Table of Contents
What is the Bipartisan Campaign Reform Act of 2002?
The Bipartisan Campaign Reform Act (a.k.a. the BCRA, or the McCain-Feingold Act) refers to a 2002 U.S. federal law that amended established campaign finance laws such as the Federal Election Campaign Act of 1971.
Soft money refers to limitless political contributions that are largely unregulated as they do not go directly to an election candidate. The funds instead go to a party committee who can use them for ‘party-building activities’ (e.g. issue advocacy advertisements). McCain, Feingold, as well as other members of Congress, sought to prohibit soft money contributions in order to limit the influence of big money on elections.
Issue advocacy ads, a form of ‘electioneering communications,’ proliferated during the 1996 Presidential election. The BCRA outlawed any advertisement that (1) named a federal candidate within 30 days of a primary or caucus or 60 days of a general election, and (2) was funded by a corporation/union/group, or with their general treasury funds.
The Supreme Court eventually overruled the limits on electioneering communications with its landmark 2011 Citizens United v. FEC ruling.
The Zero Theft Movement is dedicated to eliminating the rigged parts of the U.S. economy in order for the healthy, ethical parts to thrive. Our elections must remain safe, transparent, and democratic, not decided by big money. That’s a sure way to create a plutocracy. The BCRA was one way to possibly limit the influence of money on elections but perhaps violated free speech rights.
The Technology CEO Council, formed by chief executives from Motorola, Dell, and Intel, published a report in October 2010 on inefficiencies in government contracting supply chains. The council estimated potential savings over ten years could exceed $700 billion, given the streamlining of the supply chain and the elimination of fraud.
If the government does not put in an effort to streamline their contracting supply chains, are they ripping off the public?
Why Enact the BCRA?
To trace the history of the BCRA, we actually need to go back to the Court’s ruling on the Buckley v. Valeo case in 1976. One particular footnote, in fact, created a massive loophole, which would only be exploited twenty years later, during the 1996 election cycle.
The use of the loophole and a string of scandals, some related to the bursting of the dotcom bubble, would motivate lawmakers to push for reform with the BCRA.
Footnote 52 of Buckley v. Valeo
In their ruling, the Court differentiated between express advocacy advertisements and issue advocacy advertisements. While the former had to abide by federal campaign regulations (e.g. contribution limits, no corporate/union contributions, public disclosure of the funding source(s)), the latter could not be regulated under free speech laws.
But what’s the difference between the two?
In footnote 52 of the Buckley decision, the Court made an attempt to distinguish express advocacy from issue advocacy. The footnote defined express advocacy as any advertising using clear expressions of support or opposition of a political candidate such as “vote for,” “elect,” “support,” “vote against,” “defeat,” or “reject.” Issue advocacy, on the other hand, refers to political advertising focused on “broad political issues rather than specific candidates.” It does not attempt to persuade the public of particular electoral outcomes but rather seeks to highlight broader political or social issues.
Intended as general guidelines, these phrases instead became the ‘Eight Magic Words.’ Specific words or phrases to avoid in order to create unregulated issue advocacy advertisements that support or criticize a specific political campaign or candidate.
The Advertisement Battle
Surprisingly enough, it took two decades until groups and political campaigns actually tested to see if they could find a loophole to create issue advocacy advertisements (again, unregulated due to free speech protections) for or against a specific candidate.
And the task proved quite simple. Don’t use any of the Eight Magic Words.
You can see the sudden uptick in soft money contributions for the 1996 election cycle in the table below.
Soft money spending during election years (1992-2002)
The University of Pennsylvania’s Annenberg Policy Center published a ‘catalogue’ tracking issue advocacy advertising during the 1996 elections. The document marks the sudden and marked shift in advertising spending by candidates ($400 million of $1 billion total spent) and political organizations ($135-$150 million).
Political campaigns, candidates, and organizations from both sides of the political spectrum appeared to share the belief that winning the advertisement battle would greatly increase their chances of winning their elections. The barrage of advertising became a motivating factor for Senators Feingold and McCain’s BCRA.
Numerous scandals, both in the political and business spheres, further stoked the flame for major reform.
From the 1996 elections onwards, a chain of high-profile scandals seriously damaged the public’s confidence in the government. Reports of Buddhist temple fundraisers and the use of the Lincoln Bedroom as a room for special guests sparked outrage. President Bill Clinton got impeached in 1999 and on his way out, he made a number of dubious pardons for the rich and powerful.
On the business side, the surge of high-risk, speculative investing in internet and technology startups eventually led to massive collapse. The technology-heavy index NASDAQ quintupled between 1996-2000 and plummeted back down between 2000-2002.
From Vishal Noel on Medium
According to CNN, venture capitalist firms invested $35.4 billion in U.S. companies in 1999. 90% of all these investments had reportedly gone to technology companies. But many of these startups used their funding to market their underdeveloped or even non-existent products, rushing to go public as quickly as possible and cash out.
The funding soon dried up, and many internet businesses had little to show for all the money they’d received. This hurt markets considerably, as suggested in the graph above.
This widespread failure came with a few massive companies allegedly attempting to hide the damage, in the Worldcom scandal and Enron scandal. Investors lost an estimated $5 trillion, and the public had generally grown disillusioned with their future prospects and the government.
Lawmakers knew they had to act. Thus, enter the Bipartisan Campaign Reform Act.
In 1996, The New York Times reported that thirty brokerage firms paid about $900 million to settle the civil suit contending they “schemed with one another for years to fix prices on the NASDAQ stock market.” They allegedly did so by not using odd-eighth NASDAQ quotes, skimming profits off of marginally larger quarter quotes.
See what the ZT community has uncovered about the matter…
Passing the McCain-Feingold Act(?)
On January 22, 2001, Senator John McCain appeared on Larry King Live to announce he, along with Senators Feingold and Cochran (R), had put a version of the Bipartisan Campaign Reform Act in the hopper on Capitol Hill.
The House vote
The bill passed the House on February 14, 2002, by a vote of 240-189. Out of three options, the Shays-Meehan bill was the measure that actually received enough support in the House. Thus, in truth, the BCRA currently in place is not the McCain-Feingold Act.
The Senate vote
The Bipartisan Campaign Reform Act passed the Senate 60-40, on March 20, 2002. Of the 60 ‘yay’ votes, 48 came from Democrats, 11 from Republicans, and one from an independent. The 40 ‘nay’ votes came from 12 Democrats and 38 Republicans.
The presidential signature
“I believe individual freedom to participate in elections should be expanded, not diminished; and when individual freedoms are restricted, questions arise under the First Amendment. I also have reservations about the constitutionality of the broad ban on issue advertising, which restrains the speech of a wide variety of groups on issues of public import in the months closest to an election. I expect that the courts will resolve these legitimate legal questions as appropriate under the law.”
And “resolve these legitimate legal questions” the Court did.
Amendments to the BCRA
Two landmark court rulings significantly loosened regulations established by the BCRA:
- Citizens United v FEC
- McCutcheon v FEC
Citizens United v. Federal Election Commission
While the restrictions on issue advocacy advertising had been overruled, the Court upheld the prohibitions against soft money and direct contributions by corporations to political campaigns/candidates. Disclaimer and disclosure requirements on the sponsors of political advertisements also remained in law.
The Court discounted the possibility that loosening regulations would cause corruption in elections. Particularly due to some of the disclaimer and disclosure requirements, as well as the increased public access to government records with the internet. Instead, its ruling has arguably led to the explosion of ‘dark money,’ limitless and anonymous campaign contributions that could actually come from anywhere, including foreign powers.
McCutcheon v. Federal Election Commission
On April 2, 2014, the BCRA took another hit when the Supreme Court ruled 5-4 that the biennial aggregate contribution limits violate the Constitution. The BCRA had established regulations limiting the total amount donors could contribute to federal candidates in a two-year election cycle to $123,000.
The Zero Theft Movement does not have any interest in partisan politics/competition or attacking/defending one side. We seek to eradicate theft from the U.S economy. In other words, how the wealthy and powerful rig the system to steal money from us, the everyday citizen. We need to collectively fight against crony capitalism in order for us to all profit from an ethical economy.
Terms like ‘steal,’ ‘theft,’ and ‘crime’ will frequently appear throughout the article. Zero Theft will NOT adhere strictly to the legal definitions of these terms (since congress sells out). We have broadly and openly defined terms like ‘steal’ and ‘theft’ to refer to the rigged economy and other debated unethical acts that can cause citizens to lose out on money they deserve to keep.