and contributors so as to achieve some of the goals of campaign reform.
However, if one views the reforms of the 1970s as an effort to regulate the flow of money into presidential campaigns, it is a regulatory structure in some jeopardy. While the structure worked well when first put into place in 1976, it began to spring leaks during the campaigns of 1980 and 1984; in 1988, major cracks appeared. The problems are attributable less to deficiencies in the law itself than to the inventiveness of political actors in circumventing the statutes and the difficulty of strictly regulating political money in a pluralistic society.
At the outset, it is important to note that the laws governing presidential campaigns have changed little since the adoption of the FECA Amendments of 1974. In the pre-nomination period, a presidential aspirant is limited in how much he or she may receive from any individual contributor ($1 000) or a political action committee ($5 000). PAC donations are not “matchable.” But a candidate may receive public matching funds for each contribution from an individual up to $250. First, the candidate must demonstrate the viability of his or her campaign by collecting $5 000 (in up to $250 amounts) in each of 20 states, for a nationwide total of $100 000. There is a cap on the total amount of public funds available to a candidate during the pre-nomination period; it increases every four years based on the consumer price index (see table 1.2).
Table 1.2 Major-party presidential campaign expenditure limits and public funding, 1976-88
(in millions of dollars)
Source: Citizens’ Research Foundation based on FEC data.
Note: Totals may not be exact due to rounding.
aBased on $10 million plus cost-of-living allowance (COLA) increases using 1974 as the base year. Eligible candidates may receive no more than one-half the national spending limit in public matching funds. To become eligible candidates must raise $5 000 in private contributions of $250 or less in each of 20 states. The federal government matches each contribution to qualified candidates up to $250. Publicly funded candidates also must observe spending limits in the individual states equal to the greater of $200 000 + COLA (base year 1974), or $0.16 x the voting-age population (VAP) of the state + COLA.
bCandidates may spend up to 20 percent of the national spending limit for fund-raising.
cLegal and accounting expenses to insure compliance with the law are exempt from the spending limit.
dBased on $20 million + COLA (base year 1974).
eBased on $0.02 x VAP of the United States + COLA.
fCompliance costs are exempt from the spending limit.
gBased on $2 million + COLA (base year 1974). Under the 1979 FECA amendments, the basic grant was raised to $3 million. In 1984, Congress raised the basic grant to $4 million.
During the general election, the presidential nominee of each major political party receives full public financing. Each candidate receives a flat grant, which may be supplemented by a limited amount of funds spent on his or her behalf by each national political party. With that exception, the two presidential nominees are theoretically barred from raising private funds for their campaigns during the general election. As will be discussed later, these restrictions bear little resemblance to current reality.
Some $500 million was spent on the 1988 presidential campaign, including the pre-nomination period, national conventions and the general election (Alexander and Bauer 1991, 11)7 More than a third of this represents funds provided by U.S. taxpayers (ibid., table 2.6). In return for this public subsidy, presidential candidates agreed to abide by expenditure limitations in the pre-nomination and general election periods and to limit use of their personal assets (as noted in Buckley v. Valeo in the last section). The expenditure ceilings also are indexed to inflation; consequently, the spending limits, as noted in table 1.1, more than doubled between 1976 and 1988.
This, however, has not discouraged candidates and their operatives from devising increasingly imaginative means to get around these ceilings - so much so that they have become largely meaningless. There is no better example than the 1988 presidential campaigns, when Democrat Michael Dukakis and Republican George Bush each helped to raise half again as much money as the general election limit defined by law (Alexander and Bauer 1991, table 3.4, 41).
To some extent, the problem of compliance with expenditure ceilings in U.S. presidential elections mirrors the 1988 Canadian campaign, when the expenditure limits on political parties were undermined by the so-called political interest groups - which spent freely in connection with the debate over the U.S.-Canada Free Trade Agreement. In the United States, the first major holes in the spending limit dike appeared during the 1980 presidential election, the second such contest featuring public financing and expenditure ceilings.
The 1980 Campaign
Yet another major element of the Buckley decision involved “independent expenditures.” The decision made clear that such activity by individuals or groups was a constitutionally protected form of free speech as long as the spending was truly independent. Consequently, independent expenditures could not be coordinated with candidates or their organizations or consented to by candidates or their agents, but they could be spent on behalf of or against a non-cooperating candidate.
The result was the creation of several independent expenditure groups in the late 1970s, the most prominent of which were strongly conservative and pro-Republican. In 1980, most of their efforts were devoted to electing Ronald Reagan. To illustrate the degree to which this device undercut spending limits, Reagan was limited to a total of $51.7 million during the pre-nomination and general election that year. However, according to Federal Election Commission data, independent expenditure campaigns spent another $12.5 million promoting Republican presidential candidates that year, most of it on Reagan’s behalf.8 One aspect of independent spending totals requires explanation. Not all such spending is for direct campaigning by means of communicating with voters; totals also include fund-raising and administrative costs of the political committee undertaking the independent expenditures.
Meanwhile, Reagan’s own advisers came up with another way around the expenditure limits: the “presidential PAC.” After losing his bid for the Republican presidential nomination to Gerald Ford in 1976, Reagan started a PAC ostensibly to contribute money to conservative candidates at the state and local levels. However, its true purpose was to promote Reagan himself as he prepared for another run for the presidency in 1980. As Anthony Corrado has said, “most of the PAC’s funds were used to hire staff and consultants, develop fund-raising programs, recruit volunteers, subsidize Reagan’s travel and host receptions on his behalf” (Corrado 1990).
The object of the PAC was to get around provisions of the Federal Election Campaign Act dictating that once a person declares his or her intention to run for president and registers a principal campaign committee with the FEC, the meter begins running on the pre-nomination expenditure ceiling. There is another advantage to the presidential PAC, since used by many other candidates: an individual donor is permitted to contribute five times as much money to a PAC ($5 000 maximum) as to a presidential or congressional candidate’s campaign committee ($1 000 limit).
The 1984 Campaign
Just as Reagan found ways around the spending limits during the 1980 pre-nomination process, so did former Vice-President Walter Mondale in winning the Democratic Party nomination four years later.
Besides agreeing to overall expenditure ceilings in the pre-nomination
