FECA and BCRA

The Federal Elections Campaign (FECA) of 1971

This was passed prior to the Watergate scandal in 1972 and aimed to reduce the influence of wealthy donors on election campaigns. The Act was aimed at reducing the influence of wealthy donors on election campaigns. The Act was strengthened in the aftermath of the Watergate scandal with the Federal Elections Campaign Act of 1974.

• It required all candidates to publicly declare the sources of their income so everyone can view who donated and how much and a judgment can be made whether or not political actions were influenced by his/her donors
• Placed precise limits on campaign donations. This was done to limit candidate’s dependence on a small number of extremely wealthy donors. Individuals could donate up to $20,000 to a political party but were limited of just $1,000 per candidate in a primary or election. Organisations were limited to just $5,000 per election and this was monitored by Political Action Committees (PAC). PACs acted like a financial filter, they discouraged a too close relationship between candidates, the law stated PACS would receive contributions from a minimum of 50 donors and make contributions to a minimum of 5 candidates.
• Set up a system of public financing of presidential elections to reduce the need for candidates to rely on wealthy private donors
• Set up the Federal Elections Commission (FEC) but was ineffective

It was a congressional law. The Supreme Court challenged it in 1976 in a case called Buckley v. Valeo who deemed it unconstitutional to restrict people on how much money they can donate. They used the 1^st Amendment, saying it went against the freedom of expression. Also, FECA could easily be overcome by soft money.

Money donated directly to the election campaign, in accordance to FECA regulations, was known as hard money. Soft money on the other hand, is donated in a way that leaves the contribution unregulated by federal law. In 1988 presidential election campaign, in order to close the funding gap with his opponent, the Democratic campaign used soft money to ‘explain’ the issues in ways that clearly encourage people to vote for their candidate. Carefully avoiding words used in FECA enabled the Democrats to use soft money for purposes, which it was not intended.

The Bi-partisan Campaign Reform Act (BCRA) of 2002

Aka the McCain-Feingold Act.

• Hard-money contributions by individuals were increased from $1,000 to $2,000 per year. And if a candidate faced a wealth opponent, self-financing a campaign, the hard cash ceiling would be raised
• PAC contributions were limited to $5,000 per campaign
• Total contributions that an individual could make to individual campaigns, PACs and political parties was raised from $20,000 to $95,000 per two years
• Soft-money donations were banned
• Pressure groups were banned from airing TV or radio electioneering advertisements one month before a primary election and two months before a general election