What is the difference between soft money and hard money campaign donations?
In the simplest terms, “hard money” is from political donations that are regulated by law through the Federal Election Commission. “Soft money” is money donated to political parties in a way that leaves the contribution unregulated. The difference boils down to a few crucial words and one administrative ruling. In 1978, the Federal Election Commission issued an administrative ruling that the funding rules established by law only applied to political campaigns, and not to “party building” activities. The commission didn’t go into great detail about what constituted a party building activity, basically defining it as something that didn’t explicitly tell people to vote for a specific candidate. The ruling was issued, and political parties uniformly ignored it until 1988. In the 1988 presidential campaigns, people working for both major parties discovered the “loophole” created by the 1978 ruling, and the race for soft money was on
