Other costs outside of the candidate limits and labour spending included minimal corporate spending, candidate compliance costs and independent expenditures. Some of these various costs can be legally controlled by the candidates, some can be coordinated by the campaigns, some are limited, but others cannot be controlled, coordinated or limited.
Table 1.3 Sources of funds, major-party presidential candidates, 1988 general election
(in millions of dollars)
Source: Citizens’ Research Foundation.
aincludes money raised by the national party committee and channelled to state and local party committees.
bIncludes internal communication costs (both those in excess of $2 000, which are reported, as required by law, and those less than $2 000, which are not required), registration and voter turnout expenditures, overhead and other related costs.
cDoes not include amounts spent to oppose the candidates: $2.7 million against Dukakis,$77 325 against Bush and $63 103 against Quayle.
Legislative Proposals
The experience of the 1988 presidential campaigns led to numerous proposals during the 1989-90 session of Congress to restrict soft money. The House and Senate, both under Democratic control, passed soft money restrictions as part of comprehensive legislation. But differences between the two bodies prevented either campaign reform bill from becoming law before the 101st Congress adjourned in October 1990. (See following section, “The Debate over Legislative Proposals”.)
Both bills aimed to prevent a recurrence of the tactics used by the presidential campaigns in 1988. The House legislation would have barred presidential candidates from raising soft money. The Senate proposal would have placed under the limits of federal law all contributions solicited by a national party committee on behalf of a state party organization, thereby curtailing the $100 000 gifts raised in 1988. Both bills also would have sharply restricted the amount of money that a state party could spend on so-called generic campaigns in connection with a presidential race, including voter registration and get-out-the-vote drives.
But the Senate bill went further by placing strict spending limits on generic campaign activities by state and national party committees even when presidential and congressional candidates are not specifically mentioned. In the less stringent House approach, generic campaign efforts that made no mention of federal candidates were left outside the purview of federal law, even if a presidential or congressional candidate might realize some benefit from them.
Both bills would have required disclosure of soft money receipts and expenditures. The FEC passed regulations that went into effect 1 January 1991; these required disclosure and set allocation formulas for generic spending on behalf of the party ticket that may affect the election of federal candidates (Federal Register 1990).11
Meanwhile, Senate Republicans wanted restrictions on non-party money. They proposed to prohibit tax-exempt organizations from activities on behalf of a particular candidate. This was aimed at organized labour as well as a number of other issue-oriented groups - such as environmental organizations - that have tended to favour Democratic presidential and congressional candidates with various forms of assistance.
In seeking to regulate another device used to skirt campaign spending limits - independent expenditures - the Democrats and Republicans found more common ground. The reason is that legislators in both parties are clearly nervous about becoming victims of the stridently negative advertising that often has characterized independent campaigns. Although the Buckley decision found independent expenditures to be a protected form of free speech, both parties in Congress have looked for constitutional ways to discourage them.
The House-passed campaign bill would have required any television advertisement underwritten by independent expenditures to contain a continuously displayed statement identifying the sponsor of the ad. The Senate bill proposed that any broadcaster selling air time to an independent campaign favouring one candidate would then have to sell air time to the other candidate to allow him or her to respond immediately.
The Future of the Presidential Checkoff
While private money has found several channels into presidential campaigns, the flow of available public funding is in danger of slowing to a trickle. It now appears that the Presidential Election Campaign Fund will face severe cash flow problems as early as the 1992 campaign and will be in a deficit situation by the 1996 race unless action is taken.
The $1 federal income tax checkoff has not been increased since its enactment in the Revenue Act of 1971, despite the fact that the U.S. dollar is worth about a third of what it was then. Compounding the erosion of the dollar is the eroding support for the checkoff from taxpayers. According to the Federal Election Commission, there has been a 30 percent decrease in taxpayer support for the checkoff since 1980, when checkoff participation was at an all-time high. This translates into tax checkoff rates declining from the high point of 28.7 percent in 1980 tax returns to 20.1 percent in 1988 returns; the 1989 rate on 1988 returns produced $32.3 million - the yearly amounts being aggregated over a four-year period for payouts in presidential election years (Federal Election Commission 1990b). This parallels the drop in checkoff participation in several states (notably New Jersey, Michigan, Minnesota and Wisconsin) that provide public funding to statewide and/or state legislative candidates.
Herein lies a paradox of the U.S. political system: while surveys indicate many voters are convinced that elected officials are being bought off by special interest money, these same voters have shown considerable reluctance to provide the public funding necessary to replace it. Some insights into this conundrum are provided by a series of focus groups sponsored by the FEC in late 1990. The private research firm conducting focus groups reported: “It was often difficult to keep the group focused on the subject at hand (the checkoff) because of their anger at politicians and a perception of wasteful spending by government. Their anger associated with these concerns contaminated their consideration of presidential funding” (Babcock 1991).12
The FEC announced in late November 1990 that the presidential public funding program could suffer a cash flow problem during the 1992 presidential race (Campaign Practices Reports 1990, 2). To deal with this, FEC and U.S. Treasury officials are currently discussing two plans that would translate into candidates receiving less than the traditional dollar-for-dollar public match on private contributions during the prenomination period. Because restricting the availability of public funding in the early going could benefit better-known candidates, the FEC and Treasury are expecting any decision they make to face political and legal challenges.
Both alternatives being considered would require the use of checkoff money collected in 1992. That, in turn, would further worsen the deficit projected for the 1996 presidential year. While the FEC is stepping up efforts to educate taxpayers about the checkoff, several commission members said recently that Congress will have to decide whether to make a one-time grant to keep the fund out of debt or totally scrap the checkoff in favour of providing public funding through continuing legislative appropriations - a perilous possibility given U.S. budget deficits (Campaign Practices Reports 1990, 3).
Congressional Campaigns
The structure of the law under which members of Congress themselves must stand for election is a hybrid fashioned by legislative and judicial fiat and by FEC regulations and opinions. The absence of public funding for congressional candidates means that there has been no carrot with which to bring about voluntary acceptance of spending limits in House and Senate contests. Reformers subsequently sought to remedy this by lobbying Congress to create a system of expenditure limits and public funding
