Legalizing the Loophole: The Special Interest Ploy to Increase Contributions From the Wealthiest Donors

6/1/2000

Executive Summary

Our current campaign finance law allows wealthy donors and big money special interests to have a disproportionate influence over the political process. This study looks at how proposals to raise the legal limits on political contributions and ban soft money could benefit some top executives and their companies. Key findings include:

• Fortune 500 CEOs are active campaign donors. In the first fifteen months of this election cycle, two-thirds of all Fortune 500 CEOs gave at least one maximum $1000 contribution to a candidate, compared to less than one percent of the general population.
• Raising contribution limits would further solidify the political power of wealthy special interests. Chief executives of Fortune 500 companies could have increased their political donations by $3.5 million if the contribution limits were tripled, according to U.S. PIRG's analysis of maximum contributions given by 500 top executives through March 31, 2000.
• A ban or restriction on soft money would not affect many politically active companies if they could triple their hard money contributions.

From January 1, 1999 to March 31, 2000:

Ford Motor Company and its employees spent $115,000 in hard money contributions and $32,500 in soft. If contribution limits were tripled, they could have increased their hard money contributions by almost 100% or $112,000.

Goldman Sachs Group and its employees spent $1.6 million in hard money contributions and $297,000 in soft. If contribution limits were tripled, they could have increased their hard money contributions by 125% or $2 million.

Monsanto and its employees spent $89,000 in hard money contributions and $20,000 in soft. If contribution limits were tripled, they could have increased their hard money contributions by almost 100% or $88,000.

Microsoft Corporation and its employees spent $1.3 million in hard money contributions and $1.1 million in soft. If contribution limits were tripled, they could have increased their hard money contributions by 120%, or $1.6 million.