In 2003, the U.S. Supreme Court declared in McConnell v. FEC that “money, like water, will always find an outlet.”1 Nevertheless, the court upheld the constitutionality of campaign finance regulations enacted under the Bipartisan Campaign Reform Act (BCRA) of 2002. The majority concluded, “What problems will arise, and how Congress responds, are concerns for another day.”2
In the aftermath of McConnell v. FEC, several political observers immediately hailed the decision as essential to protecting American democracy from the influence of big money and special interests. One reform organization declared that BCRA “helps ensure the removal of the corrupting influence of ‘soft money’ from federal elections” and that it “represents a home run when it comes to limiting the influence of special interests in our elections.”3 Another reform advocate added, “The Supreme Court decision [in McConnell v. FEC] to uphold the constitutionality of the Bipartisan Campaign Reform Act (BCRA) brought to an end the corrupt soft money system that had engulfed federal officeholders and the political parties for nearly two decades.”4
Yet, some have argued that BCRA has been largely unsuccessful in accomplishing its overriding objectives. One member of Congress declared BCRA a “failure.”5 Former Federal Election Commission Chairman Bradley A. Smith observed, “If one thought McCain-Feingold [BCRA] would reduce the time candidates spend raising money or that it would keep money—big money, soft money, corporate money, union money, little money or lots of money—out of politics, they were sadly mistaken. Moreover, few would dare to argue that McCain-Feingold has ‘cleaned up the system.’ The era of McCain-Feingold is the era of disgraced lobbyist Jack Abramoff, former Reps. Bob Ney (R-Ohio) and Duke Cunningham (R-Calif.), and cash in Rep. William Jefferson’s (D-La.) fridge.”6 Another prominent columnist went so far as to declare in the title of his article that “campaign finance reform enables corruption.”7 Even a noted and distinguished scholar on campaign finance concluded, “BCRA is bad politics, bad regulation, and bad democracy.”8
Despite reformers’ and opponents’ black-and-white assessments of BCRA, there is considerably more gray area when it comes to evaluating the success and failure of campaign finance reform. This chapter attempts to make some sense of what campaign finance reform has been able and unable to accomplish at the national level. We begin with a history of campaign finance reform and review the promises of reformers. Following that discussion, we examine each of the specific goals of reform efforts and examine whether reforms that eventually became law have met these goals or whether they have largely failed. We conclude with an overall assessment of the campaign finance system.
The role of money in American politics has long been a controversial subject. Stories about wealthy industrialists contributing vast sums of money to political candidates go back more than a century. William McKinley (who served as governor of Ohio from 1891–1895 and as president from 1897–1901), for instance, was helped throughout his political career by Ohio millionaire Mark Hanna. According to various accounts, Hanna contributed $100,000 to McKinley for his 1896 campaign for president (an amount worth more than $2.5 million in 2009).9 McKinley also had the financial backing of big corporations, business owners, and executives, including Standard Oil and J. P. Morgan, which each gave $250,000 ($6.3 million in 2009) to his campaign.10 The deep pockets of those with corporate interests reportedly helped McKinley outspend his opponent, William Jennings Bryan (a populist who held positions at odds with big business), by as much as ten to one.11 The excessive financial assistance to the McKinley campaign from the financial sector prompted some of the earliest calls for Congress to institute rules and restrictions on campaign finance.
Indeed, charges of vote buying and voter coercion were common in elections in the late nineteenth and early twentieth centuries, as were allegations of graft in the legislative and policymaking process. Throughout this period, big business hired lobbyists (or what some derisively called lobby “barons”) who were reported to have “a well lined purse with which to entertain and to distribute money ‘where it would do the most good.”’12 Political cartoons frequently cast leading political figures from the period as corrupt. James G. Blaine, a U.S. senator and presidential contender, was famously depicted as a “tattooed man” with each tattoo representing an expression of corruption (see figure 4.1). Cartoonist Thomas Nast was well-known for his work highlighting bribery, fraud, and graft in government (see figure 4.2).
As political corruption worsened, investigative journalists, known as “muckrakers,” brought abuses to the public’s attention. In response to public outcry from the muckrakers’ stories, reformers, known as “progressives,” called for new federal laws to limit the power and influence of large corporations and industrialists. They advocated anti-trust laws as well as restrictions on corporate lobbying and campaign contributions from big business. Progressives also sought to empower citizens with reforms such as the referenda, the initiative, recall elections, secret ballots, and the expansion of the franchise to women.
Congress took its first major steps to reform the nation’s campaign finance system following charges that President Theodore Roosevelt (who replaced McKinley after McKinley’s assassination in 1901) exchanged favors with corporate and banking interests for their financial support of his 1904 presidential campaign.13 Unable to quell the suspicion of improper dealings, Roosevelt, in his address to Congress in 1905, proposed a federal law eliminating all corporate contributions, and requiring disclosure of campaign expenditures. Led by its sponsor Senator Ben Till-man of South Carolina, Congress responded by passing the Tillman Act of 1907, which banned corporations and interstate banks from contributing directly to federal candidates.
In later years, Congress passed further regulations on campaign contributions. The first federal disclosure requirements (i.e., public reporting of campaign contributions and expenditures) took effect in 1910 (for U.S. House elections) and in 1911 (for U.S. Senate elections). Congress also set limits on campaign expenditures for all congressional candidates. The Federal Corrupt Practices Act of 1925, which served as the primary law regulating federal campaign finance for much of the twentieth century, attempted to strengthen these disclosure requirements and expenditure limits.14
However, the reforms from the early 1900s never created a regulatory agency to monitor and enforce campaign finance rules and restrictions. Instead, the law relied on congressional oversight, which due to partisan pressures proved to be highly ineffective. Early reforms also failed to establish a clear and comprehensive set of penalties for those who violated the law. Candidates could avoid liability for violating the spending limit and disclosure requirements simply by claiming to have no knowledge of spending done on their behalf. Consequently, campaign finances remained effectively unregulated and lacked proper disclosure.
By the second half of the twentieth century, broadcast television advertising became the dominant means of campaign communication, creating increased demands on candidates to raise money. With costs escalating to campaign for federal office, Congress passed the Federal Election Campaign Act (FECA) in 1971 (along with the 1971 Revenue Act). The law, which took effect on April 7, 1972, required full reporting of campaign contributions and expenditures, as well as spending limits on campaign advertisements (which were later repealed) and an initial system of public financing of presidential elections. Unfortunately, Congress again failed to provide for a single, independent body to monitor and enforce the law.
Shortly after FECA’s passage, pressure once more built for Congress to strengthen campaign finance laws when news surfaced that Richard Nixon’s Committee to Re-Elect the President (CRP, or what some referred to as “CREEP”) laundered campaign funds to pay those responsible for breaking into the Democratic National Committee’s headquarters at the Watergate hotel in 1972.15 When it became known that President Nixon was involved in a direct cover-up of the scandal, Nixon was forced to resign from office in 1974. The totality of the Watergate scandal helped move Congress to strengthen FECA.
The modern structure for campaign finance regulations comes from a series of comprehensive amendments to FECA that Congress passed in 1974. As originally constructed, the 1974 law outlined five major provisions: (1) campaign contribution limits; (2) campaign spending limits; (3) disclosure of contributions and spending; (4) public financing in presidential elections; and (5) the creation of the Federal Election Commission to enforce the law.16
However, the Supreme Court weakened FECA’s restrictions on expenditure limits in 1976. The Court ruled in Buckley v. Valeo (1976), that while contribution limits were constitutional to help prevent corruption or the appearance of corruption, spending money was a form of free speech protected by the First Amendment. This invalidated most limits on campaign expenditures. The Buckley ruling, for instance, entitles political committees and individuals to spend unlimited amounts of their own money in federal elections if the expenditures are independent of the candidates’ campaign organizations.17
In 1979, Congress also allowed individuals and interest groups to give unlimited amounts to political parties for the purpose of party-building activities and to help state and local candidates. This unregulated “soft money” soon became a way for companies, labor unions, and wealthy individuals to make very large contributions that sometimes reached into the hundreds of thousands of dollars or more. Although donors did not give these contributions to any particular federal candidate, political parties often earmarked this money to particular races for issue advocacy and generic party advertising.18 (Soft money could also go to pay for a portion of the party organization’s overhead expenses, for construction and maintenance of party headquarters, and for transfers to state and local party committees.) When the Court ruled in Colorado Republican Federal Campaign Committee v. Federal Election Commission (1996) that political parties could make unlimited campaign expenditures provided that they were independent of the candidate, party leaders began aggressively soliciting soft money contributions from businesses and wealthy individuals.19
The Court later allowed interest groups to spend unlimited amounts to advocate issues, but only if the advertisements did not include “express advocacy” (defined by the Court as “explicit words of advocacy of election or defeat” such as “vote for,” “re-elect,” “help defeat”). In general, the Court has applied rather loose standards for what constitutes express advocacy. In FEC v. Christian Action Network (1992), for example, the Court found that an ad using President Bill Clinton’s face, which morphed into black and white, and stated that Clinton supported “militant homosexual” causes, was not express advocacy because it did not use the words, “vote for” and “vote against.” This meant that wealthy supporters, corporate profits, or membership dues could finance any advertisements if they avoided express advocacy. Interest groups began to rely on what appeared to be thinly-veiled campaign ads disguised as issue advocacy spots that carefully avoid the words “vote for” or “vote against.” These rulings effectively eroded contribution limits.20
Increasing sums of soft money began to flood federal elections in the 1990s. By the 2000 election, for example, Republican national party committees raised nearly $250 million in soft money—an increase of 81 percent from the previous presidential election. Likewise, Democratic national party committees raised $245 million in soft money—an increase of 98 percent from four years earlier.21 By 2000, soft money made up 47 percent of the funding of the Democratic national party committees and 35 percent of the Republican national party committees.22
Soft money contributions were often very large, which concerned groups and citizens argued had the capacity to influence the actions of Congress and distorted the equality of the political process. Critics of the system added that large soft money contributions, which average citizens could not afford to give, amplified the voices of the wealthiest Americans and created an environment ripe for corruption.23
Equally as troubling for reformers was the fact that many organized groups were using issue ads (instead of campaign ads), which avoided the law’s disclosure requirements. Additionally, some charitable organizations and political committees, known as 501(c) and 527 committees, rather than political action committees (PACs), often financed issue ads (for a description of PACs, 501(c), and 527groups, see box 4.1). These committees do not report to the FEC, but instead to the Internal Revenue Service (IRS). This created disclosure problems because the IRS reporting forms were neither comprehensive nor timely. Critics also charged that issue ads were not transparent, because it was difficult and often impossible to trace who was funding them. Organized interests were able to create new organizations with innocuous-sounding names, such as Citizens for Reform.24
As more and more money poured into political campaigns during the 1990s, familiar arguments against the system once again surfaced. Critics charged that various court rulings, advisory opinions, and other developments had rendered FECA obsolete. Candidates continued to face intensifying pressure to raise funds, and with money again effectively unregulated and meaningful disclosure all but absent, pressure built on the need for a new round of reforms. This pressure grew especially strong following a serious financial scandal involving the corporation Enron. After the company’s collapse, reports surfaced that Enron and its executives had used soft money donations to help the company avoid federal regulations.25 By 2002, Congress acted to reform the campaign finance system by passing the Bipartisan Campaign Reform Act (BCRA).
BOX 4.1
WHAT IS A PAC, A 501(C), AND A 527 GROUP?
What is a PAC? A political action committee is a legal entity formed by an organized group (a corporation, union, interest group, citizen action group, etc.) whose purpose is to raise money for, and make contributions to, the campaigns of candidates for federal office.
What is a 501(c)(3) group? A 501(c)(3) group is a nonprofit organization that may not engage in partisan political activity, and lobbying cannot be their principal activity. Issue advocacy, voter registration, and voter mobilization are allowed, but only if these activities are nonpartisan. Contributions to these groups are tax-deductible.
What is a 501(c)(4) and 501(c)(6) group? Similar to 501(c)(3) groups, but they may engage in unlimited lobbying and partisan political activity provided that neither activity is their primary purpose. Contributions to these groups are not tax-deductible.
What is a 527 group? 527 groups are political committees, including political parties and candidate campaign committees. Some 527 organizations, however, avoid FEC regulations because they are focused on “issues” and not on electioneering activities. Contributions to these groups are not tax-deductible.
One of BCRA’s major changes was to institute a ban on soft money contributions to political parties in an effort to eliminate the large six-figure donations that had become increasingly common throughout the 1990s. The new law also mandated that state and local parties fund their federal activities with hard money (i.e., regulated money). Limited exceptions, known as “Levin Amendment” funds, existed only for state and local parties to pay for voter registration and get-out-the-vote activities with soft money limited to $10,000 per source (if allowed under state law).26
BCRA also redefined what qualified as “electioneering communications” in an effort to close the loophole that had allowed for a surge of issue advocacy advertisements throughout the second half of the 1990s. Under the new definition, interest groups could run broadcast ads that name a federal candidate within thirty days of a primary or sixty days of a general election, but only if they now used funds that were subject to federal limits (PAC funds as opposed to treasury funds) to pay for the advertisements. However, the law still allowed for large contributions to various interest groups that could run issue ads, although there were limits on these ads, as well as new standards for identifying campaign ads. Under the new law, campaign ads included those that mentioned a candidate by name or appeared on television or radio during the period of intense campaigning before the election. PACs could still fund these ads as independent expenditures, but they could only do so with funds raised through hard money contributions.
While most of BCRA’s provisions tightened restrictions on money, the new law did increase the amount that individuals could give to federal candidates from $1,000 per election to $2,000 with the amount indexed for inflation ($2,400 for the 2009–2010 election cycle) to make it easier for candidates to raise money (and hence spend less time on the fundraising trail). The law also increased the amount that individuals could give to political parties and indexed the amount for inflation ($30,400 per calendar year in the 2009–2010 election cycle) to help compensate for the parties’ loss of soft money funds (for a complete listing of all contribution limits, see table 4.1). BCRA, however, did not ban large contributions to various interest groups that established 501(c) and 527 committees.
Critics of the law offered several dire forecasts immediately following BCRA’s passage. These included predictions that the ban on soft money would weaken political parties, and that BCRA’s ban on soft money would disproportionately harm the Democratic Party and its candidates. As it turns out, both predictions later proved incorrect. Nevertheless, other problems have emerged under BCRA. In the section that follows, we discuss what BCRA has and has not been able to accomplish.
As noted above, critics of BCRA made several immediate predictions, including one that BCRA would weaken political parties by making it more difficult for them to raise the funds they needed to communicate with voters. While the BCRA law increased the maximum hard money limit that an individual could contribute to a national party committee, it also banned soft money donations, which parties had become increasingly reliant upon throughout the 1990s. The loss of soft money to the parties seemed unlikely to offset any gains that would come from the increased hard-money limits. Indeed, litigants led by the Republican National Committee in the Supreme Court case McConnell v. FEC (2003) argued that parties would not only weaken, but that interest groups would likely fill the void and grow more powerful. According to the plaintiff’s principal brief, “BCRA will not only weaken political parties in absolute terms; it will weaken them relative to special interest groups like the NRA, the Sierra Club, and NARAL.”27
However, in the two presidential elections since BCRA went into effect, the concerns that parties would struggle to raise funds and grow weaker has not happened. Hard money totals for the national party committees increased by amounts great enough in the BCRA era (2004 and 2008) to top the combined hard and soft money totals in 2000—the most recent pre-BCRA election (see table 4.2). Indeed, during the 2008 election, the national party committees raised an overall total of $1.239 billion compared to $1.09 billion in 2000—an overall increase of $149 million.28
Independent expenditures, which allow parties to carry out advertising campaigns in areas with competitive elections, also increased in 2008 from earlier pre-BCRA elections. Local, state, and national Democratic party committees spent a combined total of more than $156 million in independent expenditures in 2008 compared to just $2.3 million in 2000. Similarly, local, state, and national Republican party committees spent a combined total of more than $124 million in independent expenditures in 2008 compared to just $1.6 million in 2000.29
National parties also have raised increasing sums of money from small donors. The amount raised by the national party committees in contributions of $200 or less increased by $129 million from 2000 to 2008.30 The Democratic Congressional Campaign Committee (DCCC), for example, raised just $9.9 million in 2000 in contributions of $200 or less compared to $30.9 million in 2008—a three-fold increase.31 Likewise, the Democratic Senatorial Campaign Committee (DSCC) saw its totals from small donations of $200 or less increase from $8.4 million in 2000 to $24.6 million in 2008.32 These figures illustrate that national party committees have returned to grassroots fundraising efforts. This represents a major success for BCRA reformers.
BCRA also did not disproportionately harm the Democratic Party as many predicted. The Democratic Party’s past dependence on large soft money donations suggested that it might struggle to raise money in the smaller hard money amounts required under BCRA. However, as table 4.2 shows, the combined receipts of the Democratic National Committee (DNC), DSCC, and DCCC in 2008 were $599.1 million—an amount $129.2 million more than the totals that these same party committees collected in 2000 when soft money was legal. Moreover, in 2008, the Republican national party committees’ traditional advantage over the Democratic national party committees shrunk considerably in 2004 and 2008 from 2000. Republican national party committees raised $149.8 million more than Democratic national party committees in 2000 ($619.7 million to $469.9 million).33 Yet without the ability to raise soft money, Democrats cut the Republican advantage to $70.8 million in 2004 ($657.1 million to $586.3 million) and to $41.2 million in 2008 ($640.3 million to $599.1 million).34
It also should be noted that the Republican Party’s advantage in 2008 may have been inflated by the fact that the Republican presidential nominee, John McCain, accepted public funds for the general election while the Democrats’ nominee, Barack Obama, did not. After McCain received the public grant and could no longer raise private donations, he encouraged Republican donors to contribute to the Republican National Committee (RNC). McCain also transferred roughly $18 million left over from his campaign to the RNC. Private donations on the Democratic side, by contrast, went mostly to the Obama campaign rather than the DNC. This dynamic resulted in a considerable monetary advantage for the RNC, which raised nearly $216 million more than the DNC.35 However, when one considers that the Obama campaign was able to raise $318 million in private donations during the short general election cycle, it seems plausible to speculate that Democratic Party totals would have been considerably higher and likely even topped those of the Republican national party committees in 2008.36
While BCRA did not experience many of the problems anticipated by opponents, it failed to resolve a number of issues that reformers had hoped to correct. Consistent with the “hydraulic theory” of campaign finance (i.e., “money, like water, will always find an outlet”), large contributions by wealthy donors continued to find their way into American elections despite BCRA’s campaign regulations. In 2004, for example, millionaire George Soros contributed $23.7 million to 527 organizations.37 Peter Lewis of Progressive Corp. and Steven Bing of Shangri-La Entertainment gave another $23.2 million and $13.9 million respectively to 527 groups in 2004.38 Research from the Campaign Finance Institute also revealed that nearly three-quarters of the funds that 527 committees raised in 2006 came in contributions of $100,000 or more.39 In 2008, thirteen individuals topped the $1 million or more mark in donations to 527 groups.40 These figures make clear that BCRA did little to slow the ability of wealthy individuals to invest their money in American elections.
BCRA also did little to affect the volume of advertising by interest groups or to curb the activity of so-called special interests. Under BCRA, 527 and 501(c) groups were quite active. In 2004, for example, a series of advertisements sponsored by the 527 organization Swift Boat Veterans for Truth generated enormous national attention for their attacks on Democratic presidential candidate John Kerry. Four years later, numerous pro-Republican 501(c) groups, such as the U.S. Chamber of Commerce ($36.4 million), Freedom’s Watch ($30.2 million), and the Employee Freedom Action Committee ($20 million), campaigned against the presidential candidacy of Barack Obama in several battleground states.41 Advertisements from pro-Republican 501(c) groups included topics such as Obama’s supposed connection to William Ayers (an activist during the 1960s and 1970s who founded the radical left-wing organization the Weather-men, which bombed public buildings in an effort to end the Vietnam War) and Obama’s pastor, Jeremiah Wright, whose harsh criticism of American foreign policy and other political subjects drew significant public controversy.42
Democratic-leaning 527 groups were also very involved during the 2008 election. Two of the top three spenders among 527 groups in 2008 were labor groups: the American Federation of State, County, and Municipal Employees (AFSCME) ($32.9 million) and the Service Employees International Union (SEIU) ($27 million).43 The third top spender, America Votes ($17.6 million) was a coalition made up of various progressive groups, but with organized labor again playing a significant role.44 Other progressive groups, such as the pro-environment Sierra Club, the League of Conservation Voters, Defenders of Wildlife, and the Natural Resources Defense Council, as well as women’s and pro-choice groups such as Planned Parenthood, EMILY’s List, and NARAL Pro-Choice America worked closely together in support of Obama.
Overall, interest groups spent considerably more in 2004 and 2008 than in past presidential campaigns before BCRA. This included not only increased advertising expenditures, but also grassroots efforts. The AFLCIO and its fifty-six affiliated unions, for example, launched the largest mobilization program in history, spending a reported $250 million on a twenty-one state effort that included seventy-six million phone calls, fifty-seven million pieces of mail, and twenty-nine million flyers to prospective voters.45 Given this high level of activity and the significant amount of money spent by various organized interests, especially the Chamber of Commerce and the AFL-CIO, BCRA fell well short of hitting a “home run” on limiting the influence of special interests in elections as some proponents of the law had predicted.
Finally, new problems emerged with the campaign finance system in 2008. While BCRA made several significant revisions to the original FECA law, it did not reform the public finance system for presidential candidates. Under the law, presidential candidates can accept partial funding of primary election campaigns and full funding of their general election campaigns. The system is funded through a $3 check-off box that taxpayers have the option to select when they file their federal income taxes.
To receive public funds in the primary (also known as matching funds), a candidate must: (1) seek nomination by a political party to the office of President; (2) raise more than $5,000 in each of at least twenty states; and (3) agree to spending limits. Candidates who qualify and wish to receive matching funds are eligible for a subsidy matching the first $250 of any contribution from an individual (e.g., a contribution of $50 is worth $100 whereas a contribution of $1,000 is worth $1,250).
As noted already, BCRA doubled the individual contribution limit from $1,000 to $2,000 and indexed the amount for inflation ($2,300 in 2008). The law, however, did not increase the portion of individual contributions matched by the federal government in presidential elections. While under FECA, the federal government matched the first $250 of contributions that were capped at $1,000, it matched only the first $250 of contributions capped at $2,300 in 2008, making matching funds slightly less attractive under BCRA.
The presidential public finance system also sets a maximum amount that candidates are able to receive in matching funds. In 2008, presidential primary candidates who accepted public funding had a maximum entitlement of just over $21 million. Candidates who accept matching funds must also agree to an overall spending limit (which is indexed for inflation). The expenditure limit was just over $50 million per candidate in 2008 including fundraising, legal, and accounting costs (with spending limits for each individual state that vary with the state’s population).
These limits, however, have failed to keep pace with the escalating costs of presidential campaigns. Moreover, in the event of a competitive primary, candidates run the risk of spending their entire allocated amount by the early spring of the election year, barring them from further spending until the late summer when the national parties hold their conventions. Undoubtedly, these strategic considerations played a role in the decision of nearly all of the major candidates for president in 2008 to refuse public funds, including Democrats Barack Obama and Hillary Clinton, and Republicans Rudolph Giuliani, Mitt Romney, and John McCain.
The general election subsidy is available to the two major-party nominees (as well as the nominees of a minor party that earned at least 5 percent of the popular vote in the previous election). In 2008, the nominees of the Democratic Party and the Republican Party were eligible for a general grant of $84.1 million each. Every major-party candidate, from Ronald Reagan to George W. Bush to John Kerry, accepted the general election grant from the program’s inception in 1976 through 2004. This changed, however, when Barack Obama declined the public grant in the 2008 general election. The $318 million that Obama ultimately raised for the general election in private contributions gave him a considerable advantage in his contest with John McCain.
Obama’s overwhelming success casts some serious doubt on whether future presidential candidates will participate in the system. Oddly enough, the spending limits that Congress implemented to repair the damage of the Watergate scandal and to decrease the influence of wealthy donors, may ultimately prove to be the cause of the system’s undoing. Of course, there are some important differences between Obama’s 2008 campaign and Nixon’s 1972 campaign. Obama raised a record sum of money, but much of it came from modest-sized contributions, unlike the huge checks that the Nixon campaign received. Indeed, one could certainly argue that Obama attained a result consistent with the goal of many reformers—he democratized the campaign finance system not by limiting money, but ironically by adding much more of it from those making small and medium-sized donations.
Campaign finance reform has been an important policy subject for more than a century. As history has shown, controlling the influence of wealthy donors and the flow of money in American elections has proven to be a challenge. The federal government’s most recent attempt with BCRA has already sparked significant controversy, with opponents and supporters of the law drawing very different conclusions about its successes and failures.
However, as this chapter has demonstrated, the full truth about BCRA is more complicated. To its credit, BCRA has succeeded in severing the direct link between the huge soft money donors who wrote six-figure checks and political parties. As BCRA co-sponsor Senator Russell Fein-gold explained, “The point [of BCRA] was to break the connection between the officeholders and the money.”46 By forcing political parties to raise hard money only, they have become less reliant on excessively wealthy donors and consequently have become more reliant on grass-roots fundraising. Much the opposite of what many scholars predicted, BCRA has made national party organizations stronger rather than weaker. BCRA also accomplished this without disproportionately harming the Democratic Party as some opponents claimed would result.
Nevertheless, BCRA has fallen short in several other areas. Wealthy donors continue to play a role in American elections through excessive contributions to 527 and 501(c) groups. These 527 and 501(c) groups continue to flood the airwaves with advertisements paid for with soft money, creating a situation not unlike the problems that plagued FECA in the late 1990s. Perhaps most alarming to supporters of regulating the campaign finance system, the 2008 election saw virtually every prominent presidential candidate opt out of the public finance system during the primary phase, and even saw a major-party nominee decline public funds in the general election for the first time since the public finance system went into effect. The overwhelming success of the Obama campaign likely spells the meaningful end of presidential public finance as constituted under FECA.
Undoubtedly, the axiom—“money, like water, will always find an outlet”—is consistent with the American experience with campaign finance reform. Campaigns constantly evolve and discover new ways to raise funds. To some, this reality simply represents another challenge for a new generation of reformers to tackle. To others, it only illustrates the continuing futility of campaign finance reform. While it is difficult to predict what the future ultimately may hold for the laws that govern the campaign finance system (especially in an era with a more conservative U.S. SupremeCourt), thelargerdebateabout thesuccesses andfailuresof campaign finance reform will certainly remain a controversial issue in American politics.
Corrado, Anthony, Thomas E. Mann, Daniel Ortiz, and Trevor Potter, eds. The New Campaign Finance Sourcebook. Washington, D.C.: Brookings Institution, 2005.
Grant, J. Tobin, and Thomas J. Rudolph. Expression vs. Equality: The Politics of Campaign Finance Reform. Columbus, Oh.: Ohio State University, 2004.
La Raja, Raymond J. Small Change: Money, Political Parties, and Campaign Finance Reform. Ann Arbor, Mich.: University of Michigan, 2008.
Malbin, Michael J., ed. The Election After Reform: Money, Politics, and the Bipartisan Campaign Reform Act. Lanham, Md.: Rowman & Littlefield, 2006.