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senators in 1913, much of the public saw the U.S. Senate as a “millionaire’s club,” with
seats bought by wealthy individuals or controlled by special interests.18 The most
enduring concern, though, has been the growing role of campaign contributions in
electoral politics and the influence that such money may have on public policy.
During the mid-nineteenth century, as election costs increased, candidates came to rely
more and more on wealthy individuals to fund their campaigns. Between 1890 and the
1920s, corporations—particularly those in the banking sector and the railroad industry—
began to fill campaign coffers.

In the 1904 presidential election campaign, Democratic candidate Alton Parker accused
his Republican opponent, Theodore Roosevelt, of accepting large contributions from
corporations, and alleged that he was beholden to his donors’ interests. After the election,
several businesses did admit to contributing funds. Roosevelt, embarrassed by the
revelation, supported the passage in 1907 of the Tillman Act, the country’s first campaign
finance reform bill. The act outlawed corporate campaign contributions, although
donations from the individuals who ran the companies were still unrestricted. The Federal
Corrupt Practices Act (FCPA) followed in 1910, requiring candidates and parties to report
all contributions and expenditures. In 1925 the FCPA was strengthened, and in 1940
Congress for the first time limited individual contributions to political campaigns.

Soon afterward, corporations and labor unions began forming Political Action Committees
(PACs) to funnel funds to candidates. Although for many years PACs were resented for
their growing influence over the electoral and policy-making processes, no further
significant reforms were adopted until the Federal Election Campaign Act (FECA) of 1971.
FECA and its subsequent amendments limited the amount of money that PACs, parties,
and individuals could donate to any particular candidate in a given election cycle. The
amendments also extended the ban on direct contributions to include foreign governments
and their nationals, limited the ability of advocacy groups to act on the behalf of a
particular candidate, provided for partial public funding of presidential campaigns, and
created the Federal Election Commission (FEC) to enforce federal campaign finance laws.
In Buckley v. Valeo (1976), however, the Supreme Court restricted the FEC’s ability to
regulate advocacy groups.
Over the next quarter century, the number of PACs exploded and campaign spending
accelerated. Interest groups began pouring loosely regulated “soft money” into political
parties. Soft money could not be used to expressly advocate for the election or defeat of a
candidate, but it was otherwise unrestricted, and the parties put it to work for their
candidates through creative “issue advocacy” and “party building” efforts. In 2002, after a
six-year crusade by Republican Senator John McCain of Arizona and Democratic Senator
Russ Feingold of Wisconsin, Congress passed and President Bush signed the Bipartisan
Campaign Reform Act (BCRA), which prohibited parties from accepting unlimited
contributions and limited the activity that could be described as issue advocacy. However,
in McConnell v. FEC (2003), the Supreme Court struck down the additional restrictions on
advocacy groups, citing First Amendment concerns.
Despite the enactment of the BCRA, the cost of running for public office continues to grow.
The Center for Responsive Politics estimates that candidates, parties, and interest groups
spent $2.8 billion on the 472 federal campaigns of 2006, a 27 percent increase over the
pre-BCRA midterm elections of 2002.19 In 2004, a presidential election year, $4.2 billion

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