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Corporate Donations to Republican Convention to Reach $160 Million.

by Bill MeslerSpecial to CorpWatch
August 31st, 2004

Cartoonist: Khalil Bendib

There will be a extravagant dinners at the New York’s famous Rainbow Room, cocktails among priceless ancient Egyptian sandstone carvings at the Metropolitan Museum of Art, exclusive Broadway performances and a midnight yacht cruise through New York Harbor. But perhaps the most important extravaganza at this week’s Republican convention is the one that will no longer be taking place. Senator Tom DeLay’s (R-Texas) cynical Celebrations for Children events have been canceled. The tax exempt parties were to include a rock concert, a golf tournament, and for the big contributors—very big at $500,000 a pop—a yacht cruise of their own, but the powerful Senator backed down in the midst of a Texas grand jury’s investigation into his fundraising tactics and a storm of criticism that the bulk of the money was in fact being used to throw elaborate celebrations for DeLay’s political benefactors.

Despite the high profile cancellation, the Republican National Convention hasn’t missed a beat. The extravagant spectacle is expected to cost upwards of $160 million, easily making it the most expensive political convention in history. It will dwarf the record $95 million spent by Democrats on their 2004 convention. In fact, the Republicans will be spending quite a bit more than the $130 million raised by Al Gore and Joe Lieberman for their entire 2000 campaign.

In many respects, the political conventions have become the last bastion of soft-money, the unlimited contributions from special interests that were ostensibly banned by the Federal Election Campaign Act, better known as McCain/Feingold. While huge, unlimited donations directly to political parties are no longer legal, the conventions are still cash cows for big special interests looking to influence legislators. RNC chief counsel Michael Toner recently told the Los Angeles Times, the Republican National Convention’s “unprecedented number of corporate gatherings” is taking up the slack of “activity that used to be done by political parties.” The New York City Host Committee even tapped a veteran soft-money-raiser-extraordinaire Lewis Eisenberg, former head of the Republican National Finance Committee.

The reason d’etra for the huge flow of donor largess was put in a nutshell by a recent Washington seminar conducted to teach companies how best to fete influential Republicans. A flier for the seminar, obtained by the Washington Post, noted that “tens of millions of dollars will be spent by your clients and competitors during the GOP convention in New York. Lasting impressions will be made; connections, branding and marketing opportunities created; and residual relationships formed.”
While direct donations to the two main party’s political campaigns are increasingly coming from rich ideologues, money for the conventions has the distinct bi-partisan air of soft money. According to data from the Center for Public Integrity, 26 corporations gave donations to both the Republican National Convention and the Democratic National Convention, held last month in Boston.

Dual givers include Boston-based shoe giant New Balance. Although political parties are not required to reveal donations before the conventions and some donors have remained secret, New Balance has boasted of its donations of $1 million to Democrats and $500,000 to the Republicans. Meanwhile, Microsoft and AT&T have provided computer and phone services to both conventions. General Motors sent 300 vehicles to both conventions, and Panasonic sent 100 Viera high definition plasma monitors--that cost up to $8,000 a piece—to New York and Boston. Remarkably, even Monster Worldwide, the job hunting website, has shown up as a big dual contributor, even though founder Jeff Taylor, a Democrat, was honorary co-chair of the Democratic National Convention held in Boston. Other notable Democrats among the top funders of the Republican bash are Citigroup CEO Stanford Weill, Verizon CEO Ivan Seidenberg, and Time Warner CEO Richard Parson, who is giving a $1 million party for the estimated 15,000 journalists descending on Manhattan to cover the convention.

Most of the corporate bipartisan givers have obvious agendas. The Pharmaceutical Industry, which is fighting congressional reforms that would allow Americans to import drugs from countries with cheaper prescription costs, has four major companies on the dual-givers list, Amgen, Pfizer, AstraZenega and Bristol-Myers Squibb, which also helped pay for a private concert by the Boston Pops held for Senator Ted Kennedy at Boston’s Symphony Hall. Pfizer CEO Hank McKinnel, chair of PhRMA, the industry’s powerful Washington trade group, has been singled out by Republicans as a key convention benefactor.

All the big Washington lobbying powerhouses will all have presences in New York during the Republican extravaganza. Not surprisingly most of their events honor the chairmen of key committees important to their particular industries, like representative Michael Oxley (R-Ohio), chair of the House Committee on Financial Services, who will be toasted by Frank Sinatra Jr. at a party funded by the Securities Industry Association and the Bond Market Association at the ritzy Penthouse 15.
The American Gas Association is helping fund at least seven events honoring key legislators. “We want to raise the visibility of natural gas issues in a fun atmosphere,” AGA spokeswoman Peggy Laramie recently told the Atlanta Journal Constitution. The AGA has budgeted $700,000 for parties at the two conventions. Among the bashes will be a “Honky-Tonk Salute” to Representative Joe Barton (R-Texas), chair of the crucial Committee on Energy and Commerce. His high profile bash is also being paid for by the Nuclear Energy Institute, the National Mining Association and the Edison Electric Institute, trade association for the electric power industry.

"We're talking about vast sums of money, all of it spent with the goal of gaining access. Money paves the way for the lobbyists to come and do their work," says Steve Weiss, communications director of the Center for Responsive Politics. "The conventions are the last bastion of soft-money giving at the federal level." The Center filed a petition with the FEC protesting that the convention host committees were actually soft money conduits for the political parties, but despite the fact that their combined take will be over $250 million the FEC failed to act.

FEC Chair Bradley Smith, the nation's most important appointee charged with enforcing McCain/Feingold, has made no secret of his disdain for the legislation. Smith, who calls any limits on campaign contributions violations of First Amendment rights to free speech, even told the Wall Street Journal that "the most sensible reform is a simple one: repeal of the Federal Election Campaign Act."

Most advocates of reform say the single biggest obstacle to removing the special interest money from American democracy is, ironically, the FEC. The nation's most important watchdog against abuse of the political system, is an ally of special interests, beholden to the two main parties, and condemned to permanent deadlock on issues of importance because of structural problems.

Mark Glaze of the Campaign Legal Center sums up the current state of reform when he says, "The FEC may be the only agency that works exactly as congress intended it to, which is to say, not at all."