• Take Action!



• Watchdog Blog



• Clean Up Washington



• White House for Sale



• Open Government



• Consumer and Civil Justice



• Election Reform



• Key Reports



• Congressional Voting Records



• The Archives



• Link to Us

Primer on Hard Money/Individual Contributions

When it comes to money in politics, most people think in terms of "hard money" – money for federal candidate campaigns that comes from legal sources, subject to contribution limits, and reported to the Federal Election Commission (FEC). Hard money stands in contrast to "soft money" – money for political purposes that comes from sources and in amounts otherwise prohibited for federal candidate campaigns. [Click here for further discussion of soft money.]

The permissible sources for hard money in federal elections include individuals, political committees (PACs), and political parties; impermissible sources include corporate or union treasury money and foreign interests. States develop their own campaign finance laws to govern state elections, with slightly more than half of the states allowing direct corporate and union contributions to state candidate campaigns.

Click here for a list of states that prohibit direct corporate and union campaign contributions

In addition to the source restrictions on hard money in federal elections, the Federal Election Campaign Act (FECA) places limits on the amount that persons may contribute to candidates and committees and requires that hard money contributions (and most expenditures) be reported to the FEC and disclosed to the public. Retrieving campaign finance records is mostly easily accomplished through the FEC’s Web site.

As part of a legislative compromise to get congressional approval of the nation’s most recent major overhaul of the campaign finance law, the Bipartisan Campaign Reform Act (BCRA) of 2002 increased many of the contribution limits in exchange for banning soft money in federal elections.

Click here to see a chart of the new federal contribution limits

The new increase in the hard money contribution limits has drawn considerable opposition, especially from elements of the campaign finance reform community. This opposition tends to come from two distinct perspectives. The first complaint being that very few Americans can afford to make contributions in amounts near the new limits; the second that the presidential public financing system is being undermined by the new limits.

• Few Americans can afford to make large contributions. In the 2000 election cycle – when the contribution limits was $1,000 from individuals to federal candidates (this limit is now $2,000 under BCRA) – only about one-ninth of 1% of the voting age population made the maximum contribution to a candidate. [Click here for the study.] Those who can afford to make such contributions are overwhelmingly wealthy, white, older and male. In fact, the bulk of such contributors can be traced to a small number of geographic zip codes, such as in Beverly Hills (CA) and Manhattan (NY).

• The higher hard money contribution limits are damaging the presidential public financing program. No subsequent increase in public funds was made for candidates participating in the presidential public financing system. This means that a few select candidates may be able to raise much more money by "opting out" of the public financing system and its voluntary limits on campaign expenditures. For example, through George Bush’s team of fund-raising "Rangers" – well-connected individuals who can bundle $2,000 checks from other individuals in a total amount of $200,000 or more – the Bush campaign is expected to raise about $200 million in hard money for the 2004 presidential election. Compare this amount to the public financing limit of about half that amount in both the primary and general elections, and opting out of public financing and refusing to limit campaign expenditures appears dangerously attractive.

The amount of hard money flowing into federal elections has almost doubled through the decade, even as soft money grew in popularity. The Federal Election Commission (FEC) reports the following aggregate sums of hard money receipts in federal elections:

Click here for a chart showing FEC Hard Money sums for the last six election cycles

more resources

Because Public Citizen does not accept funds from corporations, professional associations or government agencies, we can remain independent and follow the truth wherever it may lead. But that means we depend on the generosity of concerned citizens like you for the resources to fight on behalf of the public interest. If you would like to help us in our fight, click here.