The 2024 US presidential election is on track to be the costliest election in modern history.

When Joe Biden dropped out of the 2024 race in June and backed Vice President Kamala Harris to face former President Donald Trump, it triggered a huge flow of cash to the Democrats. In the 24 hours after Harris announced her candidacy, $81m flooded her campaign fund.

Harris’s campaign has been a major cash cow for the Democratic Party. She set a new record, pulling in $1bn in three months. She entered October with a huge cash advantage over Trump, having outraised the Republican Party candidate almost three-to-one, in September, pulling in $378m. Harris has also edged Trump in the battle for small donors.

Despite a smaller war chest, Trump still has deep pockets, raising $160m in September. At a June event, Trump walked away with $50m after addressing donors for roughly 45 minutes. And thanks to his loyal base, when he was found guilty of falsifying business records in May, Trump used his conviction to raise $52.8m in about 24 hours, according to his campaign. Trump also leveraged an assassination attempt and his New York mugshot to extract millions from donors.

Former US President and Republican candidate Donald Trump has not raised as much money as his opponent in the presidential election, Vice President Kamala Harris [File: Sam Wolfe/Reuters]

What are the rules of funding?

In the US, campaign finance is regulated by a series of laws, which aim to prevent corruption while promoting transparency. The Federal Election Commission (FEC) enforces these rules.

Individuals, organisations, and companies can contribute to political campaigns, but there are limits on how much they can give directly to candidates.

Individuals usually contribute the lion’s share of any given candidate’s campaign funds. Wealthier donors tend to give more. Legally, individuals can donate up to $3,300 per candidate, per election in the 2024 cycle.

Both parties have federal- and state-level committees that also raise money. Candidates can also self-fund, as Trump has partially done in the past.

Democrats have rallied behind Kamala Harris since she became the party’s nominee for president, after President Joe Biden dropped out of the race [File: Evelyn Hockstein/Reuters]

What’s a super PAC?

There are ways to get around the contribution limits – political action committees (PACs) and super PACs, which play a monumental role in US elections. PACs pool contributions from members and donate them to campaigns, with limits of $5,000 per candidate per year. PACs often represent industries like oil or aerospace, or focus on issues like climate change or gun rights.

Super PACs, created after a 2010 Supreme Court ruling, are funded by individuals, unions, and corporations. Unlike PACs, they can donate unlimited amounts to independent organisations linked to a candidate, but cannot give to, or coordinate directly with, campaigns.

And that freedom allows the wealthy to pump as much money as they want to support their preferred candidate. So far, outside spending from these groups has totalled approximately $2.8bn since 2010, according to OpenSecrets, a nonpartisan group tracking money in politics. Much of that money funds advertising, mailings, canvassing, and online presence.

Tesla and SpaceX CEO and significant monetary Trump donor Elon Musk walks to the stage to speak alongside Republican presidential candidate former President Donald Trump at a campaign event at the Butler Farm Show, Saturday, October 5, 2024 [Alex Brandon/AP Photo]

What’s the impact?

The influence of money in politics raises concerns. Super PACs especially open the door for significant contributions, often raising questions about whether elections truly reflect the will of the people or that of elite donors.

Elon Musk, the controversial tech billionaire — and the world’s richest person — who endorsed Trump, announced in July that he planned to donate about $45m monthly to the America PAC, a Trump-supporting super PAC that he set up. His fundraising efforts, focussed on voter registration and early voting in battleground states, have faced scrutiny. Meanwhile, Miriam Adelson, the conservative billionaire, donated $95m to another super PAC supporting Trump, CNN has reported.

The rise of “dark money” — contributions not required to disclose donors — has also made transparency harder to achieve. OpenSecrets reported an “unprecedented surge” in dark money during the 2023 and 2024 cycles, which could surpass the $660m from unknown sources in 2020.

In some cases, PACs and Super PACs are even a way of influencing another party from the one the donor supports. For example, the American Israel Public Affairs Committee (AIPAC), which specifically aims to fund candidates who back Israel and support the opponents of those who don’t, was found to be the biggest source of money from Republican-aligned donors to Democrats in the latter’s primaries earlier this year, according to an analysis by Politico.

That money successfully helped to defeat Jamaal Bowman and Cori Bush, two pro-Palestinian progressives in the House of Representatives, during their primaries this year.

Early voting has begun in the 2024 election, but millions are still being pumped in to support candidates and reach people who have not yet voted [Megan Varner/Getty Images/AFP]

What’s being done?

Campaign finance reform could help balance the scales, but efforts advocating for stricter donation limits, transparency, and public financing have not gained traction at the federal level.

In 2022, President Biden called dark money a “serious” threat to democracy and urged Congress to pass a campaign finance bill requiring political groups to disclose big donors. Senate Republicans blocked the bill. There are state initiatives, however, helping balance the scales. New York City has a public matching system, where small-dollar donations are matched by public funds, amplifying the voices of more modest contributors over large donors.

Other efforts, like the Honest Ads Act, had aimed to make political advertising more transparent, by providing more information on the people buying the advertisements. It was folded into the Freedom to Vote Act, but that has failed to pass the US Senate.