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Soft Money

Soft Money

Soft Money research papers look at the campaign finance process and discuss presidential politics. Custom written and focused on soft money and politics, Paper Masters help you understand the process of financing a campaign.

Political party soft money are funds raised by the national parties in amounts otherwise forbidden by FECA. In accordance with state law, "these funds are transferred to state and local parties for party-building activities, overhead expenses, and issue ads." Certain corporate and labor union activities are exempt from FECA regulation and soft money can be used for these purposes.

For over a quarter century Congress has grappled with the seemingly intractable problem of campaign finance reform. The current focus is on "soft money," funds raised and spent according to applicable state laws, which the Federal Election Campaign Act (FECA) prohibits being spent on federal elections directly. There are three major types of soft money:

  1. Political party
  2. Corporate and labor union
  3. Issue advocacy communications.

By contrast, "hard money" funds are donated by an authorized individual, acting independently, expressly for the purpose of electing or defeating a clear identified candidate. Soft money is significant because "many states permit direct union and corporate contributions and individual donations in excess of $25,000 in state campaigns, all of which are forbidden in federal races".

Many political observers see limitations on campaign contributions through the lens of the practical outcome of such efforts. While there have been countless expressions of the belief that contributions are corrupting, as a practical matter, individual large corporations (e.g., Colgate-Palmolive) spend more money annually on advertising soap than the United States spends on advertising candidates and issues in a presidential election year. More to the point, contribution limitations appear to inherently favor incumbents over challengers.

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