What does the term 'soft money' refer to in campaign finance?

The term 'soft money' refers specifically to funds raised for generic party activities that are not coordinated with specific candidates' campaigns. This type of funding can include contributions for party-building activities, voter registration drives, and other party expenses that do not directly advocate for a particular candidacy.

Soft money became particularly relevant in the context of campaign finance reform, as it allows parties to raise funds with fewer restrictions compared to direct contributions made to candidates. The distinction is significant because while hard money donations (which are subject to federal limits and regulations) directly support a candidate's election efforts, soft money can be used more broadly for party operations. This was a point of contention in political discussions, especially leading up to reforms such as the Bipartisan Campaign Reform Act of 2002, which sought to limit the influence of soft money in politics.

In contrast, other options focus on different aspects of campaign financing. Direct contributions to candidate campaigns refer to hard money, small donations from citizens do not capture the essence of soft money, and monetary contributions exceeding legal limits are illegal and do not reflect permissible activities under the soft money definitions. Thus, 'soft money' specifically pertains to funds for general party activities rather than direct support for candidates.