arrowSection 3.1 - Campaign Finance

arrowSection 3.1.1 - Federal Law

This topic is monitored by Moritz Law Professor Edward B. Foley

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Financing the Presidential Race in 2004: An Overview

Because this year's presidential election is the most fiercely fought in memory, it not surprisingly has attracted the most money in history. As of May 31, President Bush had raised a record-smashing $215 million, while Senator Kerry was in hot pursuit, with a total of $180 million by the end of June, including $34 million raised in June alone. 1

But the candidates' own campaign treasuries are only a part of the picture. The big news this year has been the rise of independent advocacy organizations intent on defeating Bush's bid for reelection. America Coming Together, MoveOn.org, the Media Fund, and Partnership for American Families — these are among the most well-funded of such groups, which collectively have raised a total of $150 million. 2  Their significance for the campaign was confirmed when, on May 13, the Federal Election Commission decided to suspend consideration of rules that would have forced them to abide by regulations applicable to political action committees (PACs), including a $5000 limit on the amount these groups could receive from any single individual and a prohibition on any contributions to these groups from unions or corporations. As of early July, Republican-oriented counterparts to these independent Democratic-supporting groups had yet to emerge with any significant strength.

Instead, the Republican Party itself remains a formidable fund-raising force, despite widespread prognostications that the political parties would be crippled by the McCain-Feingold campaign reform law. By April 1 of this year, the G.O.P had raised $290 million. The Democratic Party raised half that much ($146 million). The combined total for the two parties ($436 million), however, was considerably more than both parties raised during the 2000 election campaign ($375 million) — with eight months left to go this year. 3

Because spending by both the political parties and the new independent advocacy groups will play such a prominent role in the 2004 presidential race, a crucial question is whether this spending is being coordinated with either candidate. Under longstanding principles of federal campaign finance law, whenever spending by any person or group other than the candidate is undertaken in coordination with the candidate, then that spending counts as a contribution to the candidate. As such, this spending is subject to contribution limits that do not apply to spending that is truly independent of the candidate's own campaign activities.

Obviously, the political parties and advocacy groups want their spending to be considered independent and not coordinated with the presidential candidate they support. Yet equally obvious is the fact that the candidates have an incentive to coordinate this spending with their own campaign activities, in order to maximize its effectiveness. Moreover, although the difference between independent and coordinated spending is easy to state in the abstract, it is extremely difficult to apply in specific cases.

Given the significance of the coordination question, this e-Book provides extensive analysis of it in a series of entries:

Notes

1. Glen Justice, Kerry Sets Web Record in Donations, The New York Times (July 2, 2004), p. A14.

2. See Center for Responsive Politics, http://www.opensecrets.org/527s/527new.asp?cycle=2004.

3. Kenneth P. Doyle, Major Parties Continue Racking Up Big Fund Raising Totals Under BCRA , BNA Money & Politics Report (May 28, 2004), available at http://pubs.bna.com/IP/BNA/mpr.nsf/SearchAllView/
0171921E12A0F61D85256EA10076F677?Open&highlight=PARTY
.