Campaign finance

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Campaign finance refers to the means by which money is raised for election campaigns. As campaigns have many expenditures, ranging from the cost of travel for the candidate and others to the purchasing of air time for TV advertisements, they often spend a great deal of time and effort raising money to finance their cause.

Campaigns vary in their techniques for doing this. Some smaller campaigns, given their relatively low fundraising needs, will raise little to no money. Larger campaigns, such as campaigns for President of the United States, will raise hundreds of millions of dollars.

Campaign contributions are often provided by lobbyists, corporations, trade unions, and other special interest groups. These interests often expect something in return (such as specific legislation being enacted or defeated) so some have come to equate campaign finance with political corruption and bribery. These views have led some governments to impose restrictions on fundraising sources and techniques in the hope of eliminating perceived undue influence being given to monied interests.

Democratic countries have differing views on what is legal and what types of donations to political parties and campaigns are acceptable. For instance, the United States has a fairly liberal view of campaign contributions, and the campaigns of many American politicians are funded by a variety of sources. Some other countries take a more restricted view.

Several disciplines, such as economics, public policy, public choice theory, and collective action theory attempt to understand the dynamics of the political processes.

1 Campaign Finance Techniques
2 Public Financing for Clean Elections
- 2.1 United States
- 2.2 Other countries
3 Alternatives to the Current System
4 See also
5 Further reading
6 External links

[edit] Campaign Finance Techniques

Campaigns often spend a great deal of time and effort on political fundraising. Especially in the early stages, candidates will often call or meet with large donors in an attempt to win their financial support. Campaigns will also often solicit campaign donations through direct mail and the Internet.

One of the best known fundraising techniques is the process of holding dinners (often referred to as chicken dinners after a common meal served at the events) that feature speakers such as the candidate or other well-known figures. Those in attendance typically would pay an entry fee, sometimes as large as $1000 or more.

[edit] Public Financing for Clean Elections

Public financing (also known as "taxpayer financing") to create clean elections is put forth to reduce the conflict of interest between private campaign donations and the elected officials who receive these funds to finance their campaigns for office. Those who finance campaigns wish to gain greater political access through that financial support of the campaign. Because it is most often the wealthiest and most well-funded interests that can contribute the most money to political campaigns, those who advocate clean elections see these often for-profit interests as having more influence on legislation than voters.

With a public financing option, candidates can voluntarily opt to run clean and are then required to abide by private and personal campaign spending limits. A candidate agrees to spend no more than a prescribed amount on their campaign in base dollars and token contributions and in exchange receives the majority of the campaign money from the government (taxpayers). States such as Arizona and Maine already have these systems in place. There are currently no options for candidates to run clean in federal elections, although a bill in the U.S. Congress, H.R. 3099 the Clean Money, Clean Elections Act, has been introduced to create such a system.

Clean elections are not to be confused with the mechanism in place for U.S. presidential elections that allows presidential candidates from the two major parties to get matching public funds for their private donations. This money comes from a fund that is received when taxpayers check a box on their tax returns to donate to the fund. Because the law doubles their total funds, half of that money is still received from private donating interests. Therein lies the conflict of interest clean elections wish to eliminate, in that only a small portion of the campaign money can come from private interests. In 2004, for the first time both major presidential candidates chose to opt out of federal fund matching in order to escape the required caps on the amount of money from private contributors when using the matching taxpayer dollars.

[edit] United States

American law allows for public financing of Presidential primary campaigns. Candidates who accept public financing must agree to spending limits.

Candidates in recent Presidential campaigns, such as George W. Bush in 2000 and 2004, have increasingly moved away from accepting public financing to avoid these limits. In the 2004 Democratic Presidential primary Howard Dean and John Kerry opted out of the federal matching fund program. Candidates instead are seeking to raise private money earlier in the campaign cycle, often several years before the election.

Public financing exists to a limited extent at the state and city level. One of the most effective municipal campaign finance systems in the United States is in New York City. The New York City Campaign Finance Board was created in 1988 in the wake of several political corruption scandals. It gives public matching funds to qualifying candidates, who in exchange submit to strict contribution and spending limits and a full audit of their finances. Citywide candidates in the program are required to take part in debates. Corporate contributions are banned and political action committees must register with the city.

Another method, generally called Clean Money, Clean Elections, gives each candidate who chooses to participate a certain, set amount of money. In order to qualify for this money, the candidates must show a broad base of support by collecting a specified number of signatures and small (usually $5) contributions. The candidates are NOT allowed to accept outside donations or to use their own personal money if they receive this public funding. This procedure has been in place in races for all statewide and legislative offices in Arizona and Maine since 2000. Connecticut joined them by passing a Clean Elections law in 2005, along with the cities of Portland, Oregon and Albuquerque, New Mexico. 69% of the voters in Albuquerque voted Yes to Clean Elections.

Public Campaign ([1]) is organizing efforts for Clean Elections nationwide and the California Clean Money Campaign ([2]) is leading the effort in California.

California has an initiative on the ballot in November 2006, Proposition 89, the "California Clean Money and Fair Elections Act", that would provide Clean Money public financing of political campaigns, strict contribution limits, and strong disclosure and enforcement provisions.

[edit] Other countries

Australia - in the federal, state and territory elections candidates for seats receive funding of about the same cost of three postage stamps per elector (currently $202.075 cents<ref name=aec>http://www.aec.gov.au/_content/how/funding_payments/rate.htm</ref>) in elections where they receive more than 4% of the vote.
Hong Kong - the election of the Legislative Council of Hong Kong is under public financing in most cases. Each of the candidates or lists of candidates are entitled to a certain amount for each vote obtained, minus the amount of campaign contributions. This amount is claimable after the election day by winners and candidates who have obtained at least a given percentage of votes.
Germany - all political parties which got more than 0.5% of the votes in federal elections or 1% in state elections get the following compensation for their campaign per year (maximum 133 million euros total):<ref>Funding of polical parties in Germany (German)</ref>
- 0,70€ per valid vote, 0,85€ for the first 4 million votes
- 0,38€ per euro received by donation or membership fees, maximum of 3,300€ per person

[edit] Alternatives to the Current System

The controversy over campaign finance has led to several alternatives being proposed.

In the United States, citizens could presumably require major broadcasters with public airwave licenses to air advertisements at no charge. The broadcasters are operating on what is legally public property. When the Federal Communications Commission was established in the 1930s, specific frequencies were licensed to broadcasters with the agreement that they would serve the "public interest". Whether this requirement can be interpreted to require all broadcasters to give political groups and candidates air time has often been debated; thus far it has only been interpreted to mean that all broadcasters must sell political air time on an equal basis to all buyers at the same rates or in the alternative, not to sell political advertising at all, meaning that they cannot accept advertising from one candidate but not others or charge discriminatory rates in an effort to influence the outcomes of elections. Opponents of the practice of mandating free air time state that it unfair to broadcasters to require them to give away the only means they have of raising the money necessary for them to continue to stay in business, advertising, and that no fair, effective mechanism can be structured so as to determine which candidates are "mainstream" and hence presumably worthy of free air time and which are "fringe" candidates or perennial candidates with little or no actual public support. Proponents of mandating free air time note that broadcasters are already mandated to carry a certain amount of public-affairs programming and carry a certain number of public service announcements, and that such a mandate could logically be viewed as merely an extension of this. Many of them further state that most of the opponents also happen to be well-funded groups and interests who have little trouble raising the amount of funding required under the present system.

[edit] See also

[edit] Further reading

Ackerman, Bruce and Ian Ayres (February 10, 2004). Voting with Dollars. Yale University Press. ISBN 0-300-10149-X.
Alexander, Herbert E. "Campaign Financing in International Perspective" in Michael J. Malbin, ed. (1980). Parties Interest Groups and Campaign Finance Laws. American Enterprise Institute. ISBN 0-8447-2167-0.
Birnbaum, Jeffrey (June 6, 2000). The Money Men : The Real Story of Fund-raising's Influence on Political Power in America. Crown. ISBN 0-8129-3119-X.
Clawson, Dan ; Alan Neustadtl; Mark Weller (May, 1998). Dollars and Votes: How Business Campaign Contributions Subvert Democracy. Temple University Press. ISBN 1-56639-626-3.
Coate, Steven (2004). Pareto Improving Campaign Finance Policy. American Economic Review.
Goodliffe, Jay BYU Syllubus for Money in Politics. Reading List. Retrieved on Fall, 2003. Extensive list of articles on Money in Politics
Green, Mark (2004). Selling Out: How Big Corporate Money Buys Elections, Rams Through Legislation, and Betrays Our Democracy. Regan Books. ISBN 0-06-073582-1. New York mayoral candidate who lost to Bloomberg.
Malbin, Michael J. (March 2006). The Election After Reform: Money, Politics, and the Bipartisan Campaign Reform Act. Rowman & Littlefield Publishers, Inc.. ISBN 0-7425-3870-2.
Smith, Bradley A. (March 1, 2001). Unfree Speech : The Folly of Campaign Finance Reform. Princeton University Press. ISBN 0-691-07045-8.
Talbot, Stephen (Producer). (1992) The Best Campaign Money Can Buy [TV-Series]. United States: Frontline (PBS Video); Center for Investigative Reporting.
Ward, Gene. Transparency in Money in Politics: A Comparison of the United States and Canada. PDF
Vanberg, Christoph (2005). "One Man, One Dollar?" Examining the equalization argument in support of campaign contribution limits. MPI.