It is well know that large corporationsespecially those that are prone to feast at the government troughmake donations to political parties and candidates. Most companies like to hedge their bets, donating to both major political parties. Nationwide, Fortune 500 companies gave between 62 and 75 percent of the donations from their political action committees (PACs) to Republicans. Most of the rest went to Democrats. However Corrections Corporation of America's (CCA's) PAC gave over 96 percent of its $149,500 in political donations to Republicans according to Federal Elections Commission filings through August 2004.
The less than 4% Democratic donations included a total of $5,000 given to Tennessee Representatives Jim Cooper, Lincoln Davis, John Tanner and Harold Ford, Jr. Tennessee is CCA's home state. Most of the donations were made in states, such as Tennessee, Colorado, Georgia and Florida, where CCA runs private prisons.
Another nationally-known Tennessee-based company, FedEx, says that it gives about sixty percent of its donations to whichever party is in power. The other 40 percent is given to the opposition.
One exception to CCA's fund the Republicans" rule came in the closely-contested Washington state gubernatorial election. There CCA gave $1,350 each to Republican candidate Dino Rossi and successful Democratic candidate Christine Gregoire.
Some think corporate contributions are down in respect to political parties and candidates. However, the not-so-secret sump of political cash contributions is so-called 527 committees. Named for section 527 of the federal tax code, the committees are allowed to raise funds without limitations so long as they spend the money on political activities not directly related to the election of a candidate. Thus, 527 committees are allowed to do just about any political activity that doesn't mention the name of the candidate they champion. Examples of this include MoveOn.org and Swift Boat Veterans for Truth, both of which had a clearly partisan agenda favoring one of the presidential candidates and both of which were allowed to accept unlimited donations. Even more clearly biased groups such as RGA (Republican Governors Association) and DGA (Democratic Governors Association) count as 527 committees.
CCA was not absent from the 527 donation frenzy. It gave $212,055 to RGA and $115,500 to DGA. Its total outlay to 527 committees was $370,055. CCA is proud of its record of political donations according to CCA spokesperson Louise Chickering.
We support organizations that want to further public-private partnerships and efficient government use of taxpayer money," said Chickering.
Melanie Sloan, executive director for the Washington-based Citizens for Responsibility and Ethics, a nonpartisan ethics organization, has another take on 527 committees. She believes that the corporate donors to are using their donations to 527 committees to influence state-level political decisions and therefore such donations should be regulated. Her organization has sued the Federal Election Commission to bring about such regulation.
Corporations are not political," according to Ms. Sloan. Most of them don't have a social agenda. They know that governors have the power to set regulations. In some ways they have more power than the president.
The McCain-Feingold campaign reform act ended the practice of allowing unlimited contributions to political parties in 2002. This was done to prevent rich and powerful corporations from purchasing access to and persuasion of government officials. However, 527 committees allow the continuation of such practices through a legal loophole that needs closing. Another legal loophole in the campaign finance reform laws is the donation by large corporations to politician's charities. For instance, CCA gave $100,000 to House Majority Leader Tom Delay's personal charity, the DeLay Foundation for Kids [PLN, April, 2005].
Yet another loophole is the legal defense fund contributions to politicians like DeLay who are being investigated for and charged with alleged wrongdoings.
All of these loopholes blur the line between political and non-political donations and allow corporations to buy face time, legislation, contracts and influence with politicians. They are all problems that need solving, preferably by amendment of the campaign finance reform laws.
Sources: Jackson Sun, The Olympian, Chattanooga Times Free Press, Associated Press.
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