Without fail, campaign financing inevitably becomes a hot topic in the months leading up to a presidential election, but many of the vocabulary and laws that get thrown around sound more like a foreign language than the American political process. We've translated a few of the more common terms you'll hear in relation to this topic, so bone up on your campaign financing know-how before the presidential debates kick off next month.
Federal Election Campaign Act (FECA): A law passed in 1971 that governs the financing of federal elections and requires candidates and political committees to disclose funding sources and spending practices. Additionally, it applies regulations to campaign contributions and spending during federal elections, and it polices the use of public funds in presidential elections.
Federal Election Commission (FEC): Established by a 1974 amendment of FECA, the FEC is an independent regulatory agency that enforces federal campaign finance laws.
Buckley v. Valeo: In 1976, the Supreme Court upheld the Federal Election Campaign Act's requirements of financial disclosure, contribution limits, and the provision for public funding of presidential election campaigns in the case Buckley v. Valeo. However, it struck down spending limits for candidates not receiving public funds (such as congressional candidates) and for independent groups who do not campaign for or against a candidate. Finally, the ruling stated that candidates who do not accept public money need not limit spending from personal funds.
For several more terms, just keep reading.
Hard money: Direct donations from individuals or groups to the political campaigns of federal candidates. These contributions are restricted by law.
Soft money: Donations directed toward civic activities like voter registration drives and party-building activities. They can also fund state and local candidates but are restricted from directly supporting a candidate for federal office. Unlike hard money, these contributions are not restricted by law.
McCain-Feingold Law: Sponsored by Senators John McCain and Russell Feingold, this law eliminated loopholes that had previously allowed candidates seeking federal office to use soft money. This law is also known as the Bipartisan Campaign Reform Act.
Hatch Act: Under the Hatch Act, federal employees (employees of the executive branch of the federal and District of Columbia governments, and state and local employees who work with federal programs) may contribute to a candidate's campaign but are restricted from using their official authority to influence an election.
Taxpayer check-off system: Allows US taxpayers to contribute $3 of their annual federal income tax payment to a public fund that finances presidential elections. To participate, taxpayers merely have to check a box on their return, which then deposits $3 of their tax payment into this fund.
Matching funds: Presidential candidates may receive public funds that match what they raise privately from individuals. These matching funds apply to donations from individuals that total $250 or less.
Political action committees: Committees not affiliated directly with a political party but rather with corporations, labor unions, or other organizations. These committees promote the legislative agendas of their members through campaign contributions and participate in other election-related activities.