS have found ways to skirt around the legislation that they cannot directly work together. For instance, candidates can attend a fundraiser that is for a Super PAC. Also, as the Daily Show pointed out, Ted Cruz’s campaign uploaded raw footage to YouTube that was meant to be used for a television ad, paid for by a Super PAC. Now these 2 entities could not work directly together, so the Cruz campaign uploaded some very uncomfortable footage to a hidden account, so that the Super PAC could then use it. It’s very awkward stuff.
Candidates can also receive funds from their political party, and the Presidential Election Campaign Fund. Political parties can accept donations of up to $30,000 from individuals, $15,000 from PACs, but cannot accept money from a corporation. And if you have ever done your taxes, you should have come across the option to donate to the Presidential Election Campaign fund. This is a public option offered to candidates.
In 2012, Barack Obama decided not to accept the donations from this public fund, and was able to raise more money than Mitt Romney. And as usual, the candidate who raises and spends more, wins the election.
This is not an exhaustive list of ways campaigns raise money. There are also 527s, 501(c)4, and other ways, just to list a few.
Until 1976, there were limits on campaign spending. There was a monumental Supreme Court case in 1976, Buckey v Valero, which determined that spending money is a form of free speech and therefore, could not be limited. At that time every form of communication required money, so by restricting how much a campaign could spend, you were limiting their voice and their reach. But since there are so many new avenues of free advertising, is this outdated?
Presidents are limited to budgets. So wouldn’t it be better to give a candidate and campaign a limit to stay within? It would level the playing field and would give the public the chance to see how a candidate spends their money, and how responsible they could be on a budget.
Now the agency that administers and enforces these campaign finance laws is the Federal Election Commission, otherwise known as the FEC. It is an independent agency, made up of three republicans, and three democrats, who are nominated by the president, and approved by the Senate. And as I’m sure you can imagine, with the current political climate in the United States, an equal number of congresspeople from each party can lead to some serious gridlock, where nothing is getting done.
Also, like with almost all of our other episode topics, a major problem is a lack of enforcement of the existing laws. With the agency only comprised by 6 people, they don’t have the ability to oversee and enforce the laws for all campaigns, so candidates and those that fund them, are able to get away with more than they should.
Another roadblock for reform is the internet era we all exist in. The last set of campaign finance laws were enacted in 1971, way before internet, emails, and cell phones existed. These days, campaigns can place ads on social media, YouTube, emails, and text messages. The FEC can’t determine the cost of these avenues, therefore, it is difficult to regulate the expenditure of web based methods of campaigns.
So this episode was a part one on campaign finance. Our next episode really dives deeper into PACs, Super PACs, and campaign finance.