Published on Monday, March 28, 2005 by the Seattle Times
Business is Basking in Strong GOP Majority
by Jim VandeHei
WASHINGTON -- Fortune 500 companies that invested millions of dollars in electing Republicans are emerging as the earliest beneficiaries of a government controlled by President Bush and the largest GOP House and Senate majority in a half-century.
MBNA Corp., the credit-card behemoth and fifth-largest contributor to Bush's two presidential campaigns, is among those on the verge of prevailing in an eight-year fight to curtail personal bankruptcies.
Exxon Mobil and others are close to winning the right to drill for oil in the Arctic National Wildlife Refuge in Alaska, which they have tried to get passed for more than a decade.
Wal-Mart, another big contributor to Bush and the GOP, and other big companies recently won long-sought protections from class-action lawsuits.
Republicans have pursued such issues for much of the past decade, asserting that free-market policies are the smartest way to grow the economy. But now it appears they finally have the legislative muscle to push some of their agenda through Congress and onto the desk of a president eager to sign pro-business measures into law.
The chief reasons are Bush's victory in 2004 and GOP gains in Congress, especially in the Senate, where much of corporate America's agenda has bogged down in recent years, according to Republicans and Democrats.
"These are not real high-profile, sexy issues like the war or Social Security, but these are issues that have huge economic consequences," said Charles Black Jr., a GOP lobbyist and one of the president's top fund-raisers. "And there is more to come on that score."
Bush and his congressional allies are looking to pass legal protections for drug companies, doctors, gun manufacturers and asbestos makers, as well as tax breaks for all companies and energy-related assistance sought by the oil-and-gas industry.
With 232 seats in the House, Republicans have their largest majority since 1949.
This is the first time since the Calvin Coolidge administration in 1929 that the GOP has simultaneously held 55 or more Senate seats and the presidency. Senate Republicans are only five votes shy of the 60 needed to break the most-powerful tool the minority holds in Congress: the filibuster.
Over the next four years, the GOP hopes to use this enhanced power to approve the president's judicial nominees, some of whom Democrats lambaste as too conservative, and restructure Social Security and the tax code.
But in the early days of the 109th Congress, it is corporations, which largely bankrolled the GOP's resurgence, that are profiting.
As recent Senate votes on bankruptcy and class-action lawsuits showed, corporations rely on a number of pro-business Democrats in the House and Senate and continue to contribute generously to both parties. But in the 2004 elections, Republicans received 66 percent of corporate political-action committee (PAC) money, which reflects a trend of businesses tilting support toward the GOP over the past decade. In 1993-94, business PACs gave slightly more to Democrats.
R. Bruce Josten, top lobbyist for the U.S. Chamber of Commerce, said businesses feel a sense of urgency to enact as many pro-business laws as possible before a fight over judicial nominees or a Supreme Court opening brings legislative action to a "screeching halt."
Wal-Mart joins the game
Wal-Mart, the retailer many experts consider the most-sued company in America, stands to benefit from the new class-action law, which is designed to cut down on lawsuits and big verdicts by steering some cases into federal courts, away from state courts with track records of siding with plaintiffs and awarding multimillion-dollar verdicts, according to policy experts.
The company, which expressed disdain for Washington politics in the 1990s, changed its tune dramatically after then-Senate Majority Leader Trent Lott, R-Miss., sat down with the company's managers in Bentonville, Ark., in the late 1990s and warned them of the perils of sitting on the sidelines.
Soon after, Wal-Mart became a major player in GOP politics, funneling money to groups such as the Chamber of Commerce to lobby on its behalf and creating a political-action committee.
In the elections last year, the company's $2.4 million PAC was the third-largest corporate PAC in the country, with nearly 80 percent of its money going to Republicans.
Wal-Mart officials contributed more than $30,000 to Bush last election, according to Federal Election Commission data compiled by the Center for Responsive Politics, a nonpartisan organization that prepared the fund-raising data for this article.
In many cases, companies such as Wal-Mart spend significantly more money hiring Republican lobbyists and helping to fund groups such as the Chamber of Commerce and other GOP-dominated trade associations — which are not required to disclose their donors — than they devote to political candidates.
Wal-Mart, for instance, has contributed at least $1 million to the Chamber of Commerce, according to chamber documents.
Marty Heires, a Wal-Mart spokesman, said the company did not want to comment for this report.
"They want to play it low-key on this," he said.
Wal-Mart is only one of scores of businesses that sought the class-action law. The companies, which included technology firms such as Intel and pharmaceutical giants such as GlaxoSmithKline, did much of their lobbying quietly though a group called the Class Action Fairness Coalition, which is run by the Chamber of Commerce. Both refused to disclose their donors.
In the end, the companies prevailed because the larger GOP majorities were joined by several pro-business Democrats, who were comfortable with the compromises they negotiated that limited the effects of the bill.
Many of these Democrats also received substantial campaign contributions from companies concerned about class-action cases, the Center for Responsive Politics found.
The story is the same for the bankruptcy bill, which recently passed the Senate and appears headed to easy passage in the House and to Bush's desk this spring.
United Republicans are counting on the support of enough Democrats to pass a bill that has been stalled since the mid-1990s. It would require many people filing for bankruptcy to repay more of their debt. Under current law, tens of thousands of people file for Chapter 7 bankruptcy, which erases all of their debt. The new law makes it harder to file for Chapter 7.
Like the class-action law, hundreds of companies stand to benefit from changes in the bankruptcy law. Credit-card and banking companies, which are leading the lobbying effort, were top financiers of Bush's two campaigns. MBNA, Credit Suisse First Boston, Bank of America and Wachovia were among the top 20 contributors to Bush, donating more than $300,000 each.
The legislation includes several provisions benefiting specific industries. Retailers such as Target and Nordstrom, which help fund the National Retail Federation, a trade association lobbying for the bill, will benefit because they lose substantial money each year when people erase their debt through bankruptcy.
"Retailers who offer credit-card programs are left holding the bag on bad debt," said Craig Sherman, spokesman for the retail federation. "This legislation will get us out of this situation."
Target contributed 80 percent of its $300,000-plus PAC money to Republicans last election.
Ford Credit Co. and others would benefit from a provision that stipulates that all automobile loans be repaid in full by people who file for Chapter 13 bankruptcy, or the auto will be repossessed. Under current law, only the present value of the car must be repaid. Ford Motor donated more than 80 percent of its PAC money to the GOP.
Oil drilling in ANWR
While the bankruptcy legislation is almost sure to become law, Bush's push to open Alaska's Arctic National Wildlife Refuge to oil drilling still must clear several hurdles. The Senate's 51-49 vote on a section of the budget resolution last week moved oil companies closer than ever to realizing their goal.
"It only happened because Americans elected a larger [Republican] majority," said Sen. Jim DeMint of South Carolina, one of seven new GOP senators who supported oil drilling.
Exxon Mobil, which was the largest contributor among energy companies in 2004, has given $5.2 million to Republicans in the past decade and less than $650,000 to Democrats. Bush received $2.5 million from oil-and-gas companies for his re-election bid alone.
Lauren Kerr, spokesman for Exxon Mobil, said the company has been clear about its support for allowing drilling in ANWR and "transparent about its political activities."
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