Campaign Financing in Federal Elections: A Guide to the Law and Its Operation

This report provides an introduction to the laws governing the financing of Federal election campaigns and presents data on campaign finance activity in the 1980’s.

hnalps: Joseph E. Cantor in American Nac Lonal Gaveniarnc Covernacct D i v isLon NORTHERN KENTUCKY UNlVERSlN LIBRARY GQYERNMENT DOCUMEN3'3 COLLECTION The Conqrcssional Research Senice works exciusive!~for 1 I the Congress. conducting research. analyzing legislation. and providing ~ntjrmationat h e *est of cornmirtm. !den- ben. and their staffs. Tne Service makes such research available. withour san b~as.in manv forms including studies. reports. compiiations. digests. and background briefings. Cpon r q u a t . CRS assists cornmitrees in indszing lespskcive ' proposals and issues. and in assessing the possible effects of these proposJ s and h e i r alternatives. The Service's senior speciaiisa and subjecr andysts are also available for personai consultations in their respecrive fields of expc~ise. ? This report provides an in-croduction t o t h e laws governing t h e f i n a n c i n g o f Federal e l e c t i o n campaigns and presents d a t a on campaign f i n a n c e a c t i v i t y in r x e n c years. PREFACE This primer is intended as an introduction to the campaign finance laws governing Federal elections in the United States and to their practical application in recenr years- 1: responds to such commonly asked questions about the law and its operation 3s the follow in^: ' 'Ahat are the maj,or provisions of cne Federal campaign finance law and how did :hey evolve? Uhat are the limits on campaign contributions and expenditures? '" O Row much money is spent to elect the President and the Congress? What. is the dollar tax checkoff , -and how does the public funding system in Presidential elections vork? ' " How does the financing of congressional elections differ from that of Presidential elections? " What are political action committees, and how much of a role do they play in Federal elections? " What role do political parties play in Federal elections? " How do tax incentives for individual donations vork? " Uhat are independent expenditures? These and other questions are addressed through summaries of the current law and through 18 tables of statistics on campaign finance activity at the Federal level in recent years. (These statistics have been compiled by CRS, the Federal Election Commission, and academic experts in this field.) The report comprises ten chapters grouped into three sections. The first of the t h r e e sections provides a summary of the current law and its antecedents, b o t h i n overview and c h r o n o l o g i c a l form. The second examines t h e camp2.ign f i n a n c e system from t h e p e r s p e c t i v e of t h e f u n d r a i s i n g o r r e c e i p t s s i d e , l o o k i n g a t t h e s o u r c e s o f money i n F s d e r a l campaigns. The t h i r d examines t h e e x p e n d i t u r e s i d e of campaigns, t h e a c t u a l spending of campaign m n e y t o i n f l u e n c e t h e outcome of e l e c t i o n s . S e c t i o n One c o n t a i n s t v o c h a p t e r s . Chapter I d i s c u s s e s t h e campaign f i n a n c e laws i n e f f e c t p r i o r t o :he e n a c t s e n t of t h e p r e s s n t l a w i n t h e e a r l y 1970s; i n t h i s r e g a r d , :c, pr3vides an over-?iev and a chronology of t h e e a r l i e r l a v s and a d i s c z s s i o n of z h s i z ? e r = e i 7 e d shorz:amiqs, t h e lavs of t h e p a s t 15 y e a r s . which. 13 :x.., '&2d t3 Chapter I1 d e s c r i b e s t h e h i q h l f g h t s of t h e c u r r e n t law and p r o v i d e s a chronology of i t s component s t a t u t e s and t h e rnajor features thereof. S e c t i o n Tvo c o n t a i n s c h a p t e r s 111 through VII, each d i s c u s s i n g one of th$,five,sajor components of F e d e r a l campaign t r e a s u r i e s . Each c h a p t e r d i s c u s s e s r e l e v a n t a s p e c t s of t h e law a f f e c t i n g t h a t s o u r c e of funds and r e l e v a n t f i n a n c i a L d a t a concerning its r e s p e c t i v e r o l e a s a c o n t r i b u t o r t o campaigns. &apter I11 d e s c r i b e s t h e p u b l i c f i n a n c e system, a v a i l a b l e o n l y ir. P r e s i d e n t i a l e l e c t i o n s and, hence, which h a s no r e l e v a n c e f o r c o n g r e s s i o n a l elections. I t o u t l i n e s t h e s t r u c t u r e of t h e system which p r o v i d e s p u b l i c money i n P r e s i d e n t i a l primary and g e n e r a l e l e c t i o n s and f o r t h e nominating c o n v e n t i o n s , and i t d i s c u s s e s t h e d o l l a r t a x checkoff which p r o v i d e s funding f o r t h e p u b l i c f i n a n c e system. I t i n c l u d e s d a t a on t h e amounts of p u b l i c funds i n r e c e n t e l e c t i o n s and on t h e s t a t u s of t h e d o l l a r t a x c h e c k o f f . Chapter I V d e a l s with t h e r o l e of i n d i v i d u a l c i t i z e n s a s c o n t r i b u t o r s , f o c u s i n g on t h e l a v l s l i m i t s on t h e i r d o n a t i o n s and p r o v i d i n g d a t a on t h e use of F e d e r a l tax incentives for p o l i t i c a l contributions. Chapter V d i s c u s s e s p o l i t i c a l a c t i o n cornmittets, d e f i n i n g what t h e y a r e . and what t h e law p e r m i t s them t o do and p r o v i d i n g d a t a on t h e i r p r o l i f e r a t i o n and t h e i r f i n a n c i a l a c t i v i t y i n t h e p a s t decade. Chapter V I examines t h e r o l e of p o l i t i c a l p a r t i e s a s a funding s o u r c e , d e s c r i b i n g how t h e y assist c a n d i d a t e s f o r F e d e r a l o f f i c e through d i r e c t c o n t r i b u t i o n s ; r e l e v a n t d a t a i s included. This c h a p t e r is concernad o n l y w i t h t h e p a r t i e s ' r o l e a s a funding source for tampaian t r e a s u r i e s ; t h e i r r o l e i n spending money aimed direcrly a t : o a u n l c a t i n ~ ~ i c hv o t e r s i s d i s c u s s e d i n S e c t i o n 'Riree, d e a l i n g w i t h shz Chapter V T I on t h e r o l e c a n d i d a t e s themselves p l a y in funding campaigns. S e c r i o n Three, which comprises c h a p t e r s V I I I through X, sxamfnes :he e x p e n d i t u r e s i d e of F e d e r a l campaigns, l o o k i n g a t each of t h e major f o r c e s d p r e s e n t i n g d a t a on r e c e n t r e s p o n s i b l e f o r spending money i n e l e c t i o n s a financial activity. Campaign e x p e n d i t u r e s e s s e n t i a l l y a r e made f o ~ communication with v o t e r s , u n l i k e a campaign c o n t r i b u t i o n , which i n v o l v e s t r a n s f e r i n g a u t h o r i t y t o a n o t h e r agent t o d e c i d e hov a comnrunication i s t o b e made. Communications--or expenditures-in t o d a y ' s F e d e r a l campaigns a r e p r i m a r i l y s a d e by Ehree f o r c e s : t h e c a n d i d a t e s , t h e p o l i t i c a l p a r t i e s , and independent groups o r i n d i v i d u a l s . Chapter VIII p r e s e n t s d a t a on campaign spending by c a n d i d a t e s i n r e c e n t P r e s i d e n t i a l and C o n g r e s s i o n a l e l e c t i o n s , i n t h e aggregate and, a l s o , . i n . c o n g r e s s i o n a l e l e c t i o n s , on average. Chapter IX d i s c u s s e s t h e p o l i t i c a l p a r t i e s a s campaign s p e n d e r s , d e s c r i b f n g and p r o v i d i n g d a t a ' o n c o o r d i n a t e d e x p e n d i t u r e s i n r e c e n t e l e c t i o n s and on o v e r a l l major p a r t y f i n a n c e s . This s e c t i o n concludes, i n Chapter X, w i t h a d i s c u s s i o n of a major form of political spending which i s not c i r c u m s c r i b e d by F e d e r a l Limits--independent expenditures. I t provides a d e f i n i t i o n of t h i s form o f campaign : . c t l ~ i t y and s u p p l i e s data on relevant f i n a n c i a l a c t i v i t y i n recent e l e c t i o n s . F i n a l l y , a s e l e c t e d bibliography is included, with r e f e r e n c e s t o academic and o t h e r major treatments o f campaign f i n a n c i n g i n t h e United S t a t e s . CONTENTS ABSTBACT ................*............................................... SECTION SNE : I . CLUI?AICN :.'IYPJUCZ ...........*...... .............................. ................ L4KS AND X E I B fYiOLiFZC?S TXE FEDERAL CORRUTT ?UCTItES ACT Summory of Law and i t s Perceived Shortcomings E f f o r t s t o Change t h e Law Chronohgy of Zarly Campaign P i n a n c s Laws and .................................... Court O e c r s ~ o n s ............................................ ............................. .................................. OF FUNDS ................... U.S. TREASURY ..........*.............. .................... ................. from .............................. .......................o.o...*...-..... ... .......................................... ................. ..... ;..............o.... ................................. .......................................... ................................ooo.. ................................. ......................................... THE FEDERAL ELECTION C N A I G X ACT 11. .............*....*m...... Major P r o v i s i o n s of Current Law Chronology o f . C u r r e n t Campaign Finance Laws a n d - C o u r t D e c i s i o n s SECTION TUO: 1x1 iii . CAMPAIGN RECEIPTS-THE SOURCES SOURaS OF FUNDSThe P r e s i d e n t i a l E l e c t i o n Campaign Fund Payments i n t o t h e Fund: The Tax-Checkoff Qj,s b u r s m e n t s t h e Fund F i n a n c i a l Data Primary E l e c t i o n s E s t a b l i s h i n g and Maintaining E l i g i b i l i t y Major and Minor P a r t y C a n d i d a t e s Amount of Matching Funds Spending L i m i t s Nominating Conventions Establishing E l i g i b i l i t y Art~ount of Subsidy Spending L i m i t s General E l e c t i o n s Major P a r t y Candidates New P a r t y Candidates Minor P a r t y Candidates F i n a n c i a l Data on P u b l i c S u b s i d i e s S i n c e 1976 7 d 3 4 5 7 7 9 13 15 15 15 16 16 18 18 18 19 19 20 20 20 20 21 21 22 23 .......................................... .......................................... ....................*........*...*. ..................................*.. ..........................*........ *............. 23 *.*.............*........ ................. SOURCES OF FUNDS.. POLITICAL ACTION COM!ITTEES ................. Uhat are PolLticaL Action ....................... The Origin of PACs .......;...**............................. Contribution Limits ......................................... The Nurnber of P X s ..............*............................ Financiai of Since 1972 *.*.................... I V * SOURCES OF FU3DS.. LAWIVIDUPL CITIZENS Contribution Limits *.**....**~..*..*~*.............oo..o..o. Tax Incentives for Individual Contributions V. Codttees? .kti.qi.7 ...*....*....*............. ...................,............,....,... ......*..................***..... SCLiRCES G F ?CXDS-?3LITIrUXL PMTIHS Contribution L ~ ~ c s 3ata :n ? z t = 7 3~ntziLutions Vfs VII. SOUBCES OF FUXDS--CXNDIDATES SECTION IIIREZ: &4D PAC3 GROUPS VIII . pAu.41GN *...........................**...* "Zt?Z?mIEJZES-TIiE SPENDING 3Y CLWDIDATES ............................................................. CAMPAIGY SPENDING-PRESWENTIAL CANDIDATES AN0 CONGBESSIONAI. .................................................. Presidential Elections .*..~**~*.*..~.~..~~~~~~. Congressional Elections ......'.......*...~.*.................. ................................... ....................*................ IX* CAHPAICN SPENDING--POLITICAL PARTIES Coordinated Expenditurae .................................... O t h e r Forms of Asaistanca .........**........................ Major Party Financial Activity ..~~...................~~~.... -CAMPASCN SPENDING-INDEPENDENT EXPENDITURES .........*.....*.*. Independent Expenditure Activfty ............................. SELECT BIBLIOGRAPHY ...................................................... Aggregate Campaign Costs Average Campaign Casts . * . * * . * * * * e e . . * . e . e o * o * o a a X* LIST OF TABLES TABLE 2. .................................... Public Subsidies in Ptesidential Elections: 1976-1984 ........ ?.\EL3 3. 5se TABLE L. Financial Status of the Tax Checkoff and the Presidential Election Campaign Fund: 1973-1985 3f che Tax Credic and Deduction for Political " ;eaerai Tax ? e t * ~ r ~ s :1972-1993 CsnetLjucl2ns ;n XBLS +.!;umber sf 3agistsred ? ~ l L i i ~ aAction i 17 24 ...................... Committees: 1974-1986 ... 23 .. 34 TABLE 5. Ficancial Activity of ?olicisal Action Committees: 1972-1984 17 T M L E 6. Political Action C o m i ttee Contributions as a ?2tcsncage of Congr%ssional Candidates' Overall Reczipts Fn p ~ n e r a l Elections: 1972-1984 ...........................*...................... 3 5 TABLE 7. 'Contributions to Congressional Candidates of' PACs by Category: 1972-1984 ................................................... 36 TABLE 9. Campaign Spending by Presidential Candidates: 1976-1984 ............................................................. 46 TABLE LO. Tocal Campaign Expenditures in House and Senate Elections: L972-ig84 ...................**..**~.***...*.***.*......... 48 TABLE 11. Total Campaign Expenditures by House and Senate General Election Candidates: 1972-1984 ............................... 49 TABLE 12. Average Campaign Expenditures by House and Senate Candidates: 1974-1984 ......................................... 51 TABLE 13. Average Campaign Expenditures by House and Senate candidates by Party: 1974-1984 ................................ 52 TABLE Average Campaign Expenditures by House and Senate Candidates by Candidate Status: 1974-1984 ..................... 53 TABLE 15. Average Campaign Expenditures by Winning House and Senate Candidates: 1976-1984 ..................................... 54 14. TABLE 16. Hajor Political Party Receipts and Expenditures: 1976-1984 .............................................. 58 LIST OF TABLES-Continued TABLE 17. P o l i t i c a l Party Coordinated Expenditures f o r Federal Candidates: 1976-1984 60. TABLE 18. Independent Expenditures For and Against Federal Candidates: 1976-1984 64 ....*...............e................... ............................................e..a SECTION ONE CXIiAIGN FIBANCE 'LAUS AND TIZEI3 EVOLUTION Current lavs and regulations governing financial activity of campaigns for Federal o f f i c e sten 1argel:r Z r o n statutes passed i r :he 1970s, 2rimarily chs Seaera1 Eleccion &n?siqn .LC:, as =mend&. These laws aere 2nac:ad to te,z!eiy widely perceived shottcominqs of the then existing law, the Corrupt ? t t c = i = z s X c Z of 1925, and in response to reports of campaign finance abuses over the years, culminating.in the Vatergace scandal of 1972-1974. These laws impose limits on contributions from individuals, interest - groups, and political parties to all campaigns for Federal officc'and to all poll t ical commit teas operating at the Federal level. Moreover, all candidates and politLcal commi.ttees involved in Federal elections are subject to u n i f o m disclosure requirements, under which contributions and expenditures must be reported on a regular basis for public examination. Within this framework, a dual system of finance has evolved: a Presidential system, funded largely from public monies, with concomitant limits on campaign expenditures; and a congressional system, funded solely by private donations and free of circumscripeions on campaign spending. The Federal Election Commission (FEC) has civil authority to enforce the lavs that regulate the current system. It was created in 1975 as an independenc agency to collect and make available to the public the financial reports filed by candidates and committees involved in Federal elections and to supervise the public funding system for Presidential e l e c t i o n s . The FEC i s as-2 charged w i t h d r a f t i n g r e g u l a t i o n s t o implement che lav and w i t h w r i t i n g a d v i s o r y o p i n i o n s t o i n t e r p r e t the l a w i n s p e c i f i c i n s t a n c e s . T h i s s e c t i o n of t h e r e p o r t p r o v i d e s a surmnary of t h e c u r r e n t law and its antecedents. H i g h l i g h t s of major p r o v i s i o n s of the l a w s , p a s t and present, are s f v e n , a s well as a chronology of key d e v e l o p m e n t s - l e g i s l a t i v e and j u d i c i a l - i n t h e i r evoLution. Chapter I d e a l s v i t h the e a r l i e r laws governing campaign f i n a n c i n g , generally cJ.asaified P r a c ~ i c e sAct. 0-apter - 9 LA a s t h e 9 e d e r a l Corrupc r- g c u s e s on :he cur7enc Law, t h e Federal 3ec:Fon Campaijn .kc' an= : s i t c e d i c a t x c a s , enactad s i n c a the early 5975s. I. THE FEDERAL CORRUPT PRACTICES ACT SUHMARY OF LAW AND ITS PERCEIVED SHORTCOMINGS Before t h e c u r r e n t campaign f i n a n c e laws were e n a c t e d i n t h e 1970s, t h e systzrn was ? q u l a t e d by a s e r i z s of laws d a t i n g from 1907, b u t p r i m a r i l y by t h e ? e a e r a i Corrupc Z r a c c i c e s Act oZ 1925, as amended by t h e a a t c h kt amenaments - of 1940. I/ Among i t s p r i n c i p a l f e a t u r e s vere- d i s c l o s u r e of r e c e i p t s and expenditures by p o l i r f c a l c o r n n i t t e e s o p e r a t i n g i n two o r a o r e S t a t e s and by House and S e n a t e c a n d i d a t e s ; l i m i t s on c o n t r i b u t i o n s by i n d i v i d u a l s t o F e d e r a l c a n d i d a t e s o r n a t i o n a l c o d t t e e s ; and - . . - * l i m i t s on e x p e n d i t u r e s by Rouse and S e n a t e c a n d i d a t e s and p o l l t i c a l committees o p e r a t i n g i n two o r more S t a t e s . The law governing campaign f i n a n c e f o r much of t h e c e n t u r y came t o be widely viewed a s s e r i o u s l y flawed, both because o f campaign a c t i v i t i e s n o t i n c l u d e d i n i t s scope and because of t h e e a s e v i t h which its r e s t r i c t i o n s c o u l d be circumvented. The l a w ' s d i s c l o s u r e p r o v i s i o n s and t h e s p e n d i n g l i m i t s d i d not c o v e r ? r e s i d e n t i a l and V i c e - p r e s i d e n t i a l c a n d i d a t e s , c a n d i d a t e s and 0 p o l i t i c a l committees i n primary e l e c t i o n s , o r p o l i t i c a l cormpittees o p e r a t i n g w i t h i n o n l y one S t a t e . Moreover, c a n d i d a t e s , p o l i t i c a l committees and i n d i v i d u a l s could and commonly d i d avoid r e g u l a t i o n under i t s p r o v i s i o n s . Candidates and p o l i t i c a l committees c o u l d circumvent t h e i r s p e n d i n g l i m i t s a s w e l l a s d i s c l o s u r e r e q u i r e m e n t s by e s t a b l i s h i n g m u l t i p l e committees o p e r a t i n g i n s i n g l e S t a t e s o r i n t h e D i s t r i c r of Columbia (which had no d i s c l o s u r e -1/ 43 S t a t . 1070; 54 S t a t . 767 requirements). I n d i v i d u a l s could evade t'te r u n i t s on c o n t r i b u t i o n s by g i v i n g t o mo're t h a n one committee working on b e h a l f of a c a n d i d a t e o r by t o u t i n g - c o n t r i b u t i o n s through a d d i t i o n a l members of t h e same family. 2/ I t can be argued t h a t t h e l a w was g e n e r a l l y f n e f f e c t i v e p a r t l y because of t h e s e and ocher widely known l o o p h o l e s and p a r t l y because i t s p r o v i s i o n s were never t r u l y enforced. No House o r S e n a t e c a n d i d a t e w a s e v e r p r o s e c u t e d f o r v i o l a t i o n of the Corrupt P r a c t i c e s A c t . During t h e 1950s and 1960s, c o n s i d e r a b l e a t t e n t i o n was p a i d t o t h e i n a d e q u a c i e s of t h e Corrupt P r a c t i c e s A c t . The p r e s s r e p o r t e d e v a s i o n s of t h e l a w ; Xembers of Congress i n t r o d u c e d b i l l s , and committees h e l d h e a r i n g s ; r e p o r t s were i s s u e d o n ~ a m p a i g nf i n a n c e , and p r o p o s a l s v c r e made f o reform i t . . . I n 1962, a P r e s i d e n t ' s Commission on Campaign C o s t s i s s u e d a r e p o r t vhich recoamended (among o t h e r t h i n g s ) f u l l e r d i s c l o s u r e of campaign f i n a n c e a c t i v i t y and a c e n t r a l agency t o r e g u l a t e i t . Both P r e s i d e n t s Kennedy and Johnson urged Congress t o c o r r e c r t h e d e f i c i e n c i e s i n t h e l a w , v h i c h Johnson r e f e r r e d t o i n a 1967 Hessage t o Congress as "more l o o p h o l e t h a n law." -3/ I n t h e l a t e 1960s, two measures foreshadoved t h e reform l e g i s l a t i o n t h a t poverns campaign f i n a n c e today: t h e P r e s i d e n t i a l Campaign Fund A c t of 1966 (P.L. 89-809) and t h e E l e c t i o n Reform Act of 1967 (S. 1880). The P r e s i d e n t i a l Campaign Fund Act provided p u b l i c s u b s i d i e s t o t h e n a t i o n a l p o l i t i c a l p a r t i e s 1982. ollar -2/ p. D4-6. P o l i t i c s . 3rd ed. Washington, Congressional Q u a r t e r l y , I n c . , 3/ U.S. P r e s i d e n t , 1963-1969 (Johnson). P u b l i c P a r t i c i p a t i o n i n t h e ~ r o c e ~ s eo fs Government. Message d a t e d Hay 2 5 , 1967. 90th Cong., 1st Sess. H. Doc. No. 90-129. Washington, U.S. Covt. P r i n t . O f f . , 1967. p. 2. for Presidential elections. Although i t r e c e i v e d L i t t l e c o n s i d e r a t i o n b e f o r e F t vas enacted, t t became a source of c o n t r o v e r s y soon t h e r e a f t e r , and, i n ?fay 1967, Congress aade i t i n o p e r a t i v e . S. 1880, knovn a s t h e Ashmore-Goodell It would have provided f o r a s t r o n g e r b i l l , was passed by t h e Senate i n 1967. system of d f s c l o s u r e t o be monitored and e n f o r c e d by a b i p a r t i s a n F e d e r a l E l e c t i o n Commission. The House never acced on t h e measure. The followfng chronology Lists t h e p r i n c i p a l s t a t u t e s and c o u r t d e c i s i o n s vhich governed campaign f i n a n c e p r a c t i c e s a t t h e F e d e r a l Level p r i o r t o t h e F e d e r a l E l e c t i o n Campaign A c t of 1971. A b r i e f summary of t h e p r i n c i p a l p r o v i s i o n s of each law i s provided, along v i t h some n o t a t i o n a s t o whether i t was l a t e r repealed o r i s s t i l l i n e f f e c t . " Tillman Act, 1907 [ 34 S t a t . 8 6 4 ) u p r o h i b i t e d monetary c o n t r i b u t i o n s from n a t i o n a l l y c h a r t e r e d banks and c o r p o r a t i o n s t o p o l i t i c a l campaigns a t any l e v e l and p r o h i b i t e d such c o n t r i b u t i o n s from any c o r p o r a t i o n t o p o l i t i c a l campaigns a t t h e F e d e r a l l e v e l ( s t i l l i n effect). a P u b l i c i t y Act of 1910 [36 S t a t . 8221--required p o s t - e l e c t i o n d i s c l o s u r e of r e c e i p t s and e x p e n d i t u r e s by n a t i o n a l p a r t y committees and committees o p e r a t i n g i n two o r more S t a t e s i n c o n n e c t i o n w i t h campaigns f o r t h e House of R e p r e s e n t a t i v e s ( r e p e a l e d by Corrupt P r a c t i c e s Act i n L92S). " P u b l i c i t y Act Amendments of 1911 (37 S t a t . 2 5 1 - e x t e n d e d d i s c l o s u r e requirements t o Senate campaigns and t o p r e - e l e c t i o n r e p o r t i n g ( f o r nomination, a s w e l l a s g e n e r a l e l e c t i o n ) ; also Limited House campaign e x p e n d i t u r e s t o $5,000 and Senate campalgn e x p e n d i t u r e s t o $10,000 ( r e p e a l e d by Corrupt P r a c t i c e s A c t i n 1925).. O Newberry v. United S t a t e s [256 U.S. 232 (1921)1--the Supreme Court held u n c o n s t i t u t i o n a l t h e r e g u l a t i o n of primary e l e c t i o n s , under t h e 1910 A c t , a s amended; t h i s c o n c l u s i o n w a s later o v e r r u l e d ( o r weakened) b y t h e Court i n United S t a t e s v. C l a s s i c [313 U-S. 299 ( 1 9 4 1 ) l . - ' O Federal Corrupt P r a c t i c e s Act of 1925 [ 4 3 S t a t . 10701-largeiy r e v i s e d and c o d i f i e d t h e p r o v i s i o n s of t h e e a r l i e r s t a t u t e s , w i t h l i t t l e s u b s t a n t i v e change, except f o r t h e d e l e t i o n of t h e p r i a a r y e l e c t i o n r e g u l a t ? o n s ; continued ,the d i s c l o s u r e requirements f o r m u l t i s t a t e p o l i t i c a l committees and Bouse and Senate c a n d i d a t e s ; changed t h e e x p e n d i t u r e l i m i t a t i o n s t o conform t o S c a t r l a w where a p p l i c a b l e o r ( f o r Senate c a n d i d a t e s ) $Lb,000 o r t h r e e c a n t s f o r each v o t e c a s t i n t h e last g e n e r a l e l e c t l o n f o r t h a t o f f i c e , up t o $25,000, and ( f o r Rouse c a n d i d a t e s ) $2,500 o r t h r e e c e n t s f o r each v o t e cast i n t h e last g e n e r a l e l e c t i o n f o r t h a t o f f i c e , up t o $5,000 ( r e p e a l e d by FECA). Hatch Act Aaendmeacs o f 1340 (54 S t a t e 7671--imposed a $5,000 per y e a r Limitation on ccnrri5u:ions t o c a n d f l a t e s o r n a t i o n a l commicztas i n connection w i t h any campaign f o r F e d e r a l o f f i c e ; a l s o s e e o S3,000,900 ?er rear L i s i t a t i m on r e c s i g t s and a x p e n d i t x r a s of any p o l ~ ~ i c acommittee l a p e r a t i n g i n two o r S t a t e s ( r e p e a l e d by t h e ?ECX). ' War labor Labor Disputes Act of 1963 [57 S t a t . 1671-prohibited unions from making p o l i t i c a l c o n t r i b u t i o n s t o c a n d i d a t e s f o r Federal affL;a ( a u t o n a t i c a i l y rupirzri s i x aonrhs a f t a t ;iorld Zar I1 ended). ' Labor m a g e m e n t R e l a t i o n s Act of 1947 [ 6 1 S t a t . 1591--mede t h e p r o h i b i t i o n on l a b o r union c o n t r i b u t i o n s permanent, and expanded t h e p r o h i b i t i o n on n a t i o n a l banks, c o r p o t a t i o a s , and union8 t o i n c l u d e e x p e n d i t u r e s i n connection w i t h Pedmral campaigns, a s y e l l a s c o n t r i b u t i d n s t o them ( s t i l l i n e f f e c t ) . 11. THE FEDERAL ELECTION CAMPAIGN ACT HAJOR PROVISIONS OF CURRENT LAW Current law governing Federal campaign practices is based on tvo 2riccl;ai statutss: the F"dera1 Sleetion Campaign Act of 1971 (P.L. as amenaed in 1974 (2.L. 9 3 - 4 4 3 ) , 1976 (P.L. and the Xevenue Act of 1971 (P.L. 92.178). 94-283), 92-225), and 1979 (P.L. 996-137), Among the major features of the current law are : Contribution Limits Individuals: $1,'000 per candidate, per electioa; $20,000 to a national party committee per year; $4,000 to any other politics1 committee per year; an aggregate total of $25,000 in contributions per year. Xulticandidate Political Committees: $5,000 per candidate, per election; $15,000 to a national party committee; $5,000 to any other political committee. 4 / - Other Political Committees: $1,000 per candidate, per election; $20,000 to a national party committee; $5,000 to any other political committee. Party C o d t t e e s : $1,000 or $5,000 per candidate, per election (depending upon whether or not committee qualifies as a multicandidate committee);.$5,000 to any other political committee. For National Senatorial Campaign Comittee, of National Party Committee, or combination of both: $17,500 to Senate candidate, per year in which election is sought. Prohibited contributions: from foreign nationals, national banks, corporations, and labor unions; cash contributions in amounts of more than $100; anonymous contributions of more than $50. 4 / A multicandidate committee is one with more than 50 contributors, which hzs been registered for at least s i x months, and, except for a State party committee, has made contributions to five or more Federal candidates. Candidate 'Limi c s ' Candidates a c c e p t i n 3 public funding ( i n P r e s i d e n t i a l e l e c t i o n s ) a a y c o n t r i b u t e 550,000 from p e r s o n a l and immediate f a s i l y f u n d s . E x p e n d i t u r e L i d ts * A p p l i c a b l e o n l y t o P r e s i d e n t i a l c a n d i d a t e s a c c e p t i n g p u b l i c funds: i n p r i m a r i e s , n a t i o n w i d e l i m i t of SL0,000,000 p l u s COLA ( c o s t o f l i v i n g a l l o v a n c e ) p l u s a d d i t i o n a l 20 p e r c e n t f o r c e r t a i n exempt f u n d r a i s i n g c o s t s and S t a t e l i m i t o f t h e g r e a t e r o f S200,000 p l u s COLA o r 16 c e n t s p e r e l i g i b l e v o t e r p l u s COL4; i n g e n e r a l e l e c t i o n s , S20,000,000 p l u s C O W . Also, p a r t i e s a c c e p t i n g p u b l i c f u n d s f o r aominasing c o n v e n t i o n s a r e l i m l c e d t o $4 s i l l i o n p l u s COLA. (COT& c a l c u l a r e d s s f n g i974 a s bass g e a r ) . I n L984, t h e z a e i o n a l 1232:s were: 520.2 a i l X o n ( p l u s SS.0 s i l l i o n f o r t u n d r a i s l n q ) i n ~ r i a a r i e s , S 4 . 4 m~LLlon Ln cSe ~ a n e r a ie l c c z i o n , and $3.1 n i i l i ~ nf o r :.le convent i o n s . P a r t y Spending L i m i t s ' In a d a i r i o n t o d i r e c t c o n t r i b u t i o n s , t h e a a t i o n a l tonunzttses sf the p o l i t i c a l p a r t i e s may make e x p e n d i t u r e s on b e h a l f o f t h e i r nominees i n t h e g e n e r a l e l e c t i o n a s f o l l o w s : f o r a House c a n d i d a t e i n a S t a t e w i t h more t h a n o a e c o n g r e s s i o n a l d i s t r i c t , $10,000 p l u s C O W ; f o r a S e n a t e c a n d i d a t e o r a t - l a r g e House c a n d i d a t e , t h e g r e a t e r o f 520,000 p l u s COLA o r 2 c e n t s , p e r e l i g i b l e v o t e r p l u s COLA; f 0 r . a P r e s i d e n t i a l c a n d i d a t e , 2 c e n t s p e r e l i g i b l e v o t e r p l u s COLA '(COW c a l c u l a t e d u s i n g 1974 a s base y e a r ) ; S t a t e p o l i t i c a l p a r t i e s may make e x p e n d i t u r e s f o r i t s House and S e n a t e c a n d i d a t e s e q u a l t o t h a t allowed f o r n a t i o n a l p a r t i e s , o r t h e y may d e s i g n a t e t h e n a t i o n a l p a r t y committee a s i t s a g e n t f o r t h e e x p e n d i t u r e s . I n 1984, t h e p a r t i e s c o u l d spend up t o $20,200 i n House r a c e s and between $40,400 and 5752,409.60 i n S e n a t e r a c e s (doubled f a r N a t i o n a l and S t a t e p a r t i e s combined). P u b l i c Funding ' A v a i l a b l e on o p t i o n a l b a s i s t o P r e s i d e n t i a l c a n d i d a t e s and t o p o l i t i c a l p a r t i e s f o r nominating c o n v e n t i o n s . Primary c a n d i d a t e s who q u a l i f y by r a i s i n g a t l e a s t $5,000 i n e a c h of 20 S t a t e s i n c o n t r i b u t i o n s from i n d i v i d u a l s of $250 o r l e s s may have i n d i v i d u a l c o n t r i b u t i o n s of $250 o r less matched e q u a l l y w i t h F e d e r a l money, up t o one-half t h e primary spending l i m i t . Nominees of major p a r t i e s i n t h e g e n e r a l e l e c t i o n a r e e l i g i b l e f o r p u b l i c f u n d s i n t h e amount of t h e i r spending l i m i t ; minor p a r t y c a n d i d a t e s may r e c e i v e a n amaunt p r o p o r t i o n a t e t o t h e v o t e t h e y r e c e i v e d vis-a-vis t h e major p a r t y c a n d i d a t e s i n p r i o r e l e c t i o n s ; new p a r t y c a n d i d a t e s a r e e l i g i b l e f o r r e t r o a c t i v e f u n d i n g i f t h e y r e c e i v e a t l e a s t f i v e p e r c e n t of t h e popular v o t e . Major p a r t i e s a r e e l i g i b l e f o r pubLic f u n d s f o r nominating c o n v e n t i o n s , up t o t h e f u l l amount of t h e i r spending l i m i t ; minor p a r t i e s may r e c e i v e a l e s s e r , p r o p o r t i o n a t e amount. Disclosure A l l c a n d i d a t e s f o r Federal o f f i c e and a l l p o l i t i c a l committees o p e r a t i n g i n Federal e l e c t i o n s must f i l e r e g u l a r l y scheduled r e p o r t s ; P r e s i d e n t i a l c a n d i d a t e s and most p o l i t i c a l committees f i l e w i t h t h e F e d e r a l E l e c t i o n Commission, w h i l e Eouse and S e n a t e c a n d i d a t e s must f i l e v i t h t h e C l e r k of t h e House and t h e S e c r e t a r y ( A l l r e p o r t s a r e a v a i l a b l e a t t h e FEC.) o f t h e Senate, r e s p e c t i v e l y . Reports must i n c l u d e t o t a l amounts of c a s h on hand, r e c e i p t s , t r a n s f e r s , Loans, r e b a t e s , refund d i v i d e n d s , and i n t e r e s t (and, f o r P r e s i d e n t i a l c a n d i d a t e s , p u b l i c f u n d s ) ; must i d e n t i f y c o n t r i b u t o r s i n e x c e s s of $200 p e r year and persons t o whom expenditures i n s x c e s s of $200 a r e made. Federal E l e c t i o n C o u d s s i o n " I;lda?endent , r a g u l a t o r y a g a x y wF:h -31.7.v o t i q zemoers appoi+:aci by P r e s i d e n t , 31th advice and consent of Senate, and two non-voting, e x - o f f i c i o members--Clerk of t h e House and S e c r e t a r y of eke Senate. Administers d i s c l o s u r e p r o v i s i o n s of t h e law and p u b l i c funding ?roqram f o r O r z s i d e n t i a l e l e c t i o n s . Ras c i v i l a u t h o r i t y t o s n f o r z e t h e law's p r o v i s i o n s ; c r i m i n a l v i o l a t i o n s r e f e r r e d t o J u s t a c e Department f o r prosecution. Conducts h e a r i n g s and i n v e s t i g a t i o n s , w r i t e s r e g u l a t i o n s implementing.the law, and i s s u e s a d v i s o r y o p i n i o n s on r e q u e s t i n o r d e r t o h e l p i n t e r p r e t t h e law. CERONOLOGY OF CURRENT CAMPAIGN FINANCE LAWS AND COURT DECISIONS The tollowlng chronology list. t h e p r i n c i p a l s t a t u t e s and c o u r t d e c i s i o n s governing campaign f i n a n c e p r a c t i c e s a t t h e F e d e r a l l e v e l today. A brief summary of t h e p r i n c i p a l p r o v i s i o n s of each law i s provided, along v i t h some n o t a t i o n 'as t o whether i t was l a t e r r e p e a l e d o r is s t i l l i n e f f e c t . t o Presidential Revenue Act of 1971 [ P u b l i c Law 92-1781-successor Campaign Fund Act of 1966, i t intended t o l e s s e n c a n d i d a t e dependence on p r i v a t e money by providing p u b l i c funds i n s t e a d ; e s t a b l i s h e d t h e P r e s i d e n t i a l E l e c t i o n Campaign Fund t o provide F e d e r a l s u b s i d i e s t o P r e s i d e n t i a l c a n d i d a t e s on an o p t i o n a l b a s i s Fa t h e g e n e r a l e l e c t i o n (beginning i n 1976); major p a r t y c a n d i d a t e s were t o r e c e i v e an amount equal t o 15 c e n t s m u l t i p l i e d by t h e v o t i n g age p o p u l a t i o n (VAP), minor p a r t y o r nev p a r t y c a n d i d a t e s were t o g e t a n amount i n p r o p o r t i o n t o t h e v o t e s they r e c e i v e d f n t h e p r e v i o u s ( o r r e t r o a c t i v e l y i n t h e j u s t concluded) e l e c t i o n ; c a n d i d a t e s t a k i n g p u b l i c funds must a b i d e by expenditure l i m i t , e q u a l t o amount major p a r t y c a n d i d a t e is e n t i t l e d t o (hence major p a r t y c a n d i d a t e s can a c c e p t no p r i v a t e f u n d i n g ) ; program t o be funded through an o p t i o n a l $1 checkoff on F e d e r a l income t a x r e t u r n s ( $ 2 on j o i n t r e t u r n s ) , beginning with Calendar 1972; e s t a b l i s h e d a tax c r e d i t of up t o $12.50 ($25 on j o i n t r e t u r n s ) on h a l f t h e amount of p o l i t i c a l c ~ n t r i b u t i o n si n a t a x Year and a n a l t e r n a t i v e t a x d e d u c t i c n of up t o $50 ($100 on ~ o i n tr e t u r n s ) on t h e f u l l amount of p o l i t i c a l c o n t r i 5 u t i o n s ( s t i l l i n e f f e c t , a s amended). Federal E l e c t i o n Campaign Act of L971 [ P u b l i c Law 92-2251--response t o t h e f a i l u r e s of d i s c l o s u r e under t h e e a r l i e r l a w s and a n attempc t o c u r b t i s l n g campaign c o s t s ; r e q u i r e d c a n d i d a t e s and p o l i t i c a l c o m f t t e e s t o f i l e d i s c l o s u r e r e p o r t s on e q u a r t e r l y b a a i s ( p l u s two p r e - e l e c t i o n r e p o r t s ) w i t h t h e S e c r e t a r y of ( t h e r e s p e c t i v e ) S t a t e and w i t h t h e a p p r o p r i a t e F e d e r a l o f f i c e r : C l e r k of t h e House ( i n connection with House campaigns), S e c r e t a r y of t h e S e n a t e ( i n . connection v i t h Senate campaigns), and Comptroller GenerallG.h.0. (concerning P z e s i d e n t i a l campaigns); r e p o r t s were t o i n c l u d e i n f o r s a t i o n on each c o n t r i b u t i o n received and ex?enditure s a d e of SlOO o r s o r p (:Centf:;7izg :he name, a d d r e s s , o c ; ~ ? a t i o n , and ? r i n c i ? a i place of business of :he d m o r o r recipient); c o n t r i t ~ u t i o n sof S5,000 o r more vere t; be :e?or:& v i z h i z 63 hours ~f r e c e i t t ; d i s c i o s u r a t a caver 311 phases of che e i e c t i o n ? r a c e s s ; imposed spending Usfts on media a a v e x r s a n g by t2dorai c a n d i d a t e s o f t h e g r e a t e r of $50,000 o r t e n c e n t s per s l f g i b f e v o t a r f n t h e j u r i s d i c t i o n ; r e q u i r e d b r o a d c a s t e r s t o s e l l a d v c r t i s i s g time t o 7 0 l i t L c a l candi'dates a t t h e l o v e s t *=it r a t e a v a i l a b l z :o cormnarc~ala d v e r t t s e r s , d u r i n g the p e r i o d of 43 days p r i o r t o a primary and 60 days p r i o r t o a g e n e r a l e l e c t i o n ; imposed l i m i t s on spending by c a n d i d a t e s and t h e i r immediate f a m i l i e s of $50,000 f o r P r e s i d e n t and Vice. P r e s i d e n t , $35,000 f o r S e n a t e , and $25,000 f o r House c a n d i d a t e s ( s t i l l i n e f f e c t , as amended; media l i m i t s and c a n d i d a t e limits f o r House and.Senate r e p e a l e d ) . - - . . - Federal E l e c t i o n Campaign Act Amendments of 1974 [ P u b l i c Law 93-4431enacted i n response t o t h e Watergate s c a n d a l s of 1972-1974; imposed c o n t r i b u t i o n l i m i t s of $1,000 per c a n d i d a t e per e l e c t i o n and an a g g r e g a t e $25,000 a year on a l l p o l i t i c a l c o n t r i b u t i o n s t o F e d e r a l c a n d i d a t e s and p o l i t i c a l committees f o r i n d i v i d u a l s , and $5,000 per c a n d i d a t e per e l e c t i o n f o r p o l i t i c a l and p a r t y c o d t t e e s ( v i t h no a g g r e g a t e l i m i t ) ; @ o h l b i t e d cash c o n t r i b u t i o n s i n exceaa of $100; imposed e x p e n d i t u r e lirpits ( w i t h annual c o s t - o f - l i v i n g a d j u s t m e n t s ) o f : S L O m i l l i o n f o r P r e s i d e n t i a l c a n d i d a t e s i n p r i m a r i e s , $20 rniUion f o r P r e s i d e n t i a l c a n d i d a t e s i n g e n e r a l e l e c t i o n s , $2 m i l l i o n f o r major p a r t y nominating conventions ( l e s s f o r minor p a r t i e s ) , t h e g r e a t e r of $100,000 o r e i g h t c e n t s per e l i g i b l e v o t e r f o r Senate primary c a n d i d a t e s , t h e g r e a t e r of $150,000 o r twelve c e n t s per e l i g i b l e v o t e r f o r Senate general e l e c t i o n c a n d i d a t e s , and $70,000 f o r House c a n d i d a t e s i n both p r i m a r i e s and g e n e r a l e l e c t i o n s ; a l s o , imposed a $1,000 l i m i t on independent e x p e n d i t u r e s f o r o r a g a i n s t c a n d i d a t e s ; ( r e p e a l e d media spending limits i n t h e 1971 Act); allowed t h e n a t i o n a l p o l i t i c a l p a r t i e s t o spend a d d i t i o n a l amounts on behalf o f t h e i r g e n e r a l e l e c t i o n candidates: $10,000 ( p l u s COLA) f o r House c a n d i d a t e s , t h e g r e a t e r of $20,000 ( p l u s COLA) o r two c e n t s per e l i g i b l e v o t e r ( p l u s COLA) f o r Senate c a n d i d a t e s , and two c e n t s pet e l i g i b l e v o t e r ( p l u s COLA) f o r P r e s i d e n t i a l c a n d i d a t e s ( t h e s e amounts were Fn a d d i t i o n t o d i r e c t c o n t r i b u t i o n s ) ; provided p u b l i c funding f o r P r e s i d e n t i a l p r i m a r i e s and nominating conventions: matching fund system i n t h e p r i m a r i e s , with i n d i v i d u a l donations of $250 o r Less matched on an e q u a l b a s i s by Federal funds once t h r e s h o l d f u n d r a i s i n g l e v e l was a t t a i n e d ($100,000 i n amounts of a t l e a s t S5,000 in each of 20 S t a t e s from donations of $ 2 5 0 o r l e s s ) ; maximum matchingfunds equal t o one-half t h e spending l i m i t ; major p a r t y nominating conventions to'be funded fully from public funds; amount of public funds availabLe to generaL election candidates changed in accordance with new spending limit; established a full-time, bipartisan agency to administer the campaign finance laws, a Federal Election Commission, with six voting members (two each appointed by the President, the Speaker of the House, and the President pro tun of the Senate) and two ex-officio members (the Clerk of the House and the Secretary of the Senate); FEC to have civil enforcement authority, with criminal cases referred to the Justice Department (still in effect, as amended; limits on campaign expenditures in non-publicly funded elections and on independent expenditures repealed). " Tariff Schedules Amendments, 1975 [Public Law 93-6251--doubled aaxisum tax credic f o r political contributions to $25 ($50 on joiat r e r u n s ) and maxfnum tax deduction to $100 ($200 on joint returns) (repealed by L378 Revenue Act). " aucWey v. Valeo [424 U.S. L (1976)l--Supreme Court upheld contribution - limits and disclosure requirements on the ground that they serve the basic vital governmental -interest of safeq&rdin3 the integrity of :he clactoral process without unduly burdening the tights of citizens and candidates to engage in political debate; also upheld public funding system for Presidential elections; Court overturned expenditure limits,~asserting that, unlike contribution limlts, they constituted an undue burden on political urprassion, without a comparable overriding governmental interest in preventing the actuality or app-earance of corruption; the limits strriek down included those on overall campaign spending, on spending of personal funds by candidates, and on independent expendirures by individuals or groups; the only spending limits that were upheld were those associated with publicly funded Presidential campaigns (whether on overall eampafgn activity or on candidates' personal expenditures); Court declared the Federal Election Commission, as constituted, was unconstitutional because it exercised executive branch functions but was appointed, in part, by the Congress. O Federal Election Campaign Act Amendments of 1976 [Public Law 94-2831. primary impetus of its enactment was to reconstitute the Federal Election Commission, vith all members to be appointed by the President; established additional contribution limits: $5,000 on individual donations to a PAC, $20,000 on individual donations to a nat1ona.l committee of a political party, $15,000 on PAC donations to a national co~nmmittee of a political party, and $17,500 on donations by the national parties' senatorial committees to their general election candidates; imposed a single limit of $5,000 on all contributions to Federal candidates by political action committees sponsored by the same organization; specified rules for solicitation of funds by PACs associated with unions, corporations, and trade associations; exempted from spending limits of publicly-funded Presidential campaigns those legal and accounting fees incurred in complying with the F E U ; cut off matching funds to any candidates who failed to receive at least LO percenr of the vote in two successive primaries, to be restored if and when 20 percenc of the vote is garnered in a later primary; required disclosure of independent expenditures of at least $100 and, wichin 24 h o u r s , of such e-.penditures of a t l e a s t $1.000 made v i t h i n 15 days of an e l e c t i o n ; r e q u i r e d d i s c l o s u r e by unions and c o r p o r a t i o n s of p a r t i s a n i n t e r n a l communications t o t h e i r members v h i c h exceed $2,000; gave t h e FEC i n c r e a s e d a u t h o r i t y t o p r o s e c u t e v i o l a t i o n s of t h e l a v ; s p e c i f i e d p e n a l t i e s f o r v i o l a t i o n s ; o u t l i n e d FEC's r e s p o n s i b i l i t i e s i n i s s u i n g a d v i s o r y o p i n i o n s and r e g u l a t i o n s , conducting i n v e s t i g a t i o n s , and a t t e m p t i n g c o a c i l i a t f o n with a l l e g e d v i o l a t o r s of t h e law b e f o r e s e e k i n g p r o s e c u t i o n ( s t i l l i n a f f e c t , as amended). Revenue Act of 1978 [ P u b l i c Law 95-600J-doubled t h e maximum t a x c r e d i t f o r p o l i t i c a l c o n t r i b u t i o n s t o $50 ($100 on j o i n t r e t u r n s ) ; e l i a i n a t e d che t a x deduction f o r p o l i t i c a l g i v i n g ( s t i l l i n a f f e c t ) . F e d e r a l E l e c t i o n Campaign Act Amendaents 3f 1979 [ P u b l i c Law 95-157)impecus f o r passage was t o make t h e requirements of t h e F E U less burdensome t o c a n d i d a t e s , committees, and c i t i z e n s and t o es:2urage a g r e a t e r g r a s s r o o t s r o l e f o r v o l u n t e e r s and f o r Stare and l o c a L p o l i t i c a l p a r t i e s ; exempted c a n d i d a t e s and l o c a l p a r t y commiczees Zr3m d i s c l o s u r e requirements i f they r a i s e d o r s p e n t less than $5,000 i n a y e a r ; i n c r e a s e d t h r e s h o l d f o r i t d z i n g r e c a i p e s and e x p e a d i t u r c s from $100 t o $200 and f o r i t m i z i n g independent e x p e n d i t u r e s from $100 c3 $230; a l l o v e d S t a t e and l o c a l p a r t i e s t o spend u n l i m i t e d amounts on 'get-out-the-vote and r e g i s t r a t i o n d r i v e s on behalf of t h e P r e s i d e n t i a l ticket and on g r a s s r o o t s campaign materials f o r v o l u n t e e r a c t i v i t i e s without counting i t toward t h e c a n d i d a t e ' s spending U n i t s ; r a i s e d from $2 t o $3 a d l l i b a ( p l u s adjustment f o r i n f l a t i o n ) t h e amount of p u b l i c subaidy provided t o major p a r t y aominating conventions; p r o h i b i t e d use of e x c e s s campaign funds by c a n d i d a t e s f o r Federa& o f f i c e , u n l e s s a l r e a d y i n o f f i c e a t t h e t i m e of euactment of t h i s l a w ( s t i l l i n e f f e c t ) . from $3 t o Nominating Conventions, 1984 [ P u b l i c L a w 98-3551-increased $4 m i l l i o n ( p l u s adjustment f o r i n f l a t i o n ) t h e amount of p u b l i c s u b s i d y provided t o t h e major p o l i t i c a l p a r t i e s f o r t h e i r P r e s i d e n t i a l nominating conventions ( s t i l l i n e f f e c t ) . CRS- 1 3 SECTION TWO CAMPAIGN RECEIPTS-THE SOURCES OF FIlNDS This section discusses the receipts or fundraising side of cam paigns 5 y examining the five aaf3r sources of funds in campaigns far Fsderal office. These include: the U.3. Traasury, i;z0i-zidual citfzeos, poli:ical cmmittees, political patzirs, and candidates theznselves. action The next five chapters are devoted to each of these 'sources, offering basic information on the role they play in today's Federal elections, the lavs governing that role, and any relevant financial data. Chapter I11 discusses the system of public funding available in Piesidential elections since 1 9 7 6 , constituting a major' component of Presidential campaign treasuries during this period. available in congressional campaigns. Public funding is noc The chapter discusses the tax checkoff on Federal tax returns, from which this system derives its funds, along vith data on its status since its inception. It also describes the operation of the system in primary elections, nominating conventions, and general elections. Chapter IV discusses the role of individual citizens as campaign contributors, including information on contribution limits and on tax incentives (including financial data on the use of tax credits and tax deductions). Chapter V discusses political action committees, defining vhat they are and how they are affected by contribution limits and offering data on their proliferation in number and the growth of their financial role in campaigns in recent years. Chapter V i Giscusses the role of the po14.tical parties, in terms of their direct contributions to Federal candidates. This includes information on their contribueion limits and data on their contributions in recent elections. It specifically excludes the role of the parties in naking coordinated expenditures oo behalf of candidates and data on the overall finances of the major parties, which are discussed in Chapter X, in the Expenditures section of this report. section, offers a b r i e f dfscuss:on funds for their o m .zampaigns. Chapter VII, the last chapter in this on the role of candidates as a source of 111. SOURCES OF FUNDS-THE U.S. TREASURY Since 1976, Presidential campaigns have been financad in large-measure through a public finance system, covering all three stages of the election: the priaaries, the nominating conventions, and the general election. P,e public money comes from the Presidential Election Campaign F w d , a speciai account in the U.S. Treasury which is funded through an optional Collar checkoff on Federal income tax returns. The public fuads are available to 'candidates (and political parties for their conveationa) on an optional basis, once they meet certain requirements and pledge to comply with the expenditure Limits and other restrictions imposed by the law, 4 The Federal Election Coinmission administers the system, certifying the eligibility of candidates to receive funds, authorizing Treasury payments to them, and conducting audits to ensure that funds are spent in compliance with the law. THE PRESIDENTIAL ELECTION CAMPAIGN FUND Payments into the Fund: The Tax Checkoff The tax checkoff, that first appeared on Federal income tax returns for 1972, allows each taxpayer to designate one dollar of general treasury funds to the Presidential Election Campaign Fund. As stated on the tax returns, the filer's tax liability is not affected by checking the "Yes" box. The Secretary of t h e T r e a s u r y makes monthly t r a n s f e r s of money t o t h e Fund from t h e g e n e r a l t r e a s u r y i n amounts e q u a l t o t h o s e d e s i g n a t e d on t h e t a x r e t u r n s . Within t h e Fund, t h e S e c r e t a r y of t h e T r e a s u r y m a i n t a i n s one a c c o u n t f o r g e n e r a l e l e c t i o n c a n d i d a t e s and c o n v e n t i o n s and a n o t h e r a c c o u n t f o r p r i m a r y c a n d i d a t e s ( t h e p r e s i d e n t i a l Primary Matching Payment Account). 9 i s b u r semenc s From t h e Fund .U1 r e q u e s t s f o r ? u b l i c f n d s a u s t be s a d e t o t3e FEC, v b f c h , opon ascertaining that the candidate o r party has m e t the e l i g i b i l i t y requiranenta, c e r t i f i e s t h e amount and r e q u e s t s payment by t h e S e c r e t a r y of t h e T r e a s u r y d i r e c t l y t o the candidate o r party. S u b s i d i e s may be made a v a i l a b l e f o r t h e n o m i n a t i n g convenciona a s e a r l y a s J u l y L of t h e year before t h e e l e c t i o n , f o r p r i r n a y c a n d i d a t e s . a f t e r J a n u a r y 1 of t h e e l e c t i o n y e a r , and t o t h e g e n e r a l e l e c t i o n c a n d i d a t e s once t h e y have a c h i e v e d e l i g i b i l i t y a s p a r t y nominees. I n t h e e v e n t t h a t i n s u f f i c i e n t f u n d s a r e a v a i l a b l e t o meet a n t i c i p a t s d r e q u e s t s f o r e l e c t i o n s u b s i d i e s , t h e law p r o v i d e s f o r money t o b e p u t a s i d e f i r s t f o r t h e p a r t y c o n v e n t i o n s and t h e n on a p r o - r a t e d and primary e l e c t i o n c a n d i d a t e s . basis f o r t h e g e n e r a l The lav p r o h i b i t s any s h o r t f a l l i n t h e Fund t o be r e p l e n i s h e d by a d d i t i o n a l a p p r o p r i a t i o n s by t h e Congress. To d a t e , t h e r e have been s u f f i c i e n t f u n d s t o pay f o r a l l c o s t s a l l o w e d under t h e law. F i n a n c i a l Data Table I p r e s e n t s i n f o r m a t i o n on payments i n t o and d i s b u r s e m e n t s from t h e P r e s i d e n t i a l E l e c t i o n Campaign Fund f o r e a c h y e a r s i n c e i t s i n c e p t i o n i n t h e r 1972 t a x year. For each y e a r , i t i n d i c a t e s t h e amount of money d e s i g n a t e d f o r t h e c h e c k o f f on the prior year's r e t u r n s , t h e t o t a l d i s b u r s e m e n t s from t h e TAELE 1. F i n a n c i a l Starus of t h e Tax Checkoff and t h e ? r e s i d e n t i a l E l e c t i o n Campaign Fund: 1973-1985 ( D o l l a r amounts i n r n i l l f o n s ) Tax checkoff L/ year- Amount designated P e r c e n t 21 of r e t u r z s P r e s i d e n t l a 1 E l e c t i o n Campaign Fund Disbursements Year -end b a l a n c e 31 - l/ Year i n d i c a t e s t h e y e a r t h e funds were r e c e i v e d o r d i s b u r s e d from t h e Fund;-checkoff d a t a based on tax r e t u r n s f o r t h e p r e v i o u s y e a r ( b u t f i l e d , -in the year indicated). 2/ Percentage of t a x r e t u r n s d e s i g n a t i n g $1 ( i n d i v i d u a l r e t u r n s ) o r $2 ( j o i n F r e t u r n s ) , r e f l e c t i n g r e t u r n s processed i n t h a t f i s c a l ( a s opposed t o calendar) year. 3/ Year-end b a l a n c e may not be e a s i l y r e c o n c i l e d w i t h o t h e r d a t a , i n p a r t becauze of repayments from c a n d i d a t e s and p a r r i e s f o l l o w i n g p o s t - e l e c t i o n a u d i t s . Source: Department of Treasury and I n t e r n a l Revenue S e r v i c e d a t a , as compiled by t h e FEC i n June 1986 p r e s s r e l e a s e . Fund, and t h e amount of money i n t h e Fund a t y e a r ' s end. (The year-end b a l a n c e f i g u r e s a r e n o t e a s i l y r e c o n c i l e d v i t h o t h e r d a t a ; in p a r t b e c a u s e of repayments t o t h e Fund p u r s u a n t t o FEC a u d i t s . ) The t a b l e a l s o p r o v i d e s t h e p e r c e n t a g e of r e t u r n s d e s i g n a t i n g one o r tw dollars f o r t h e Fund s i n c e 1976. PRIMARY ELECTIONS C a n d i d a t e s s e e k i n g a p o l i t i c a l ? a r t y ' s nomination f o r t h e ? r e s i d e n c y aay 3 v a i l theziselves 3 i p a r t i a l sublic funding of chef: campaigns t h r o u g h 3 satching fund system. E s t a b l i s h i n g and M a i n t a i n i n g Z l i g i b i l i t y - - - ~ l i g i b i l i t yis e s t a b l i s h e d by r a i s i n g $100,.000 i n amounts of a t l e a s t $5,000 from each of 20 S t a t e s , i n c o n t r i b u t i o q s from i n d i v i d u a l s of $250 o r 4 less. C o n t r i b u t i o n s r e c e i v e d a s of J a n u a r y 1 of t h e y e a r p r i o r t o t h e e l e c t i o n u n t i l December 31 of t h e e l e c t i o n y e a r s a y be e l i g i b l e f o r p a t c h i n g f u n d s ( i n c l u d i n g f o r purposes of d e b t r e t i r e m e n t ) . f n d i v i d u a l s may c o n t r i b u t e up t o $1,000 t o a P r e s i d e n t i a l c a n d i d a t e i n t h e p r i m a r y e l e c t i o n phase ( t h e same l i m i t a s in o c h e r F e d e r a l e l e c r i o n a ) , b u t o n l y t h e f i r s t $250 o f a n i n d i v i d u a l ' s t o t a l c o n t r i b u t i o n s t o a c a n d i d a t e c o u n t toward e s t a b l i s h i n g e l i g i b i l i t y . C a n d i d a t e s who f a l l t o r e c e i v e a t least 10 p e r c e n t of t h e p o p u l a r v o t e i n two s u c c e s s i v e primary e l e c t i o n s l o s e t h e i r e l i g i b i l i t y f o r c o n t i n u e d matching fund payments, u n l e s s and u n c i l t h e y r e c e i v e a t l e a s t 20 p e r c e n t of t h e v o t e i n a l a t e r primary. Major and Hinor P a r t y C a n d i d a t e s The matching f u n d . s y s t e m d o e s not d i s t i n g u i s h between major and n i n o r p a r t y c a n d i d a t e s , w i t h the requirement of r a i s i n g money i n s m a l l amounts from c o n t r i b u t o r s i n many S t a t e s and t h e LO p e r c e n t v o t e requirement c o n s i d e r e d s u f f i c i e n t t ~ t of s a c a n d i d a t e ' s v i a b i l i t y i n an e l e c t i o n . The requirements f o r t h o s e two f o r a s of popular support a r e i n t e n d e d t o minimize c o n c e r n s t h a t p u b l i c money might be used t o b o l s t e r f r i v o l o u s c a n d i d a t e s . Only one minor p a r t y c a n d i d a t e has q u a l i f i e d f o r matching fund-s s i n c e 1976-Soda Johnson of t h e C i t i z e n s P a r t y i n 1984. Amount o f Xatchfng Funds 3ncs e l i g i b i l i t y is a s t a b l i s h e d , c o n t r i b u t i o n s from i n d i v i d u a l s of S250 o r Less a r e matched on an e q u a l b e d s v i t h F e d e r a l money, up t o one h a l f of :ne :ocal i~ni: on primary spending ( s e e below). Only t h e f i r s t $250 of a n i n d i v i d u a l ' s t o t a l c o n t r i b u t i o n s t o a c a n d i d a t e count tovard q u a l i f y i n g f o r matching funds. No funds a r e paid o u t u n t i l a f t e r J a n u a r y 1 of t h e ' e l e c t i o n year. Spending L i m i t s E l i g i b l e c a n d i d a t e s vho choose t o r a c e i v e P e a e r a 1 matching funds must agree t o adhere t o t h e f o l l o w i n g l i m i t a t i o n s on spending: * an o v e r a l l n a t i o n a l Limit on spending p r i o r t o t h e nominating convention: $10,000,000 p l u s an adjustment f o r i n f l a t i o n (based on 1974 d o l l a r s ) , p l u s a n a d d i t i o n a l 20 p e r c e n t f o r c e r t a i n exempt f u n d r a i s i n g c o s t a , plua a n u n l i m i t e d amouat , f o r l e g a l and accounting f e e s i n c u r r e d i n complying w i t h t h e l a w ( n e i t h e r of t h e s e supplements t o t h e baae l i m i t a r e f a c t o r e d i n f o r purposes of e s t a b l i s h i n g t h e L i m i t on t o t a l matching f u n d s ) ; a S t a t e l i m i t on spending f o r p r i m a r i e s and caucuses i n t h e r e s p e c t i v e S t a t e s : t h e g r e a t e r of $200,000 p l u s an adjustment f o r i n f l a t i o n (based on 1974 d o l l a r s ) o r 16 c e n t s times t h e voting age p o p u l a t i o n p l u s an adjustment f o r i n f l a t i o n (based on 1974 d o l l a r s ) ; and , ' a l i m i t on spending of personal o r immediate family funds: S50,OOO. U i t h t h e a p p l i c a t i o n of adjustments f o r i n f l a t i o n , t h e n a t i o n a l spending L i m i t f o r prenomination campaims v a s set i n 1976 a t $10.9 d l l i o a ( p l u s $2.2 m i l l i o n f o r f u n d r a f s i a g ) ; i n 1980, $14.7 m i l l i o n (plus $2.9 m i l l i o n f o r f u n d r a i r i n g ) ; - a n d i n 1984, $20.2 m i l l i o n ( p l u s $4.0 m i l l i o n f o r f u n d r a i s i n g ) . I n 1984, t h e S t a t e spending l i m i t s ranged from $0.4 n i l l i o n t o $6.0 m i l l i o n . N O H I U T I N G CONVENTIONS Establishing Elfqibilfty Each of t h e tvo major p o l i t i c a l p a r t i e s is autoataticallgl e n t i t l e d t o a p u b l i c g r a n t t o pay f o r :he :2st o f its q u a d r e n n i a l nominating convention. Hinor p a r t i e s ( t h o s e whose P r e s i d e n t i a l c a n d i d a t e s r e c e i v e d b e t v e e n 5 and 25 percent of t h e popular v o t e i n t h e preceding e l e c t i o n ) a r e a l s o e n t i t l e d t o e a p u b l i c s u b s i d y t o def r a p t h e c o s t s o i nominating conventions. New p a r t i e s a r e not e l i g i b l e f o r t h e subsidy. Amount of Subsidy The subsidy f o r major p a t t i e s is e q u a l t o t h e f u l l amount of t h e spending l i m i t (see below). For d n o r p a r t i e s , t h e amount of subsidy is t o be i n t h e samc r a t i o t o t h e major p a r t y ' s g r a n t as van t h e v o t e s cast f o r t h e minor p a r t y ' s P r e s i d e n t i a l c a n d i d a t e i n t h e preceding e l e c t i o a t o t h e average v o t e c a s t f o r t h e major parties' c a n d i d a t e s i n t h a t e l e c t i o n . Spending L i m i t s The spending l i m i t f o r p a r t i e s a c c e p t i n g t h e p u b l i c subsidy v a s set in the 1974 FECA Amendments a t $ 2 m i l l i o n p l u s an adjustment f o r FnfLation; t h e oase amount xas changed :o S3 sillion i n :he 1379 ?ZCX .Amendments and million in Public Law 98-355, enacted in 1986. : 3 SA Based on the changes Fa the base amounts and the adfustnents f ~ rinflation since 197L, the spending lizit (and the amount of pubLic subsidy available to each o t the major parties) was $2.2 million in 1976, $4.4 million in 1980, and S8.L million in 1984. For major parties, the convention committees' must agree to lisit spending to the full amount of the grant. No funds from private sources may be accepted, alchough certain specified services aay be rovided by che host city and S c a t = and Local business and l a j c r ~roups. c3nvenc:sn X xinor party qualityiq tor rk= subsidy 2ay xcepc adalcional funds Eron private sources jut is subject to the same spending Limft as is the major party. Sf-ce the system vas instituted in 1976, no sinor party has requestad or qualified for the convention subsidy. GENERAL ELECZIONS The public funding system in the general election makes available a flat grant to major party nominees, under the condition that no additional funds will be raised or spent by those candidates. The amount of subsidy thus constitutes the expenditure liait for candidates in that election. Unlike the system in place during the prenomination campaign, the general election system distinguishes between major, minor and new party candidates, with the majcr party nomination considered a sufficient demonstration of electoral viability to warrant a full public subsidy of campaign costs. Minor and new party candidates may be eligible for a lesser amount of public grant. Major Party Candidates Xajor party status under the FECX is determined when che Presidential candidate of that party receives at Least 25 percent of the popttlar vote in t h e p r e c e d i n g e l e c t i b n ; i n e f f e c t , t h e Democratic and R e p u b l i c a n p a r t i e s a r e c o n s i d e r e d major p a r t i e s . O ~ c e:he major parties have nominated t h e i r c a n d i d a t e s f o r P r e s i d e n t and Vice P r e s i d e n t , t h e FEC, upon r e q u e s t by t h e nominees, c e r t i f i e s t h e i r e l i g i b i l i t y f o r p u b l i c f u a d s ; t h e c e r t i f i c a t i o n is s e n t t o t h e S e c r e t a r y of t h e T r e a s u r y f o r paymeat. The amount of s u b s i d y a v a i l a b l e t o major p a r r y nominees is $20 a i l l i o n p l u s an a d j u s t m e n t f o r i n f l a t i o n ( b a s e d on 1974 d o l l a r s ) ; i k e a c t u a l a v a i l a b l e s u b s i d y ( a n d s p e n d i a g l i s i c ) was $21.3 n i l l i o n i n L ? 7 5 , 329.A n i L l i o n i n !980, and S4O.G a i l l i o n i n 1984. Ylajor p a r t 7 n o a i z e e s who a c c e p t t h e p u b l i c grant must a g r e e n o t t o r a i s e o r spend any a d d i t i o n a l monies i n h i s o r h e r campaign, vith t h e e x c e p t i o n t h a t l e g a l and a c c o u n t i n g f e e s i n c u r r e d Ln s e e k i n g c o m p l i a n c e w i t h t h e F E U may be p a i d from p r i v a t e f u n d i n g s o u r c e s and a r e n o t s u b j e c t t o t h e e x p e n d i t u r e L i m i t . In a d d i t i o n , t h e P r e s i d e n t i a l and V i c e - p r e s i d e n t i a l nominees a r e s u b j - e c t t o a j o i n t l i m i t of $50,000 on campaign s p e n d i n g from p e r s o n a l and immediate f a m i l y funds . New P a r t y C a n d i d a t e s For nominees of new p o l i t i c a l p a r t i e s , t h o s e w i t h no p r i o r e l e c t o r a l r e c o r d , t h e law p r o v i d e s f o r p o s t - e l e c r i o n s u b s i d i e s t o c a n d i d a t e s vho r e c e i v e a t l e a s t f i v e p e r c e n t of t h e p o p u l a r v o t e . I f t h a t o c c u r s , t h e c a n d i d a t e may r e c e i v e a F e d e r a l payment i n t h e same r a t i o t o t h a t r e c e i v e d by t h e m a j o r p a r t y c a n d i d a t e s a s was t h e v o t e s r e c e i v e d by t h e new p a r t y nominee t o t h e a v e r a g e of v o t e s r e c e i v e d by t h e major p a r t y nominees. I n o n l y one i n s t a n c e , John Anderson of t h e N a t i o n a l Unity P a r t y i n 1980, d i d a c a n d i d a t e q u a l i f y f o r s u c h a p o s t election subsidy. W n o r P a r t y Candi d a t e s P u b l i c funding is a l s o a v a i l a b l r t o minor party c a n d i d a t e s . A minor p a r t y nominee is e n t i t l e d t o a s u b s i d y i n t h e same r a t i o t o t h a t a v a i l a b l e t o t h e major p a r t y nominees a s was t h e r a t i o of v o t e s cart f o r t h e minor p a r t y ' s P r e s i d e n t i a l c a n d i d a t e t o t h e a v e r a g e of v o t e s c a s t f o r t h e major p a r t i e s ' Presidential candidates i n the previous election. A d d i t i o n a l funds aay be r a s e d froa ? r i o a t e s o u r c a s , but t h e c a n d i d a t e s n u s t a b i d e by t h e sane spending i i d c c a a t soverns oalor ? a r t y nominees (an exemptLon i s allowed f o r f u n d r a i s i n g c o s t s of up t o 20 p e r c e n t of t h e d i f f e r e n c e between t h e spending limit and amount of p u b l i c funds r e c e i v e d ) . Had Anderson r u n i n 1984 on t h e N a t i o n a l Unity P a r t y l i n e , he would have been e l i g i b l e f o r F e d e r a l f u n d i n g a s a minor p a r t y c a n d i d a t e ; he would t h u s have been t h e f i r s t c a n d i d a t e t o have t a k e n advantage of t h e s u b s i d y f o r minor p a r t y c a n d f d a t e a . FINANCIAL DATA ON PUBLIC SUBSIDIES SINCE L976 Table 2 p r e s e n t s d a t a on t h e amount of p u b l i c funds t h a t e u b r i d i z e d c a n d i d a t e s and p a r t i e s a t each phase of t h e e l e c t i o n p r o c e s s s i n c e 1976. The number of c a n d i d a t e s o r p a r t i e s is 1 i s t e d . b e s i d e t h e p u b l i c f u n d s f i g u r e , along w i t h an i n d i c a t i o n of p a r t y a f f i l i a t i o n of t h e r e c i p i e n t s . T A ~ E2. Public Subsidies in Presidential Elect1 ons: 1976-1984 (Dollar amounts in millions) 1976 Amount ?tenominat ion period S24.8 1980 Recipients* !3D/ 2R Amount 1984 Recipients* Amount Recipients* $31.3 4D/6R $36.5 9D/ i B / IC $63. 1 lD/ LR/ LAW $80.8 1D/ 1X National c m v e n r ions $4.1 General elect ion $43 .6 TOTAL AMOUNT $7295 *Party key: LDi La ID/LX D-Democrat, R-Republican., NU=National Unity, CICitizens Source: U.S. Federal. Election Coaanission. Washington, 1986. p. 4 . Annual Report, 1985. IV. SOURCES OF FUNDS-INDIVIDUAL CITIZmS The g r e a t e s t s t n g l e s o u r c e of campaign f u n d s r a i s e d by c a n d i d a t e s f o r , p u b l i c o f f i c e t a k e s t h e f o r a of d i r e c t c o n t r i b u t i o n s from i n d i v i d u a l c i t i z e n s . ( T h i s i s d i s t i n c t frcrn i n d i v i d u a l s g i v i n g t h r o u g h PACs and p a r t i e s . ) is v i r t u a l l y i m v o s s i b l e :o Vhile i r s t a t e w i t h any c e r t a i n t y :he e x a c t s h a r e of t h e a v e r a g e carnpaiqn budget 2hFsh comes f r o m i n d i v i d u a l g i v e r s , much of ehe a c a d e n i ; l i t e r a t u r e h a s p i a c e d i t i n t h e r a n g e o f 60-70 p e r c e n t o f Eouse and S e n a t e campaign budgees i n r t c e n t y e a r s . A r e c e n t s t u d y found t h a t t h e F n d i v t a u a i g i v e r s ' component i n House campaign b u d g e t s f e l l t o 47 p e r c e n t i n t h e 1984 e l e c t i o n s , v h i l e a c c o u n t i n g f o r 61 p e r c e n t i n S e n a t e campaigns t h a t same y e a r . -61 D e s p i t e t h e d i f f e r e n c e s i n t h e f i n d i n g s o f academic e x p e r t s and o t h e r . o b s e r v e r s , t h e r e i s no d i s a g r e e m e n t t h a t , on a v e r a g e , i n d i v i d u a l g i v e r s p r o v i d e a g r e a t e r s h a r e of S e n a t e t h a n House campaign r e v e n u e s and t h a t i n d i v i d u a l d o n a t i o n s c o n s t i t u t e t h e l a r g e s t s i n g l e s o u r c e of t h e a v e r a g e (non-Federally-funded) campaign budget. CONTRIBUTION LIMITS The F e d e r a l E l e c t i o n Campaign Act l i m i t s c o n t r i b u t i o n s by i n d i v i d u a l s t o c a n d i d a t e s f o r F e d e r a l o f f i c e and t o p o l i t i c a l cormnittees s e e k i n g t o i n f l u e n c e e l e c t i o n s a t the Federal level. The f o l l o w i n g limits a r e a p p l i c a b l e : 5 1 J a c o b s o n , Gary C. Money i n t h e 1980 and 1982 C o n g r e s s i o n a l E l e c t i o n s . I n x a i b i n , M c h a e l J. ( e d . ) Money and P o l i t i c s i n t h e U n i t e d S t a t e s : F i n a n c i n g E l e c t i o n s Fn t h e 1980s. Washington, American E n t e r p r i s e I n s t i t u t e , 1984. p. 39. 6 Conlon, Richard P. The D e c l i n i n g Role of I n d i v i d u a l C o n t r i b u t i o n s i n ~ i n a n F i nC~o n g r e s s i o n a l Campaigns. P r e p a r e d f o r Conference on Campaign F i n a n c i n g , U n i v e r s i t y of V i r g i n i a Law S c h o o l , Apr. 3-4, 1986. pp. 37, 4 1 . a $1,000--to any candidate for Federal office, per election (primary, general, and run-off are each counted as separate elections); a S20,000--to a $5,000-to a national political patty committee, per year; any other political corPrPittec ( a . g . , PAC*), par year ' $23,000--co ali Federal candidates and committees, per year. These limits apply to Fa-kind contributions (che value of goods and services provided to a campaign) and loans (until they are repaid), as well as to direct aonetary donations. prohibirai. I a d i - r i d ' a l ~~os:izg Cash contributions oi aore than SLCO are ?ar=ies in their homes :o 5e5sfft tanCtCates may spend up to $L,000, not subject to the contribution limits. Finally, volunteer s e w i c e s are cot subject to the contribution limits, provided the volunteers do not assist the campaign during their normal working hours. TAX INCENTIVES FOR INDIVIDUAL CONTRIBUTIONS Since 1972, the Federal Government has provided tax incentives as a means of encouraging individuals to make small donations to political organizacioas; this policy is intended to offset the role of interest groups and large givers and to provide a broader base of participation in the political process. Under Public Law 92-178, taxpayers between 1972 and 1974 could claim either a 50 percent credit up to 812.50 ($25 on joint returns) or a full deduction of up to $50 ($100 on joint returns) on the value of a l l contributions to political candidates and committees at Federal, State and local levels la that tax year. Between 1975 and 1978, under Public Law 93-443, taxpayers could claim a 50 percent credit up to $25 ( $ 5 0 on joint returns) or a full deduction of up to $100 ($200 on joint returns). Since 1979, under Public Law 95-600, taxpayers may claim a 50 percent credit o f up to $50 ($100 on joint returns); the deduction was eliminated by that law. Table 3 provides data on the use of t a x credits and deductions since 1972, TABLE 3. Use of t h e Tax C r e d i t and Deduction f o r P o l i t i c a l C o n t r i b u t i o n s on F e d e r a l Tax R e t u r n s : 1972-1983 Number of t a x returns Year Number of r e t u r n s taking credit (deducti o n ) Total value of' c r e d i t s ( d e d u c t i o n s ) l/ - A/ Partfcipatioa rate i n t a x - i n c e n t i v e s y s t e m 21 / * Because t h e IRS d i d not provide d a t a r e g a r d i n g u s e o f t h e ' t h e s e years, these percentages r e f l e c t only p a r t i c i p a t i o n i n the system. They would be h i g h e r i f t h e tax d e d u c t i o n p a r t i c i p a t i o n p a r t i c u l a r l y i n view of l i k e l y f n c r e a a e s t h e r e o f d u r i n g e l e c t i o n d e d u c t i o n in tax c r e d i t were i n c l u d e d , years. -1 The d e d u c t i o n w a s e l i m i n a t e d a f t e r 1978. -2/ Percentage of a l l r e t u r n s c l a i m i n g t h e c r e d i t (and t h e d e d u c t i o n ) . Source: Tax Returns. Internal Revenue S e r v i c e . (annual series) U.S. S t a t i s t i c s o f Income: Individual V. SOURCES OF°FUNDS-POLITICAL ACTION COMMITTEES PACs , as t h e y a r e commonly known-are P o l i t i c a l a c t i o n commit t ees--or an i n c r e a s i n g l y i m p o r t a n t s o u r c e o f f u n d s f o r p o l i t i c a l campaigns, e s p e c i a l l y i n c o n g r o s s i s n a l e 1 t c : i ~ n s ' v h e r e p b l l c f u n d i n g is not a v a i l a b i e ) . 3XCs have ?rol::az3ttd g - t a t l ; ~i n :he ?as: Airhough d e c a d e , F n r t r z s t g r o u p s have l o n g pidyed a n important r3Le i n che funding of American p o l i t i c a l campaigns. WRAT ARE POLITICAL ACTION COPMITTEES? PACs a r e Legal e n t i t i e s t h r o u g h which i n t e r e s t g r o u p s raise and c o n t r i b u t e m o s e y - t o p o l i t i c a l c a n d i d a t e s . 'The Eerm " p o l i t i c a l a , c t i o n commfttee" is c o l l o q u i a l and does npt a p p e a r i n F e d e r a l law; i t c o r r e s p o n d s w i t h e i t h e r of C-30 l e g a l expressions-"separate s e g r e g a t e d fund" and " p o l i t i c a l committze"-- depending upon whether t h e PAC is a f f i l i a t e d v i t h a s p o n s o r i n g o r g a n i z a t i o n . Of t h e 4,092 p o l i t i c a l a c t i o n committees r e g i s t e r e d v i t h t h e F e d e r a l E l e c t i o n Commission i n nid-1986, s e p a r a t e s e g r e g a t e d funds. approximateLy 7 5 p e r c e n t c a n be c l a s s i f i e d a s Such a fund is e s s e n t i a l l y a bookkeeping a r r a n g e m e n t . An o r g a n i z a t i o n ( u s u a l l y one p r o h i b i t e d by law from making d i r e c t campaign d o n a t i o n s from i t s , o w n t r e a s u r y ) e s t a b l i s h e s and a d m i n i s t e r s ( v i t h f u n d s from its general treasury) a separate e n t i t y vhich, i n turn, seeks voluntary c o n t r i b u t i o n s from t h e s p o n s o r i n g o r g a n i z a t i o n ' s membership f o r e x p r e s s l y p o l i t i c a l purposes. Organizations vhich today maintain s e p a r a t e segregated funds i n c l u d e l a b o r u n i o n s , c o r p o r a t i o n s , t r a d e and h e a l t h a s s o c i a t i o n s , nembership o r g a n i z a t i o n s ( s u c h a s t h e N a t i o n a l R i f l e A s s o c i a t i o n and t h e N a t i o n a l Organization for Women), cooperatives (such as dairy cooperatives), and corporations vit'nout :ap.ital stock (such as certain savings and loans or shareholder insurance companies). The remaining 25 percent of today's PACs are noc affiliated with sponsoring organizations and, as such, do not constitute separate segregated funds. Xather, these PACs, rsfarred to as "non-connected" by the FEC, are organized aeroly by meeting :ke canpaizn finance l a w ' s definition of a "political cornittee"--a 3 t o u p ~ h i t . 5 ~ a l s e sst spends SL,000 or zore in a calendar year. Unlike the separace segregated funds, these PACs are not tequiied b y Law to limit fundraising appeals to finite, designated groups of persons; however, the non-connected PACs must pay their own administ~ativeand fundraising expenses out of contributions, not having sponsoring organizations to underwrite these costs. For the most part, the non-connected PACs.are comprised of ideological * and single-issue groups. THE O R I G I N OF PACs PACs had their origins in the L940s, as a response by organized Labor to the prohibition on union treasury money from being concrtbuted in connection with elections for Federal office. In the wake of the 1943 statute (and the L9b7-statuce making the prohibition.permanent), unions began to establish separate segregated funds to conduct their campaign fundraising and contribution activities, and, for the next three decades, labor PACs dominated the field of interest group political activities. Corporations, prohibited since 1907 from making contributions in connection with Federal elections, were reluctant to establish PACs, in Large measure because of the relative lack of precedent for such e n d e a v o r s a n d this area. the concomitant absence of conclusive judtcial r u l i n g s in A number of legislative, judicial, and administrative actions in the early and atid-i970~helped pave the vay for other groups to explore the PAC option, by removing legal ambiguitiss and by granting specific authority under the law to unions, corporacions, trade associations and others to set up separate segregated funds for political purposes. Apart from the elimination of legal barriers, the growth of PACs was spurred by a perceived decline in the strength of political garties, by contribution limits significantly hisher than those for indi.~iduals,and as a response to increased governrnenc regulation o f azd invoLvenent in people ' s lives and :ivelinoods. The law provides far two different sets of limits for what ve refer to as polktical action committees. @ The limits for a basic political committee are: $1,000--to any candidate for Federal office, per election; ' S20,000--to the national committee of a political party; a $5,000-to any other political codttee. In terns of these limits, the law treats a political committee as it does an individual citizen, with the major.exception being that political committees are n o t subject to the aggregate, annual limit on all political contributions. The law allows political committees to qualify for a higher per candidate contribution limit by meeting the requirements of a "muLticandidate commfttee." The latter is defined as a political committee which has been registered with the FEC for at least six months, has received contributions from mote than SO persons, and has contributed to at least five candidates for Federal office. By qualifying as a multicandidate committee, which the vast majority of PACs do, a PAC is subject to the following limits: " $5,000--to " $15,000--to " $5,000--to any c a n d i d a t e f o r F e d e r a l o f f i c e , p e r e l e c t i o n ; t h e n a t i o n a l committee of a p o l i t i c a l p a r t y ; any o t h e r p o l i t i c a l committee. The major d i s c t a c t i o n betveen t h e b a s i c p o l i t i c a l c o d t t e e and t h e m u l t i c a n d i d a t e cormnittee is t h e $5,000 l i r n i t p e r c a n d i d a t e , p e r e l e c t i o n p e r t a i n i n g t o t h e l a t t e r , which, by v i r t u e of ' l t s comparison w i t h t h e l i m i t on i n d i v i d u a l s , has c o n t r i b u t s d g r e a t l y t o t h e p r o l i f e r a t i o n o f PACs s i n c e t h e e a r l y L970s. X E ! K M E R OF PACs T a b l e 4 documents rhe growth o f p o l i t i c a l a c t i o n c o d t t e e s s i n c e the e a r l y 1970s. The t a b l e i n d i c a t e s t h e number o f PACs r e g i s t e r e d a t t h e end o f e v e r y two y e a r p e r i o d , according t o t h e s i x c a t e g o r i e s d e v i s e d by the FEC i n 1977: c o r p o r a t e , l a b o r , trade/mernbership/health, non-connected, and c o r p o r a t i o n w i t h o u t c a p i t a l s t o c k . cooperative, TABLE 4. Number of R e g i s t e r e d p o l i t i c a l A c t i o n Committees: 1974 Corporate - 1986 -l / 89 20 1 Labor Trade / ~ernbershi~f 318 Health 2 / - Nonconnec t ed Cooperative Corporation without c a p i t a l stock - T o t a l 3/ 608 1146 1653 zas 1 ' 3371 4009 4092 4 -1 -2/ Data as of December 31 f o r each y e a r , e x c e p t as of ~ u l y i~n l 1986. I n c l u d e s a l l n o n - c o r p o r a t e and non-labor .. PACs through l2/3L/ 75. 3/ Not dl PACs r e f l e c t e d i n chase t o t a l s p l a y a n a c t i v e r o l e i n any !given-election. I n 1984, 3,046 PACs c o n t r i b u t e d . t o F e d e r a l c a n d i d a t e s . Source: U.S. F e d e r a l E l e c t i o n Conmctssion. ( p r e s s r e l e a s e ) : J u l y 14, 1986. FEC Releases New PAC Count FINANCIAL ACTIVITY OF PACs SINCE 1972 Table 5 provides d a t a on t h e f i n a n c i a l a c t i v i t y of F e d e r a l l y - r e g i s t e r e d PACs s i n c e 1972. For each e l e c t i o n , i t p r e s e n t s t h e t o t a l a d j u s t e d r e c e i p t s and a d j u s t e d e x p e n d i t u r e s of a l l PACs and t h e t o t a l amount c o n t r i b u t e d t o a l l c o n g r e s s i o n a l c a n d i d a t e s s e e k i n g office d u r i n g t h a t e l e c t i o n c y c l e . Donations a r e l i s t e d o n l y f o r c o n g r e s s i o n a l c a n d i d a t e s because they r e c e i v e by f a r t h e l a r g e s t s h a r e of PAC money g i v e n i n F e d e r a l e l e c t i o n s and because such d a t a is a v a i l a b l e in comparable form for a l l t h e y e a r s covered h e r e i n . TABLE 5 . Election cycle - d Financial Pct',vLty of-Political Action Committees: 1972-1984 (full election cycle data) Adjusted receipts Adjusted expenditures Contributions to congressional candidates ~~lit1ea.l Action Committees: Their Sources: See U.S. Library of b&rcss. Evolution, ~ r o w t h ,and Implications For the Political System.. CRS Report No. 84-78 GOVs by Joseph E. Cantor.. Washington, 1984. Addenda, April 21, t986. p. 2-3. The large gap between the level of total expenditures and the total'amount of contributions to congressional candidatas can be largely accounted for by the following commonly-made PAC expenditures: coutributions to State and local candidates, contributions to Presidential candidates, contributious to congressional candidates from past or future electiou cycles, contributions to political parties, administrative and fundraising costs of non-connected PACs, and inde pendent expenditur es . Table 6 places the level of PAC concribucions in the context of total receipts of congressional candidates, thus attempting to put the rising level of PAC donations into perspective. The table indicates the total receipts by congressional candidates running in general elections since 1972, the total PAC concribucions to those candidates, and the percentage of overall receipts c o n s t i t u t e d by PAC d o n a t i o n s . The d a t a d e m o n s t r a t e t h a t t h e i x k r e a s e i n PAC g i v i n g has outpaced t h e o v e r a l l i n c r e a s e s i n c a n d i d a t e r e c e i p t s (and s p e n d i n g ) , a s r e f l e c t e d i n t h e i n c r e a s e d s h a r e of campaign t r e a s u r i e s emanating from PAC=. TABLE 6. Year PAC C o n t r i b u t i o n s as a P e r c e n t a g e o f C o n g r e s s i o n a l C a n d i d a t e s ' O v e r a l l R e c e i p t s i n General E l e c t i o n s : 1972-1984 ( D o l l a r amounts i n d l l i o r m ) Candidat e receipts PAC contributions P e r c e n t Given by PACs Sources: See U.S. L i b r a r y of Congress. P o l i t i c a l Action Committees: T h e i r E v o l u t i o n , Grovth, and I m p l i c a t i o n s For The P o l i t i c a l System. CXS Report No. 84-78 GOV, by Joseph E. Cantor. Washington, 1984. Addendum, A p r i l 21, 1986. p. 5. The f i n a l table of d a t a on PACs p r o v i d e s i n f o r m a t i o n on t h e a g g r e g a t e l e v e l of campaign c o n t r i b u t i o n s by each of t h e major t y p e s o f PAC: l a b o r , c o r p o r a t e , trade/membership/health, mn-connected, c o r p o r a t i o n s without c a p i t a l s t o c k ) . and o t h e r ( c o o p e r a t i v e s and P r i o r t o 1978 ( t h e f i r s t e l e c t i o n wherein t h e FEC c a t e g o r i e s v e r e u s e d ) , d a t a f o r c o r p o r a t e and t r a d e / m e m b e r s h i p / h e a l t h PACs a r e combined under t h e b r o a d e r heading of " b u s i n e s s - r e l a t e d " ; t h i s scheme is based on t h e v i d e l y - h e l d view t h a t most of t h e groups c l a s s i f i e d by t h e FEC as trade/rnernbership/heaIth o r g a n i z a t i o n s have a b u s i n e s s - o r i e n t a t i o n . TABU 7. Type of PAC Contributions t o Congressfonal Candfdatea of PACs by Category: 1972-1984 (in a i l l i o a s of d o l l a r s ) 1372 1974 1976 1978 1980 1982 - Labor Businessrelated Corporate $3.6 2.7 - $13 .2 $6 .3 $8.2 510.3 4.4 10.0 - - - 1984 - $20.3 $24.8 - - LO 7 14 .j - Non-coanect ed - .7 1.5 2 .8 4.9 3 t her 2.2 1.0 2 08 1.0 2.0 3.2 3.d $8.5 $12.5 $22.6 $35.2 $55.2 $83.6 $105.3 Total . . ' Sources: See U.S. Library of Congrcaai Palltical Action Committees: Their Evolution, Growth, and Implications For The PoliticaL Syuten~. CXS Report No. 84-78 GOV, by Joseph E. Cantor. Washington, 1986. ~ddendum,~ A p r i l 2i. 1986. p. 11-12. Vl. SOURCES OF FUNDS-POLITICAL PARTIES P o l i t i c a l p a r t i e s are a n i m p o r t a n t s o u r c e o f campaign f u n d s a t t h e F e d e r a l Level, a l t h o u g h j u s t hov i m p o r t a n t h a s been a m a t t e r of some d i s p u t e i n r e c e n t years. S t a c l s t i c s c o m p i i s d 3 y acadeaic e x p e r t s ia t h e l a c 2 L970s a p p e a r 4 t s i n d i c a t e a s h a r ? d e c i i n e i n :nc tola o f p a r t i e s a s a f u n d i n g sour:e - c o n g r e s s i o n a l campaians d u r i n g t h a t decade. 8/ of T h i s was v i cued by some a s w i d e n c e of t h e i n c r e a s i n g l y d i s p r o p o r t i o n a t e r o l e b e i n g played by PACs, v h i c h , i n t u r n , seemed t o c o n f i r m t h a t s p e c i a l i n t e r e s t s were m u l t i p l y i n g a s t h e more 0 broadly-based, mediating structurao-the p a r t i e s - w e r e withering. Some saw t h e a p p a r e n t d e c l i n e i n t h e p a r t i e s ' r o l e as the r e s u l t of changes i n t h e * - campaign f i n a n c e l a v s which r e s t r i c t e d p o l i t i c a l p a r t i e s from f u l l y a s s i s t i n g t h e i r c a n d i d a t e s ( t h r o u g h c o n t r i b u t i o a limits, e t c . ) . S i n c e L980, however, t h e n a t i o n a l p a r t i e s ( p a r t i c u l a r l y t h e R e p u b l i c a n ) have shoun s i g n s of i n c r e a s e d a c t i v i t y b o t h as a g e n t s f o r a s s i s t i n g t h e i r c a n d i d a t e s and f o r promoting some d e g r e e of u n i t y among e l e c t e d o f f i c i a l s on policy matters. Combined w i t h t h e growing campaign t r e a s u r i e s by t h e n a t i o n a l p a r t y committees ( a g a i n , p a r t i c u l a r l y t r u e of t h e COP), t h e s e f a c t o r s have c o n t r i b u t e d t o a r e e v a l u a t i o n of t h e o r i e s a b o u t d e c l i n e of p o l i t i c a l p a r t i e s . Indeed, more r e c e n t methods of c a l c u l a t i o n have y i e l d e d s t a t i s t i c s which show, 8/ Jacobson, Gary C. The P a t t e r n of Campaign C o n t r i b u t i o n s t o C a n d i d a t e s I n U.S. Congress. House. f o r txe U.S. House of R e p r e s e n t a t i v e s , 1972-78. Committee on House A d m i n i s t r a t i o n . An A n a l y s i s of t h e Impact of t h e F e d e r a l E l e c t i o n Campaign A c t , 1972-1978- From t h e I n s t i t u t e of P o l i t i c s , John F. Kennedy School of Government, Harvard U n i v e r s i t y . Committee P r i n t , 9 6 t h Cong., 1 s t Sess. Uashington, U.S. Govt. P r i n t . O f f . , 1979. p . 20 ( T a b l e 1 ) . at the very least, a constant role by parties as a funding source and, in - Senate campaigns and among Republican candidates, a somevhat grovinq role. 91 There are several methods used by the major national parties to provide assistance to their candidates for Congress. This chapter, hovever; is confined to a discussion of their monetary contributions to candidates; other forms of assistance vill be discussed in Chapter IX, in the Expenditures section of this repor?. In making contributions, polftfcal party comPrittees are treated the same as other political committees, with a limit of $1,000 or $5,000 per candidate, per election, depending upon whether they meet the standards of "multicandidate committee." The one exception applies to Senate candidates, to whom ths - . national party committee and the senatorial campaign committee may make a combined donation of up to $17,500 in the year of the general election. Because the tvo major national party committees and the respective senatorial and congressional campaign cmmittces, and many-if not most--of the State party committees, qualify aa multicandidaee c o d t t e e s , the $5,000 contribution limit uidely applies. In House races, a candidate can receive as much as Sl0,000 from the national party committee, $10,000 from the party's congressional campaign committee, and $10,000 from the State party committee-a total of $30,000. (This assumes that no run-off elections occur, in which case the candidate can accept another $5,000 from each of those three sources, and that the parties are villing to be involved in primary elections-) Senate 91 O r n s t e i n , Norman J . e t al. ( e d . ) . Vital Statistics on Congress, 1984-7985 Edition. Washington, American Enterprise Institute, 1 9 8 4 . p - 78-79. c a n d i d a t e s can r e c e i v e up t o $17,500 from t h e n a t i o n a l and s e n a t o r i a l . c o d t t e e s - and another $10,000 from t h e S t a t e committee-a t o t a l o f $27,300. DATA ON PARTY CONTRIBUTIONS Table 8 p r e s e n t s d a t a on t h e t o t a l c o n t r i b u t i o n s by the major p o l i t i c a l . p a r t y c o m i c t e e s t o t h e i r candidaces f o r F e d e r a l offi'ce s i n c e 1976. The f i g u r e s constitute :he combiaed c o n t r i h t i a n s of ?arty c s m l r t e e s a t eke qationa', s t a t a , and l o c a l l e v e l s . ( P a r Democrats, t o c d s Lor c a t i c n a l c m m i t t e e s include t h e Democratic National.Co&ttee, Campaign hnmittee, t h e Democratic Congrassi o t h e Democratic Seoacorial d Caatpaiqn Couuulttee , and o t h e r s ; for. Republicans, n a t i o n a l c o m i t t e e t o t a l s i n c l u d e t h e Republican N a t i o n a l Committee, t h e National Republican S e n a t o r i a l Cormittee, .the N a t i o n a l Republican Congressional Cormnittee, and o t h e r s . ) 4 A s w i l l ' be d e m o n s t r a t e d i n Chapter I X . . (and s p e c i f i c a l l y i n Table 1 7 ) , t h e s e d i r e c t c o n t r i b u t i o n s c o n s t i t u t e only a small s h a r e of t h e f i n a n c i a l resources through which t h e p a r t i e s a s s i s t t h e i r c a n d i d a t e s f o r Federal o f f i c e . CBS-40 TABLE 8. Year P o l i t i c a l P a r t y C o n t r i b u t i o n s t o F e d e r a l Candidates: 1976-1984 House Senate President . * Toekt Democratic * Data i n c l u d e c o n t r i b u r i o n s by p o l i t i c a l p a r t y connnittees a t t h e n a t i o n a l , s t a t e and l o c a l l e v e l s t o a l l F e d e r a l c a n d i d a t e s ; not l i m i t e d t o c a n d i d a t e s s e e k i n g e l e c t i o n d u r i n g t h a t e l e c t i o n c y c l e o r t o c a n d i d a t e s vho met t h e FEC's r e p o r t i n g t h r e s h o l d of r a i s i n g o r spending a t l e a s t $5,000 (except f o r 1976, which is l i m i t e d t o c a n d i d a t e s on t h e g e n e r a l e l e c t i o n b a l l o t ) . ** T o t a l i n c l u d e s o n l y t h e f i g u r e s l i s t e d f o r House and S e n a t e . *** $820,922 r e p r e s e n t s proceeds from. j o i n t f u n d r a i s i n g a c t i v i t y f o r v a r i o u s . p r e s i d e n t i a l campaigns. V i t a l Statistics Source: For 1976: O r n s t e i n , Norman J., e t a l . (ed.). on Congress, 1984-L985 E d i t i o n . Washington, American E n t e r p r i s e I n s t i t u t e , 1984. p. 84 (from FEC D i s c l o s u r e S e r i e s ) . For 1978: U.S. Federal Election F i n a l Report: Commission. FEC Reports on F i n a n c i a l A c t i v i t y , 1977-1978. P a r t y and Non-Party P o l i t i c a l Coramfttecs. Vol. 1-Summary T a b l e s . Washington, 1980. pp. 102-105. For 1980: U.S. F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l F i g u r e s on 1979-80 Major P o l i t i c a l P a r t y A c t i v i t y ( p r e s s r e l e a s e , c o r r e c t e d ) : Feb. 21, 1982. For 1982: U.S. F e d e r a l E l e c t i o n Commission. FEC F i n a l Report f o r 1981-82 Confirms Republicans Outspent Democrats 5 t o 1 ( p r e s s F e d e r a l E l e c t i o n Commission. FEC r e l e a s e ) : Dec. 3 , 1983. For 1984: U.S. F i n a l 1984 Report Shows Republicans S t i l l Hold F i n a n c i a l Lead ( p r e s s r e l e a s e ) : Dec. 5 , 1985. VII. SOURCES OF FUNDS--CANDIDATES A f i n a l s o u r c e of campaign f u n d s is t h e c a n d i d a t e s ' p e r s o n a l and f a m i l y wealth. Of t h e f i v e major s o u r c e s of f u n d s d i s c u s s e d i n t h i s r e p o r t , t h i s 3ae Aas senerally been c h e z o s t difficult t o gsuge on a n a g g r e g a t e l a v e 1 and is :he s u b j e c t of t h e l e a s t ccxnpr&ensive d i s c u s s i o n i n :he academic and journalistic Literature. The F e d e r a l E l e c t i o n Campaign Act Amendments of 1974 imposed a l i m i t on what c a n d i d a t e s c o u l d c o n t r i b u t e from p e r s o n a l and immediate f a m i l y f u n d s : $50,000 f o r P r e s i d e n t and V i c e - p r e s i d e n t , House. $35,000 f o r S e n a t e , and $25,000 f o r - The Supreme C o u r t ' s 1976 r u l i n g i n t h e Buckley v. Valeo c a s e h e l d such l i m i t s t o be u n c o n s t i t u t i o n a l , u n l e s s t h e y were imposed i n c o n j u n c t i o n w i t h a p u b l i c f u n d i n g system. Hence, w h i l e t h e s e l i m i t s a p p l y t o c a n d i d a t e s i n P r e s i d e n t i a l e l e c t i o n s ( i f t h e y a c c e p t p u b l i c f u n d i n g , a s most m a j o r p a r t y c a n d i d a t e s d o ) , c a n d i d a t e s f o r t h e House and S e n a t e are free of r e s t r i c f i o n s on p e r s o n a l spending. C a n d i d a t e s f o r t h e House and S e n a t e may c o n t r i b u t e t o o r l o a n t h e i r campaigns u n l i m i t e d amounts of money. The l o a n s may be r e p a i d t h r o u g h t h e r a i s i n g of d o n a t i o n s from o t h e r s o r , a s is o f t e n t h e c a s e , r e m a i n u n p a i d , t h u s c o n s t i t u t i n g a n a d d i t i o n a l c o n t r i b u t i o n by t h e c a n d i d a t e . Under t h e F e d e r a l campaign f i n a n c e l a w s , l o a n s a r e t r e a t e d a s c o n t r i b u t i o n s f o r p u r p o s e s of t h e c o n t r i b u t i o n l i m i t s ( i n t h e c a s e of c a n d i d a t e s , t h i s means no l i m i t s on l o a n s ) ; a l s o , banks may l o a n campaigns money, o f t e n g u a r a n t e e d by t h e c a n d i d a t e , i n t h e " o r d i n a r y c o u r s e of b u s i n e s s " [ 2 U . S . C . 431(8)(B)(vii)]. L a r g e l y because o f c a n d i d a t e l o a n s which may go unpaid f o r l o n g p e r i o d s of t i m e , making i t d i f f i c u l t t o d e t e m i n e whether t h e y s h o u l d be c o n s i d e r e d a s c o n t r i b u t i o n s , a g g r e g a t e d a t a on t h e Level of c a n d i d a t e s f p e r s o n a l money i n campaigns has proven d i f f i c u l t t o c o m p i l e - Furthermore, c a n d i d a t e c o n t r i b u t i o n l e v e l s a r e o f t e n i n f l a t e d by i n c o r r e c t r e p o r t i n g o f baak l o a n s t o c a n d i d a t e s a s c o n t r i b u t i o n s from t h e c a n d i d a t e d i r e c t l y . One r e p o r t p l a c e d t h i s s o u r c e ( i n c l u d i n g c o n t r L 3 u t i o n s and unpaid l o a n s ) i n t h e 6-12 p e r c e n t r a n g e i n Xouse e l e c t i o n s between 1974 and !982 and j e t v e e n 1-20 p e r c e n t i n S e n a t e elections d u r i n g :his period.. 101 - b c m r d f n g t o CXS c a l c u l a t i o n s , 89 p e r c e n t o f Xouse c a n d i d a t e s and 78 p e r c e n t of S e n a t e c a n d i d a t e s i n 1984 g e n e r a l e l e c t i o n s gave o r loaned t h e i r campaigns 525,000 o r Less; o n l y 3 p e r c e n t o f House c a n d i d a t e s and 15 p e r c e n t of S e n a t e c a n d i d a t e s gave o r l o a n e d t h e i r campaigns more t h a n While t h e s e d a t a may be of l i m i t e d r e l i a b i l i t y , one s h o u l d be even more h e s i t a n t t o draw c o n c l u s i o n s about p o s s i b l e t r e n d s i n c a n d i d a t e g i v i n g from p e r i o d i c newspaper s t o r i e s about wealthy c a n d i d a t e s making v e r y l a r g e d o n a t i o n s o r l o a n s t o t h e i r campaigns. There a r e i n v a r i a b l y a few n o e a b l e i n s t a n c e s of t h i s i n e v e r y e l e c t i o n y e a r , b u t t h e r e is no firm e v i d e n c e t h a t w e a l t h y c a n d i d a t e s a r e proving any more o r any l e s s numerous o r s u c c e s s f u l t h a n t h e y have bean throughout American h i s t o r y , d u r i n g most of which i n a d e q u a t e d i s c l o s u r e laws made t h e f i n d i n g of t r e n d s i m p o s s i b l e - ... LO/ Conlon, Richard P. A New Problem i n Campaign F i n a n c i n g And a ~ i m ~ l ~ ~ e ~ i s lSao ltuit ivo ne. Prepared f o r t h e Law and The P o l i t i c a l P r o c e s s Study Group, 1984 Annual Meeting, American P o l i t i c a l S c i e n c e A s s o c i a t i o n . Washington, S e p t . 1, 1984, p . 13. 11/ U.S. L i b r a r y of Congress. C o n g r e s s i o n a l Research S e r v i c e . C o n t r i b u t i o n s and ~ z n by s Xajor P a r t y General E l e c t i o n C a n d i d a t e s , L984. Typed R e p o r t , by Kevin Coleman, J u l y 2 5 , 1986. Washington, 1986. SECTION TIiREE CAMPAIGN EXPENDITURES-TEE SPENDING BY CANDIDATES AND GROUPS n i s section of the report is concerned with the expenditure side of cainpaigns tsr Federal office, :he of thesa eiactfcns. %ersas spending of money to influence the outcome Erc:isn Two dealt with campaign fundraisinq and the sources of contributions made to candidates, this section discusses the spending of those campaign dollars by the candidates and by other groups as a means of communicating directly vith the voters. This section focuses to a large extent on the data on expenditures by the major players in Federal campaigns: the candidates, the political parties, and independent groups. 8 This section is divided into three chapters. Chapter V'III deals vith campaign expenditures by the candidates and their official committees; it is divided into two parts--Presidential and congressional, presenting aggregate (and, for congressional elections, average) data on spending levels fa recant elections. Chapter TX discusses the role of the major political parties in spending money to assist their candidaces in elections, as opposed to their role in simply contributing money to the candidates (discussed in Chapter VI). Chapter X focuses on political expenditures aimed at influencing elections by individuals and groups operating independently of any candidate's official campaign organization. This form of spending is known as independent expenditures, and it constitutes a significant and unique type of political activity in Federal campaigns. VIII. W A I C N SPENDING-PRESIDENTIAt. AND CONGRESSIONAL CLWDIDATES T h i s c h a p t e r p r e s e n t s d a t a on campaign e x p e n d i t u r e s by c a n d i d a t e s f o r Federal o f f i c e i n recent elections. I t is d i v i d e d i n t o two s e c t i o n s : t h e first d e a l s w i c k ! s g e n d i n s t y ? r o s f d e c t f a l c a n d i d a t e s , t h e second v i t n c a v e r i n g e x p e n d i t u r e s 5y a l l c a n d i d a t e s o r e m a j o r segments t h e r e o f , a s a =ems of d i s c e r n i n g t r e n d s i n campaign spendfng o v e r t i m e . PX3SIDENTIAL ELECTIONS - S t a t i s t i c s on campaign s p e n d i n g i n r e c e n t P r e s i d e n t i a l e l e c t i o n s a r e presented i n able . 9. . C The p e r i o d of tine--1976 i h r o u g h 1984-coincides with t h e e x i s t e n c e of p u b l i c f u n d i n g i n P r e s i d e n t i a l e l e c t i o n s . The d a t a L i s t e d uades "Primary" and "General" r e f l e c t s campaign s p e n d i n g by t h e c a n d i d a t e s o f major and minor p a r t i e s , w i t h t h e p r i m a r y o b j e c t i v e b e i n g t o i l l u s t r a t e t h e e x t e n t of campaign s p e n d i n g d i r e c t l y c o n t r o l l e d by t h e c a n d i d a t e ( a s opposed t o t h e v a r i o u s forms of s p e n d i n g d i s c u s s e d l a t e r which may d i r e c t l y o r i n d i r e c t l y b e n e f i t a c a n d i d a t e , b u t which is s p e n t w i t h o u t t h e candidate's authorization). Two t o t a l f i g u r e s a r e p r e s e n t e d f o r e a c h e l e c t i o n year: t h e f i r s t ( " T o t a l " ) is s i m p l y t h e a d d i t i o n of t h e f i r s t two c o l u m n s - - d i r e c t c a n d i d a t e s p e n d i n g . The second ( " E s t i m a t e d T o t a l " ) r e f l e c r s t h e b e s t e s t i m a t e by e x p e r t s of t h e e x t e n t of all spending aimed a t i n f l u e n c i n g t h e P r e s i d e n t i a l e l e c t i o n , w h e t h e r by c a n d i d a t e s , p a r t i e s , independent g r o u p s , c o r p o r a t i o n s and u n i o n s , e t c . TABLE 9. Campaian Spending by P r e s i d e n t i a l Candidates: 1976-1984 ( D o l l a r amounts i n m i l l i o n s ) * Reported c a n d i d a t e spending Year Primary &nerd- Estimated total-all spending l/ - Total * Soending by c a n d i d a t e s is l i m i t e d t o t h e M o u n t s s p e n t by t h e o f f i c i a l campaign committees of t h e candidaees--major and minor part.y combined. . 1/ These e s t i m a t e s - a l l by D r . H e r b e r t Alexander of t h e C i t i z e n s ' ~ e s e a F c hfoundation-tncompass a l l s p e n d i n g aimed at in f l u e a c i n g t h e P r e s i d e n t l a 1 e l e c t i o n , whether'by t h e candidates, t h e a a t i o n a l p a r t i e s , independent groups, u n t o n s , a n d c o r p o r a t i o n s , s t a t e and l o c a l p a r f ies , etc. Source: 1976 d a t a : Alexander, H e r b e r t E. F i n a n c i n g t h e 1976 E l e c t i o n . Washington, C o n g r e s s i o n a l Q u a r t e r l y P r e s s , 1979. pp. 171, 172, 175. 1980 d a t a : Alexander, Herbert E. F i n a n c i n g t h e 1980 E l e c t i o n . Lexington, D.C. Heath & -Co., 1983. p. 111. 1984 d a t a : U.S. F e d e r a l E l e c t i o n Commission. F i n a l 1984 P r e s i d e n t i a l S t a t i s t i c a l Report Released ( p r e s s r e l e a s e ) : Jua. 4, 1986; H e r b e r t E. Alexander ( u n p u b l i s h e d d a t a ) . T h i s s e c t i o n of t h e r e p o r t is c o n f i n e d t o a d i s c u s s i o n . o f f i n a n c i a l a c t i v i t y d i r e c t l y by t h e P r e s i d e n t i a l c a n d i d a t e s . A s i n d i c a t e d by t h e "Estimated T o t a l " column i n Table 9 , t h e r e a r e s e v e r a l o t h e r s i g n i f i c a n t ways i n v h i c h o t h e r g r o u p s c a n and do spend money t o s u p p o r t o r oppose p a r t i c u l a r candidates. These i n c l u d e ( b u t a r e n o t l i m i t e d t o ) : n a t i o n a l p a r t y e x p e n d i t u r e s on behalf of t h e P r e s i d e n t i a l t i c k e t ( d i s c u s s e d i n Chapter I X ) ; independent e x p e n d i t u r e s by i n d i v i d u a l s and groups ( d i s c u s s e d i n Chapter X ) ; partisan i n t e r n a l communications by c o r p o r a t i o n s and l a b o r u n i o n s t o t h e i r members ( o r e x e c u t i v e employees and s t o c k h o l d e r s ) ; get-out-che-vote by u n i o n s , c o r p o r a t i o n s , n o n - p r o f i t and r e g i s t r a t i o n d r i v e s o r g a n i z a t i o n s , and S t a t e and l o c a l p o l i t i c a l p a r t i e s ; and v o l u n t e e r - o r i e n t e d a c t i v i c l e s , campaign p a r a p h e r n a l i a - , and o t h e r p a r t y - b u i l d i n g a c t i v i t i e s conducted by S t a t e and l o c a l p o l i r i c a l parties. These activities-consticutea growing p o r t i o n of a11 f u n d s s p e n t on P r e s i d e n t i a l e l e c t i o n s , a l t h o u g h most of them a r e not r e q u i r e d t o be r e p o r t e d t a t h e FEC, t h u s making them d i f f i c u l t t o monitor. CONGRESSIONAL ELECTIONS This s e c t i o n f o c u s e s on ,the l e v e l o f spending i n c o n g r e s s i o n a l e l e c t i o n s s i a c e the earl;* 1970s. T a b i e s of d a t a 3re i n c l u d e d vhich p r o v i d e i n f o m a ~ i a n on o v e r a l l House and S e n a t e campaign c o s t s d u r i n g t h i s p e r i o d , a s well as average c o s t s of such c a m p a i g n s - 4 t h b r e a k d o ~ sb y - p a r t y , c a n d i d a t e s t a t u s ( I n c w b e n t , c h a l l e n g e r , open s e a t ) , and e l e c t i o n outcome. Aggregate Campaign Casts Table LO c o n t a i n s d a t a on t h e t o t a l amount s p e n t by House and S e n a t e . c a n d i d a t e s s i n c e 1972, w i t h breakdawns f o r t h e House, t h e S e n a t e , and f o r both chambers combined. It r e f l e c t s spending by c a n d i d a t e s i n p r i m a r i e s and g e n e r a i e l e c t i o n s ( a s w e l l a s runoffs, *ere cycle-the a p p l i c a b l e ) f o r each two y e a r e l e c t i o n e l e c t i o n y e a r and t h e one p r e c e d i n g i t . a r e 1972 and 1974, vhich encompass s h o r t e r p e r i o d s . ) (The e x c a p t i o u s , a s n o t e d , These d a t a do n o t i n c l u d e spending on behalf of t h e c a n d i d a t e s , w i t h o r without t h e i r c o o p e r a t i o n , by p a r t y committees and PACs, b u t they do r e f l e c t t h e b e s t a v a i l a b l e d a t a on c a n d i d a t e spending d u r i n g t h i s period. Table 11 s e r v e s a s a companion t o Table 10, p r o v i d i n g t h e same t y p e of a g g r e g a t e spending d a t a b u t o n l y f o r c a n d i d a t e s who r a n I n t h e g e n e r a l e l e c t i o n . The d i f f e r e n c e between an e n t r y i n Table 10 and i n Table 11 f o r t h e comparable c a t e g o r y is t h e spending by l o s e r s i n pre-nomination c o n t e s t s . By e l i m i n a t i n g t h o s e expenditures, T a b l e 11 more a c c u r a t e l y r e f l e c t s t h e spending l e v e l s i n TABLE LO. Year T o t a l Campaign Expenditures i n House and Senate E l e c t i o n s : 1972-1984" House- E l e c t 1ons . Senate E l e c t i o n s Tot a 1 * These d a t a r e p r e s e n t n e t e x p e n d i t u r e s ( g r o s s ~ x p e n d i t u r e sminus t r a n s f e r s between a f f i l i a t e d committees) by c a n d i d a t e s i n each e l e c t i o n , i n c l u d i n g primary l o s e r s a s v e l l as t h o s e on t h e g e n e r a l e l e c t i o n b a l l o t . Not r e f l e c t e d a r e e x p e n d i t u r e s on behalf of t h e s e c a n d i d a t e s by p a r t y cormoittees and independent groups. Expendi t u r e s cover t h e two-year elect1on c y c l e ( t h e e l e c t i o n year and t h e p r s c e d i n g y e a r ) , except f o r t h e 1974 f i g u r e , c o v e r i n g Sept. 1, 1973-aec. 31, 1974, and t h e 1972 f i g u r e , covering Apt. 7 , 1972-Dec. 31, 1972. Sources: For 1972: Common Cause. Campaign Finance Monitoring P r o j e c t . 1972 F e d e r a l Campaign Finances: I n t e r e s t Groups and P o l i t i c a l P a r t i e s . Volume 111, p. i v - ; a l s o , Common Cause p r e s s r e l e a s e s l s s u e d wfth release of i t s 1972 studies. [Common Cause r e p o r t e d spending on Rouse r a c e s by c a n d i d a t e s i n t h e g e n e r a l e l e c t i o n of $39,959,376 and spending by Senate g e n e r a l e l e c t i o n c a n d i d a t e s of $26,446,393; i t r e p o r t e d an a d d i t i o n a l $10.9 m i l l i o n s p e n t by House and Senate c a n d i d a t e s vho l o s t i n p r i m a r i e s but not with r e s p e c t i v e breakdowns. The f i g u r e s l i s t e d i n t h i s t a b l e r e p r e s e n t s t h e g e n e r a l e l e c t i o n d a t a p l u s a p o r t i o n of t h e $10.9 m i l l i o n s p e n t by primary l o s e r s a l l o c a t e d i n t h e same r a t i o a s t h e a c t u a l g e n e r a l e l e c t i o n spending f o r each t h e House and t h e S e n a t e ] . For 1974: Common Cause. Campaign Finance Monitoring P r o j e c t . 1974 Congressional Campaign Finances. Volume 1: Senate Races, p- vi. For 1976: Alexander, Herbert E. Financing t h e 1976 E l e c t i o n . Washington, Congressional Q u a r t e r l y P r e s s , 1979; p. 176-177. [ F i g u r e s i n t h i s t a b l e a r e based on FEC d a t a f o r d i r e c t c a n d i d a t e e x p e n d i t u r e s ] . For 1978: U.S. Federal Election I n t e r i m Report No. Commission. FEC Reports on F i n a n c i a l A c t i v i t y , 1977-1978. 5 - U.S. Senate and House Campaigns. Washington, 1979. p. 91, 93. For 1980: U.S. F e d e r a l E l e c t i o n Commission. FEC Reports on F i n a n c i a l A c t i v i t y , 1979-1980. F i n a l Report. U-S. Senate and House Campaigns. Washington, 1982. p - 123. For 1982: U.S. Federal E l e c t i o n Commission. FEC Reports on F i n a n c i a l A c t i v i t y , 1981-1982. F i n a l Report. U.S. Senate and House Campaigns. Washington, 1983- p . 89. For 1984: U.S. Federal E l e c t i o n Commission. FEC Releases F i n a l Report on 1984 Congressional Races ( p r e s s r e l e a s e ) : Dec. 8 , 1985. TABLE 11. Year T o t a l campaign E x p e n d i t u r e s by House and S e n a t e G e n e r a l E l e c t i o n C a n d i d a t e s : 1972-1986 * Rouse E l e c t i o n s Senate E l e c t i o n s Total * These d a t a r e p r e s e n e n e t e x p e n d i t u r e s ( g r o s s e x p e n d i t u r e s minus t r a n s f e r s between a f f i l i a t e d c o m m i t t e e s ) by House and S e n a t e c a n d i d a c e s who r a n i n . t h e g e n e r a l e l e c t i o n , i n c l u d i n g t h e i r e x p e n d i t u r e s i n pre-nomination c o n t e s t s ; o n l y primary l o s e r s a r e e x c l u d e d . Not r e f l e c t e d a r e e x p e n d i t u r e s on b e h a l f of . t h e s e c a n d i d a t e s by p a r t y committees and i n d e p e n d e n t g r o u p s . F i g u r e s r e p r e s e n t e x p e n d i t u r e s f o r t h e two-year e l e c t i o n c y c l e (.the e l e c t i o n y e a r and t h e p r e c e d i n g y e a r ) , e x c e p t f o r t h e 1974 f i g u r e , c o v e r i n g t h e p e r i o d o f September 1, !973December 31, 1974, and t h e 1972 f i g u r e , c o v e r i n g t h e p e r i o d of A p r i l 7 , 1972December 31, 1972. S o u r c e s : -For 1972: Common Cause. Campaign F i n a n c e Y a n i r o r i n g P r o j e c t . 1972 F e d e r a l Campaign,Finances: I n t e r e s t Groups and P o l i t i c a l P a r t i e s . Volume ZIT, p. i v . ; a l s o , Common Cause p r e s s r e l e a s e s i s s u e d w i t h r e l e a s e of i t s 1972 studies. For 1974: Common Cause. Common Cause Study R e v e a l s $74 M i l l i o n Spent by C o n g r e s s i o n a l C a n d i d a t e s Who Ran i n 1974 G e n e r a l E l e c t i o n s [ p r e s s r e l e a s e ] : A p r i l 11, 1975. For 1976: U.S. F e d e r a l E l e c t i o n Coatmission. FEC D i s c l o s u r e S e r i e s No. 6: 1976 S e n a t o r i a l Campaigns, R e c e i p t s and E x p e n d i t u r e s . Washington, 1977. p. 3; and FEC D i s c l o s u r e S e r i e s No. 9: 1976 House of R e p r e s e n t a t i v e s Campaigns, R e c e i p t s and E x p e n d i t u r e s . Washington, 1977. p. 4. For 1978: U.S. F e d e r a l E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , l977-L978. I n t e r i m Report No. 5. U.S. S e n a t e and House Campaigns. Washington, 1979. p. 31. For 1980: U.S. F e d e r a l E l e c t i o n C o m m i s s i o n . FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1979-1980. F i n a l R e p o r t . U.S. S e n a t e and House Campaigns. Washington, 1982. p. 49. For 1982: U-S. F e d e r a l E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1981-1982. F i n a l R e p o r t . U.S. S e n a t e and lfouse Campaigns. Washington, 1983. p . 33. For 1984: U S F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l Report on 1984 C o n g r e s s i o n a l Races ( p r e s s r e l e a s e ) : Dec. 8 , 1985. t h e main arena-the general election. I d e a l l y , one would b e ~ b l et o s e p a r a t e s p e n d i n g i n p r i m a r i e s by g e n e r a l e l e c t i o n c a n d i d a t e s , t o p r o v i d e t h e t r u e l e v e l o f s p e n d i n g aimed s p e c i f i c a l l y a t t h e g e n e r a l e l e c t i o n . Hovever, r e p o r t i n g p r o c e d u r e s a a k e i t t o p o s s i b l e t o do s o , presumably b e c a u s e t h e r e ts no c l e a r d e l i n e a t i o n between s p e n d i n g d i r e c t e d a t primary v o t e r s and s p e n d i n g directed a t the general electorate. E x p e n d i t u r e s made p r i o r t o a p r i m a r y e l e c t i o n which i s n o t s e r i o u s l y c o n t e s t e d may i n f a c t be i n t e n d e d t o i n f l u e n c e t n e g e a e r a i a'sczion, and ~ x ~ e n G i : u r z sxade a f t e r a p r i n a r y aay c o n s t i c u t z payments 3 f d e 3 t s iiom t h e p r f s a r p p e r i o d . me g e n e r a l e l e c t i o n :anaidac=s d a t a , d e s p i t e i t s l i m i t a t i o n s , is used by p o l i t i c a l s c i e n t i s t s i n c a l c u l a t i n g o t h e r s t a t i s t i c s , s u c h a s t h e a v e r a g e campaign :osts i n f o r m a t i o n which is p r e s e n t e d h e r e i n T a b l e s 12-13. Average Campaign C ~ ss t The n e x t f o u r t a b l e s p r o v i d e d a t a on a v e r a g e campaign c o s t s d u r i n g t h e p a s t t e n y e a r s , broken down i n t o v a r i o u s c a t e g o r i e s . T a b l e 12 p r o v i d e s a v e r a g e c o s t s of a l l c a n d i d a t e s i n House and S e n a t e g e n e r a l e l e c t i o n s s i n c e 1974. Table 13 p r o v i d e s t h e a v e r a g e c o s t s of a l l House and S e n a t e c a n d i d a t e s , according t o t h e i r p a r t y a f f i l i a t i o n . T a b l e 14 p r o v i d e s t h e c o s t s , a c c o r d i n g t o t h e i r e l e c t o r a l s t a t u s - - w h e t h e r a n incumbent, a c h a l l e n g e r , o r an open s e a t contender. T a b l e 15 p r o v i d e s t h e a v e r a g e c o s t s o f winning c a n d i d a t e s o n l y , s i n c e 1976. It is worth n o t i n g t h a t t h e s e t a b l e s a r e c o n f i n e d t o s p e n d i n g o n l y by major p a r t y c a n d i d a t e s , a s more a c c u r a t e r e f l e c t i o n s of t h e t r u e c o s t s of s e e k i n g a House o r S e n a t e s e a t . A d i f f e r e n t methodology would y i e l d d i f f e r e n t r e s u l t s , a n d , i n d e e d , d a t a d o e s e x i s t which c o n f l i c t s v i t h t h o s e i n t h e s e tables. For example, i n c o m p i l i n g s i m i l a r i n f o r n a t i o n , o t h e r p o l i t i c a l s c i e n t i s t s have r e s t r i c t e d t h e i r d a t a b a s e s t o major p a r t y c a n d i d a t e s who had a a j o r p a r t y o p p o n e n t s ; o t h e r s s a y d i v i d e t o t a l e x p e n d i t u r e s by t h e number of major p a r t y c a n d i d a t e s on t h e b a l l o t , r e g a r d l e s s o f v h e t h e r t h e y met t h e FEC's r e p o r t i n g - t h r e s h o l d ( t h e r a i s i n g o r spending o f at l e a s t $5,000). The p r i m a r y v a l u e of s u c h t a b l e s is t h e t r e n d s r e v e a l e d o v e r t i m e , n o t any s p e c i f i c f i g u r e t h e r e i n ; t h e methodology used becomes l e s s i m p o r t a n t i n t h a t c o n t e x t . TXaL3 12. Year Averago Campaign E x p e n d i t u r e s by House and S e n a t e Candidates: !974-1984 * House Senate * I n c l u d e s primary and g e n e r a l e l e c t i o n e x p e n d i t u r e s by m a j o r p a r t y g e n e r a l e l e c t i o n c a n d i d a t e s o n l y ( n e t e x p e n d i t u r e s , where p o s s i b l e ) . Source: For 1974: O r n s t e i n , Norman, e t a l . Vital S t a t i s t i c s on C o n g r e s s , 1984-1985 E d i t i o n . Washington, American E n t e r p r i s e I n s t i t u t e f o r P u b l i c P o l i c y R e s e a r c h , 1984. 6. 65-46, 69-70 [Based on Common Cause d a t a ] . For 1976: U.S. F e d e r a l E l e c t i o n Commission. FEC D i s c l o s u r e S e r i e s . No 6: 1976 S e n a t o r i a l Campaigns, R e c e i p t s and E x p e n d i t u r e s . Washington, 1977. p . 6 ( i n c l u d e s one Independent p a r t y c a n d i d a t e ) ; FEC D i s c l o s u r e S e r i e s . No. 9: I976 House of R e p r e s e n t a t i v e s Campaigns, R e c e i p t s and E x p e n d i t u r e s . Washington, 1977. p. 11. For 1978 : U.S. F e d e r a l E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1977-1978. I n t e r i m Report No. 5: U.S. S e n a t e and House Campaigns. Washington, 1979. p. 31; and FEC p r e s s r e l e a s e , J u n e 29, 1979. For 1980: U.S. Federal E l e c t i o n Cormnission. FEC R e l e a s e s F i n a l S t a t i s t i c s on 1979-80 C o n g r e s s i o n a l Races ( p r e s s r e l e a s e ) : Mar. 7 , 1982. For 1982: U.S. Federal. Election Commission. FEC R e l e a s e s F i n a l Report on 1981-82 C o n g r e s s i o n a l E l e c t i o n s ( p r e s s r e l e a s e ) : Dec. 2 , 1983. For 1984: U.S. F e d e r a l E l e c t i o n Commission. - - - - . FEC R e l e a s e s F i n a l Report on 1984 C o n g r e s s i o n a l Races ( p r e s s r e l e a s e ) : Dec. 8 , 1985. - TABLE 13. Average Campaign Expenditures by House and S e n a t e C a n d i d a t e s by P a r t y : 1974-1984 * - House Remoc r a t Year 1974 Senate S 53,993 Republican $ 54,835 Democrat $ 487,775 Republican $ 382,3&3 !976 74,757 71,945 569,902 1378 108,502 LO? ,OL 1 ?20,454 1980 133,105, 145,415 1,:L1,202 1982 201,607 218,823 1,810,617 1,609, LAO 1984 219,575 214,962 2,034,733 2,180,402 616,501 1 .L5L,SO7 971,502 * I n c l u d e s pr+mary and g e n e r a l e l e c t i o n e x p e n d i t u r e s by major p a r t y g e n e r a l e l e c t i o n c a n d i d a t e s o n l y ( n e t e x p e n d i t u r e s , where p o s s i b l e ) . Source: For 1974: O r n s t e i n , Norman, ee a l . Vital S t a t i s t i c s on Congress, 1984-1985 E d i t i o n . Washington, American E n t e r p r i s e I n s t i t u t e f o r P u b l i c P o l i c y Research, 1984. p . 65-66, 69-70 [Based on Coannon Cause d a t a ] . For 1976: U.S. F e d e r a l E l e c t i o n Commission. FEC D i s c l o s u r e S e r i e s . No 6: 1976 S e n a t o r i a l Campaigns, R e c e i p t s and Expenditures. Washington, 1977. p. 6; FEC D i s c l o s u r e S e r i e s . No. 9: 1976 House of R e p r e s e n t a t i v e s Campaigns, R e c e i p t s and Expenditures. Washington, 1977. p. 11. For 1978: U.S. Federal Election Commission. FEC Reports on F i n a n c i a l A c t i v i t y , 1977-1978. I n t e r i m Report No. 5: U.S. S e n a t e and House Campaigns. Washington, 1979.. p. 31; and FEC p r e s s r e l e a s e , June 29, 1979. For 1980: U.S. F e d e r a l E l e c t i o n Commission. FEC Releases Final S t a t i s t i c s on 1979-80 Congressional Races ( p r e s s r e l e a s e ) : Mar. 7 , 1982. For 1982: U.S. F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l Report on 1981-82 CongressLonal E l e c t i o n s ( p r e s s r e l e a s e ) : Dec. 2, 1983. For 1984: U.S. F e d e r a l E l e c t i o n Cammission. FEC Releases F i n a l Report on. 1984 Congressional Races ( p r e s s r e l e a s e ) : Dec. 8, 1985. TASLE 14. Year Average Campaign E x p e n d i t u r e s by House and S e n a t e C a n d i d a t e s by C a n d i d a t e S t a t u s : 1974-1984 * Incumbent Challenger Open S e a t House 1974 1976 - 1978 L980 L982 i 384 Senate 1974 * I n c l u d e s primary and g e n e r a l e l e c t i o n e x p e n d i t u r e s by m a j o r p a r t y g e n e r a l e l e c t i o n c a n d i d a t e s o n l y ( n e t e x p e n d i t u r e s , where p o s s i b l e ) Source: For 1974 (House and S e n a t e ) and 1976 House: O r n s t e i n , Norman, e t a l . Vital S t a t i s t i c s on Congress, 1984-1985 E d i t i o n . Washington, American E n t e r p r i s e I n s t i t u t e f o r P u b l i c P o l i c y R e s e a r c h , 1984. p. 65-66, 69-70 [Based on Common Cause d a t a f o r 1974 and FEC d a t a f o r 19761. For 1976 S e n a t e : U.S. F e d e r a l E l e c t i o n Commission. FEC D i s c l o s u r e S e r i e s . No 6 : 1976 S e n a t o r i a l Campaigns, R e c e i p t s and E x p e n d i t u r e s . Washington, 1977. p. 6 ( i n c l u d e s one Independent c a n d i d a t e ) . For 1978: U.S. F e d e r a l E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1977-1978. I n t e r i m Report No. 5: U.S. S e n a t e and House Campaigns. Washington, 1979. p. 38. For 1980: U.S. Federal E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1979-1980. Final Report: U.S. S e n a t e and House Campaigns. Washington, 1982. p. 57-58 (1980 d a t a based on g r o s s e x p e n d i t u r e s ) . For 1982: U.S. F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l Report on 1981-82 C o n g r e s s i o n a l E l e c t i o n s ( p r e s s r e l e a s e ) : F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l Dec. 2 , 1983. For 1984: U.S. Report on 1984 C o n g r e s s i o n a l Races ( p r e s s r e l e a s e ) : Dec. 8 , 1985. T a b l e 15 provides t h e average c o s t of winning c a n d i d a t e s f o r t h e House and S e n a t t s i n c e - 1 9 7 6 . By u s i n g d a t a f o r winning c a n d i d a t e s o n l y , some p o l i t i c a l s c i e n t i s t s b e l i e v e t h a t t h i s provides t h e t r u e s t gauge of t h e l e v e l of funding needed f o r c o n g r e s s i o n a l r a c e s , i . e . , what i t c o s t s t o win a House o r Senate s e a t . These d a t a are d e r i v e d from FEC f i g u r e s on t h e t o t a l amounts spent by winning c a n d i d a t e s s i n c e 1976; u n f o r t u n a t e l y , t h e t o t a l f i g u r e s were rounded t o t h e n e a r e s t t t r . c h o f a m i l l i o n d o l l a r s , s a k i n g ,the r e s u l t i r t g average f i g u r e s of lrsite4 ? r ~ c i s i o n . T A a U 15. Year Average Campaign Expenditures by Uinning House and Senate Candidates: 1976-1984 * House Senate Calculated by d i v i d i n g t h e t o t a l e x p e n d i t u r e s by winning c a n d i d a t e s (primary and g e n e r a l e l e c t i o n e x p e n d i t u r e s incbuded) by t h e number of winners. T o t a l e x p e n d i t u r e f i g u r e s were rounded to n e a r e s t t e n t h of a m i l l i o n d o l l a r s ; hence, t h e s e averages a r e l i m i t e d i n t h e i r p r e c i s i o n . U.S. F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s Source: For 1976-1982: F i n a l Report on 1981-82 Congressional E l e c t i o n s ( p r e s s r e l e a s e ) : Dec. 2, 1983; and FEC Releases F i n a l S t a t i s t i c s on 1979-80 Congressional Races ( p r e s s r e l e a s e ) : Mar. 7 , 1982. For 1984: U.S. Federal E l e c t i o n Commission. FEC R e l e a s e s F i n a l Report on 1984 Congressional Races ( p r e s s r e l e a s e ) : Dec. 8 , 1985. IX. CAMPAIGN SPLWINC~POLITICALPARTIES T h i s c h a p t e r f o c u s e s on t h e r o l e p o l i t i c a l p a r t i e s p l a y in a s s i s t i n g c a n d i d a t e s beyond d i r e c t c o n t r i b u t i o n s t o t h e i r campaigns ( s e e C h a p t e r VT). The ?ar:Les a a k e =arnpaign e x p e n d i t u r a s t o b e n e f i t c a n d i d a t e s and a l s c ?ravr=s v a r i o u s 2 o m s of s e c h n i c a l and o t h e r s u p p o r t t o t h o s e candidates. u n'l 'x' e " c o n t t i b u c i o n s , whereby s o n e y is simply t r a n s f e t e d s o t h a t a c a n d i d a t e a a y d e t e r m f n a how i t Fs s p e n t , t h e s e e x p e n d i t u r e s are made d i r e c t l y 5 y t h e party a c c o r d i n g t o i t s own judgment a b o u t v t r a t s f o t ; n o f a s s i s t a n c e may p r o v e most helpful. The p a r t y e x p e n d i t u r e s c o n s t i t u t e a far g r e a t e r p o r t i o n of t h e major p a r t i e s ' b u d g e t s t h a n do t h e i r c o n t s i b u t i o n s t o c a n d i d a t e s . COORDINATED EXPENDITURES The law p r o v i d e s f o r a s u b s t a n t i a l method w i t h which p a r t i e s may a s s i s t t h e i r c a n d i d a t e s f o r F e d e r a l o f f i c e , i n t h e form o f c o o r d i n a t e d e x p e n d i t u r e s These e x p e n d i t u r e s a r e made i n c o n s u l t a t i o n and c o o r d i n a t i o n w i t h t h e c a n d i d a t e f o r campaign s e r v i c e s ( s u c h a s TV o r r a d i o a d s and v o t e r s u r v e y s ) . f o r which t h e c a n d i d a t e would o c h e r v i s e have t o pay'. These e x p e n d i t u r e s a r e made by and r e p o r t e d by t h e p a r c y , n o t t h e c a n d i d a t e . Under 2 U.S.C. 4 4 1 a ( d ) , t h e n a t i o n a l and S t a t e p a r t y c o m m i t t e e s may make such e x p e n d i t u r e s f o r t h e i r nomfnees in t h e general e l e c t i o n , s u b j e c t t o l i m i t s . I n t h e c a s e of House and S e n a t e c a n d i d a t e s , a S t a t e committee may d e s i g n a t e e i t h e r a l o c a l p a r t y a f f i l i a t e o r a n a t i o n a l p a r t y committee a s t h e * a g e n t f o r a a k i n g t h e e x p e n d i t u r e , which, i n t h e l a t t e r c a s e , h a s t h e e f f e c t o f d o u b l i n g t h e c o o r d i n a t e d l i m i t f o r t h e n a t i o n a l p a r t y ( a common o c c u r r e n c e ) . I n t h e c a s e of P r e s i d e n t i a l c a n d i d a t e s i n t h e g e n e r a l e l e c t i o n , t h e n a t i o n a l p a r t y committees a r e p e r m i t t e d t o spend up t o t v o c e n t s times t h e VAP p l u s an adjustment f o r i n f l a t i o n , based on 1974 d o l l a r s . These e x p e n d i t u r e s may be c o o r d i n a t e d v i t h t h e P r e s i d e n t i a l and V i c e - p r e s i d e n t i a l cand-idates and are not a f f e c t e d by t h e r e s t r i c t i o n s on p r i v a t e sources of money which govern publicly-funded sillion F3 candidates. . The l i m i t was set a t $3.2 m i l l i o n i n 1976, $4.6 1980, and $6.9 a i l l i o n i n 1994. For Xouse c a n d i d a t e s :a S t a t e s w i t h mors t h a n one c o n g r e s s i o n a l d l s t z i c r , t h e n a t i o n a l and S t a t e p a r t i e s may each spend up t o $10,000, p l u s a n a d j u s t s e n t f o r i n f l a t i o n based on 1974 d o l l a r s . I n 1984, t h e 1Mt on c o o r d i n a t e d e x p e n d i t u r e s i n House r a c e s ras $20,200. Hence, che n a t i o n a i and S t a t e ; a r r i e s c o u l d have made combined c o o r d i n a t e d e x p e n d i t u r e s of $40,400 i n b e h a l f of Rouse c a n d i d a t e s . For Senate c a n d i d a t e s and f o r Rouse c a n d i d a t e s i n s i n g l e d i s t r i c t S t a t e s , t h e p a r t i e s may make c o o r d i n a t e d e x p e n d i t u r e s of up t o $20,000 ( p l u s adjustment f o r i n f l a t i o n ) o r two c e n t s times t h e v o t i n g age p o p u l a t i o n ( p l u s adjustment f o r i n f l a t i o n ) , whichever is g r e a t e r . I n 1984, t h e c o o r d i n a t e d e x p e n d i t u r e limfts ranged from $40,400 ( i n s i n g l e d i s t r i c t S t a t e s U k e Delaware and South Dakota) t o $752,409.60 i n California. Hence, t h e n a t i o n a l and S t a t e p a r t i e s c o u l d have made combined c o o r d i n a t e d e x p e n d i t u r e s on behalf of S e n a t e nominees of between $80,800 and some $1.5 m i l l i o n , depending upon t h e s i z e of t h e S t a t e . OTHER FORHS OF ASSISTANCE I n a d d i t i o n t o c o n t r . i b u t i o n s and c o o r d i n a t e d e x p e n d i t u r e s , there a r e o t h e r ways i n vhich t o d a y ' s n a t i o n a l p a r t i e s a s s i s t t h e i r c a n d i d a t e s f o r o f f i c e . These i n c l u d e " g e n e r i c " p a r t y a d v e r t i s e m e n t s designed t o boost s u p p o r t f o r t h e ---..l .. .---~4 A - r a c np s 1 avo1 s - ~ W t r a i pP j n ~s c h o o l s , r e s e a r c h assistance on district voting patterns and o n opponents, opinion polls, getout-the-vote and rsgistration drives, and party-building activities through transfers of funds to State and local party affiliated comittees. These and ocher forms of assistance may be extremely valuable to candidates, vhile the benefits derived may be impossible to gauge from FEC reports. Unlike the direct contributions and coordinated expenditures, these f o m s of assistance are aot subject co Limits under Pederal campaign ficance Laws. Table 16 presents data on financial activity of the two n a j o t rolitical p t t i + ~from 1976 - 1984- For each major party, it lists tatai adjusted receipts and expenditures during that election cycle, with breakdowns for national level and state and local level committees. For Democrats, totals for national cannnittees include the Democratic National Committee, the Democratic Senatorial Campaign Comictee, the Democratic Congressional Campaign .. Committee, Presidential convention committees and others. For Republicans, national committee totals include the Republican National Committee, the National Bepublican Senatorial Cormnittee, the National Republican Congressional Committee, Presidential convention committees and others. TABLE 16. Major Political Party Receipts and Expenditures: 1976-1984 Year Party Level Democratic National State/local Total Republican Nat ional State/ local 1 ~otal Democratic National Scate/local Total Republican National State/Tocal Tot a1 Democratic National State/local Total Republican National State/ local Total Democratic National State/local Tocal Republican National St ate/ local Total Democratic National State/local Total Republican National State/local Total Adjusted Receipts 1/ - * - Adjusted l/ Expendi cures T ~ B L E16. Ma j o t P o l i t i c a l P a t t y R e c e i p t s and Expenditures: 1976-1 984-continued * Data f o r N a t i o n a l p a r t y committees i s l a r g e l y comprised of f i n a n c i a l a c t i v i t y of t h e n a t i o n a l committee, t h e s e n a t o r i a l campaign committee, t h e c o a g r e ~ s i o n a lcampaign committee, and, v h e r e r e l e v a n t , t h e p r e s i d e n t i a l convention committee ( v h e r e i n r e c e i p t s a r e from t h e p u b l i c t r e a s u r y ) . l/ Adjusted r e c e i p t s and e x p e n d i t u r e s r e p r e s e n t t h e g r o s s f i g u r e s minus t h e t T a n s f e r s between af filf a t e d p a r t y committees. Source: For 1976: U.S. F e d e r a l E l e c t i o n Commissioa. FEC D i s c l o s u r e S e r i e s . Xo. 4: N a t i o n a l P a r t y ? o l i t i c a l Committees, B e c e i p t s and Z x ~ e n d i Z u t e s * Fcr Democratic and Xepublican, 1975 C a ~ p a i g n . Mashinqtcn, 1977. pp. 5 - 5 . 1978: U S . Federal Z l e c t i o n Conmission. FEC Reports on F i n a n c i a l .ktFvi:y, L97?-1975. I ? n a i S t p o r t : P a r 5 7 acd Son-?arty ? a E t i : a l Camaircats. P o l , 1Sunnnary Tables. Washington, 1980. p . 101. For 1980: U.S. Ftderai Zeccion Coaaaission. FEC Releases F i n a l F i g u r e s on 1979-80 Major P o l i t i c a l ? a x ? A c t i v i t y ( p r e s s r e l e a s e , c o r r e c t e d ) : Feb. 21, 1982. For 1982: U.S. Federal. E l e c t i o n Cammi ssion. FEC P i n a l Report f o r 1983-82 Conf inns S e p u b l i c a n s Outspent Democrats 5 t o 1 ( p r e s s r e l e a s e ) : Dec. 3 , 1983. For 1984: U.S. F e d e r a l E l e c t i o n Commission. FEC F i n a l 1984 Report Shovs Republicans S t i l l Hold F i n a n c i a l Lead ( p r e s s r e l e a s e ) : Dec. 5, 1985. A s Table 16 demonstrates, t h e Republican P a r t y ' s r e s o u r c e s have_prowri t o e x t r a o r d i n a r y Levels, g r e a t l y exceeding t h e combined r e s o u r c e s of t h e Democratic P a r t y . Z'his has had a c l e a r e f f e c t on t h e r e l a t i v e a b i l i t i e s of each p a r t y t o a s s i s t i t s c a n d i d a t e s f o r - F e d e r a l o f f i c e . Table 17 s e r v e s a s a c o u n t e r p a r t t o t h e p r e v i o u s one, by i n d i c a t i n g t h e c o o r d i n a t e d e x p e n d i t u r e s by p a r t y committees a t t h e n a t i o n a l , s t a t e , and l o c a l Levels on behalf of P r e s i d e n t i a l , Senate and House c a n d i d a t e s i n each e l e c t i o n cycle. (The d a t a i n c l u d e s e x p e n d i t u r e s on behalf of a l l F e d e r a l c a n d i d a t e s , r e g a r d l e s s of whether they sought e l e c t i o n d u r i n g t h a t e l e c t i o n c y c l e . ) This t a b l e r e v e a l s t h a t through c o o r d i n a t e d e x p e n d i t u r e s , t h e p a r t i e s a r e a b l e t o put s i g n i f i c a n t l y l a r g e r r e s o u r c e s i n t o campaigns t h a n t h e y can through d i r e c t c o n t r i b u t i o n s ( s e e Table 8 i n Chapter VI). Once a g a i n , t h e g r e a t e r a b i l i t y of t h e Republicans t o h e l p t h e i r c a n d i d a t e s vis-a-vis 1s demonstrated i n t h e s e d a t a . t h e Democrats TABLE 17. P o l i t i c a l P a r t y Coordinated Expenditures f o r F e d e r a l C a n d i d a t e s : 19760L984 * House Senate Resident Tot a1 Delnocrati c 1976 1978 1980 i382 1984 Republican. 1976 1978 1980 1982 1984 * Data i n c l u d e c o o r d i n a t e d e x p e n d i t u r e s [441a(d) e x p e n d i t u r e s ] by p o l i t i c a l p a r t y committees a t t h e n a t i o n a l , s t a t e and l o c a l l e v e l s on b e h a l f of a l l F e d e r a l c a n d i d a t e s ; n o t l i m i t e d t o c a n d i d a t e s s e e k i n g e l e c t i o n d u r i n g t h a t e l e c t i o n c y c l e o r t o c a n d i d a t e s who met t h e FEC's r e p o r t i n g t h r e s h o l d of r a i s i n g o r spending a t l e a s t $5,000. Source: For 1976: U.S. F e d e r a l E l e c t i o n Commission. FEC D i s c l o s u r e S e r i e s . No 4: N a t i o n a l P a r t y P o l i t i c a l Committee R e c e i p t s and E x p e n d i t u r e s . Democratic and Republican, 1976 Campaign. Washington, 1977. pp. 31, 34, 36, 39. For 1978: U.S. F e d e r a l E l e c t i o n Commission. FEC R e p o r t s on F i n a n c i a l A c t i v i t y , 1977-1978. F i n a l Report: Pdrty and Non-Party P o l i t i c a l Committees. Vol. 1-Summary T a b l e s . Washington, 1980. pp. 124-127. For 1980: U.S. F e d e r a l E l e c t i o n Commission. FEC R e l e a s e s F i n a l F i g u r e s on 1979-80 U j o r P o l i t i c a l P a r t y A c t i v i t y ( p r e s s r e l e a s e , c o r r e c t e d ) : Feb. 21, 1982. For 1982: U.S. F e d e r a l E l e c t i o n Commission. FEC F i n a l Report f o r 1981-82 Confirms Republicans Outspent Democrats 5 t o 1 ( p r e s s r e l e a s e ) : Dec. 3, 1983. For 1984: U.S. F e d e r a l Election Commission. FEC F i n a l 1984 Report Shows R e p u b l i c a n s S t i l l Hold F i n a n c i a l Lead ( p r e s s r e l e a s e ) : Dee. 5 , 1985. X. CAMPAIGN SPENDING-INDEPENDENT EXPENDITURES Independent e x p e n d i t u r e s c o n s t i t u t c ' a way t h a t 7i n d i v i d u a l s and g r o u p s c a n communicate su'pport f o r o r o p p o s i t i o n t o c a n d i d a t e s v i t h o u t any c o n n e c t i o n t o ' . . . ac r x p d i z u r a j y 3 7 r r s o n e x p r e s s l y a d v o c a t i n g the e l s c t l s n 22 a s i t a r l y ;trn:iifad c a n d i a a t e which FY a a d e wi:hcur :ooperation o r c o n s u l t a t i o n ~ i t hany c a n d i d a t e , o r any a u t h o r i z e d committee o r agency of s u c h c a n d i d a t e . and v h i c h is n o t made i n c o n c e r t v i t h , o r a t t h e r e q u e s t o r s u g g e s t i o n o f , any t a n d i d a c e , o r a g e n t of s u c h c a n a i d a t r . 121 o r any authorized cmnni::ee o r deioar - Although t h e F E U imposes L i m i t s on t h e amount o f money which may be c o n t r i b u t e d d i r e c t l y t o p o l i t i c a l c a n d i d a t e s , t h e r e a r e no limits on i n d e p e n d e n t expenditureq. These i n d e p e n d e n t e x p e n d i t u r e s c o n s t i t u t e a d i s t i n c t c a t e g o r y - in campaign f i n a n c e l a v , i n view of t h e BucMey v. Vdleo d e c i s i o n ( 4 2 4 U.S. 1 ( 1 9 7 6 ) ] which s t r u c k . d o w n e x p e n d i t u r e l i m i t s , i n d e p e n d e n t o r o t h e r w i s e ( e x c e p t t h o s e e x p e n d i t u r e l i m i t s i n P r e s i d e n t i a l e l e c t i o n s i n which p u b l i c f i n a n c i n g h a s been a c c e p t e d ) . The FECA Amendments of 1974 had imposed a $1,000 limit on i n d e p e n d e n t e x p e n d i t u r e s , a s a means of d i s c o u r a g i n g e v a s i o n of t h e c o n t r i b u c i o n l i m i t s . I n s t r i k i n g down t h i s l i m i t , t h e Supreme. Court r u l e d t h a t t h e a l l e g e d b e n e f i t s of t h e l i m i t i n p r e v e n t i n g r e a l o r a p p a r e n t c o r r u p t i o n were i n s u f f i c i e n t t o j u s t i f y t h e r e s t r i c t i o n s i t p l a c e d on F i r s t Amendment r i g h t s . The Court s t a t e d : The a b s e n c e of prearrangement and c o o r d i n a t i o n o f a n e x p e n d i t u r e v i t h t h e c a n d i d a t e o r h i s a g e n t n o t o n l y undermines t h e v a l u e of t h e expenditure t o t h e candidate, but a l s o a l l e v i a t e s t h e danger t h a t e x p e n d i t u r e s w i l l be g i v e n a s a q u i d p r o quo f o r i m p r o p e r commitments from t h e c a n d i d a t e . 13/ - On t h e b a s i s of t h i s r a t i o n a l e , t h e C o u r t t h u s s t r u c k down l i m i t s on i n d e p e n d e n t e x p e n d i t u r e s , w h i l e l e a v i n g i n t a c t t h e FECAfs l i m i t s on c o n t r i b u t i o n s . I n t h e wake o f t h e Buckley d e c i s i o n , C o n g r e s s s o u g h t t o p r e v e n t a b u s e s of i n d e p e n d e n t e x p e n d i t u r e s by r e q u i r i n g d i s c l o s u r e of s u c h e f f o r t s and by p r o v i d i n g s p e c i f i c g u i d e l i n e s on what i s *and i s n o t c o n s i d e r e d t o b e an independent e x p e n d i t u r e . The 1976 PECA Amendments i n c l u d e d a d e f i n i t i o n o f " i n d e p e n d e n t expeedicurs" ( v h i c h a p p e a r s a t t h e o p e n i n g of t h i s c h a p t a r ) and a l s o s u c h tcms 3s "clearly i d e n t i f i e d c a n d i d a t e " ( i . e . , vhere the candidate's - name o r p i c t u r s o r some unambiguous r s f a r e n c a a p p e a r s ) . 14/ r e g u l a t i o n s impl.ementiag t h e F E U (11 C.F.R. Furthermore, the 109.1) e l a b o r a t e on t h e meaning of o t h e r key t e r m s i n t h e " i n d e p e n d e n t e x p e n d i t u r e " d e f i n i t i o n . Two e s s e n t i a l c r i t e r i a d e t e r m i n e v h e t h e r a p o l i t i c a l e x p e n d i t u r e i s c o n s i d e r e d i n d e p e n d e n t : f i r s t , i t must b e f o r a communication w i t h v o t e r s , a n d , s e c o n d , i t must b e made w i t h o u t any c o n s u l t a t i o n w i t h t h e c a n d i d a t e ' s own orqanization. h y e x p e n d i t u r e by a n o u t s i d e i n d i v i d u a l o r g r o u p which i n v o l v e s s u c h c o n s u l t a t i o n o r c o o r d i n a t i o n i s c o n s i d e r e d t o be a n in-kind c o n t r i b u t i o n t o t h e campaign, t h e r e b y c o u n t i n g toward t h a t i n d i v i d u a l ' s o r g r o u p ' s contribution l i m i t s . The r e g u l a t i o n s s p e c i f i c a l l y d e c l a r e t h a t any u s e of c a n d i d a t e - p r e p a r e d m a t e r i a l s i n a communication by an i n d i v i d u a L o r s r o u p - c o n s t i t u t e s a n in-kind c o n t r i b u t i o n and n o t a n i n d e p e n d e n t e x p e n d i t u r e . 15/ Independent Expenditure A c t i v i t y The Buckley d e c i s i o n and t h e 1976 FECA Amendments c l e a r e d t h e way f o r c i t i z e n s t o a t t e m p t t o i n f l u e n c e t h e e l e c t o r a l p r d c e s s i n a manner not l5/ - 11 C.F.R. 109.L(d)(l) r e s t r a i n e d by t h e c o n t r i b u t i o n L i m i t s imposed b y - l a w . This, together v i t h t h e g r e a t e r d e g r e e of c o n t r o l which c i t i z e n s may e x e r c i s e o v e r s-pending, a c c o u n t s f o r t h e p o p u l a r i t y of independent e x p e n d i t u r e s among p o l i t i c a l l y a c t i v e i n d i v i d u a l s and groups. It is a l s o worth n o t i n g t h a t a n overwhelming s h a r e of t h e s e e x p e n d i t u r e s have been made by PACs, which, a s s h o i~n Chapter V , a r e an important s o u r c e of both funds and p o l i t i c a l e x p e r t . i s e . Table 18 snows t h a t s u b s t a n c i a l sums o f 3oney have been r e p o r t e d l y s p e n t i n this zianner s i . ~ c e1 ? 7 5 ; L: aLss ? r e s e n t s t h e d i s t t i b u t i o n of each y e a r ' 3 c o t a l e x p e n d i r u r s s betveen a c t i v i t i e s f o r and a g a i n s t c a n d i d a t e s , showing t h a t t h e g r e a t b u l k of money i n a l l but one y e a r was s p e n t i n s u p p o r t o f , r a t h e r t h a n o p p o s i t i o n t o , candidates. ( I t is i m p o r t a n t t o n o t e t h a t t h e s e r e p o r t e d d a t a may g r e a t l y o v e r s t a t e t h e a c t u a l amount s p e n t on independent c o ~ ~ m u n i c a t i o nws i t h v o t e r s ; many independent s p e n d e r s commonly r e p o r t t h e i r s i g n i f i c a n t overhead c o s t s f u n d r a i s i n g , a d m i n i s t r a t i o n , e t c .--as p a r t of chef r independent e x p e n d i t u r e s t o t a l , Leaving o n l y some f r a c t i o n t h e r e o f f o r t h e c o s t s of a d v e r t i s e m e n t s and m a i l i n g s i n s u p p o r t of o r o p p o s i t i o n t o c a n d i d a t e s . ) TXaLE 18. Independent Expenditures i n F e d e r a l E l e c t i o n s : 1976-1984 -- - - Pear House Senate President Total (Key: F = For Candidates / A = Against Candidates) F e d e r a l E l e c t i o n Cormnission. FEC Source: For 1976 and L978: U.S. Releases Information on Independent Expenditures ( p r e s s r e l e a s e ) : O c t . , 9 , 1980. F e d e r a l E l e c t i o n Commission. FEC Study Shovs Independent For 1980: U.S. Expenditures Top $16 ' H i l l i o n ( p r e s s r e l e a s e ) : Nov. 29, 1981. For 1982: U.S. Federal E l e c t i o n Cammission. FEC I s s u e s F i n a l Report on 1981-82 Independent Federal Election Spending ( p r e s s r a i e a s e ) : O c t . 14, L983. For 1984: U.S. Cornmission. FEC Reports 1983-84 Independent Spending A c t i v i t y ( p r e s s r e l e a s e ) : kt. 4, 1985. SELECT BIBLIOGRAPHY Adaaany, David W . , and George 2. Agree. P o l i t i c a l money: A s t r a t e g y f o r campaign f i n a n c i n g i 3 America. B a l t i m o r e , J o h n s Bopkins U n i v e r s i t y ? r e s s , 1975- 242 p* JK1991 .A64 A l e x a n d e r , H e r b e r t E. 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Washington, American E n t e r p r i s e I n s t i t u t e f o r . J K l 9 9 l sM73 1984 P u b l i c P o l i c y R e s e a r c h , 1984. 324 p. I ----. Parties, . . - i n t e r e s t g r o u p s , and campaign f i n a n c e laws. E n t e r p r i s e I n s t i t u t e f o r P u b l i c P o l i c y R e s e a r c h , 1979. . Washington, American 384 p. J K l l l 8 .P37 S a b a t o , L a r r y J. P.4C power.: i n s i d e t h e world o f p o l i t i c a l a c t i o n committees. N.Y., W.W. Norton and Co., 1984. 251 p. . JK1991 .S23 1984 U.S. Congress. House. C o ~ t t c~n eRouse A d m i n i s t r a t i o n . An a n a l y s i s of t h e impact of t h e F e d e r a l e l e c t i o n campaign a c t , 1972-1978. From t h e I n s t i t u t e of P o l i t i c s , John F. Kennedy S c h o o l o f Government, Harvard U n i v e r s i t y . Washington, U.S. Govt. P r i n t . O f f . , 1979. 1 4 1 p. 9 6 t h Cong., 1st S e s s . House. Committee P r i n t . U.S. Congress. House. Committee on House A d m i n i s t r a t i o n . Task F o r c e on E l e c t i o n s . Campaign f i n a n c e r e f onn. H e a r i n g s , 9 8 t h Cong. , 1st S e s s . Washington, U.S. Govt. P r i n t . O f f . , 1984. 837 p. Hearings h e l d Jun. 9, 16, 21, 23; J u l . 8 ; Aug. 22-23; Oct. 1 2 , 1983. U.S. Congress. S e n a t e . Committee on R u l e s and A d m i n i s t r a t i o n . r e f o r m p r o p o s a l s of 1983. H e a r i n g s , 9 8 t h Cong., 1st S e s s . U.S. Govt. P r i n t . O f f . , 1984. 783 p. Hearings h e l d J a n . 26-27, May 1 7 , and S e p t . 29, 1983. ---- Campaign f i n a n c e Washington, Proposed Amendments t o t h e F e d e r a l E l e c t i o n Campaign A c t of 1971. H e a r i n g s , 9 9 t h Cong., 2nd S e s s . Washington, U.S. Govt. P r i n t . O f f . , 1986. 392 p . Hearings h e l d Nov. 5 , 1985, J a n . 22, and Yar. 2 7 , 1986. J E C : p jg