Small Donors Still on Sidelines of Congressional Races – Legislation to Change is Stalled in Congress

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  • Leila Pedersen

LOS ANGELES – Big donors continued to dominate California’s congressional campaigns even as we entered the fall campaign season when small donors traditionally became more engaged, according to analysis of campaign finance data for nine diverse* members of Congress by the non-partisan government watchdog organization California Common Cause.

“When campaigns are funded by a small group of large donors instead of a large amount of small donors, the price we pay is a less representative government” noted Kathay Feng, executive director of the group.  “It doesn’t have to be this way. Passing the Government By the People Act would encourage candidates to rely upon small donations from regular folks,” she added.

Among the group’s findings:

  • Of the nine members of Congress, none of them raised more than 20% of their funds from donors giving less than $200 from July 1st to September 30th of 2014.  Eight of the nine raised less than 10% of their total funds from small donors.  (These numbers are also holding true for 7 members during the period Oct 1 – Oct 15.  Pre-election data for Rep. McLeod and Rep. Issa’s leadership PAC were not yet posted by the FEC as of 9 AM on Oct 24.)
  • Retiring member Buck McKeon did not report any contributions since July 1st.  However, McKeon did report having his wife on his campaign payroll for $5209 a month, despite not running a campaign.  As chair of the House Armed Services Committee, Congressman McKeon raised $582,876 in the first 18 months of the cycle including $99,100 from defense contractors, $74,100 from defense related aerospace, and $53,500 from defense related electronic firms.  McKeon’s fundraising during his final term while not seeking re-election exceeded his total fundraising during his first three campaigns.
  • Congressman Dana Rohrabacher didn’t report a single donation from someone giving less than $200 during the entire period of July 1st to October 15, 2014.
  • House Majority leader Kevin McCarthy reported raising less than 0.1% of the total funds he raised from individuals from donors giving less than $200.

Previous California Common Cause analysis of fundraising data for the first 18 months of this election cycle found that:

  • Six of the nine members had real estate interests among their top five industries for support.  Federal candidates receive more campaign funds from the Finance/Insurance/Real Estate sector than any other industry group. When the House considered a bill written by Citigroup lobbyists to weaken banking regulations, co-sponsors of the bill received 16 times the funds from Citigroup as other members. The price we paid for big money contributions from Wall Street was weakened banking rules which led to the sub-prime mortgage crisis. Homeowners saw property values plummet by $1.2 trillion and more than 500,000 fewer jobs were created. California financial institutions were responsible for 56% of the subprime lending, which devastated our housing market. By the end of 2007, a full 25% of foreclosures in American were in California.
  • Three of the nine members had securities and investment firms among their top five industries that supported them.  In the 2012 election cycle, Wall Street institutions spent more than $108 million to influence congressional elections – nearly double what they’d spent in 2010 prior to the Citizens United ruling. Senators who voted against a provision to allow people to refinance their student loans at lower interest rates received 58% more money from financial institutions than Senators who voted for it.  The $1.2 trillion in student debt carried by college graduates prevents them from starting businesses, buying homes, and contributing to a growing economy.
  • Seven of the nine members raised 20% or less of their funds from within their congressional district during the 1st 18 months of the cycle:  Denham (16%), Costa (20%), McCarthy (17%), McKeon (5%), McLeod (9%), Bass (19%), Issa (16%). Only two members raised more than 40% of funds from within their districts: Dana Rohrabacher (44%) and David Valadao (40%). 

California Common Cause has called upon these nine members of Congress to join 29 other members from California in co-sponsoring H.R. 20, the Government By the People Act.  That bill would encourage small donors to contribute to candidates by using a tax credit incentive system, and encourage candidates to rely heavily upon small donors for their campaigns by providing federal matching funds at ratios of at least six-to-one.  Congresswoman McLeod has agreed to co-sponsor the bill.

*Congressmembers studied were Jeff Denham (R-CD 10), Jim Costa (D-CD 16), David Valadao (R-CD 21), Kevin McCarthy (R-CD 23), Gloria Negrette McLeod (D-CD 35), Karen Bass (D-CD 37), Dana Rohrabacher (R- CD 48), and Darrell Issa (R- CD 49).  Data for 3rd quarter and pre-election fundraising reports downloaded from the FEC. Data for the first 18 months of the cycle on industry source and in-district is from