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Campaign finance refers to the fundraising and spending that political campaigns do in their election races. As campaigns have many expenditures, ranging from the cost of travel for the candidate and others to the purchasing of air time for TV advertisements, candidates often devote substantial time and effort raising money to finance campaigns.

Although the political science literature indicates that most contributors give to support candidates with whom they are already in agreement,^[1] there is wide public perception that donors expect illegitimate government favors in return.^[2] (such as specific legislation being enacted or defeated) so some have come to equate campaign finance with political corruption and bribery^{[citation needed]}. These views have led some governments to reform fundraising sources and techniques in the hope of eliminating perceived undue influence being given to monied interests. Another tactic is for the government, rather than private individuals and organizations, to provide funding for campaigns.

Democratic countries have differing regulations on what types of donations to political parties and campaigns are acceptable.

The causes and effects of different campaign finance rules are studied in a number of disciplines including political science, economics and public policy.

Contents 1 Private financing 2 Public financing 3 Regulation 4 See also 5 References 5.1 Notes 5.2 Sources 5.3 Further reading 6 External links

[edit] Private financing

Some democracies rely heavily on private donors to finance political campaigns. In these countries, fundraising is often a significant activity for the campaign staff and the candidate, especially in larger and more prominent campaigns. For example, one survey in the United States found that 23% of candidates for statewide office surveyed say that they spent more than half of their scheduled time raising money. Over half of all candidates surveyed spent at least 1/4 of their time on fundraising.^[3]. The tactics used can include direct mail solicitation, attempts to encourage supporters to contribute via the Internet, direct solicitation from the candidate, and events specifically for the purpose of fundraising, or other activities.

Most countries that rely on private donations to fund campaigns require extensive disclosure of donations, frequently including information such as the name, employer and address of donors. This is intended to allow for policing of undue donor influence by other campaigns or by good government groups, while preserving most benefits of private financing, including the right to make donations and to spend money for political speech, saving government the expense of funding campaigns, and keeping government from funding partisan speech that some citizens may find odious (see [1]). Supporters of private financing systems believe that, in addition to avoiding government limitations on speech, private financing fosters civic involvement, ensures that a diversity of views are heard, and prevents government from tilting the scales to favor those in power or with political influence.

[edit] Public financing

Other countries choose to use government funding to run campaigns. Funding campaigns from the government budget is widespread in South America and Europe.^[4] The mechanisms for this can be quite varied, ranging from direct subsidy of political parties to government matching funds for certain types of private donations (often small donations) to exemption from fees of government services (e.g. postage) and many other systems as well. Supporters of government financing generally believe that the system decreases corruption; in addition, many proponents believe that government financing promotes other values, such as civic participation or greater faith in the political process. Not all government subsidies take the form of money; some systems require campaign materials (often air time on television) to be provided at very low rates to the candidates. Critics sometimes complain of the expense of the government financing systems. Libertarian critics of the system argue that government should not subsidize political speech. Other critics argue that government financing, with its emphasis on equalizing money resources, merely exaggerates differences in non-monetary resources.

In many countries, such as Germany and the United States, campaigns can be funded by a combination of private and public money.

In some electoral systems, candidates who wins an election or secures a minimum number of ballots are allowed to apply for a rebate to the government. The candidate submits an audited report of the campaign expenses and the government issues a rebate to the candidate, subject to some caps such as the number of votes cast for the candidate or a blanket cap. For example, in the 2008 election, candidates for the Legislative Council of Hong Kong were entitled to a rebate up to HK$11 per vote.

[edit] Regulation

The concept of political finance can affect various different parts of a society's institutions which support governmental and social success.^[5] Correct handling of political finance, impacts a countries ability to effectively maintain free and fair elections, effective governace, democratic government and regulation of corruption.^[5] The United Nations convention against Corruption, recognizing this, encouraged its members to "enhance transparency in the funding of conidatures for elected punlic office and, when applicable, the funding of political parties."^[6] Throughout the world countries have identified the problems which improper use of political finance could entail.^[7] When conducting a study pursuing and understanding of what international civil society has determined integral to regulation of political finance, Magnus Öhman and Hani Zainulbhai identified several common understandings by these organizations:^[7]

1. Money is necessary for democratic politics, and political parties must have access to funds to play their part in the political process. Regulation must not curb healthy competition.
2. Money is never an unproblematic part of the political system, and regulation is desireable
3. The context and political culture must be taken into account when devising strategies for controlling money in politics
4. Effective regulation and disclosure can help to control adverse effects of the role of money in politics, but only if well conceived and implemented
5. Effective oversight depends on activities in interaction by several stakeholders (such as regulators, civil society and the media) and based on transparency.

Their study also affirmed the perspective laid down by the Council of Europe, when discussing the concept of effective regulation of campaign financing: "[We are]convinced that raising public awareness on the issues of prevention and fight against corruption in the field of funding of political parties is essential to the good functioning of democratic institutions."^[7]

[edit] See also

• Investment theory of party competition
• Campaign finance in the United States
• Political donations in Australia
• Political funding in Japan
• Political funding in the United Kingdom
• Campaign finance reform
• Clean elections
• Hatch Act of 1939
• No-bid contract
• Pacific scandal
• Election promise

[edit] References

[edit] Notes

[edit] Sources

• Ansolabehere, Stephen; John de Figueiredo, James M. Snyder, Jr. (2003). "Why Is There So Little Money in U.S. politics?" (PDF). Journal of Economic Perspectives (Massachusetts Institute of Technology) 17 (1): 105–130. doi:10.1257/089533003321164976. http://web.mit.edu/polisci/research/representation/CF_JEP_Final.pdf. Retrieved 2007-03-12. 
• Ohman, Magnus; Zainulbhai, Hani (2009). Political Finance Regulation: The Global Experience. International Foundation for Electoral Systems. ISBN 1-931459-42-8. http://www.ifes.org/files/Political_Finance_Regulation_The_Global_Experience.pdf. 
• Will, George (2005-12-11). "'Don't Ask, Don't Tell' Hypocrisy". The Washington Post. http://www.washingtonpost.com/wp-dyn/content/article/2005/12/09/AR2005120901716.html. Retrieved 2007-03-12. 

[edit] Further reading

• Ackerman, Bruce and Ian Ayres (February 10, 2004). Voting with Dollars. Yale University Press. ISBN 0-300-10149-X. 
• Alexander, Herbert E. "Campaign Financing in International Perspective" in Michael J. Malbin, ed. (1980). Parties Interest Groups and Campaign Finance Laws. American Enterprise Institute. ISBN 0-8447-2167-0. 
• Birnbaum, Jeffrey (June 6, 2000). The Money Men : The Real Story of Fund-raising's Influence on Political Power in America. Crown. ISBN 0-8129-3119-X. 
• Clawson, Dan ; Alan Neustadtl; Mark Weller (May 1998). Dollars and Votes: How Business Campaign Contributions Subvert Democracy. Temple University Press. ISBN 1-56639-626-3. 
• Coate, Steven (2004). Pareto Improving Campaign Finance Policy. American Economic Review. 
• Gill, David & Lipsmeyer, Christine (2005). Soft Money and Hard Choices: Why Political Parties Might Legislate Against Soft Money Donations. Public Choice. 
• Goodliffe, Jay "BYU Syllabus for Money in Politics". Reading List. http://fhss.byu.edu/PolSci/Goodliffe/410/syllabus.htm#Readings. Retrieved Fall 2003.  Extensive list of articles on Money in Politics
• Green, Mark (2004). Selling Out: How Big Corporate Money Buys Elections, Rams Through Legislation, and Betrays Our Democracy. Regan Books. ISBN 0-06-073582-1.  New York mayoral candidate who lost to Bloomberg.
• Malbin, Michael J. (March 2006). The Election After Reform: Money, Politics, and the Bipartisan Campaign Reform Act. Rowman & Littlefield Publishers, Inc.. ISBN 0-7425-3870-2. 
• John Samples (2006). The Fallacy of Campaign Finance Reform. University of Chicago Press. ISBN 978-0226734507. 
• Sandler, Joseph "The Campaign Finance Minefield." An analysis of the impact of the Bipartisan Campaign Reform Act on state and local party committees. Campaigns & Elections Magazine, May 2004
• Smilov, Daniel and Jurij Toplak (2007). Political Finance and Corruption in Eastern Europe. Ashgate Press. ISBN 978-0-7546-7046-9. 
• Smith, Bradley A. (March 1, 2001). Unfree Speech : The Folly of Campaign Finance Reform. Princeton University Press. ISBN 0-691-07045-8. 
• Talbot, Stephen (Producer). The Best Campaign Money Can Buy [TV-Series]. United States: Frontline (PBS Video); Center for Investigative Reporting.
• Ward, Gene. Transparency in Money in Politics: A Comparison of the United States and Canada.  PDF

[edit] External links

• Campaign Finance from UCB Libraries GovPubs
• Center for Competitive Politics
• More on United States campaign law
• Campaign Finance Institute
• Read Congressional Research Service (CRS) Reports regarding campaign finance
• NEWSMEAT campaign contribution search engine
• PoliticalMoneyLine
• OpenSecrets
• Campaign Money Search
• The National Institute on Money in State Politics
• Institute for Law and Politics at the University of Minnesota Law School
• Money and Politics - Political Finance & Public Ethics (IFES) - links to news articles, resources and handbooks on political corruption, political finance and campaign finance issues around the world