U.S. Subsidiaries: You Think Our Money's Dirty? Give it Back!
The midterm mud is being slung at a ferocious pace and U.S. subsidiaries of foreign corporations are now in the cross hairs.
Fifteen Democratic Senators recently sent a letter to the Federal Election Commissionurging them to "repair and strengthen protections against foreign influence of American elections" by not allowing foreign-controlled subsidiaries (or U.S. subsidiaries) to donate to political campaigns and "influence" the election. Those Senators were Sherrod Brown (D-OH), Barbara Boxer (D-CA), Byron Dorgan (D-ND), Dick Durbin (D-IL), Al Franken (D-MN), Kirten Gillibrand (D-NY), Frank Lautenberg (D-NJ), Pat Leahy (D-VT), Bob Menendez (D-NJ), Jeff Merkley (D-OR), Patty Murray (D-WA), Jack Reed (D-RI),Jeanne Shaheen (D-NH), Sheldon Whitehouse (D-RI), and Ron Wyden (D-OR).
The kick of this is, with the exception of Sen. Franken, the fourteen other senators have accepted PAC donations from U.S. subsidiaries of foreign corporations. According to opensecrets.org, Menendeztops the donations list with $247,204. Combined, the fourteen Senators have received a total of $1,216,122.00 from U.S. subsidiaries of foreign corporations. Outside of this group, a total of 86 Senators on both side of the aisle have accepted funds.
The Organization for International Investment (OFII), whose members are U.S. subsidiaries of foreign corporations, has fired back. They have sent a letter to the fifteen senators asking them to clarify the position against foreign donations. I interviewed Nancy McLernon, CEO of OFII, about the controversy.
NM: It baffles me how a Senator could sign on to a letter like this without checking their own donations. Wouldn't they check what companies have donated to them? I hope when they realize they have received donations from American employees directly working at U.S. subsidiaries, they will clairfy their position. If not, maybe they should refund the money.
LL: This is not the first time U.S. subsidiaries of foreign companies have been a Congressional target. What kind of message does this send to them?
NM: It's the constitutional right of Americans who work for U.S. subsidiaries to pool their money in support of someone. So, if you work for Nestle does that mean your rights are less important than if you work for, say, Hershey? U.S. subsidiaries have been a punching bag for too long when it comes to political rhetoric.
In our recent CFO survey, 72 percent said the U.S. business environment for them is deteriorating. They are questioning if the U.S. is a place for investment and the jobs that come with it. The dots need to be connected.
U.S. subsidiaries should not be tagged with the scarlet letter "F" — it is counterproductive in encouraging them to invest and create jobs here.
LL: Where have most of the monies gone to?
NM: In the last election cycle, U.S. subsidiaries have given more to Democrats than Republicans. So who are they really bashing? This is not a GOP issue. Senators on both sides of the aisle have accepted PAC money.
List of 86 United States Senators who have received campaigndonations from foreign-connected PACs in 2010 election cycle
|New Hampshire||Jeanne Shaheen|
|New Jersey||Frank Lautenberg|
|New Mexico||Jeff Bingaman|
|New York||Chuck Schumer|
|North Carolina||Kay Hagan|
|North Dakota||Kent Conrad|
|Bob Casey Jr|
|Rhode Island||Sheldon Whitehouse|
|South Carolina||Jim DeMint|
|South Dakota||Tim Johnson|
|Texas||Kay Bailey Hutchinson|
|West Virginia||Jay Rockefeller|
- Read Letter to Federal Election Commission
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A Senior Talent Producer at CNBC, and author of "Thriving in the New Economy:Lessons from Today's Top Business Minds."