Days after a pro-Trump mob attacked the United States Capitol, some of America’s biggest companies said they would pause political giving as they rethink their support of certain lawmakers and their own involvement in politics more broadly.
Marriott International, Dow, Airbnb and Morgan Stanley were among those that said they would halt donations from their political action committees, or PACs, to the 147 Republican members of Congress who objected to certifying the election results on Jan. 6. The plans to object to the results appear to have contributed to the deadly storming of the Capitol that day. AT&T, whose PAC donated the most of any single public company in the 2019-20 election cycle, also said it would suspend contributions to those lawmakers.
At the same time, Facebook, Microsoft, Coca-Cola, Citigroup, JPMorgan and Goldman Sachs said they were pausing PAC donations to both Republican and Democratic candidates for various lengths of time — a tactic that will also penalize those who voted to uphold the election.
The moves are notable because corporations and their employees are active players in the political process, making campaign contributions through PACs and helping politicians raise funds in myriad ways. But it was not clear how long the pause would last — the first quarter is the slowest period of the cycle — and whether the companies would quietly roll back the changes after public attention had shifted.
In the last election cycle, American corporate PACs gave $91 million to members of the House of Representatives, accounting for 8 percent of that chamber’s total funds raised, and $27 million to senators, accounting for 3 percent of the total, according to figures compiled by the Center for Responsive Politics.
“Corporate PAC money is usually an arm of the lobbying interests of the corporation and is used to buy access and influence,” said Fred Wertheimer, president of Democracy 21, an organization that advocates for campaign finance reform. “If that were to fundamentally change, and if small donors became a much bigger part of financing elections, we could potentially face a fundamental change in the financing of elections.”
By announcing their intention to withhold funds, companies are signaling to lawmakers that there are growing political and public relations risks to their actions. By the end of Monday, at least 16 companies had put out statements disavowing the events of Wednesday and pledging to use their corporate giving to uphold their principles.
Companies do pause their political contributions sometimes, such as when they are being investigated. But broad initiatives are rare, although this one is at least partly rooted in pragmatism and business savvy.
“I think that some corporations just have been a little bit tone deaf about this,” said Ann M. Ravel, who chaired the Federal Election Commission under former President Barack Obama. “But now, the events of the last week have been so outrageous, and so violent. And the people who were shown trying to undermine our democracy are probably not the kind of people that most corporations want to appeal to.”
Last week, an armed mob, egged on by a disgruntled President Trump, breached the Capitol building as lawmakers were debating whether to certify Joseph R. Biden Jr.’s victory over Mr. Trump in the presidential election. The rioters forced the vice president and lawmakers to be evacuated. Five people, including a police officer, died.
Dow, which took some of the strongest steps, said it was suspending donations for at least two or six years, depending on the lawmaker’s election cycle, “to any member of Congress who voted to object to the certification of the presidential election.”
Hallmark requested the return of campaign contributions that its PAC made to Senators Josh Hawley of Missouri and Roger Marshall of Kansas, who both voted against certifying the presidential election results. “Hallmark believes the peaceful transition of power is part of the bedrock of our democratic system, and we abhor violence of any kind,” the company said in a statement.
Other large companies, including Delta, Walmart and FedEx, said they were monitoring the situation but appeared to stop short of taking any targeted action. .
Lloyd C. Blankfein, the former chief executive of Goldman Sachs, said that the rush by companies to take a stand on political contributions could be shortsighted, given the nature of business.
“I don’t want to minimize the bad outcomes that threaten us all in the waning days of the Trump administration,” he said. “Yet I would be very reluctant to threaten a legislator with a permanent breach over any single issue, recognizing we may need to work together on many other things that will be important to us in the future.”
The pullback in PAC donations will hurt lawmakers unevenly. Sam Graves and Blaine Luetkemeyer, both Republicans from Missouri who objected to certifying Mr. Biden’s election victory, were the House members who were second- and third-most reliant on PAC donations. Their 2020 campaigns were both funded about 80 percent by PAC donations, according to data from the Center for Responsive Politics. In the Senate, where the reliance on PAC money is generally lower, Senator Hawley received 7 percent of his recent funds from corporate PACs; for Texas Republican Ted Cruz, probably the highest profile objector to the November election result, the figure was 1 percent.
Corporations spent four years grappling with the volatile Mr. Trump and how best to react to his unpredictable actions, some of which ran counter to the values of their employees and customers. After Mr. Trump’s refusal to commit to a smooth transition, many business leaders began a more sustained conversation about what — if anything — they could do.
On Nov. 23, more than 160 executives signed a letter demanding a swift presidential transition. Some of the executives discussed withholding donations from the Republican candidates for Senate in Georgia if party leaders did not do more to facilitate the transition.
On Jan. 5, the day before the violence at the Capitol, senior executives from Merck, Disney, Pfizer, Morgan Stanley and others revisited the notion of withholding contributions in a call with historians and constitutional experts, said two people who participated in the call. A poll of the call’s participants showed that 100 percent believed it was a good idea to privately warn lobbyists that their companies would no longer support election “deniers,” according to a copy of the poll results obtained by The New York Times. Yet no concrete plan emerged.
That changed after Wednesday.
Early Thursday, calls began for corporations to end their support for Republican lawmakers who either supported Mr. Trump’s agenda during his term or objected to certifying the election. Steve Schmidt, a co-founder of the Lincoln Project, a group of conservatives critical of Mr. Trump, said in a Twitter post that his organization “will be running a brutal corporate pressure campaign,” targeting boards, chief executives, and companies that helped finance the politicians that may have set off the Capitol attacks. His group had already been pressuring Citi, AT&T and Charles Schwab over their support for Mr. Hawley and Mr. Cruz, who had taken leadership roles in opposing the election certification.
In an interview on Monday, Mr. Schmidt said that companies — including banks like Citi and JPMorgan — that had halted all political donations instead of specifically focusing on the objectors were missing the point.
“The issue isn’t suspending all political donations,” he said. “The issue isn’t even suspending all donations to conservatives who largely supported Donald Trump. The issue is suspending donations to seditionists, people that incited an insurrection.”
Big banks have in the past withheld political donations to convey their disapproval, usually only temporarily. In 2015, Goldman Sachs and PNC Financial Services halted donations to Scott Garrett, a Republican with an influential position on the House Financial Services Committee, after he objected to Republican congressional candidates that were gay. That same year, representatives from Citi, JPMorgan and other big banks met to talk about a coordinated freeze on donations to Senate Democrats in order to express disapproval over Massachusetts Senator Elizabeth Warren, a sharp critic of big banks.
Lauren Hirsch contributed reporting.
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