Campaign Finance: An Overview Page: 4 of 22
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Campaign Finance: An Overview
Evolution of the Current System
Today's federal campaign finance law evolved during the 1970s out of five
major statutes and a paramount Supreme Court case. That case not only affected
earlier statutes, but it has also continued to shape the dialogue on campaign finance
reform.
The 1971 Federal Election Campaign Act (FECA), as amended in 1974, 1976,
and 1979, imposed limits on contributions, required disclosure of campaign receipts
and expenditures, and set up the Federal Election Commission (FEC) as a central
administrative and enforcement agency. The Revenue Act of 1971 inaugurated
public funding of presidential general elections, with funding of primaries and
nominating conventions added by the 1974 FECA Amendments. The latter also
imposed certain expenditure limits, later struck down by the Supreme Court's
landmark Buckley v. Valeo ruling [424 U.S. 1 (1976)].
In the Buckley ruling, the Court upheld the act's limitations on contributions as
appropriate legislative tools to guard against the reality or appearance of improper
influence stemming from candidates' dependence on large campaign contributions.
However, Buckley invalidated the act's limitations on independent expenditures, on
candidate expenditures from personal funds, and on overall campaign expenditures.
These provisions, the Court ruled, placed direct and substantial restrictions on the
ability of candidates, citizens, and associations to engage in protected First
Amendment free speech rights. The Court saw no danger of corruption arising from
large expenditures, as it did from large contributions, and reasoned that corruption
alone could justify the First Amendment restrictions involved. Only voluntary limits
on expenditures could be sustained, perhaps in exchange for government benefits.
Such a plan was specifically upheld in the existing presidential public funding
system, as a contractual agreement between the government and the candidate. The
Court's dichotomous ruling, allowing limits on contributions but striking down
mandatory limits on expenditures, has shaped subsequent campaign finance practices
and laws, as well as the debate over campaign finance reform.
In 2002, Congress enacted the Bipartisan Campaign Reform Act (BCRA) of
2002 (popularly known as McCain-Feingold for its Senate sponsors). This statute
made the most significant changes in the FECA since the 1970s, featuring higher
contribution limits, a ban on the raising of soft moneys by political parties and federal
candidates, and a restriction on broadcast ads by outside groups in the closing days
1 Soft money (discussed more fully in this report) generally refers to funds that are raised
and spent outside the purview of federal election law regulation but which are intended to
affect federal elections, at least indirectly.
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Cantor, Joseph E. Campaign Finance: An Overview, report, July 31, 2006; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc806048/m1/4/: accessed April 19, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.