Money In Us Politics

In the last 40 years of American politics, money has played a significant role and has changed the role of corporations and the judiciary in politics. This article will explore 40 years of American money in politics, the rise of superPACS, and the increase of `Dark money`

40 years of `Money Rules`

In 1974, Congress enacts major changes to the Federal Election Campaign Act (1971), this was the first comprehensive effort to regulate campaign spending and contribution, it included

• Limiting contributions to candidates running for Federal Office
• Requiring the disclosure of political contribution
• Limiting independent expenditures to $1000
• Limiting candidate spending from personal funds

This remained in place until 1976, when Buckley v Valeo strikes down this change, this Supreme court ruling ruled that whilst it was okay to limit contributions due to the risk of corruption, it was not okay to limit expenditures, limit candidates use of their own personal funds - this was mainly due to the First Amendment and the opinion that there was no risk of corruption in these areas.

Much later, in 1990, the supreme court ruled again in Austin v Michigan chamber of Commerce, this time ruling that it was infact okay for the Michigan legislature to prohibit corporations from making independent expenditures to support or oppose a candidate - this was ruled because `corporate wealth can unduly influence election outcomes. We can assume from this that the court believed that corporation do not have the same first amendment rights as individuals

Heres the case you`ve probably heard of if you`ve studied American Politics as part as your Global Politics module, the 2010 Supreme court ruling Citizens United v FEC (i will write a separate article explaining who Citizens United are). this court ruling struck down the 1990 Austin ruling, by stating congress may not limit corporate spending - deciding this because the First Amendment rules and that there is no risk of Corruption.

More recently, the 2014 SpeechNow v FEC (D.C. Circuit court of appeals) ruled that any contribution limits cannot be limited due to the first amendment rules - however, congress may require disclosure, due to the public having an interest

SuperPACs, dark money and the rise of 501(c)4

P - political

A - action

C - committee

these can raise and spend unlimited amounts of money given to them by corporations, unions, individuals or associations, they can either be a 527 or & 501(c)4

527

• created by the IRS to allow for the raising and spending of money to directly influence political activity
• must report donors and contributions
• donor lists are public in exchange for greater freedom to directly influence election initiatives

501(c)4

• Created by the Tariff Act of 1913 - intention of creating tax exemptions for commercial and civic organisations focusing on social welfare
• does not have to disclose donor list
• however forfeits the ability to engage in politics as a primary function

However somewhere along the line, a change in tax code in the 1950s meant that 501(c)4s would only have to primarily spend on social welfare, meaning a 51% welfare budget to 49% politics. this meant a sharp increase in money given to 501(c)4s