Isabella Carter
Campaign finance in the United States is a highly scrutinized aspect of politics, with laws and regulations in place to ensure transparency and fairness. The Federal Election Commission (FEC) maintains a database of individuals who contribute to federally registered political committees, with details on the date, amount, and committee receiving the contribution. The FEC is responsible for enforcing these laws, which regulate campaign donations, spending, and public funding. However, the FEC has been criticized for not formally investigating instances of former lawmakers using leftover campaign funds for personal expenses. The influence of dark money groups, which do not reveal their sources of funding, further complicates the matter. Organizations like OpenSecrets aim to strengthen democracy by tracking the flow of money in politics and providing data and analysis to the public. With the cost of elections rising faster than inflation, understanding the sources and impact of campaign contributions is crucial for maintaining transparency and accountability in the political system.
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What You'll Learn
The Federal Election Campaign Act of 1971
FECA was introduced to the Senate on January 26, 1971, by Senator Mike Mansfield, following President Nixon's veto of the Political Broadcast Act of 1970, which he deemed insufficient in limiting campaign expenditures. FECA was first presented to the Senate Subcommittee on Communications of the Committee on Commerce on March 2, 1971, by Senator John Pastore. The Act passed in the House on November 30, 1971, by a vote of 372-23. As the House version differed from the Senate's, a conference committee was called, and the Act was sent to President Nixon on January 19, 1972.
FECA has been amended several times. In 1974, following the Watergate scandal, the Act was amended to create the Federal Election Commission (FEC). It was amended again in 1976, in response to the Supreme Court ruling several provisions unconstitutional in Buckley v. Valeo, and in 1979 to allow parties to spend unlimited amounts of hard money on activities like increasing voter turnout and registration. In 2002, major revisions to FECA were made by the Bipartisan Campaign Reform Act (BCRA), which banned soft money expenditures by parties.
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The Federal Election Commission (FEC)
The FEC maintains a database of individuals who have made contributions to federally registered political committees. This includes information such as the name of the contributor, their employer or occupation, the city and state they are from, the date and amount of the contribution, and the committee receiving the contribution. The FEC also provides legal resources, campaign finance data, and help for candidates and committees.
The FEC has been criticised for its membership structure, which has resulted in deadlocks on 3-3 votes. From 2008 to August 2014, the FEC had over 200 tie votes, accounting for approximately 14% of all votes in enforcement matters. For example, in June 2021, the FEC found that the National Enquirer violated US election laws and that a $150,000 payment by AMI to Karen McDougal amounted to an illegal campaign contribution. However, the commission was deadlocked on a 2-2 vote between Democrats and Republicans, and no further action was taken.
The FEC sets contribution limits for political campaigns. For example, a national party committee and its Senatorial campaign committee may contribute up to $62,000 combined per campaign to each Senate candidate. The FEC also recommends that campaigns encourage contributors to designate their contributions for specific elections. This ensures that the contributor's intent is clear and promotes consistency in reporting to avoid the appearance of excessive contributions.
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Campaign funds for personal use
While most states, about 47, and the federal level prohibit the personal use of campaign funds, Virginia stands out as an exception. In Virginia, it is legal for state candidates and officeholders to use campaign funds for personal purposes. However, there have been consistent efforts to change this, with former Governor Terry McAuliffe and Governor Ralph Northam expressing support for prohibiting personal use. During the 2022 General Assembly session, a bill to ban personal use of campaign funds passed the House of Delegates but was unsuccessful in the Senate Privileges and Elections committee.
The FEC has provided some clarification on the use of campaign funds for security measures. In September 2024, the FEC approved a rule that allows the use of campaign funds for "reasonable costs of security measures" to address ongoing dangers or threats that are specifically related to an individual's status as a federal candidate or officeholder. This includes expenses for non-structural security devices, structural security enhancements, security personnel, and cybersecurity.
It is important to note that the FEC also regulates contribution limits for federal candidates running for the U.S. House, U.S. Senate, or U.S. President. These limits apply to individual donations, as well as contributions from political action committees (PACs) and party committees. Additionally, the FEC maintains a database of individuals who have made contributions to federally registered political committees, allowing for transparency and accountability in campaign finance.
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Political action committees (PACs)
At the federal level, an organization becomes a PAC when it receives or spends more than $1,000 to influence a federal election and registers with the Federal Election Commission (FEC). Federal law formally recognizes two types of PACs: connected and non-connected. Connected PACs, also known as corporate PACs, are established by businesses, non-profits, labor unions, trade groups, or health organizations. They receive and raise money from a restricted class, such as managers and shareholders in a corporation or members in a non-profit organization. Non-connected PACs, on the other hand, are formed by groups with ideological missions, single-issue groups, and members of Congress or other political leaders.
Additionally, judicial decisions have led to the creation of a third classification: independent expenditure-only committees, commonly known as "super PACs." Super PACs can raise unlimited funds from individuals, corporations, unions, and other groups but are not permitted to coordinate with or contribute directly to candidate campaigns or political parties. They are, however, subject to the same reporting and disclosure requirements as traditional PACs.
Another type of PAC is the hybrid PAC, which can make independent expenditures in unlimited amounts while also contributing limited amounts of money directly to campaigns and committees. PACs have been a growing source of campaign donations, raising $333 million in 1990 and $482 million in 2022.
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Dark money groups
The term "dark money" refers to undisclosed funds used during political campaigns. The Sunlight Foundation, a group advocating for comprehensive disclosure, coined the term to describe the funds used during the 2010 United States mid-term election. Dark money groups can spend unlimited amounts to advocate for or against political candidates without disclosing their donors, thanks to loopholes in campaign disclosure rules created by the Citizens United ruling. This lack of transparency makes it difficult for voters to make informed decisions as they don't know who is trying to influence them.
One notable dark money group is the National Association of Realtors Congressional Fund, a super PAC formed by the National Association of Realtors, the country's largest trade association. The group advocates for policies that foster homeownership and engages in debates on various issues, including the National Flood Insurance Program and infrastructure spending. Unlike most other super PACs, 100% of their spending has been positive, promoting a mix of Democratic and Republican candidates.
Another example is the Sixteen Thirty Fund, described as "the indisputable heavyweight of Democratic dark money." In 2020, they raised $390 million, with half coming from just four donors. The Sixteen Thirty Fund donated $61 million of untraceable money to progressive causes, taking advantage of their legal structure to avoid disclosing their donors.
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Frequently asked questions
Yes, Congress can investigate a congressman's political campaign contributions. The Federal Election Commission (FEC) maintains a database of individuals who have made contributions to federally registered political committees. However, there is a lack of clear regulation regarding the use of Leadership PACs, which have been described as "big slush funds".
Misusing campaign funds for personal use is a criminal violation and may be prosecuted by the Department of Justice. It is also a violation of the Federal Election Campaign Act and may result in tax evasion charges if income taxes are not paid on the funds.
Yes, laws regulating campaign donations, spending, and public funding have been enacted at the federal level by Congress and enforced by the FEC. These laws include the Federal Election Campaign Act of 1971.
Retiring members of Congress have several options for disposing of leftover campaign funds. They can return the money, donate it to charity, transfer it to a party committee, or make political contributions within specified limits. However, they may face pressure from national party committees to transfer a significant portion of their leftover funds to the party coffers.
