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Much-Needed Legislation Would Overhaul the Financing of Presidential Campaigns

Dec. 5, 2007

Much-Needed Legislation Would Overhaul the Financing of Presidential Campaigns

$1 Billion Projected to Be Spent in 2008 Race to Buy the Presidency; Bills Introduced Today in House and Senate Would Curtail Influence of Wealthy Interests

 WASHINGTON, D.C. – Public Citizen today heartily endorsed new legislation introduced in the Senate and House of Representatives that would overhaul the faltering presidential public financing program. The bills are by Sens. Russell Feingold (D-Wis.), Susan Collins (R-Maine), Richard Durbin (D-Ill.), Hillary Clinton (D-N.Y.), John Kerry (D-Mass.) and Barack Obama (D-Ill.); and Reps. Chris Van Hollen (D-Md.), David Price (D-N.C.), Rahm Emanuel (D-Ill.), Christopher Shays (R-Conn.), Mike Castle (R-Del.) and Todd Platts (R-Pa.).

First implemented in 1976, the presidential public financing system worked admirably for decades in helping to level the playing field among presidential candidates. Under the system, challengers defeated sitting incumbent presidents half the time. But its limits on campaign fundraising and spending have languished because the system has not been updated in more than 30 years. Today, very few presidential candidates agree to participate in the public funding system because they can raise much more money from wealthy special interests and because they believe they could be at a disadvantage compared to other candidates who do not opt to take public financing.

“The 2008 presidential election will likely be the first $1 billion presidential campaign in history,” said Joan Claybrook, president of Public Citizen. “Most of this money will be coming from the very same wealthy corporations and industry groups that have business pending before the federal government, and they expect favors, access and even jobs in return.”

Enacted after the Watergate election scandals, the presidential public financing system is supposed to reduce the clout of special interest money in presidential campaigns by providing qualified candidates with significant amounts of public funds in the primary election and nearly full public financing in the general election. Public financing dramatically reduced the need for presidential candidates to seek money from wealthy corporate interests who regularly benefit from their contributions and bundle campaign money from others as well.

Prior to the 2000 elections, only three presidential candidates – each independently wealthy – opted out of the public financing system in the primary elections. Since 2000, however, the list of candidates opting out has swelled. In the upcoming 2008 election, few serious presidential contenders are expected to stay in the public financing system. This time, candidates are choosing to forgo public money not because they are independently wealthy but because they can raise and spend more money than if they accepted the public dollars. The consensus of many: The current presidential public financing system must be updated.

“The presidential public financing program of 1976 has not kept up with the times,” said Craig Holman, legislative representative for Public Citizen. “The spending ceilings are unrealistically low and don’t keep pace with what is being spent. Further, spending ceilings are fixed in stone. They are not even increased to match excessive spending by candidates who opt out of the system.”

 The Presidential Funding Act of 2007 would:

  • Increase the spending ceilings for publicly funded candidates in both the primary (from about $50 million to $150 million) and general elections (from about $80 million to $100 million) to reflect the true costs of running a presidential campaign. The spending ceilings would be increased further if a non-participating candidate spends in excess of those ceilings.
  • Provide a 4-to-1 match of public funds to private donations of $200 or less, which means that a $200 contribution would provide $1,000 to a participating candidate in the primary elections. In the general election, participating candidates would receive all their campaign budget in public funds in exchange for giving up special interest contributions.
  • Enhance the funding source for the program by increasing the voluntary tax check-off system from $3 per individual to $10. The check-off does not add any tax burden to taxpayers; it simply allows a taxpayer to designate a portion of his or her taxes to help clean up presidential elections.
  • Prohibit the national parties from using unregulated special interest money to pay for their national party nominating conventions, better known as party “soirées.”
  • Require presidential campaigns to disclose all their fundraising “bundlers” – those who receive credit from a campaign for collecting a large number of contributions from individuals, usually in an effort to curry favor with the presidential candidate – and the amounts they raise.

LEARN MORE about the presidential public financing system, its strengths and weaknesses, and how to repair the program.