Study: Firms seeking bailout gave millions to conventions
The same companies that are now lining up for bailouts from the federal government spent millions just last summer to sponsor both the Democratic and Republican national conventions.
That is the conclusion of a new study from the Center for Responsive Politics (CRI) and the Campaign Finance Institute, which shows that "companies like AIG, Ford, Citigroup and Freddie Mac were among the biggest sponsors of the summertime political conventions that nominated Barack Obama and John McCain for president."
The host committees that put on national conventions are not subject to the campaign finance rules that restrict donations to the candidates themselves, and major corporations regularly take advantage of this loophole to donate generously to both parties.
Most notably, the troubled finance, insurance, and real estate sector was the largest single source of contributions, giving the two conventions almost $25 million, split about evenly. Insurance giant AIG gave each convention $750,000, Citigroup spent $600,000 on both conventions, Goldman Sachs gave $505,000, and Bank of America gave $100,000 entirely to the Democrats.
"If the executives who have come to Washington, hat in hand, looked familiar to members of Congress, maybe it's because they met over the summer at the conventions," suggested CRI executive director Sheila Krumholz. "The conventions provided representatives of major corporations and industries with many opportunities to interact with Washington's decision-makers. Those conversations may have paid off just weeks later."
CRI reports that "private interests gave $118 million to cover the two conventions, $61 million to the host committee putting on the Democratic National Convention in Denver and $57 million to the hosts of the Republican National Convention in Minneapolis-St. Paul -- four times the $16 million that each party received from the federal government to support its convention."
The bulk of those donations came from the largest corporate and individual donors. The Republican convention received 44% of its funding from just 15 donors who each gave between $1 and $3, while the Democrats received nearly a quarter of their funds from donors who gave over $1 million.
Wealthy individuals and their charitable foundations they control figured heavily into the mix. The Wall Street Journal points out that billionaire Kirk Kerkorian, whose Lincy Foundation gave $3.5 million to the two convention, is also Ford's largest shareholder.
The Associated Press additionally identified donations by two wealthy Wall Street hedge fund operators, noting, "The GOP convention got $2 million from Raymond Dalio of Bridgewater Associates. The Democratic convention received $500,000 from James Chanos of Kynikos Associates."
Unions representing government employees donated $2.7 million, all of it going to the Democrats, leading Krumholz to comment, "By taking advantage of the false distinction between a political party and the committee hosting the party's convention, unions were able to support the Democratic Party in a way that hasn't been allowed since the days of soft money, when labor was among the biggest givers."