From this modest beginning, the U.S. has developed an extensive system of contribution limits, disclosure requirements, and public funding of presidential campaigns. Yet despite a century of modifying and expanding campaign finance regulation, unhappiness with the current system is legion.
Reformers typically advocate either a ban on soft-money or full public funding of campaigns.
The answer lies in the details of campaign finance regulation, which changes both the incentives and the opportunities faced by donors and candidates. These details explain why campaign finance regulation is ineffective, just as they show why politicians oppose further regulation. The analysis of details presented here does not suggest what campaign finance regulation, if any, is the best policy. But it provides a cautionary tale for reformers and clarifies the key tradeoffs that confront this debate. The regulations governing campaign financing in the United States have three important features.