Corporate Campaign Cash Floods US Elections

Published on
by
the Chicago Tribune

Corporate Campaign Cash Floods US Elections

Conservative fundraising commitment has stunned Democrats

by
Tom Hamburger

WASHINGTON -- Driven by increasing anger at Democratic policies and by
recent Supreme Court decisions unshackling corporate contributions,
business and conservative groups are preparing a flood of campaign money
to try to wrest control of Congress from the Democrats.

The U.S. Chamber of Commerce, the biggest collection point for corporate
contributions, has increased its spending for the congressional
election in November from $35 million in 2008 to a projected $75 million
this year. Officials say it may go even higher.

The chamber has been joined by new conservative fundraising
organizations - such as American Crossroads, affiliated with Republican
strategist Karl Rove - that have committed to raising tens of millions
of dollars.

One report circulating among Democratic leaders on Capitol Hill last
week estimated that more than $300 million has been budgeted for the
campaign by a group of 15 conservative tax-exempt organizations.

"A commitment of $300 million from just 15 organizations is a huge
amount, putting them in record territory for groups on the right or
left," said Sheila Krumholz, executive director of the nonpartisan
Center for Responsive Politics, which tracks campaign contributions.
"With control of Congress hanging in the balance, this kind of spending
could have a major impact."

The money's power is magnified because it will be concentrated in a
relatively small number of swing states and districts. Of the 435 House
and 37 Senate seats at issue in November, about 100 House seats and 18
in the Senate are considered competitive.

The conservative fundraising commitment has stunned Democrats.

"It's raising the alarm bell," said Rep. Chris Van Hollen (D-Md.),
chairman of the Democratic Congressional Campaign Committee, which spent
$177 million in all of 2008 for congressional races.

Labor unions and allied liberal groups also plan to spend heavily. The
Service Employees International Union, for example, has budgeted $44
million on election-related spending this year.

But the momentum and the new money appear - at least at this moment - to be coming from business and its allies.

"What we are seeing is that major businesses and industries are taking
advantage of the recent court ruling and favorable political
environment," said Anthony J. Corrado Jr., a political scientist at
Colby College in Maine and a leading expert on money and politics. "They
are already committing substantially more money than they have in any
previous election cycles."

Two recent Supreme Court decisions have encouraged corporate and union
participation in political advertising campaigns. This year, the court
decided in Citizens United vs. Federal Election Commission that corporations and unions could spend directly on elections, overturning a century of laws limiting such spending.

Chamber of Commerce officials say a more significant ruling was the 2007 decision in Federal Election Commission vs. Wisconsin Right to Life
that lifted the ban on political issue advertising close to an
election, allowing corporations and unions to spend unlimited sums on
these ads at the last minute.

The rulings have given all sides powerful tools to influence the outcome of elections.

Business leaders see high stakes in the midterm election. They were
concerned about the sweeping healthcare overhaul passed this year and a
far-reaching bill passed last month to establish greater federal
monitoring and regulation of the financial system. Energy firms are
particularly concerned about how Democratic-dominated Washington will
regulate their businesses after the oil spill in the Gulf of Mexico.

Scott Talbott of the Financial Services Roundtable, a trade group for
major financial firms, said banks and investment houses were
participating in fundraising and lobbying at an unprecedented pace,
partly because of concern over thousands of pages of new regulations
that will be written to implement the laws, as well as who will be
picked to head new government entities, such as the consumer protection agency for banking and securities.

President Obama's sagging approval ratings, which have dropped to 44% in
some polls, have created an opportunity that could allow Republicans to
gain control of the House and cut into the Democrats' majority in the
Senate.

Valerie Jarrett, White House liaison to business, said many of the
chief executives she talked with appreciated the administration's
economic policies and the chance to participate in developing new
regulatory ground rules. The threatening rhetoric from the Chamber of
Commerce and like-minded groups is nothing unusual, she said.

"Special-interest groups have always been able to raise a lot of money
in Washington, but the last presidential campaign demonstrated that
regular, everyday Americans can participate as well - and they will when
they believe there is a candidate looking out for their interests," she
said.

Democrats as well as Republicans point out that the political spending
by business is still largely speculative and that in some early
primaries, labor outspent business.

But current indications are that spending for the midterm election will
break all records. Campaign advertising has already soared to $153
million, almost twice the $77 million spent at this point in the last
midterm election in 2006, said Evan Tracey of the research firm Campaign
Media Analysis Group.

Efforts to bring greater transparency to political ad campaigns by
requiring disclosure of donors were blocked in the Senate last week by
Republicans, after heavy lobbying by the Chamber of Commerce.

Conservatives have found plenty of fertile ground for fundraising.

Roger Nicholson, a senior vice president of International Coal Group, a
mining company, wrote fellow executives Tuesday, urging them to raise
money to deal with the "fiercely anti-coal" Democrats who rule
Washington.

Specifically, he called for funds to defeat Democratic candidates,
including Kentucky's Jack Conway, who is running for the Senate, and
incumbent Rep. Nick J. Rahall II of West Virginia, chairman of the House
Natural Resources Committee.

Similarly, the Center for Public Integrity reported
last week that five of the nation's largest health insurers, including
Aetna Inc., Cigna Corp. and United HealthCare Inc., have been discussing
bankrolling a new nonprofit group with about $20 million to influence
tight congressional races and boost the industry's image. The head of
the insurers' Washington trade association, Karen Ignagni, declined to
comment on the report.

The Chamber of Commerce has focused its efforts on 10 Senate races and about 40 contests in the House.

The chamber has spent more than $1 million over the last four weeks on
two Senate races - between Democrat Joe Sestak and Republican Pat Toomey
in Pennsylvania, and Democrat Lee Fisher and Republican Rob Portman in
Ohio. It has never invested so much in a campaign so early.

Plans call for more. In early August, the chamber is expected to throw
its weight behind Republican Carly Fiorina in her bid to defeat
Democratic Sen. Barbara Boxer in California, adding more fuel to a race
that may be one of the most expensive ever. Already the two candidates
have raised $30 million.

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