Political Action Committee (Super Pac) – Definition

Cite this article as:"Political Action Committee (Super Pac) – Definition," in The Business Professor, updated December 3, 2019, last accessed May 25, 2020, https://thebusinessprofessor.com/lesson/political-action-committee-super-pac-definition/.

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Political Action Committee (Super PAC) Definition

Political action committees (PACs) are created to raise money privately to make donation to a political campaign hoping to influence the election. Super PACs are capable of raising unlimited sums of money to influence an election, but they aren’t allowed to make direct donations to a campaign.

A Little More on What is a Political Action Committee (Super PAC)

Corporations can’t make direct contributions to a campaign, however the citizens United v. FEC case of 2010 made it legitimate for corporations to to support a political action committee. The decision overruled the Campaign Reform Act of 2002, which prevented unions, corporations, and other entities from making monetary donation to political campaigns. The new laws permit these entities to donate a certain amount of money to a PAC which can then be donated to a campaign. For Super PACs, a corporation can donate an infinite sum of money. Irrespective of the fact that the money cannot be directly given to a campaign, it can be spent with the intention of indirectly influencing an election.

Limits of PACs

At the federal level, an organization is termed to be a PAC once it raises $2,600 meant to influence a campaign. State needs are dependent upon the election laws of that state. Limitations exist as to the amount of money a PAC is allowed to contribute to a political campaign.

$5,000 to a candidate per election

$15,000 to a party per year

$5,000 to another PAC per year

PACs are also needed to reveal details about their donors; however, in various situations, these names are revealed upon the completion of the election, when every vote has been cast

Types of PACs

Two official PAC types exist and they are connected and non-connected. But, Super PACs or independenr-expenditure only committees are now referred to as a third type.

Unions, businesses, and other entities establish connected PACs and they receive donations from a “restricted class”, always company managers and organization members or shareholders. A group with a certain mission forms non-connected PACs and they are capable of accepting funds from any source.

Super PACs were birthed in 2010 after the court cases of Citizens United v. FEC and Speechnow.org v. FEC, which permitted deregulation of political funds. While there can’t be a direct donation from a Super PAC fund to a campaign, Super PAC managers, as well as, political candidates are allowed to join and discuss strategy. Since the inception of Super PACs, they have grown quickly to become one of the biggest influencing forces in American politics. Thus, it is calculated that in the Republican primaries of 2012, Super PACs spent more than the campaigns of the candidates. Individuals donated most of the money as against businesses.

References for “Political Action Committee (Super PAC)

https://www.investopedia.com › Insights › Politics & Money

https://medium.com/…committee/how-do-political-action-committees-work-8ef3ee05…

https://www.opensecrets.org/pacs/superpacs.php

https://www.britannica.com/topic/political-action-committee

https://www.thoughtco.com › … › Issues › U.S. Government › History & Basics

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