The Role of Money in U.S. Elections

Sep 7, 2024

Lecture Notes: Money in U.S. Elections

Introduction

  • Speaker: John Dorman, Senior Politics Reporter at Business Insider
  • Topic: Influence of money in U.S. elections, with focus on big donors and fundraising.

Historical Context

  • 2012: First time both presidential campaigns (Obama vs. Romney) raised over $1 billion.
  • 2020 cycle: $14.4 billion raised in total for congressional and presidential races.

Impact of Campaign Spending

  • General Trend: Candidates who spend more money typically win.
    • 2022 House races: 94% of big spenders won.
    • 2022 Senate races: 82% of big spenders won.
  • Exception: Presidential campaigns can differ. Example: 2016, Clinton raised more but lost to Trump.

Allocation of Campaign Funds

  • Spending areas include rallies, office openings, staff hiring, consulting fees.
  • Major spending on advertising (direct mail, TV, radio, social media).

Fundraising in Presidential Campaigns

  • Fundraising is critical to campaign success.
  • Example: Biden's campaign struggled after losing major donors.

Current Fundraising Landscape

  • 2024 Presidential Race: Immense fundraising already.
    • Kamala Harris: Raised $310 million in July, $377 million cash on hand.
    • Donald Trump: $327 million cash on hand.
    • Democrats currently have a $15 million advantage.
  • Motivating Events: Announcements and strategic moves, e.g., selection of running mate can dramatically boost fundraising (e.g. $20 million raised by Act Blue after Tim Walz was announced as Harris's running mate).

Sources of Donations

  • Types:
    • Individual contributions (strict federal limits: $6,600 per cycle).
    • PACs (Political Action Committees) with $5,000 limit per candidate.
    • Super PACs (unlimited contributions).
  • Importance of wealthy donors and small-dollar donations.

Significant Donors and Their Impact

  • Examples of Big Donors:
    • George Soros: $60 million for 2024, $170 million in 2022 cycle.
    • Elon Musk: Allegedly supporting GOP efforts, specifics denied.
    • Reed Hastings: $7 million to Harris-affiliated Super PAC.
    • Timothy Mellon: $50 million to pro-Trump Super PAC.
    • Linda McMahon: $10 million to pro-Trump Super PAC.

Influence of Donations on Policy

  • Policies can reflect donors' interests, e.g., Trump's support for fossil fuels aligns with donations from oil and gas interest groups.

Public Opinion

  • 72% of Americans want limits on campaign contributions.
  • Money's role is significant in the current political system.