U.S. House Votes to End Watergate-Era Finance System [View All]

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Source: Bloomberg Businessweek

Jan. 26 (Bloomberg) -- The Republican-controlled U.S. House voted to eliminate public financing of presidential campaigns almost four decades after the Watergate scandal that led to its adoption.

Today’s 239-160 vote was primarily along party lines. Republicans said the U.S. can’t afford the program in an era of trillion-dollar budget deficits. The legislation would save $617 million over 10 years, according to the nonpartisan Congressional Budget Office.

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Under the financing program, the government matches the first $250 of each individual contribution for presidential candidates who are willing to limit their spending in primaries. In the general election, the major-party nominees receive a lump sum if they agree to forgo private fundraising except to cover legal and accounting costs.

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The program was enacted in 1974 after President Richard Nixon resigned from office amid revelations about his role in covering up the break-in of Democratic political offices at Washington’s Watergate Hotel. During probes of the break-in, reports surfaced of secret slush funds and illegal activities funded by some of the unregulated private donations to Nixon’s 1972 re-election campaign. That spurred Congress to create the public financing system.



Read more: http://www.businessweek.com/news/2011-01-26/u-s-house-votes-to-end-watergate-era-finance-system.html