Campaign Contributions: Who's Raised The Most?

Political campaigns in the United States are extremely expensive, with combined spending on the 2022 congressional races topping $8.9 billion, a new record for midterm elections. Political action committees (PACs), which collect contributions from employees or members and direct them to candidates and party committees, are a major source of campaign funding. In the 2024 election cycle, individual candidates have drawn over $2 billion, while party committees have raised just over $929 million. While the common wisdom is that Republicans raise more corporate political donations than Democrats, the gap is less pronounced when it comes to PACs, with Republicans capturing 55% of PAC contributions and Democrats 45%.

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Corporate political donations

The impact of corporate donations is significant, as they can shape political agendas and influence elected officials. In the House, where members face voters every two years, candidates often rely on corporate and business association PACs for at least half of their funding. Committee assignments and leadership roles can also impact how much candidates raise from corporate PACs. However, in the Senate, with its six-year terms and larger war chests, corporate donations typically constitute a smaller percentage of campaign funding.

There is a perception that Republicans attract more corporate political donations than Democrats. In the 2022 midterms, company PACs and business-related associations contributed approximately $189 million (55%) to Republicans and $154 million (45%) to Democrats. Certain organizations are known to favour Republicans, such as the National Auto Dealers Association, the American Bankers Association, and the National Association of Home Builders. On the other hand, Democrats receive more support from groups like the American Hospital Association and the National Multifamily Housing Council.

The surge in corporate political donations has raised ethical, legal, and business concerns. Critics argue that corporate donations can conflict with stated corporate values and commitments, such as when a company professes support for a particular cause but donates to politicians working against it. Additionally, the lack of transparency around corporate spending leaves shareholders, employees, and voters in the dark about the true extent of a corporation's political involvement. While reform efforts aim to increase transparency, the debate continues over how much and what type of information corporations should disclose.

PACs

Political action committees (PACs) are tax-exempt 527 organizations that pool campaign contributions from members and donate those funds to campaigns for or against candidates, ballot initiatives, or legislation. PACs have become an increasingly large source of campaign funding, with over 75% of funds for the 2024 election coming from PACs and party committees.

There are several types of PACs, including connected PACs, non-connected PACs, and super PACs. 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 the case of a corporation. Non-connected PACs, also known as leadership PACs, can accept donations from individuals and other PACs. Leadership PACs are a way for dominant parties to capture seats from other parties, as current officeholders have an easier time attracting contributions. Super PACs, or independent expenditure-only committees, can receive unlimited contributions from individuals, corporations, labor unions, and other PACs to finance independent expenditures and other political activities.

PAC contributions are regulated, limited, and disclosed, and they cannot be given directly to candidates or campaigns themselves. For example, in the 2024 election cycle, individuals can donate up to $5,000 per year to a PAC and $3,300 per election to a candidate. However, there are loopholes that allow for essentially unlimited transfers, such as through hybrid PACs, which can receive unlimited contributions from various entities while maintaining a separate bank account for contributions to federal candidates that adhere to statutory amount limitations.

In terms of partisan leanings, it is commonly believed that Republicans receive more corporate political donations than Democrats, and this holds true for PAC contributions as well. In 2022, Republicans received 55% of contributions from company PACs and business-related associations, while Democrats received 45%. However, this difference is less pronounced compared to other sources of corporate donations. Additionally, some organizations strongly favor one party over the other, while others split their contributions more evenly between the two parties.

Some of the top PACs for the 2024 election cycle include Empower Parents PAC, which made the single highest individual contribution of $82.5 million to the Never Back Down PAC. Pete Buttigieg's PAC, Pete for America, raised $102.6 million in the 2020 cycle. Two Trump PACs, Trump Victory PAC and the Trump Make America Great Again Committee, spent over $470 million combined in the 2020 cycle, outspending the Democratic National Committee.

Super PACs

Political action committees (PACs) are committees that collect contributions from employees or members and direct them to candidates and party committees. PAC contributions are regulated, limited, and disclosed, and represent the most traditional way for companies to support candidates and political parties. Corporate political donations from company PACs and business-related associations totalled almost $344 million in the 2022 midterms, with about $154 million going to Democrats and $189 million going to Republicans.

In 2024, a Federal Election Commission ruling eased the restrictions on super PACs by allowing them to coordinate with campaigns for canvassing purposes. Contributions to, and expenditures by, super PACs are tracked by the FEC and by independent organizations such as OpenSecrets, a nonprofit that tracks campaign money.

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Individual candidates

Political donations from individuals represent a large share of campaign funding. In the 2016 election cycle, 71% of Hillary Clinton's fundraising total and 40% of Donald Trump's came from individual contributions. In the 2024 election cycle, individual candidates have drawn over $2 billion in donations.

In the 2020 election cycle, Joe Biden raised the most money as of May 9, 2024, with $170.6 million, followed by Donald Trump at $114.8 million, and Nikki Haley at $57.2 million.

In the 1992 electoral cycle, the Republican and Democratic parties combined raised roughly $650 million. In the 2020 cycle, they raised almost $2.7 billion. In the 2016 cycle, more than $2.3 billion was raised between the two parties.

Corporate political donations are an important source of funding for congressional candidates. In the House, candidates who are heavily funded by corporate and business association PACs often count on these sources for at least half of their money. In the Senate, where terms are six years, corporate donations make up a smaller percentage. In the 2022 midterms, corporate political donations from company PACs and business-related associations totalled almost $344 million, with about $154 million going to Democrats and $189 million to Republicans.

According to a 2016 Pew Research Center survey, 15% of Republicans and 14% of Democrats reported making a donation to a candidate, party, or outside group. For independents, the share was 5%. Higher-income, more educated, and older Americans are more likely to donate.

Soft money

One example of soft money is the money contributed by independent expenditure committees, also known as "super PACs." These committees can raise and spend unlimited amounts of money to advocate for or against any candidate or issue, as long as there is no coordination with any campaign or candidate. In recent years, these committees have become increasingly active in American politics, with hundreds of millions of dollars being raised and spent.

The use of soft money in political campaigns has been criticized by some, who argue that it creates a major loophole in federal campaign financing and spending laws. Despite the court's reasoning that independent expenditures would be visible to the public, critics argue that soft money can be closely coordinated with political campaigns and has the potential to influence election outcomes.

The impact of soft money on the political landscape is significant, with organizations and individuals contributing large sums of money to influence elections and shape public policy. By analyzing soft money contributions, we can better understand the financial involvement of corporations, unions, and other groups in the political process.

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