President Reagan's tax-simplification proposal calls for elimination of the $1 checkoff used to finance presidential campaigns, a move that proponents of public financing say could effectively end the system.
Reagan is "fundamentally opposed" to public financing of elections, but the decision to eliminate the checkoff provision was made to further tax simplification, not to kill the campaign financing program, a White House spokesman said.
Congress could appropriate money for the fund, the spokesman said, although the president would probably oppose the appropriation.
"If there is no money, there is no public financing. The law does not provide for any other alternative," a spokesman for the Federal Election Commission said. Under existing law, public financing of presidential elections, one of the key campaign reforms enacted after the Watergate scandal, is paid for entirely by $1 checkoffs that people can voluntarily exercise on their tax returns. The $1 checkoff, which does not increase their payments, funneled $35 million into the 1984 election.
The official Treasury description of the elimination of the checkoff provision contends that it "is a source of confusion" to many taxpayers.
Fred Wertheimer, president of Common Cause, criticized the proposed change, contending that it would kill public financing and increase pressure to raise the ceilings on political contributions. At present, individuals can contribute $1,000 to a candidate in any election, while political action committees (PACs) can contribute $5,000.
"A fundamental question of the financing of campaigns is being played out in a tax bill," Wertheimer complained. He argued that shifting to congressional appropriations would make public financing highly unreliable, subject to partisan considerations in the midst of elections.
FEC officials said the checkoff fund now has about $92 million and, if past trends continue, $35 million more will be contributed this year, for a total of $127 million. In 1984, presidential candidates received $133 million. In 1988, inflation and the prospect of nomination contests among both Republicans and Democrats are likely to push total requests higher than in 1984.
During the primaries, presidential candidates can receive grants from the public-financing fund matching all contributions of $250 or less from individuals. In the general election, campaign costs are paid by public financing. In return for the public support, candidates must accept spending ceilings which, in 1984, were $20.2 million in the primary and $40.4 million in the general election. A candidate rejecting public financing is not bound by spending limits, but must comply with restrictions on contributions.