Money and Elections Chapter 7 Section 3. Key Terms Political Action Committee (PAC) Subsidy Hard...
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Transcript of Money and Elections Chapter 7 Section 3. Key Terms Political Action Committee (PAC) Subsidy Hard...
Money and Elections
Chapter 7
Section 3
Key Terms
Political Action Committee (PAC)SubsidyHard MoneySoft Money
Campaign Spending
There are 500,000 elective offices in the United States
Presidential election s consume the largest share of campaign dollars
In 2008, $2.5 billion was spent for all major and minor party presidential efforts Caucuses and primaries, conventions, general
elections and campaigns
Spending has doubled in the last decadeCandidate must raise and spend 1 million
dollars for a House seatSenate campaigns spent 20 times that
amount1.5 billion was spent on House and Senate
contests in 2008
RadioTelevisionConsultantsNewspapersOffice rent PollsWeb sites
ButtonsPostersBumper stickersData processingMass mailingsWeb sites Travel
How much is spent depends on Office involved Candidate (incumbent or challenger) Nature of opposition Availability of campaign funds
Sources of Funding
Private and Public Sources Small contributors $5 to $10 dollars
Only 10 percent of voting age people contribute Wealthy individuals and families
“Fat cats” who make large donations in their best interest
Candidates Incumbents, challengers People who want tom hold appointive public offices
Various nonparty groups Political Action Committees (PAC)- are
political arms of special interest groups with a stake in the Election
Temporary organizations Groups formed for the immediate purpose of
the campaign Hundreds of these are short lived Hold luncheons, dinners, receptions for a fee Some reach the $100,000 level
The Internet State treasuries
Subsidy- is a grant of money usually from a government
Subsidies have been more important at the presidential level
Some state provide some form of public funding for parties and/or candidacies
Why people give They are a form of political participation Some make small donations because they
believe in the candidate Many want something in return Want access to government (friends)
Regulating Finance First began in 1907
Became unlawful for any corporation or bank to make money contributions
Congress has passed several laws regulating money in campaigns
1974 response to Watergate scandal 2002 closed the “soft money” loophole
Congress can not regulate use of money in state and local elections
Every state regulates campaign finance
Federal Election Commission
Set up in 1974Handles all federal law dealing with
campaign financeIndependent agency in the executive
branchLaws are not well enforced
Agency is underfunded and understaffed
Congress has made it almost impossible for them to do their job
FEC laws cover four areas Require the timely disclosure of campaign
finance data Place limits on campaign contributions Place limits on campaign expenditures Provide public funding for several parts of the
presidential election process
Disclosure Requirements Started reporting in 1910 Intended to spotlight the place of money in a
federal campaign No one can make a gift in the name of another Cash gifts over $100.00 are prohibited All contributions must be made through a single
campaign committee
Any spending over $200.00 must be identified by name of the person or the firm who made it.
Any contribution of over $5,000.00 must be reported to the FEC
Any sum over $1,000.00 received in the last 20 days of the campaign
Limits on Contributions First regulated in 1907 Outlawed donations by corporations or national
banks Today no person can giver more than
$2,300.00 each in a federal primary and in general election
No one can give more than $5,000.oo to a PAC FED adjusts every two years for inflation
PAC Contributions Neither corporations and unions can contribute
to candidate for a federal office Their PAC can There are 4,400 PACs active today
Limits on Expenditures Began in 1925 Only to Presidential Buckley v Valeo held “money is speech”
contrary to 1st Amendment One part held is cap on spending if candidate
accepts FEC subsidies
Public Funding for Presidential Campaigns 1971 Presidential Campaign Revenue Act
Each person could donate $3.00 for individual and $6.00 for joint return
Will match the first $250.00 up to the limit Fec could give a contender $21 million.
In 2008 John McCain spent $100 million on the GOP nomination
$7million from the FEC
McCain raised $230 million in private contributions
Until 2008 both candidates took public money Could spend no more than the general subsidy Could not accept campaign funds from another
sourceOnly McCain took money and could only
spend $84.1 million for fall campaign
Barack Obama became the first in 32 years to reject public money
He raised and spent $500 million in the ten week post convention campaign
Many people believe this will lead to the collapse of public funding
$300 million was spent on television advertising
Hard Money, Soft Money 1970’s placed limits on hard money
Hard money- those contributions that are given directly to candidates for their campaign
Are limited and must be reported
Soft money-funds given to parties or to a political organization in unlimited amounts
Used for party building activities Voter registration Against a public policy
Amount of money through soft money loophole rose from $19 million 1980 to $500 million in 2000
McCain-Feingold Rule in 2002 Bipartisan Campaign Reform Act (BCRA)
Bans soft money contributionsBut law does not say that political
organizations can not raise and spend these dollars
Special interest groups popped up and $200 million poured through the loophole
Even more for congressional elections in 20008
Most are know as 527’sObama discouraged them and McCain
accepted them