Following the insurrection at Capital Hill just over a week ago, many companies have begun to reconsider their political donations. Hallmark, Mastercard, Marriott, AT&T, Comcast, and Airbnb are among the companies that have announced that they are withholding donations from Republican lawmakers who opposed the certification of election results. Other companies, such as Blackrock, Goldman Sachs, Facebook, Google, Citigroup, JPMorgan Chase, Coca-Cola, and Microsoft are pausing all political donations. This broader response has left many Democrats, like Maryland Senator Ben Cardin, unhappy. ‘“I don’t know what you gain by cutting everyone off. You should penalize those who are responsible.”’1
The withdrawing of donations will also have uneven impacts on the politicians that are affected.
According to the New York Times, House members are more likely to be affected by these withdrawals. “Sam Graves and Blaine Luetkemeyer, both Republicans from Missouri who objected to certifying Mr. Biden’s election victory, were the House members who were second- and third-most reliant on PAC donations. Their 2020 campaigns were both funded about 80 percent by PAC donations ... In the Senate, where the reliance on PAC money is generally lower, Senator Hawley received 7 percent of his recent funds from corporate PACs; for Texas Republican Ted Cruz, probably the highest profile objector to the November election result, the figure was 1 percent.”2
According to the New York Times, House members are more likely to be affected by these withdrawals. “Sam Graves and Blaine Luetkemeyer, both Republicans from Missouri who objected to certifying Mr. Biden’s election victory, were the House members who were second- and third-most reliant on PAC donations. Their 2020 campaigns were both funded about 80 percent by PAC donations ... In the Senate, where the reliance on PAC money is generally lower, Senator Hawley received 7 percent of his recent funds from corporate PACs; for Texas Republican Ted Cruz, probably the highest profile objector to the November election result, the figure was 1 percent.”2
I think that all large businesses and corporations who make donations to PACs probably share the sentiment of Lloyd C. Blankfein, the former chief executive of Goldman Sachs. ‘“I don’t want to minimize the bad outcomes that threaten us all in the waning days of the Trump administration,” he said. “Yet I would be very reluctant to threaten a legislator with a permanent breach over any single issue, recognizing we may need to work together on many other things that will be important to us in the future”’.2 Clearly, companies view political donations as an important tool for representing their interests, and I think it’s likely that the majority of these companies will resume most of their donations before the next election cycle.
4 comments:
The Capitol Hill riot seemed to definitely serve as a wake-up call for many, one of the most notable being these large companies. As the amount of companies suspending donations to politicians continues to increase, I believe a significant message is being sent out to many elected representatives. The divisiveness furthered by President Trump’s rhetoric on and before January 6th, and those politicians who continued to delegitimize the 2020 election results that night, are not to be tolerated. However, I agree with your view on Lloyd C. Blankfein’s statement, regarding resuming future cooperation between PACs and politicians. As we move forth under the Biden-Harris administration’s leadership following Wednesday’s inauguration, it’ll be interesting to see the individual decisions each of these companies make, considering how long they plan to hold back on certain/ all political donations, and to whom.
Politicians that receive a majority of their funding from PACs are working for large companies and not the people. These companies have no incentive to cut off or temporarily suspend funding unless they see a public backlash on the horizon. Giving money to people who fought against the democratic system of this country in the country's heightened state of polarization will damage their brand and their earnings, perhaps irreparably. I find it interesting that members of Congress with the highest percentage of PAC donation are Republicans in comparison to other donations (most likely because they're against regulations), and yet Republicans are at the subject of reprimand from most of these companies. I also agree that this hiatus won't last for very long because companies need people working within the legal system to ensure the highest margin of profit and flexibility for themselves.
I do think this was a prudent move for these companies. I think so much about what happened at the Capitol was symbolic—about the implications it placed on the future of the principle of democracy and about the state of our parties and the ideological balance in our country. Until there is a clear and distinct separation between the Republican party and those who are just unconditional Trump supporters that don’t respect Republican leadership, I think it is in the best interest of anyone giving financial support (companies, businesses, citizens, etc.) to hold back and remember that contributions should be made through well-deliberated considerations. At the end of the day, money does provide candidates the momentum necessary for success, and the Capitol attack prompted many to question who we truly want our leaders to be and who will truly hold the general public’s best interests at mind.
While I agree to some extent with my previous commentators about the impact of the Capital riot and the Republicans attempting to challenge the acceptance of the EC and certifying the election are what caused these companies to suspend donations, I believe these large companies actions are also influenced by the incoming administration. Part of their actions are likely to appease the Biden administration and be on the "right side" of the conflict. If these companies continued to back lawmakers who continued to fight against the certification, they could likely expect backlash by the Administration and Congress on their own businesses. Additionally, there have already been concerns by Big Tech that with Democratic control of the Senate, they should expect more regulations. Some Democrats want new Anti-Trust laws that would impact these big Fortune 500 companies. Thus the suspension of donations seems to serve more than one purpose, distancing themselves from Trump and publicly condoning the Capital riot, while also attempting to show support for the Democrats coming in.
https://www.marketwatch.com/story/if-the-democrats-win-the-senate-big-tech-better-be-ready-for-a-bigger-fight-2020-10-06
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