Tracing the Money Trail

Here are the main sources of political cash and the amounts given during the 2000 election cycle. Political money falls into one of two categories:

1. “Hard Money” is donated directly to candidates campaigning for federal office or is spent on activities that directly urge voters to support or oppose a candidate for federal office. Hard money is regulated by the Federal Election Commission.

2. “Soft  Money” is donated to political parties, not specific candidates, or is spent on political activities that are not aimed at the general public (for example, messages directed to an organization's internal membership) or that do not expressly advocate for or against a federal candidates (for example, ‘issue ads’ about health care or air pollution.) Although soft money donations to the national parties must be disclosed to the FEC, it is not regulated by the commission.

Hard Money Sources

► Individual Donors ($822.3 million): Rich, elite professionals, businessmen and bankers are the largest single source of political dollars. Forty-six percent of individual donors earn $250,000 or more a year; 90% are white; 80% are men and 66% are self-described conservatives or moderate conservatives. The McCain-Feingold campaign finance reforms will not clamp down on rich donors; indeed they make the role of wealthy individuals in politics even more important.

► PACs ($246.7 million): Nearly 4,000 corporations, trade associations, unions and other groups have registered Political Action Committees with the FEC that collect funds and contribute them to candidates and campaigns. Under federal law, PAC contributions cannot come from corporate profits or union dues. For example, all political contributions by the IAM's PAC (the Machinists Non-Partisan Political League, or MNPL) come from voluntary donations by IAM members.

► U.S. Treasury ($208.4 million): Since 1976, presidential candidates have been able to receive public funds for their campaigns if they agree to certain spending limits.

► Candidate”s Personal Funds ($194.7 million): Candidates may spend their own money or borrow money to finance their campaigns.

► Political Parties ($59.4 million): Major and minor parties contributed a combined $3.7 million to federal candidates, spent $5 million on party activities directly supporting federal candidates and another $50.7 million on activities in coordination with the candidate's campaigns.

Soft Money Sources

► Individual Donors ($177.3 million): to national party committees.

► Political Parties ($433.2 million): The national parties transferred $274.2 million into state and local party committee ‘non-federal’ accounts (for activities that do not directly support or oppose particular federal candidates). They spent another $159 million on issue-oriented ads and educational materials.

► Interest Groups ($417.7 - $467.7 million): Business groups, labor unions, environmental organizations and others donated $317.7 million to national party ‘non-federal’ accounts and spent an estimated $100 million to $150 million on various types of ‘issue advocacy’ and ‘member education.’ The latter activities are difficult to define and track and these are conservative spending estimates.