The Role of Campaign Finance in Elections

When running for public office, individuals will attempt to maximize the contributions they receive as a means to help further their campaign. This brief will cover the history of campaign financing, the policy that surrounds it, and other policy options. This allows us to understand the current and desired impact of campaign financing on elections.

Published by


February 12, 2023

At YIP, nuanced policy briefs emerge from the collaboration of six diverse, nonpartisan students.

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Federal elections occur every two years in which there will be midterm elections and every four years in which there is the presidential election. Campaign financing can play a major role in the publicity and outreach a given candidate has. It is important to understand the role the campaign financing serves and the real world implications they have, especially considering the midterm elections just passed.

Pointed Summary
  • Recent midterm elections
  • Discrepancies in campaign financing 

As we know, the midterm elections just ended in November. As a result, the Senate is now split between Republicans and Democrats while Republicans hold an eight seat lead in the house. The partisan makeup of the congressional houses is vastly important when it comes to what legislation will pass and what changes will be made. Campaign financing is a way for certain candidates to get an upper hand on their opposition.

They can make more appearances, purchase more commercials, and make themselves more known to voters. The amount of money being put toward these campaigns is constantly growing as seen in the fact that “The 2022 elections are expected to cost over $16.7 billion, making them the most expensive midterms ever.” The recency of these elections makes a deep dive into this topic of utmost relevance. 

As noted before, campaign financing can serve as a means to give a candidate a sizable advantage in an election. This brings to question the fairness of the financing when there are discrepancies that exist. This is one of the major reasons the incumbent advantage exists, as they have a much easier time getting contributions compared to someone who’s just beginning their political career.

As found by Open Secrets, this past election, incumbents received an average of $26 million in funding while open and challenges received just over $1 million on average. This illustrates the obvious discrepancies that exist in campaign financing which further calls to question the fairness of said financing. Further, it warrants an exploration into the complete role and overall effectiveness of said financing. 

The Economist analyzes that as more races become sensationalized, candidates are changing how they advertise and fundraise. Software like WinRed for Republicans and ActBlue for Democrats have made it easier for smaller donors to contribute.

But wealthier donors like billionaire Peter Thiel, former FTX CEO Sam Bankman-Fried, and quant trader Jeffrey Yass have fueled the increase as well. Tighter restrictions from Facebook and YouTube have pushed advertisers toward streaming and TV, allowing them to target audiences more directly.

Why have midterms become so expensive? There’s a clear incentive: OpenSecrets, a nonpartisan research group that tracks money in politics, explains that as of November 10, 96% of races called were won by the biggest spender. Over time, this has stayed consistent.

In the House, more than 90% of candidates who spend the most win. From 2000 through 2016, there was only one election cycle where that wasn’t true: 2010 at 86%. But FiveThirtyEight notes that victory isn’t a result of the money; instead, winning draws the money. Donors are more likely to give their money to candidates who appear like winning candidates, judging off of hard-to-measure characteristics like quality or enthusiasm.

While most studies show that money actually buys few votes, it still matters: fundraising remains predictive of success in Congressional elections.

Current Stances

Campaign finance reform is an ongoing discussion for legislators. This past election cycle, OpenSecrets traced over $295 million to party-aligned dark money groups. These groups are not obligated to report their spending to the Federal Elections Commission (FEC). In response to concerns of dark money pouring in from foreign governments and corporations to influence elections, like Russia in 2016.

Senator Sheldon Whitehouse (D-RI)  introduced the DISCLOSE Act in September. This would require an entity that receives more than $10,000 in an election cycle from a single source to publicly identify that source. It would also strengthen restrictions for overseas entities.

Tried Policy

The Supreme Court has played an outsized influence on campaign finance regulation. After the Watergate scandal, Congress attempted to regulate campaign finance via amendments to the Federal Election Campaign Act of 1971. These were struck down by the Supreme Court in Buckley v. Valeo, which allowed the wealthy to spend as much as they wanted on elections. Citizens United v. FEC further expanded the right to spend to corporations. This decision highlighted that the Supreme Court views money as First Amendment-protected speech.

Policy Problem


Throughout all of American history, the main stakeholders in campaign finances have been lobbyist groups such as Political Action Committees and Special Interest Groups. According to OpenSecrets, out of the $8.9 Billion spent in the 2022 midterm elections, close to $7.5 Billion, or about 84 percent of all campaign spending, came from lobbyist groups. 

Risks of Indifference

What this means is that in the United States, elected officials rely heavily on a small number of donors to get elected. Without campaign finance reforms, politicians can write bills, pass policies, and vote on legislation that don’t necessarily benefit their constituents, but rather those with the money to back them and their campaigns. 

Nonpartisan Reasoning

The only way to produce any meaningful campaign finance reform is on the national level. This is because the majority of states already have some limitations on campaign finances in order to limit the power interest groups have on state-level offices. However, because the main crux of campaign reform has to do with Congressional or Presidential races, the only way any change can occur is if it occurs on the national level.

This type of bipartisan coalition building in regard to campaign finance reform is unlikely to happen again, however. This is due to the fact that after Citizens United v FEC, a precedent was set that campaign reform should be in the hands of the courts rather than the legislature or the executive.

Policy Options

The most impactful government action regarding campaign finance is the Supreme Court decision in Citizens United v FEC. Prior to this case, the government was able to restrict donations from wealthy donors and corporations, limiting the influence of one individual on any given election. In a 5-4 decision, the court overturned this proposition, ruling that the First Amendment protects political expenditures under the freedom of speech clause.

As a result, the government is no longer allowed to restrict corporate or individual contributions to campaigns, thus allowing unlimited financial influence on elections. Since the decision, interest groups have spent $4.4 billion on campaigns, and campaign expenditures have grown tremendously: 86% of all donations in the past 30 years occurred in the 10 after Citizens United (Rep. Steny Hoyer).

The creation of super PACs — a political action committee which can contribute unlimited amounts of money — doubled from 2014 to 2018 (Center for Responsive Politics). However, in March 2019, House Democrats passed The For the People Act, a bill which aimed to curb the effects of the Court’s decision and reinstate contribution limits.

The Act bans foreign money in campaigns, requires organizations to disclose all of their donors and expresses disdain for outside influence in our elections. In spite of attempted reform, dark money and the influence of big donors remained a problem in the 2022 election, as a result of a lack of contribution limits and government regulation of political funding. Had the court ruled differently in Citizens United, it is probable that this would not be such a prevalent issue today.

A significant proportion of the US’s electoral races are no longer being decided solely by the candidate’s policies or the will of American voters, but rather by which candidate can cater to the most influential donors. The prevalence of campaign funding distorting elections has only increased with the rise of super Political Action Committees accepting unlimited campaign contributions.

The issue is exacerbated by Supreme Court precedents blocking any policy changes in the legislative and executive branch, meaning the public has no way of pushing for change of the regulations of campaign finance. Without significant campaign finance reform, money, rather than the will of the American people, will be the deciding factor in many US elections.


The Institute for Youth in Policy wishes to acknowledge Brady Zeng, Elizabeth Miller, Nolan Ezzet, and other contributors for developing and maintaining the Policy Department within the Institute.

Works Cited


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  13. Fundraising remains predictive of success in Congressional elections. (2022, September 1). The Economist. Retrieved November 22, 2022, from
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  15. S.4822 - 117th Congress (2021-2022): DISCLOSE Act of 2022 | | Library of Congress. (n.d.). Retrieved November 22, 2022, from
  16. Candidates and political action committees spent nearly $17 billion on midterms. (2022, November 10). NPR. Retrieved November 22, 2022, from
  17. “Total Cost of 2022 State and Federal Elections Projected to Exceed $16.7 Billion.” OpenSecrets News, November 21, 2022. 
  18. “Out-of-State Money Is Flooding Midterm Races - and Drowning out Local Issues.” Bloomberg. Accessed December 7, 2022. 
  19. “State-by-State Comparison of Campaign Finance Requirements.” Ballotpedia. Accessed December 7, 2022. 
  20. “Citizens United v. FEC.” Accessed December 7, 2022.

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Humzah Ahmad

Economic Policy Analyst

Humzah is a high school senior from Texas who has developed an interest in U.S. economics, specifically in the realm of healthcare policy. Aside from being a debater, Humzah has written and researched for various organizations, publishing pieces ranging from longer-form policy analyses on nuclear energy to op-eds on the theater of American Party Politics.

Jordyn Ives

Policy Analyst

Jordyn Ives is a freshman at the university of Michigan, hoping to study policy, economics and Spanish. She plans on pursuing law school and working in the foreign service or as a human rights lawyer.

Arya Kumar

Lead Analyst, Criminal Justice Policy

Arya is a junior in high school in Northern Virginia who currently works at Youth Institute for Policy as the Economic Policy Department Head.

Donovan Zagorin

Former Director, Policy & 2022 Senior Fellow

Donovan Zagorin is a senior fellow and the Director of Policy at YIP. He is currently a high school student in California who looks to further the goal of improving discourse in politics, especially among youth. He has interests in politics, philosophy, and economics, all of which he hopes to pursue through college and the rest of his foreseeable future.