Despite the intent of legislators, the Pendleton Act did not fully diminish the influence of politics on the operation of the government, especially in the selection and removal of federal employees. Furthermore, in the last decade of the 19th century the issue of money and politics became a major concern to party leaders and American society, when candidates for political posts raised unprecedented amounts of funding during election campaigns, particularly from private business and corporations. This was observed especially in the 1896 presidential campaign, when the Republican Party candidate, William McKinley, often collected more than $100,000 in a single donation, thanks to the implementation of an organized, corporate system of fundraising by party leader Mark Hanna. In sum, throughout only few election cycles, some candidates were able to spend more than $3 million in a single race, creating a social perception of corrupt government. As large companies were now filling the coffers of parties and candidates with large contributions- and the 1904 presidential campaign of Theodore Roosevelt did not avoid allegations of wrongdoing – in his State of the Union Addresses of 1905 and 1906 the president urged legislators to establish a law which would control the flow of money during electoral campaigns and prohibit national banks and corporations from contributing to the electoral efforts of candidates for federal offices.

Democratic Party Senator Benjamin Tillman initiated a bill aimed at reducing the impact of corporations and big money on congressional and presidential elections. Despite Republican obstruction, The Tillman Act was signed into law in 1907, becoming in time one of the longest standing campaign finance regulations. It was the first to ban corporations from making campaign donations, and demanded the filing of financial reports after the election cycle.

An Act to prohibit corporations from making money contributions in connection with political elections