1. UNDERSTANDING ELECTIONS CHAPTER 12 Campaign Funding and Political Action Committees Section 2

2. Controversies over Campaign Funding James Traficant A Democratic representative from Ohio in the U.S. Congress, he was very popular in his district. He was first charged with racketeering in 1983, but successfully defended himself and was acquitted of all charges. He was charged in 2002 with corruption, and this time he was convicted. Tom DeLay A powerful Republican representative from Texas in the U.S. Congress, he formed several PACs that gave campaign funds to Republican candidates. In 2005, he was indicted for violating campaign finance laws. Campaign-Funding Challenges These cases show the need to regulate campaign financing.

5. Funding Election Campaigns Election campaigns can be very expensive. Where the Money Comes From Individual Donations: Largest source of funds; individuals contribute directly or by hosting fund-raisers Contributions by PACs: Second most important source of funds Political Party Contributions: Limited amounts funded by committees within a political party Public Funding: Comes from federal government through income tax; only available to presidential candidates

7. Campaign Finance Laws Early Campaign Finance Reform 1907: Congress first restricts campaign funds; expanded restrictions in 1940s 1971: Congress passed FECA, requires candidates, PACs, political parties to report contributions received above certain amount FECA reports must identify contributors FECA Amendments 1974: FEC (Federal Election Commission) created 1979: allowances made for unlimited spending on party-building activities Soft Money No restrictions placed on donations not given directly to candidates Bipartisan Campaign Reform Act 2002: banned soft money raised for issue ads

9. Interest Groups and Election Campaigns Political Action Committees Many interest groups have a PAC. How PACs Function Collects funds; distribute to political parties or candidates Leadership PACs Not official campaign organizations; can raise unlimited funds Influence of PACs Allow interest groups greater voice in government; critics say too powerful Elections and 527 Groups Tax-exempt organizations that have no limit on political donations Controversies over 527 Groups First came to forefront in 2004 election (e.g., MoveOn.org) Impact of 527 Groups Critics blame for increase in negative campaigning Campaign Reform and the Media BCRA requires ads to identify who is paying for them; supporters hope this reduces negative campaigning

10. Interest Groups and Election Campaigns Political Action Committees Many interest groups have a PAC. How PACs Function Collect funds Distribute to political parties or candidates Leadership PACs Not official campaign organizations Can raise unlimited funds Influence of PACs Allow interest groups greater voice in government Critics say too powerful

11. Interest Groups and Election Campaigns Elections and 527 Groups Tax-exempt organizations that have no limit on political donations. Controversies over 527 Groups First came to forefront in 2004 election (e.g., MoveOn.org) Impact of 527 Groups Critics blame for increase in negative campaigning Campaign Reform and the Media BCRA requires ads to identify who is paying for them Supporters hope this reduces negative campaigning

12. Vocabulary Federal Election Commissiongovernment agency created to enforce the Federal Election Campaign Act and administer the related public-funding program Party-Building Activitiespolitical party activities that do not support specific candidates Issue Adsadvertisements that support or oppose candidates’ views without specifically calling for their election or defeat Leadership PACsgroups formed by officeholders that are separate from the officeholders’ campaign organizations 527 Groupa tax-exempt organization created to influence an election