Campaign Funding's Impact On Democracy

PACs, SuperPACs, 527s And Others

PAC (Political Action Committee). PACs are federally-regulated organizations established by corporations, unions, and special interest groups to provide financial contributions for political campaigns. Corporations cannot contribute directly to PACs but can sponsor a PAC for employee donations. These organizations are free to make campaign contributions directly to candidates and to engage in express advocacy for the election or defeat of political candidates or specific ballot measures, such as initiatives or referendums. Contributions to PACs must come in the form of “hard money” (see definition below), and are subject to federal contribution limits and disclosure requirements. Annual donations are limited to $5,000 from individuals, whose names and contributions must be disclosed.

SuperPAC. This is a PAC to which corporations, unions, and other organizations can donate freely. Super PACs can raise and spend unlimited amounts on politics, but they cannot contribute to individual candidates. Donors must be disclosed to the Federal Election Commission. These did not exist prior to the Citizens United decision, in which the Supreme Court ruled that corporations must be treated as individuals in terms of having "protected speech," including the right to spend unlimited amounts of money for political campaigns as an element of that free speech.

527 Association. Also known as a 527 group, this is a tax-exempt organization named after "Section 527" of the IRS Code. A 527 group is created primarily to influence the selection, nomination, election, appointment, or defeat of candidates to federal, state or local public office. Named for a section in the tax code, a 527 group can run political ads with unlimited individual and corporate contributions but must disclose donors to the IRS. An example of a 527 group that gained prominence in the 2004 presidential election are the Swift Boat Veterans for Truth, who ran a series of demeaning advertisements attacking John Kerry's military record.

Political Party: A political party can accept donations of up to $30,400 from individuals, less from PACs, but nothing from corporations. Donations must be disclosed to the FEC.

Nonprofits. Non-profits are allowed to participate in elections by running political advertising ahead of elections, but they are not supposed to be devoted primarily to politics. They can accept contributions of any size without disclosing donors. As described in the Lobbying section, some lobbyists join together to form non-profit organizations to circumvent contribution limits and donor disclosure requirements.

Public Funding. The federal government provides funds for qualified presidential candidates to pay for the valid expenses of their political campaigns in both the primary and general elections. National political parties also receive federal money for their national nominating conventions. Public funding is rarely used by the two major parties because they can raise many times the amount provided by public funding through other sources.

The Extreme “Supremes” Intervene ... Unfortunately, this form of funding has been dealt a sever blow by the U.S. Supreme Court, which recently ruled that the public financing laws of Arizona were in violation of corporate free speech rights guaranteed under the First Amendment, a subject in itself that is in question by many people..

… But Reaction is Strong. Marge Baker of People For the American Way Foundation responded in :very strong words:

“This decision, based on an upside-down interpretation of the First Amendment, takes away the right of Arizonans not only to ensure a modicum of integrity and fairness in their elections but to promote more political speech. The Court has thus ensured that the wealthiest can continue to pay for outsized political influence and maintain their speech advantages.”

“The Roberts Court has once again twisted the Constitution to benefit the wealthy and powerful while leaving ordinary Americans with a diminished voice. Like in Citizens United v. FEC, which prohibited legislatures from limiting corporate spending to influence elections, the Court’s majority has strayed from the text and history of the Constitution in order to prevent citizens from maintaining control over our democracy. The Roberts Court would do well to remember that the Constitution was written to protect democracy for all people, not just the rich and powerful. Today it has ruled not only that the wealthy have a right to spend more but that they have a right that everyone else spend less.” (Source: PFAW's Marge Baker on Supreme ... - People for the American Way)

Hard Money. Hard money refers to contributions made directly to a candidate's campaign. These contributions are subject to limits. In 2009-2010, an individual could donate a maximum of $2,400 to a candidate per election. This means that an individual could give the maximum in the primary election and again in the general election. For organizations donating to candidates, the limit is $5,000. The limit is adjusted for inflation every election cycle.

Soft Money. Soft money refers to contributions made in support of a political position, but the donations are not made directly to a candidate or to national political parties. Because there are no limits on contributions to independent organizations (that could spend whatever they wished to promote their political views, provided they did not coordinate their efforts with those of their preferred candidates), tremendous amounts of soft money are channeled through 527 organizations.

Hard Money vs. Soft Money. Here are a couple of examples that distinguish between campaign ads that can be run with each of the two different type of contributions.

Let's say that an ad is run for Mary Smith, citing her excellent background, qualifications, and accomplishments.. The ad might go on to say that her opponent doesn't have as good a record, and then concludes with a solicitation of votes for Mary Smith. This is a political ad, which must be paid for with hard money because it is soliciting votes for a specific candidate.

On the other hand, let's say that an ad is run that details undesirable things about Mary Smith's opponent and concludes with the message, “Vote on election day.” Because the ad does not explicitly solicit voting for a specific candidate, the ad is considered to be party-building and “educational” and can be paid for with soft money.

The examples above disclose a very fine distinction between the two ads. The average viewer would recognize that second ad as still saying, in essence, “Vote for me,” It just didn't use those specific words. That is just how murky our campaign finance laws are today.

Additional Sources. Read more about hard money and soft money at : eHow.com at http://www.ehow.com/about_5089550_hard-money-soft-money.html#ixzz1X5sJMka4)

For additional information on contribution limits, a chart is available at the Federal Election Commission web site at http://www.fec.gov/pages/brochures/contriblimits.shtml

Problems with Campaign Financing. In an attempt to produce some reform to our campaign financing situation, while still appealing to the interests of politicians and their financial backers, our politically duopolistic government has developed a campaign financing system that is so complex and so difficult for the average citizen to understand that it no longer borders on the ludicrous. It has now become totally ludicrous.

Different Choices For Different Donors .... If you want to contribute without your contribution being made public, there is a way of doing that. If you want to contribute directly to the campaign of a specific candidate, there is a group for that. If you are a corporation and want to “invest” huge sums of money in a particular campaign, there is a group for that as well. There seem to be so many groups that enable and protect the truly large donors, but nothing for the common, average citizen to offset their clout and influence on our government.

… With A Little Help From The Supremes ... The rules, as they now stand, seem not only to allow but to endorse flagrantly huge contributions to political campaigns. In so doing,they extend the plutocratic control of our country and doing away with the democracy intended by our founding fathers. Backed by two ridiculous Supreme Court rulings that corporations are people and that public financing of elections in Arizona are not constitutional, our right to self government has never before been so threatened.

… But It is Killing Our Chances for Restoring Our Democracy. Let's face it. Money wins campaigns, and the candidates with the most money win the most elections. The, to ensure re-election, whose favor do the politicians curry? Why, the big money interest, of course. And what better way to curry those interests than by passing legislation that is favorable to them. So the cycle continues – and our form of government by the people and for the people does indeed perish from the earth.


Coming Up:

	Money Talks, And Politicians Listen!
	U.S. Congress: Bought And Paid For
	Lobbying And Its Impact On Democracy
	Lobbyists Teach One Day and Get Huge Pension