The CEOs of some of the biggest companies in the United States have started ramping up their donations to Republican causes as concern grows about Joe Biden's plan to raise the corporate tax rate.
Of the top 10 political donors among S&P 500 CEOs, a majority gave big to GOP groups in the second quarter, according to data from the Center for Responsive Politics. The development comes as the presumptive Democratic nominee has expanded his lead in the polls over President Donald Trump.
As Trump and other Republicans slide in the polls, the idea that taxes could go up under a Democratic administration and Congress has forced GOP donors off the sidelines, according to people helping raise money for GOP organizations. Biden has said he wants to raise the corporate tax rate to 28% from 21%.
A Real Clear Politics polling average shows Biden ahead of Trump by close to 10 points. The Cook Political Report marks six Republican-held Senate seats in Colorado, Georgia, Iowa, Maine, Montana and North Carolina as toss ups. Despite the increased support from CEOs, Biden and the Democratic National Committee outraised their opponents in the second quarter.
People helping raise money for these Republican organizations told CNBC that the idea of taxes going up has struck a nerve with GOP donors and forced them off the sidelines after being largely absent throughout the 2020 election cycle.
Dan Eberhart, a longtime prominent Republican donor, told CNBC he senses that wealthy financiers are going to start lining up behind Trump.
"After Biden released his economic plan, I would expect CEO donations to President Trump to accelerate. Raising the corporate tax rate is not exactly conducive to growing revenue or earnings," Eberhart said. He noted that the recent run of corporate executives giving to Republicans is a sign that the campaign is fervently calling these donors. There are just under 100 days until Election Day.
"It's clear Team Trump needs to break the glass and pull the fire alarm. They are doing that, and there's still time," Eberhart said.
Roy Bailey, a Texas businessman who is leading fundraising efforts for the Trump campaign and the Republican National Committee, explained that business leaders he speaks with says there is a concern that Biden will be influenced by more progressive leaders, such as as Sen. Elizabeth Warren and Rep. Alexandria Ocasio-Cortez if he became president.
"Who do they want managing the economy: Trump (Mnuchin, Powell, Kudlow) or Biden (Bernie, Warren and AOC)?," Bailey said.
A Wall Street financial advisory firm recently told their clients they don't expect Biden to lean too far to the left as the policy recommendations put together by allies of Biden and Sen. Bernie Sanders didn't, they say, have many progressive ideas.
Jeffrey Sprecher, the CEO of the Intercontinental Exchange and husband to Sen. Kelly Loeffler, R-Ga., who came under scrutiny for their stock dealings during the start of the coronavirus pandemic, gave nearly $1.3 million during the April-June quarter. Sprecher's total was the most he's given in the past two presidential election cycles.
Of those donations, $1 million went to America First Action, a pro-Trump super PAC. Sprecher also gave at least $106,500 to the National Republican Senatorial Committee, the official campaign arm of Republicans running for Senate seats. Loeffler is running for reelection to the Senate.
Safra Catz, the CEO of Oracle, gave $125,000 in May to the Trump Victory committee, a joint fundraising operation between the Trump campaign and the Republican National Committee. She also wrote a $46,100 check to the McCarthy Victory Fund in June. Before her recent spending spree, Catz had given very few political contributions this cycle. Oracle Chairman Larry Ellison has also been close to the president and was one of the donors advising Trump at the start of the pandemic.
Other notable S&P 500 CEO contributions to Republican led groups in the second quarter include Robert Bradway, the chief executive of biopharmaceutical company Amgen; Daniel Amos, the CEO of insurance giant Aflac; and Gregory Brown, the CEO of Motorola Solutions.
David Zaslav the CEO of Discovery Inc., and Bob Iger, the former CEO of Disney who is now the company's executive chairman, are among the top executive Democratic donors from the second quarter.