Bloomberg News

Northrop Grumman, CSX Making Pre-Sequestration Donations

February 15, 2013

Northrop Grumman Joins CSX in Making Pre-Sequestration Donations

A United States Air Force Global Hawk drone, manufactured by Northrop Grumman Corp., is displayed during a media preview of the Seoul International Aerospace & Defense Exhibition in Seongnam, South Korea, in this file photo. Photographer: SeongJoon Cho/Bloomberg

No sooner had the 2012 election ended than Northrop Grumman Corp (NOC:US). and CSX Corp. (CSX:US) set their sights on the looming budget cuts and the 2014 campaign.

Northrop’s political action committee contributed $17,500 in December to candidates running for re-election two years from now; CSX Corp.’s PAC donated $11,000. Other company PACs also gave out early money, including Comcast Corp (CMCSA:US)., the largest U.S. cable company, and General Electric Co (GE:US).

Such contributions helped fill the coffers of incumbents well before facing any opposition and came from some companies with big stakes in how Congress responds to more than $1 trillion of automatic spending cuts set to begin March 1.

“If you receive early money from virtually anybody, you are going to look upon them very kindly,” said Democratic consultant Glenn Totten, who works for congressional candidates. “Not only do you have the value of the money itself, you have now enlarged your war chest, thus making you a more formidable candidate, which makes you much less likely to be challenged.”

Falls Church, Virginia-based Northrop Grumman’s PAC donated to Republican Senators Susan Collins of Maine, who sits on the Appropriations Committee, and Jim Inhofe of Oklahoma, who is the ranking minority member on the Armed Services Committee. It also gave to Democratic Senators Tom Udall of New Mexico, another appropriations panel member, and Mark Udall of Colorado. In the House, it cut checks to Representatives Kevin McCarthy, a Californian and the third-ranking Republican, and Chaka Fattah, a Pennsylvania Democrat who sits on the House Appropriations Committee, in advance of the final negotiations to avoid spending cuts of $1.2 trillion over 10 years, half from defense.

Gaining Access

“They’re mainly interested in gaining access to members of Congress in order to get their side of the issue heard,” said Paul Herrnson, director of the Center for American Politics and Citizenship at the University of Maryland in College Park. “With that goal in mind, it’s not very early for them to contribute at all.”

Another Falls Church-based defense contractor, General Dynamics Corp (GD:US)., used its PAC to support five senators up for re- election in 2014, including Thad Cochran of Mississippi, the top Republican on the appropriations panel overseeing defense spending and whose state houses military bases and thousands of defense-industry jobs.

General Dynamics’s PAC “supports incumbents who support a strong national defense” said Rob Doolittle, a spokesman. “There is no significance to the timing of the contributions.”

Randy Belote, a Northrop Grumman spokesman, declined to comment on the donations.

Beyond Defense

Early giving wasn’t limited to the defense industry as other sectors that could be affected by the domestic side of spending cuts also chipped in early contributions.

Jacksonville, Florida-based CSX used its PAC to back four senators up in 2014: Cochran, Inhofe, and Democrats Chris Coons of Delaware and Mark Warner of Virginia.

“CSX allocates and spends its PAC budget in a manner that demonstrates consideration and appreciation for the CSX employees who generously support it,” said Gary Sease, a spokesman for the largest East Coast rail carrier. “Their enthusiastic support of the PAC gives us the ability to make budgeted 2013 contributions and allocate the balance to 2014.”

Comcast made $109,000 in PAC donations in the final five weeks of 2012 including to nine Democratic senators up for re- election in 2014. Democrats control 55 of 100 Senate seats.

House Donations

Having just won re-election in November, five House members received donations from General Electric’s PAC a month later for their next races, $2,500 apiece to Republicans Erik Paulsen of Minnesota and Bill Shuster of Pennsylvania and $1,000 to Republican Pat Tiberi of Ohio. It also give to Democrats Doris Matsui of California and Emanuel Cleaver II of Missouri.

A spokesman for Fairfield, Connecticut-based GE, Seth Martin, said the donations are determined by a board made up of company employees. Sena Fitzmaurice, a spokeswoman for Philadelphia-based Comcast, declined to comment.

Following the 2012 elections, some lawmakers also didn’t wait for the new year before asking for money.

Senate Republican leader Mitch McConnell of Kentucky, faces re-election in 2014 and anti-tax Tea Party groups are threatening to challenge him. Seeking to intimidate any prospective competitors, he held back-to-back fundraising dinners Dec. 17-18 in Washington, where PACs were asked to contribute $2,500 apiece, according to the Sunlight Foundation, a Washington-based research group.

Early Fundraisers

Udall of Colorado and Warner of Virginia held fundraising events Dec. 10, according to the Sunlight Foundation. The PACs for CSX and Comcast were sponsors of Warner’s event.

Some companies looked beyond even the next election. JPMorgan Chase & Co (JPM:US). contributed $2,000 through its PAC to Mike Crapo of Idaho, the top Republican on the Senate Banking Committee. The PAC of Wells Fargo & Co (WFC:US)., based in San Francisco, gave $2,500 to Senator Roy Blunt of Missouri, who sits on the appropriations subcommittee overseeing housing programs. Both Republicans next face the voters in 2016.

And Atlanta-based Home Depot Inc (HD:US). reported that a $2,500 contribution previously given to Senator Kirsten Gillibrand, a New York Democrat, should be used the next time she runs for re- election. That’s in 2018.

To contact the reporters on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net; Greg Giroux in Washington at ggiroux@bloomberg.net.

To contact the editor responsible for this story: Jeanne Cummings at jcummings21@bloomberg.net.


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Companies Mentioned

  • NOC
    (Northrop Grumman Corp)
    • $127.5 USD
    • -0.42
    • -0.33%
  • CSX
    (CSX Corp)
    • $31.01 USD
    • -0.09
    • -0.29%
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