Effects of The Proposed Campaign Finance Law
February 15, 2002
Barring any last minute surprises -- including a presidential veto -- a new campaign finance law will soon govern how elections are funded. The prospective law won't take money out of politics, but it will alter the way political money is solicited and spent, primarily so-called "soft money" -- which are donations to political organizations not intended for the direct benefit of individual candidates.
Here are some of the likely effects:
- The treasuries of the two main political parties would no longer have access to unlimited donations from businesses, labor unions and wealthy individuals.
- State parties, on the other hand, would continue to have access to soft money.
- It will pressure corporations to put money into independent political operations -- but makes those dollars more likely to be wasted and more difficult for the press and public to track.
- Hard money donations from executives and professionals to individual candidates would be capped at $2,000 per candidate.
The prospective law would probably reduce the amount of television advertising aired in a campaign's home stretch -- while increasing the investment by both sides in local efforts to get out the vote. As for other effects:
- It will probably make it harder on challengers, because soft money is one of the few sources of political money that benefits challengers almost as much as incumbents.
- It will probably hurt smaller interests because Fortune 500 companies will still have lobbyists.
It may not affect the long-term balance of power between Republicans and Democrats. But observers think it will provide a major boost for President Bush's re-election efforts.
Source: John Harwood and David Rogers, "How the New Law On 'Soft Money' Redirects the Wealth," Wall Street Journal, and Sean Higgins, "New Campaign Finance Law Isn't a Fix, Says Top Official," Investor's Business Daily, both February 15, 2002.
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