Campaign Finance: Yesterday, Today, and Tomorrow

By Sam Torre

As the 2016 Presidential election nears, the anticipated and often feared influence of corporate wealth on politics through super PAC contributions continues to raise concern throughout the United States. As The New York Times Editorial Board predicted, “This election year will be the moment when individual candidate super PACs—a form of legalized bribery—become a truly toxic force in American politics.”

These apprehensions breed discussion about campaign finance reforms. Proponents of reform fear that contributions by large corporations will allow the donors to exert control over policy and push their own political agendas on the candidates to whom they contribute. They look to stop organizations from using their large sums of money as incentive for politicians to pass legislation in accordance with their special interests. Opponents of these reforms argue that the legislation violates the Constitution, specifically the right to freedom of speech, since monetary contributions enable candidates to communicate their platforms to voters. How have these regulatory policies changed in the last several decades, and how do they impact Presidential candidates’ campaigns today? Additionally, is the panic caused by fear of super PACS warranted or simply blown out of proportion?

After decades of mostly unsuccessful attempts at campaign finance reform dating back to the 1800s, policymakers enacted stricter regulations in 1971 with the creation of the Federal Election Campaign Act (FECA). Goals of replacing previous, evaded legislation, including the Federal Corrupt Practices Act of 1925 and the Hatch Act of 1939, with more enforceable legislation remained at the forefront of the discussion. FECA, signed by Richard Nixon in 1972, required candidates in federal elections to disclose campaign contribution details. Although FECA achieved some progress in terms of regulating campaign finance, it required amending following the infamous Watergate Scandal later that year. After the discovery of a link between the money used by Nixon’s reelection campaign and the Watergate break-in, the American public’s emergent distrust of government led to the FECA reforms of 1974.

The creation of the Federal Election Commission (FEC) arguably remains the most influential aspect of those 1974 FECA amendments. The FEC defines their duties as “to disclose campaign finance information, to enforce the provisions of the law such as the limits and prohibitions on contributions, and to oversee the public funding of Presidential elections.” This establishment provides enforcement practices which failed to exist in previous legislation. Additionally, the amendments included individual donation limits of $1,000 to a single candidate and no more than $25,000 delegated between federal election candidates. The reforms also validated Political Action Committees (PACs), or outside entities established to campaign for a candidate’s election, by limiting their contributions to $5,000 per candidate.

However, several provisions of the reforms, including candidate spending limits of $10 million in primaries and $20 million in general elections, were not readily accepted nationwide.

The Supreme Court case Buckley v. Valeo (1976) took a step away from regulation and determined unanimously that limiting campaign expenditures violated freedom of speech rights, except in the cases of candidates who received public funding. Buckley v. Valeo remains a landmark case due to its denial of financial equality as a standard for federal elections while also demonstrating the continued struggle between upholding individual rights and establishing an accepted sense of fairness in elections.

2002 marked the enactment of the Bipartisan Campaign Reform Act, more commonly known as the McCain-Feingold law in recognition of the act’s main sponsors, U.S. Senator John McCain (R-AZ) and former Wisconsin State Senator Russ Feingold. A major provision of the act included ending the use of soft money in federal elections, or what the FEC describes as nonfederal “money raised outside the limits and prohibitions of federal campaign finance law.” The act also coined the term ‘electioneering communications’ to describe paid television and radio ads which “discuss[ed] candidates in the context of certain issues without specifically advocating a candidate’s election or defeat,” and disallowed their funding by corporations or labor unions. Additionally, individual contribution limits became $2,000 to a single candidate and $95,000 every two years for overall contributions. While these alterations were, in part, adjusted for inflation, they also demonstrated a growing tendency toward deregulating campaign finance.

The Supreme Court case Citizens United vs. FEC (2010) struck down on parts of the McCain-Feingold law. The Court ruled that free speech rights also extend to corporations and unions, giving rise to super PACs. Individuals and corporations may contribute unlimited amounts of money to super PACs, permitting these super PACs to spend limitlessly on campaigns, as well. As a result, the use of super PACs in the 2008, 2012, and 2016 Presidential elections grew exponentially. While candidate money is capped and goes directly to the candidate, super PAC contributions have no limits and do not go directly to the candidates, but rather to outside campaigns. According to the New York Times, in 2008, before Citizens United vs. FEC created super PACs, roughly 99.9% of total campaign contributions went directly to the candidate. In 2012, the first Presidential election to follow the Citizens United case, approximately 8% of total funds were contributions to super PACs and 92% were contributions to the candidate. Surprisingly, in 2016, 49% of total funds were contributed to super PACs and 51% went directly to the candidate, nearly an even split. The ability to donate limitless amounts of money to super PACs tends to attract wealthy donors and corporations. Additionally, super PACs may target their campaigns to specific aspects of a candidate’s platform and often use smear tactics to create negative and typically distorted (or simply untrue) campaigns about a candidate’s opponents. Although considered unscrupulous by many, this ability to donate to smear campaigns through contributions to super PACs incentivizes others. Together, these features explain a proliferating trend toward super PAC use, only exacerbating concerns of a government swayed by wealthy contributors.  

The struggle between seeking equality in federal elections and avoiding infringement on individual liberties manifests in the 2016 election season. Senator Bernie Sanders repudiates the use of super PACs and claims that, “I am very proud to be the only candidate up here who does not have a super PAC, who’s not raising huge sums of money from Wall Street and special interests.” According to a report by the New York Times, as of February 20, 2016, Sanders received a negligible 0.1% of his total funds from super PACs/PACs, while Drumpf received 7%, Kasich received 25%, Clinton received 31%, and Cruz received 48%. Interestingly enough, these numbers hardly compare to the monstrous super PAC funds amassed by several former candidates in the election. Scott Walker received 61% of his total funds from super PACs/PACs, Chris Christie received 69%, and Jeb Bush received 79%, yet all still removed themselves from candidacy due to the meager prospects of their election. This raises the question of whether these corporate contributions are as formidable as they may seem or if hysteria may be partly to blame for the concern. Accordingly, fears regarding super PACs may be justified but misplaced; while raising the largest amount of money may not always win elections, as demonstrated by Jeb Bush, issues may still arise if a candidate heavily funded by super PACs does win and allows special interests to influence legislation.

Where does this leave us as a nation on the brink of electing a new national leader? We have been irresolute for many decades, wavering between more and less regulation of campaign finance; with the recent controversy surrounding super PACs, we can assume this indecisiveness will continue.  Because limitless contributions to super PACs are a fairly new phenomenon, we are still gauging their power and efficacy. Party nominations and the election in November may convey the initial impacts of these super PAC contributions; however, only time will reveal their true effects, as we wait in hope of an honest and upstanding President who will distinguish special interests from those of the nation as a whole.