Tags: midterms | Republicans | PACS | businesses | senate

Business PACs Now Betting Their Money on GOP

By    |   Wednesday, 29 October 2014 09:05 AM

Business-backed political action committees are now giving more money to Republicans than Democrats, in many cases even turning against incumbent senators as the Nov. 4 election nears.

Through June, such PACs had given 61 percent of their donations to Democrats, reports The Wall Street Journal.  But since then, 42 percent of the donations are now going to Democrats, with 58 percent going to Republicans between July and September, Federal Election Commission reports show.

The change is because of shifting expectations of who is more likely to win the election, says Nicholas Colas, chief market strategist for the brokerage firm ConvergEx Group.

"Wall Street expects return on investment,” said Colas. “It makes no sense to contribute to a losing campaign.”

For example, incumbent Democratic Sens. Kay Hagan of North Carolina and Mark Udall of Colorado got less money from business PACs in the third quarter of the election cycle, and in Alaska, donations were about the same for incumbent Sen. Mark Begich and his Republican challenger, Dan Sullivan.

Such shifts have been good predictors of elections in the past.

In 2006, business PACs shifted toward Democrats late in the election cycle just ahead of a sweep election that gave Democrats control of the House and Senate. And in 2010, business contributions shifted Republican, just before the wave that gave the GOP control of the House and several gains in the Senate.

But even without the business PAC money, Democrats are still bringing in more money Republicans this election cycle, said Democratic Senatorial Campaign Committee spokesman Justin Barasky.

“The DSCC has outraised [its GOP counterpart] by $30 million,” he told The Journal.

In all, the Democratic Congressional Campaign Committee reports it raised almost $17 million in September, and has $34 million saved for the final weeks of the election.

Of the $163 million the committee has raised since January of 2013, more than $50 million has come from online donors.

Contributions to GOP candidates can offset the high amounts of money donated by labor union PACs, which gave 99 percent of their contributions to Democrats running in seven key Senate races.

The AFL-CIO is supporting Democrats because "in each particular race, the Democrat has a more pro-worker point of view," said union political director Mike Podhorzer.

However, business lobbyists say the political climate favors Republicans, and backing GOP candidates is being seen as a prudent move.

President Barack Obama and other party leaders are making Democratic candidates "vulnerable," said U.S. Chamber of Commerce National Political Director Rob Engstrom.

"It’s increasingly likely we’re going to reestablish a pro-business majority in the Senate,” Engstrom told The Journal. "Companies aren’t going to write PAC checks to candidates who fundamentally don’t represent their interests.”

The shift became more apparent in September, when polls started showing Republicans pulling ahead.

Hagan's share of the PAC money dropped to 44 percent in the third quarter of the cycle, after she'd received 82 percent between January 2013 and this June.

In addition, many companies that initially backed Hagan are now backing Republican challenger Thom Tillis. For example, American Airlines' PAC gave Hagan $4,500 in the first six months of 2013, but on Sept. 26 gave $5,000 to Tillis.

However, in Louisiana, the energy-rich economy's businesses are sticking by Democratic Sen. Mary Landrieu, who chairs the Senate energy committee. She got 68 percent of business PAC money, compared to Republican challenger Bill Cassidy, who drew 32 percent.

But fossil-fuel PACs are generally not following suit, the reports showed.

“For fossil-fuel energy PACs, there are no credible Democratic alternatives in close Senate races such as Colorado, Iowa, New Hampshire and North Carolina, so the choice is easy,” Stephen Brown, a vice president for Tesoro, a San Antonio-based oil-refining company, told The Journal.

“For races in Alaska, Arkansas, and Louisiana, fossil-fuel folks get more conflicted, as credible Democratic incumbents in those states unfortunately appear to be fading," he said.

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Business-backed political action committees are now giving more money to Republicans than Democrats, in many cases even turning against incumbent senators as the Nov. 4 election nears.
midterms, Republicans, PACS, businesses, senate
Wednesday, 29 October 2014 09:05 AM
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