Already a Bloomberg.com user?
Sign in with the same account.
Venture capitalists have decided to plant their political seed money with Democrats this year after investing mostly in Republicans in 2006. Casino operators have switched their bets to the party newly in power on Capitol Hill. And defense contractors are not staying the course: They've flipped from giving 62% of their donations to Republicans before the election to 67% to Democrats now.
In the 2006 election cycle, business political action committees (PACs) gave 66% of their $234 million in donations to Republicans. This year, though, corporate interests have rewarded Democrats for taking back control of Congress for the first time in 12 years by funneling 58% of their $7 million in early money to them, according to an analysis of Federal Election Committee data by PoliticalMoneyLine. "Money follows power realignment," says Bernadette A. Budde, senior vice-president of the Business Industry Political Action Committee. "We're telling [business] people, 'Be prepared to do business in a town that continues to look very different.'"
Among the businesses that have given a majority to Democrats this year after backing mostly Republicans in the 2005-2006 cycle: Aflac (AFL
), Anheuser-Busch (BUD
), ConocoPhillips (COP
), General Dynamics, Harrah's Entertainment (HET
), Home Depot (HD
), Honeywell International (HON
), MGMMIRAGE (MGJ
), Miller Brewing (SBMRY
), and United Technologies (UTK
), which switched from 62% Republican to 59% Democratic after the election. UTC spokesman James DeFrank says the change "reflects in part the new Democratic majority in Congress and changes in leadership on key committees." Lockheed Martin Corp. (LMT
)spokesman Jeffery Adams says his company's Democratic contributions are "part of the ebb and flow of our overall budget within the election cycle." The Maryland defense contractor, which has given 62% of its donations to Republicans over the past decade, has contributed to 11 Democrats and 3 Republicans this year, including new Senate Armed Services Committee Chairman Carl Levin (D-Mich.).
It's not the first time companies have changed donation habits. When Republicans captured Congress from Democrats in 1994, GOP receipts from business PACs soared, from 49.9% before the election to 72% in the next campaign.
Most outfits deny they are opportunistic and say they've always tried to reward friends in both parties. "In any given year it may skew slightly to one party, but on average it balances out," says Mechell Clark, AFLAC's media relations manager. Since 1979, 54% of AFLAC's PAC money has gone to Republicans. It has given a majority to Democrats in 5 of the 14 previous election cycles, each time when that party controlled both houses.TOO SOON TO JUDGE?Some companies caution against over-interpreting any trends. Home Depot has shifted its PAC contributions from 71% Republican in 2006 to 55% Democratic in 2007. But spokesman Ron DeFeo warns: "It is much too early to make judgments about the partisan balance of our giving." DeFeo says the PAC is nonpartisan and supports candidates "who advocate policies that promote a favorable business climate for the Home Depot."
Of course, not every company has reversed gears. ExxonMobil, Halliburton, PricewaterhouseCoopers, and U.S. Bancorp have remained loyal to the Republican Party. ExxonMobil spokesman Gantt Walton says his company's contributions are "very, very consistent," no matter which party is in power. "We focus on candidates that are pro-business and want to strengthen the free-enterprise system." By Richard S. Dunham