How Watergate and Citizens United Shaped Campaign Finance Law

June 17, 2022

(13 min.)

Has lesson plan

Updated

The Watergate campaign finance scandals led to a landmark law designed to limit the influence of money in politics. Decades later, some say the scandal isn’t what’s illegal, it’s what’s legal.

The Watergate scandal exposed a network of secret fundraising and illegal campaign donations. Laws aimed at reducing financial abuses have had little or no effect on big money’s influence on politics.

After five men with ties to the Nixon campaign were arrested for breaking into the Democratic National Headquarters at the Watergate Hotel on June 17, 1972, to plant listening devices, investigations revealed that tens of millions of dollars in illegal corporation donations had fueled his victory. Nixon resigned; the donations and the attempts to cover them up led Congress to pass the Federal Election Campaign Act of 1974. But by 1988, corporate money was flowing again – to political parties, which were free to spend the donations in support of party candidates. In 2002, Congress passed the Bipartisan Campaign Reform Act, which outlawed donations from corporations, unions and wealthy individuals.

Then came the U.S. Supreme Court decision in 2010 known as Citizens United. It and subsequent decisions meant that corporations could give unlimited money to outside political groups. Critics say it reverses decades of reforms meant to fix the illegal practices of the Watergate days.

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Related:

The Cost of Campaigns by Clyde Haberman

Previous versions

At Retro Report, we update our journalism as news unfolds. Here are the previous published versions of this story.

October 19, 2014: Campaign Finance from Watergate, to Soft Money and Citizens United

For teachers

Lesson plan 1: Citizens United v. F.E.C. and Modern Campaigning
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Producer: Scott Michels
Producer: Drew Magratten
Editor: Anne Checler
Update Producer: Sianne Garlick
Update Producer: Sandra McDaniel
Update Editor: Brian Kamerzel

For Educators

Subjects

Civics and Government U.S. History

Topics

1970s Elections Politics Postwar Era U.S. Presidents Watergate

Introduction

This 13-minute video introduces students to the Watergate break-in and connects it to the subsequent campaign finance scandal. The video documents how, despite campaign finance regulations created in the wake of Watergate, the United States is once again experiencing the same unregulated flow of campaign cash that helped give rise to the issues in the 1970s.

The lesson plan delves into what, if anything, should be done about the prevalence of money in politics and its impact on campaign advertising. The number and types of campaign advertisements draw frequent criticism during campaign season, but candidates and their campaigns usually choose to allocate more than half of their campaign expenditures to various forms of advertising. With the increase of dollars flowing into politics over the last decade, the quantity of political advertising has skyrocketed. Students will explore the potential effects of the increase in campaign ads and compare advertising by campaign committees with that from Super PACs.

Background reading

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After five men with ties to the Nixon campaign were arrested for breaking into the Democratic National Headquarters at the Watergate Hotel in June 1972 to plant listening devices, other allegations against the Nixon campaign were investigated. This included the fact that tens of millions of dollars in illegal, secret, corporation donations had fueled President Richard M. Nixon’s sweeping victory in the 1972 election.

Nixon resigned; the donations and the attempts to cover them up led Congress to pass the Federal Election Campaign Act of 1974.

The law targeted the Nixon campaign’s financial abuses by strictly limiting how much an individual could give to a candidate, mandating tough reporting regulations, and banning corporate donations.

But every law has loopholes. By the 1988 presidential election, corporate money was flowing again – not to candidates, but to political parties, which were free to spend the donations in support of party candidates.

That was perfectly legal until public outrage rose again, and Congress passed the Bipartisan Campaign Reform Act in 2002, which outlawed these so-called “soft money” donations from corporations, unions and the individually wealthy.

Then came the U.S. Supreme Court decision in 2010 known as Citizens United. It and subsequent decisions meant that while there were still limits on giving directly to candidates and parties, individuals and corporations could now give unlimited money to outside political groups. Critics say it meant a return to the days before the Watergate scandal.

Lesson Plan 1: Citizens United v. F.E.C. and Modern Campaigning

Citizens United v. F.E.C. and Modern Campaigning

Citizens United and Modern Campaigning

Campaign Finance - Concept Application FRQ

Citizens United SCOTUS FRQ

U.S. Supreme Court

Midterm Elections

Overview

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Students will learn how the Watergate break-in changed the way political campaigns were funded, and what that means for today.

Objectives

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Students will:

Examine how significant events in American political history have led to changes in campaign finance law, as well as changes in campaign strategies.
Analyze television advertisements from candidate campaigns as well as independent expenditure-only committees (Super PACs).
Draw conclusions from data on money spent in recent presidential and congressional elections.

Essential questions

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What is the Watergate scandal, and how did it affect Congress’ attitude toward regulation of spending by presidential candidates?
What is Citizens United v. F.E.C. (2010), and how does it affect how political campaign strategy today?
How do political advertisements on television by outside groups differ from those paid for by candidates’ campaigns directly?

Additional resources

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Standards

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C-3 Framework Standards for Social Studies:

D2.Civ.13.9-12.Evaluate public policies in terms of intended and unintended outcomes, and related consequences.
D2.His.1.9-12.Evaluate how historical events and developments were shaped by unique circumstances of time and place as well as broader historical contexts.
D2.Civ.12.9-12.Analyze how people use and challenge local, state, national, and international laws to address a variety of public issues.
D2.Civ.11.9-12.Evaluate multiple procedures for making governmental decisions at the local, state, national, and international levels in terms of the civic purposes achieved.
D2.Civ.3.9-12.Analyze the impact of constitutions, laws, treaties, and interna-tional agreements on the maintenance of national and international order.
D1.4.9-12.Explain how supporting questions contribute to an inquiry and how, through engaging source work, new compelling and supporting questions emerge.

Common Core Standards

CCSS.ELA-LITERACY.RH.9-10.1:Cite specific textual evidence to support analysis of primary and secondary sources, attending to such features as the date and origin of the information.
CCSS.ELA-LITERACY.RH.9-10.3: Analyze in detail a series of events described in a text; determine whether earlier events caused later ones or simply preceded them.
CCSS.ELA-LITERACY.RH.9-10.7:Integrate quantitative or technical analysis (e.g., charts, research data) with qualitative analysis in print or digital text.
CCSS.ELA-Literacy.WHST.6-12.2:Write informative/explanatory texts to examine and convey complex ideas and information clearly and accurately through the effective selection, organization, and analysis of content.

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How Watergate and Citizens United Shaped Campaign Finance Law

For Educators