Corporate Giving to Candidates Hits New Highs
Corporate America is pouring money into the U.S. presidential campaign at an unprecedented rate, with a torrent of donations coming from the businesses behind the subprime mortgage crisis.
Facing a government crackdown over predatory lending and a troubled housing finance system, Wall Street and the real estate industry were among the top political givers in 2007, a campaign finance watchdog group said Sunday.
Leading all corporate donors in campaign donations as of the end of last year was investment banking giant Goldman Sachs, based on an analysis of Federal Election Commission records, the Center for Responsive Politics said.
The next four largest corporate donors were Citigroup, Morgan Stanley, Lehman Brothers and Merrill Lynch, according to the center's fourth-quarter preliminary analysis, which is subject to revision.
Investment banks, commercial banks and real estate companies altogether have pumped almost $34 million into the presidential race, with Democratic leaders Hillary Clinton and Barack Obama getting the most money, the center said.
Overall, the 2008 presidential contest is shaping up, as expected, to be by far the costliest in U.S. history.
"From the beginning we've known this will be the most expensive race ever ... Already the whole field has raised $582.5 million," said Massie Ritsch, spokesman for the nonprofit, nonpartisan center.
Senators Clinton and Obama have each taken in more than $5 million from securities and investment firms; Republican Mitt Romney, over $4 million, and rival John McCain, $2 million.
Real estate has not been far behind, donating $4.8 million to New York's Clinton and $3.7 million to Romney, the former governor of Massachusetts.
Illinois' Obama has raked in $2.7 million, and Arizona Sen. McCain $1.9 million from real estate interests including mortgage brokers, homebuilders and property developers.
Real Estate Worries
With home prices plummeting and foreclosures on the rise, especially among subprime mortgage borrowers with poor credit, lawmakers and regulators are looking hard at home lenders and the debt markets into which they sell loans.
Fears of recession have pushed the economy onto center stage of the election campaign, stealing attention from the wars in Iraq and Afghanistan, health care, immigration and such social issues as abortion rights.
One sector with an interest in almost every debate remains the richest source of campaign funds -- lawyers and law firms, which have donated $26.6 million to date in the 2008 cycle.
Hollywood, including television, film and music, has given $6 million -- $5 million of it to Clinton and Obama.
In contrast, oil and gas's favorite candidate still standing is Romney, who has taken in $375,000 of the sector's $1.1 million. Those firms donated more than $620,000 to former New York Mayor Rudolph Giuliani, who left the race.
Hedge funds and private equity, a new, independent-minded source of funds, has sunk $3.6 million into campaigns: $1.3 million to Clinton; $1 million to Obama; $837,000 to Romney, and $395,000 to McCain. But the private equity and hedge fund kingpins also bet big on drop-out Giuliani, donating more than $1.2 million to him.
Major hedge fund donors contributing to presidential and congressional campaigns have included Elliott Management, SAC Capital Advisors, Citadel Investment Group, Fortress Investment Group and Renaissance Technologies, the center said.
Giving by all of them has skewed heavily toward Democrats, except for Elliott, which gave 99 percent to Republicans.
Private equity firms with generous purses have included Blackstone Group, Apollo Advisors and Carlyle Group.
Housing finance groups Fannie Mae and Freddie Mac have given nearly $1 million to 2008-cycle presidential and congressional campaigns; mortgage broker Countrywide Financial has given $156,900, the center said.
The center's analysis of campaign giving by business sector includes donations by political action committees and donations from individuals giving more than $200 based on employment.