Elections Policy Case Study #2 S. 4563
A BILL to prohibit corporations from making money contributions in connection with political elections.
Compelling Policy Question: What should be the goal of election policies regulating campaign finance?
Historical Context of S.4563
1884- Republican Candidate for President, James G. Blaine, meets with a number of very wealthy businessmen and political donors at the fashionable New York steakhouse Delmonico’s. The New York World newspaper published a political cartoon the next morning showing Blaine eating with the wealthy men. It implied he was going to give the wealthy political favors in exchange for their support. Blaine lost the election to Grover Cleveland.
1888 - During the election of 1888 the Republican Party’s treasurer William W. Dudley gave state party leaders directions on organizing bribes to voters. He told them to divide undecided voters into “blocks of five”, and assign man with “necessary funds” in charge of each group making sure all of them “vote our ticket”. The paper on which Dudley wrote his instructions was found, and Democrats brought it up in the campaign as evidence of corruption. Republicans still won the election, but the scandal led to a push for election reform. Joseph Keppler’s cartoon, “The Bosses of the Senate” is an example of the public’s opinion of how big companies were influencing politics.
1892-1894- President Grover Cleveland’s chief fundraiser, William C. Whitney, specifically targets the corporate world for campaign donations to fund Cleveland’s 1892 Presidential re-election campaign. Anger towards corporations grew during the 1893-1894 depression, especially when Republican newspapers reported that the American Sugar Refining Company had given $500,000 to Cleveland’s campaign.
1894- New York politician Elihu Root proposed an amendment to the New York State Constitution that would ban corporations from making campaign contributions. In a speech Root delivered explaining the need for a ban he said; “The idea of this section… is to prevent the great moneyed corporations of the country from furnishing the money with which to elect members of the Legislature of this State in order that these members of the legislature may vote to protect the corporations… It strikes, Mr. Chairman, at a constantly growing evil in our political affairs, which has, in my judgement, done more to shake the confidence of the plain people of small means of this country in our political institutions than any other practice which has ever obtained since the foundation of our government.”
1896- During the Presidential campaign in 1896, a millionaire industrialist from Ohio named Mark Hanna becomes Republican candidate William McKinley’s chief fundraiser. Hanna travels to New York City to convince the wealthy industrialists and Wall Street bankers to fund McKinley’s campaign against Democrat William Jennings Bryan. It is estimated a total of $3,000,000 was given to the campaign by the wealthy of New York. This was more than any other Presidential campaign before had ever raised.
1900- After a Senator William E. Chandler from New Hampshire criticises a railroad company in his State for their involvement in State politics, the railroad company supports his opponent for reelection. Chandler lost the race, but before leaving Senate he introduced a bill to prohibit corporations engaged in interstate commerce from donating to election campaigns. The bill was not voted on.
1904- During the 1904 Presidential campaign between Republican Teddy Roosevelt and Democrat Alton B. Parker a group of Wall Street Bankers, leaders of Insurance Companies, and other wealthy Industrialists funded 69% of Roosevelt’s campaign fund.
1904- Wisconsin Governor Robert H. La Follette introduces a bill similar to Chandler’s in the Wisconsin State Legislature. The legislation passed.
1905- In reaction to scandals involving a New York insurance company, the New York State Legislature created a committee to investigate the company’s actions. During its investigation the Armstrong Committee heard testimonies including how much money the Insurance Companies had been giving to Political Campaigns. This included money given to President Roosevelt’s Presidential Campaign. The Armstrong Committee made a report full of suggestions to fix the problems that allowed the scandal to happen. One of the suggestions was a prohibition on corporate contributions to political campaigns.
In President Theodore Roosevelt’s December, 1905 Message to Congress (below) he asked Congress to create a law banning corporate campaign Contributions.
1906 - The New York and Pennsylvania State Governments pass laws prohibiting corporations from making campaign contributions.
1906- Former Senator William E. Chandler (R)New Hampshire convinces Senator Benjamin R. Tillman, (D)South Carolina, to sponsor a bill similar to the one Chandler had first introduced in 1900 banning corporations from contributing to political committees.
Policy Case Study S.4563
S. 4563. A BILL to prohibit corporations from making money contributions in connection with political elections.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That it shall be unlawful for any national bank or any corporation organized by authority of any laws of Congress to make a money contribution in connection with any election to any political office. It shall also be unlawful for any corporation whatever to make a money contribution in connection with any election at which Presidential and Vice-Presidential electors or a Representative in Congress is to be voted for or any election by any State legislature of a United States Senator.
Every corporation which shall make any contribution in violation of the foregoing provisions shall be subject to a fine not exceeding five thousand dollars, and every officer or director of any corporation who shall consent to any contribution by the corporation in violation of the foregoing provisions shall be subject to a fine of not exceeding one thousand dollars.
Section One - Guiding Question: Why do people support restricting who can help fund campaigns?
In President Theodore Roosevelt's Fifth Annual Message to Congress on December 5, 1905, he said...
(modified/link to original)
In political campaigns in a country as large and populous as ours it is inevitable that a lot of money will be spent. This, of course, means that many contributions, and some of them of large size, must be made. In any big political contest such contributions are always made to both sides.
It is entirely proper both to give and receive them, unless there is an improper motive connected with either gift or reception. If a politician is extorted by any kind of pressure or promise is made or implied, then the giving or receiving becomes not only improper but criminal.
All contributions by corporations to any political committee or for any political purpose should be forbidden by law. Directors of companies should not be allowed to use stockholders' money for such purposes. A prohibition of this kind would be an effective method of stopping the evils aimed at in corrupt practices acts. Not only should both the National and the several State Legislatures forbid any officer of a corporation from using the money of the corporation in or about any election, but they should also forbid such use of money in connection with the creation of legislation.
In 1905, William E. Chandler wrote an article in the New York Tribune titled, “Campaign and Insurance Funds". In the article, he said...
(modified/link to original)
After graduating from Harvard Chandler helped organize the Republican Party in New Hampshire. After serving in the Lincoln and Johnson Administrations Chandler was went to Congress to finish the term of a member who died. He served in Congress from 1887 to 1901. He lost his reelection campaign in 1900, when a railroad company he criticized for their involvement in his State’s politics, supported his opponent. Before the end of his term in Senate he introduced a bill to make it illegal for corporations engaged in interstate commerce from donating to election campaigns. Chandler's biography.
Republican government is based upon individual action and freedom of the individual. Gifts for campaign expenses should be made by individuals only. The moment corporations make them, government by men ends and government by soulless corporations wins.
Since nothing was produced by the debate over the well known political contributions by corporations in 1896, the system continued in 1900 and 1904.
This system now exists in a dangerous form in this country. It cannot be shaken off without a popular uprising.
There may be a question whether every individual who gives or receives money for political campaigns should have the fact and the amount made public. But, there is no doubt that it should be illegal to use corporate money to help one political party against another during elections in our so-called “model Republic”.
In 1901 I introduced a bill forbidding corporation election contributions, but Congress did not pass the bill.
Both the open and secret opponents always say there is a better way to do the work, and so little is done. A national act should be passed, but it should not invade State rights. Both parties should unite together in the work of reform.
Joseph H. Gaines (R)West Virginia, Speech to Congress on S.4563, 1907 (modified/link to original)
Before being elected to Congress in 1900, Gaines was a lawyer and the U.S. District Attorney for West Virginia. While in Congress he served as the chairman of the Committee on Election of President, Vice President, and Representatives. His biography
Mr. Speaker, this bill has two parts.
The first will make it illegal for any national bank or corporation to give money to any political campaign. The Federal Government obviously has the right to tell corporations they shall not make any contributions whatever to affect political elections.
The second part of the bill makes it illegal for any State or National corporation, meaning any corporation, to make a money contributions during any Presidential, or Congressional, election.
Perhaps the bill will do some good. It may cure an evil which has been very much complained of in this country. In my opinion, no Federal law will do much to prevent corruption at the polls and the corrupt use of money in elections until the Federal courts are given the power to convict for those offenses. However, Mr. Speaker, the bill should do some good. At least, in my opinion, it cannot possibly do any harm.
The Report from the Committee on Privileges and Elections on Bill S.4563, in1906 said... (modified/link to original)
The Committee on Privileges and Elections was established by a Senate resolution approved March 10, 1871. The committee was in charge of matters such as contested elections for Senate seats, questions regarding credentials of Senators, financing of senatorial elections, and expenses of contestants in contested election cases.
The evils of the use of money in connection with political elections are so generally recognized that the committee deem it unnecessary to make any argument in favor of the general purpose of this measure. It is in the interest of good government and calculated to promote purity in the selection of public officials.
New York Times, Happy Corporations, June 17, 1906 (modified/link to original)
The sun has interviewed a number of representatives of corporations and a number of politicians of both parties about S.4563. The bill is very sweeping. It will cover all important elections.
One "great financial authority who is a Republican" told me; "all the financial men I have talked to have welcomed this legislation. They have the same emotions a peasant would have celebrating his liberation from a tyrannous ruler."
The corporations are happy because if someone asks them for a penny for campaign purposes, they can kick them out of the door. I don't think I have seen some of the rich contributors to political campaigns so happy in years. They will take advantage of the laws forbidding them to give money for political purposes.
This bill will not fix everything, but it will lessen a very mean and sleazy practice of blackmail. Corporations will still find ways to support the party if they want to. But now corporations that have been extorted by politicians will have strong backbones. Parties will now have to fill their coffers by really voluntary contributions. The bill, however, is not yet a law.
New York Daily tribune, Campaign and Insurance Funds, 1905 (modified/pdf of original document below)
The key idea of democracy is the right of each citizen to a free voice in public affairs. Each voter deserves to use his own vote in whatever way he will. He may foolishly vote against his own interests, but he has that right. A more powerful person using other men’s votes, or property, for politics, without their permission, is dangerous to republicanism.
Many New York Life customers probably supported William Jennings Bryan’s 1896 Campaign. They were blind to their own and the country's welfare. But, it was their right to vote as they chose. When the corporation gave money to help defeat their chosen politician it took their votes from their hands.
This is true for all corporate political contributions. From the point of view of public policy, we must regard all such contributions as vicious.
In the United States the government is supposed to be a government of men. A corporation is not a citizen with a right to vote or participate in politics. It is an artificial creation with one purpose. Attempts by it to exercise rights of citizens are a misuse of its power. Its stockholders, no matter how wise or how rich, should be forced to use their political influence as individuals equal with other men. That is the basic idea of democracy, and forgetting that causes many corporation abuses and has led to anger against corporations.
NYTrib ed 9-18-1905 p6.pdf
Mr. Speaker, I have not had time to investigate the constitutionality or the unconstitutionality of this bill. The political history of this Republic during the last few years has shown the need for a law like this.
It is a step in the right direction; but it does not go far enough. This bill should force politicians to apologize to the American People for the money used during the last national election.
My friends of the other side of this Chamber should say to the American people that during the last election they took thousands of dollars from the widows and orphans of this country. They did this by taking money from the insurance companies, who those widows’ and orphans’ ancestors had paid premiums to. They should admit they misused them in for politics. They should now pay back what they took from them wrongfully in the past.
It is a fact that some of the great corporations of this country, in order to corrupt the elections, spent many thousands of dollars.
The Political Parties should show where we got the money, from whom we received it, and how we spent it.
We now call what was done criminal. We recognize the need for this legislation. Let us use our inspiration and work to do right, while we pass this legislation, pay back what has been stolen.
Mr. Speaker, I do not rise to discuss the question of the purity of the elections in the United States. That is a great, big question, and far more important than the one that is directly involved here.
I think it is fair to say only a few of the national banks have ever made contributions to any election. Those banks are interested in the prosperity of the country, and they thought it would not hurt them to make small political contributions.
But we are all now on a virtuous footing. Almost all of us, I think, are going to vote for this bill, even though it may be unconstitutional.
This bill bans contributions made to help secure the election of anybody during State Elections. How that comes under our powers in the Constitution I do not know. I doubt we even have the right to prohibit corporations making contributions to control elections of the Members of this House. Under section 4 of Article: I of the Constitution, States are the ones with the power to make rules about elections for Senators and Representatives. However, Congress may at any time by law make or alter those rules.
Thomas W. Hardwick (D)Georgia, Speech to Congress on S.4563, 1907 (modified/link to original)
Hardwick's biography
On this bill I desire to say this only, that the bill is right, in my judgment, and should pass. It has been carefully considered by the Committee on Elections. The President of the United States has himself recommended its passage in his message to this Congress.
Representative Kiefer doubts this bill’s constitutionality. When corporations are chartered under national laws, Congress clearly has the right to regulate them.
But, Mr. Speaker, I did not rise to defend this bill, because it needs no defense. Every honest man in this country is for it. I doubt any Republican or Democrat can safely afford to face his voters if he votes against it.
The President has progressed a great deal since the last election. He was charged by the Democratic candidate with having received improper contributions from corporations. That charge implied there might have been a promise for what corporations would receive in return for these contributions.
Roosevelt denied it in one of the bitterest statements ever issued to the American public. He admitted that there were such contributions made by corporations; but he denied there was any improper motive or agreement.
Why doesn’t the Republican party give back to the widows and orphans the money that the New York Life Insurance Company paid into your campaign fund? Why don't you do it?
Udo J. Keppler drew a cartoon titled "Everyman" and his dollar - the Republican morality show for Puck Magazine in 1906.
Caption: But the real work of financing the campaign will, as usual, be done behind the scenes.
Library of Congress Summary
Illustration shows James S. Sherman collecting $1 donations for the Republican Party at a fundraising event in a theater; Theodore Roosevelt and Charles W. Fairbanks can be seen in the audience. "Behind the scenes" are J. Pierpont Morgan, Henry H. Rogers, and Edward H. Harriman pouring coins from large money bags into "The Dough Barrel".
In 1899, Joseph Keppler's cartoon, "The Bosses of the Senate" was published by Puck Magazine.
Summary: Keppler's cartoon depicts corporate interests–from steel, copper, oil, iron, sugar, tin, and coal to paper bags, envelopes, and salt–as giant money bags looming over the tiny senators at their desks in the Chamber. Joseph Keppler drew the cartoon, which appeared in Puck on January 23, 1889, showing a door to the gallery, the "people’s entrance," bolted and barred.
The galleries stand empty while the special interests have floor privileges, operating below the motto: "This is the Senate of the Monopolists by the Monopolists and for the Monopolists!"
Udo J. Keppler, At the keyboard, Puck 1905
Library of Congress Summary: Illustration shows Nelson Aldrich and J.D. Rockefeller sitting at a keyboard overlooking Congress in session at the U.S. Capitol; Rockefeller is holding a "Prompt Book" as Aldrich plays the instrument; they are illuminated by the flame of an oil lamp labeled "Standard Oil".
Udo J. Keppler, As seen from the boxes, Puck, 1906
Caption: An act that is sure to get a laugh.
Library of Congress Summary: Illustration shows H.H. Rogers, John D. Rockefeller, John D. Rockefeller, Jr., and a man labeled "Armour", possibly J. Ogden Armour, in a theater box during an opera with two women labeled "Law" and "Justice" singing and dancing on a stage to the direction of a man wearing legal robes and a wig, labeled "The Courts" and holding a violin and bow, in the orchestra pit.
Udo J. Keppler, Bringing in the Teddy-turk, Puck
Library of Congress Summary; Illustration shows a chef labeled "Special Privilege" holding a large platter on which rests a huge turkey with the face of Theodore Roosevelt; he is about to place the platter on a table around which sit several men labeled "Cannon, Rockefeller, Archbold, Haskell, Payne, Dalzell, Elkins, Sherman, Foraker, Harrimen, Day, Rogers" and one unidentified man who looks like Nelson W. Aldrich.
Udo J. Keppler, The making of a senator, Puck 1905
Caption: When will the People Stand from Under?
Library of Congress Summary: Illustration shows Nelson W. Aldrich standing at the top of a human pyramid on a platform labeled "The Senator", on the next level down John D. Rockefeller and a bloated man, typically identified with trusts, are sitting on bags of money on a platform labeled "The Big Interests", below them are men with bags labeled "Graft" and "Dough Bag", standing on a platform labeled "The Bosses", beneath them comes a larger group of men standing on a platform labeled "The State Legislature", and finally at the bottom is a group on a platform labeled "The People, who are being crushed by the weight of those above them.
William Allen Rogers, What Are You Doing Here?, Harper’s Weekly, 1904
Harp Weekly's explanation
Homer Davenport, "Honest Money," the New York Journal, 1896
Davenport's cartoon shows Mark Hanna carrying bags of money he collected on Wall Street for William McKinley's 1896 Presidential campaign.
Walt McDougall, “Belshazzar Blaine and the Money Kings”, New York World, 1884
Harpweek Explanation , and larger picture, of "Belshazzar Blaine and the Money Kings"
Section Two - Guiding Question, Why do people oppose restricting who can help fund campaigns?
Mr. Speaker, I am against the passage of this bill for two reasons:
First, I do not believe the Government of the United States has the constitutional authority to control all elections in the country.
Second, I do not believe the Government of the United States should make it so that only a rich man can run for office. The name of this bill should be, “a bill to prevent a poor man from holding office in the United States.”
There are not more reasons why a corporation should not be allowed to contribute to political campaign funds, than there are reasons why an individual should not.
It is wrong to not let corporations contribute to a campaign fund, when individuals are rewarded, both here and overseas, for great campaign contributions.
I know of the popular demand of the country that we shall prevent the influence of corporations. The influence of corporations should be controlled. However, I will be courageous and vote in the way I think is right on this bill.
Llewellyn Powers (R)Maine, Speech to Congress on S.4563, 1907 (modified/link to original)
Powers first served in Congress from 1877 to 1879. He was Governor of Maine from 1897 to 1901, and then was elected to Congress in 1901.
I know that in these days of wonderful reform we are all very eager to get something of this kind passed.
However, I don’t want to pass an act that would mean if I was a director of a bank, and that make made an illegal contribution, that I would be the one held criminally responsible unless I had protested against what the bank was doing.
I feel this way, even though this is a time of great reform.
I do not know that I care for any more.
I think that the House will pass the bill, and there is no use of my protesting against it.
Charles H. Grosvenor (R)Ohio, Speech to Congress on S.4563, 1907 (modified/link to original)
Grosvenor was a lawyer who joined the Union Army during the Civil War. After the war he became involved in politics and first served in the House from 1885 to 1891. He lost the election of 1890, but would be elected again in 1893. His biography
I do not rise to discuss the merits or demerits of this bill. I shall vote for it. However, no good will come of this legislation. It does not go far enough. If you want to purify the politics of this country and stop the corrupting of voters, you must say no candidate, or any other man shall spend any money.
Why pick on a corporation, which is an artificial person, and forbid them from contributing to the corrupting of the people of the country, when you let the rich men put their money in campaigns? You should go further and say no man can be a candidate for office unless he proves to a nonpartisan committee that he does not have a cent on God's earth and cannot corrupt anybody. You will make Congress a club of millionaires.
Why not say that State corporations shall not earn more than a certain amount? Why stop? This is a step in the direction of the abolition of State lines and State rights, and is the most startling of anything we have heard in Congress.
I shall vote for the bill, and I shall do it simply, as very often it has been my duty, to help give the American people an opportunity to test the thing which, in my judgment, will be a total and significant failure.
New York Daily tribune, Campaign and Insurance Funds, 1905 (modified/pdf of original document below)
The Armstrong Committee was an investigation done by the New York State Government. They were investigating stories that had been told about corrupt actions of Insurance Companies in New York. The full title of the Committee was the Joint Committee of the Senate and Assembly of the State of New York to Investigate and Examine into the Business and Affairs of Life Insurance Companies Doing Business in the State of New York
Nobody who remembers the 1896 McKinley Campaign will find it difficult to understand why the officers of insurance companies made the political contributions found by the Armstrong Commission. A majority of those with businesses in charge of protecting people’s property hoped for the election of McKinley. Their actions were a display of patriotism rising above politics.
However mistaken may have been their methods, there is no reason to doubt that the officers of the New York Life honestly felt that they were protecting the interests of their customers. They thought spending money to prevent financial disaster and national dishonor, was as justifiable as spending money building vaults to protect their assets. If they have the right to use funds to protect their customers’ interests, then the motives behind their political contributions should not be questioned.
Whether or not an election would impact the nation’s prosperity and stability is a matter of opinion. As long as the opinion is honest, then contributions made to serve the customers, and not just help the insurance officers or their friends and relatives, then the transaction should not be considered bad.
NYTrib ed 9-18-1905 p6.pdfUdo J. Keppler's cartoon "Putting the screws on him" was published by Puck Magazine in 1904 .
Library of Congress Summary: Illustration shows George B. Cortelyou turning a vice to squeeze money for Theodore Roosevelt's campaign from a bloated man labeled "The Trusts".
Results of the Debate:
Due to pressure from the public, S.4563 became law. S.4563 became known as the “Tillman Act”, named for Senator Tillman who introduced the bill. (Even though the bill was really created by Senator William E. Chandler, remember the one who lost his job because the railroad he criticised funded his opponent).
The biggest impact of the Tillman Act was it made illegal for corporations and national banks to give campaign contributions to politicians running for Federal Level office (President, Senator, Representative). However, the law did not create a strong enforcement policy, and was easily worked around. Remember, that the Act made it illegal for the contributions to come directly from a corporation. It was not technically illegal for the corporation to give money to one of their employees, and then have that person give money to the candidate.
Three years after the Tillman Act passed Congress passed the Federal Corrupt Practices Act was passed. The Federal Corrupt Practices Act required the Political Parties to make their Campaign finances public (meaning they had to tell how they were spending their money), and it established spending limits for House races. One year later, Senate and primary candidates also were required to disclose their finances, and expenditure limits were set for all congressional candidates.
1921: In Newberry v. United States, the Supreme Court rules that the Federal Corrupt Practices Act is unconstitutional because the Constitution does not grant Congress the authority to regulate political parties or federal primary elections. As a result, spending limits were not longer required in Congressional elections.
1925: Congress amends the Federal Corrupt Practices Act to include a ban on any corporation contribution to a federal campaign, candidates must disclose the source of contribution greater than $50, patronage is prohibited, and Senate candidates can spend $0.03 for each voter based on the previous election up to $25,000. House candidates are limited to $5,000.
1935: The Public Utilities Holding Act is passed, prohibiting public utility companies from contributing to federal campaigns.
1939: The Hatch Act is passed, which bans most federal employees from contributing to candidates in national elections and from participating in political activities or campaigns.
1943: The Smith-Connally Act is passed, which prohibited unions from contributing to federal candidates. Prior to this law, unions had been using dues as political donations. The first political action committee (PAC) is established by the Congress of Industrial Organization, and union members voluntarily contribute to the PAC independent of the union.
1947: The Taft-Hartley Act is passed, which banned corporations and unions from even making independent expenditures in federal political campaigns. As long as candidates promised not to use their primary money during the general election campaign or collect private donations, they could campaign with publicly funded dollars.
1967: Congress officially begins to collect campaign finance reports, despite it being law for nearly 50 years.
1971 Election laws: The Federal Election Campaign Act (FECA) of 1971 and the 1971 Revenue Act were passed, initiating fundamental changes in campaign finance laws. FECA required full reporting of campaign contributions and expenditures and also limited spending on media advertisements. In addition, FECA provided the legislative framework for PACs established by unions and corporations, which allowed unions and corporations to use treasury funds to establish, operate and solicit voluntary contributions for the PAC to be used in federal races.
The Revenue Act allowed citizens to check a box on their tax forms authorizing the federal government to use one of their tax dollars to finance Presidential campaigns in the general election. From the time this was first implemented in 1973, enough money had been collected to fund the 1976 election.
The Clerk of the House, the Secretary of the Senate and the Comptroller General of the General Accounting Office monitored and enforced FECA, while the Justice Department was responsible for prosecuting violations.
1974 Amendments: Following the documentation of campaign abuses in the 1972 elections, the Federal Election Commission (FEC) was established and given jurisdiction in civil enforcement, authority to write regulations and responsibility for monitoring compliance with FECA. The President, Speaker of the House and President pro tempore of the Senate were each allowed to appoint two voting members of the commission, and the Secretary of the Senate and Clerk of the House were designated as nonvoting Commissioners.
The 1974 amendments also provided for partial Federal funding, in the form of matching funds, for Presidential primary candidates. Public funding was also extended to political parties to finance their Presidential nominating conventions. Congress also enacted strict limits on both contributions and expenditures for all federal candidates and political committees involved in federal elections.
Buckley v. Valeo: Portions of the 1974 amendments were challenged as unconstitutional, and a lawsuit was filed by Senator James L. Buckley against the Secretary of the Senate, Francis R. Valeo. The Court upheld contribution limits, but overturned expenditure limits, saying that limiting expenditures would limit the quantity of campaign speech, which in turn violated First Amendment rights. In addition, provisions of the law regarding public funding, disclosure and record keeping were upheld. The Court also found that the method of appointing members to the FEC violated the principle of separation of powers.
1976 Amendments: In response to the Court's ruling, Congress repealed expenditure limits and revised the method of appointing Commissioners. Beginning in 1976, the President appointed six Commissioners, to be confirmed by the Senate. These amendments also included provisions to limit the scope of PAC fundraising by corporations and labor organizations by specifying who could be solicited for contributions, and how those solicitations could be conducted. In addition, a single contribution limit was adopted for all PACs established by the same union or corporation.
1979 Amendments: Following the 1976 and 1978 elections, Congress further amended the law to include provisions to simplify reporting requirements, encourage party activity at state and local levels and increased public funding grants for Presidential nominating conventions.
Post Federal Elections Campaign Act
1990: The Supreme Court ruled on Austin v. Michigan Chamber of Commerce, stating that Michigan's law banning corporations from using company money for independent expenditures was constitutional.
1992: President George H.W. Bush vetoed a bill that sought to provide partial public financing for congressional candidates.
2002: The McCain-Feingold Bipartisan Campaign Reform Act (BCRA) was passed, which sought to limit the use of "soft money." Soft money is money raised by national parties and political action committees for "get out the vote" campaign efforts and other organization-building activities. This money wasn't regulated by the federal government, and parties were raising unlimited funds for these activities but using them for purposes aside from voter registration. Notably, 501(c) and 527 organizations were exempted from the soft money ban, though they were banned from running ads prior to primaries and elections, and from providing direct advocacy for a candidate.
2003: The BCRA was sent to the Supreme Court via suits filed by Kentucky Senator Mitch McConnell (R), the California Democratic Party and National Rifle Association, under the complaint that the law was too broad and limited their First Amendment rights. The Court upheld the law in McConnell v. The Federal Election Commission.
2006: The Supreme Court ruled Vermont's strict caps on campaign contributions unconstitutional in Randall v. Sorrell, saying it violated the First Amendment.
2007: The Supreme Court reversed their on issue ads in McConnell v. Federal Election Commission in Federal Election Commission v. Wisconsin Right to Life, Inc, saying that limits on electioneering spending by nonprofits were unconstitutional.
2008: Senator Barack Obama became the first presidential candidate from a major party not to take public financing for the general election, citing a broken system for his actions.
Citizens United and McCutcheon
2010: In Citizens United v. FEC, the Supreme Court held that independent expenditures by corporations and labor unions were protected by the First Amendment, which struck down BCRA provisions that banned these types of expenditures. A few months later, the decision from Citizens United was applied to Speechnow.org v. FEC in the D.C. Circuit Court of Appeals. Judges decided arguments that unlimited independent expenditures would lead to corruption were invalid after the Citizens United decision.
2012: For the first time, both presidential candidates did not accept public financing. Also, the Supreme Court decided that Citizens United applied to Montana's 1912 legislation banning direct corporate political spending in American Tradition Partnership v. Bullock.
2014: The recent Supreme Court decision in McCutcheon v. FEC ruled that aggregate contribution limits infringed on First Amendment rights. This decision removes a cap on the amount of money any single donor, including PACs, can give to candidates or party committees. Previously, the limit had been a total of $48,600 every two years for all federal candidates and an aggregate of $74,600 to political parties and committees. There is no limit to the number of PACs that can exist, so donors could theoretically increase their contributions to certain candidates considerably if they had enough PACs supporting them. The base limits for campaign contributions of $2,600 for individual candidates and $5,000 for PACs remain in effect.