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Conventional Wisdom

By Courtney Mabeus, Capital Eye

July 23, 2004

An increasing number of corporations are giving to both party conventions. When Boston Mayor Thomas Menino and Massachusetts Sen. Ted Kennedy began calling on New Balance to help the city in its efforts to bring the 2004 Democratic National Convention to Beantown, officials with the century-old, Boston-based athletic shoe company eventually ponied up more than $1 million. 

"We know the mayor pretty well," said company spokeswoman Katherine Shepard. "We wanted to help Boston get the convention. It's our city. We like the city and we want to see it grow." 

Later, New York City Mayor Michael Bloomberg called and asked New Balance to contribute for the Republican convention, Shepard said. New Balance gave $500,000 to the New York host committee, she said. The company's chairman and CEO, Jim Davis, has contributed $113,500 to Republican federal candidates and party committees since 1999. He has contributed $9,500 to Democrats during that time. 

New Balance's dual donations added the company to a growing list of more than 20 companies that have contributed to the Democratic and Republican conventions, according to a comparison of contributor lists released by the host committees. Nine companies contributed to both conventions in 2000. 

New Balance might appear to be an unlikely member of the double donor club, which includes corporate giants AT&T and Microsoft, as well as a slew of pharmaceutical firms that are all known for their heavy lobbying on Capitol Hill. 
Shepard said New Balance is "a non-partisan company" with no political agenda other than to be an equal-opportunity donor. The company also paid to have its logo emblazoned on the side of gift bags that media and delegates will receive at both conventions, she said. 

"We don't play favorites," Shepard said. "Boston is our city." 

This year's presidential election is the first since the 2002 McCain-Feingold law banned soft-money contributions from corporations, labor unions and wealthy individuals to the national political parties. Despite the soft money ban, host committees may still raise unlimited contributions, thanks in part to the Federal Election Commission's decision last year to remove a 1994 regulation that permitted only local individuals or companies to contribute. 

The decision, which allowed the host committees to cast a wider fundraising net, was criticized for opening a new avenue for unlimited political contributions. 

The host committees have pledged to raise a combined $110 million to stage their conventions this year. The Democratic and Republican parties each receive $15 million in federal money to pay for their conventions. 

The host committees are not required to disclose their contributors until 60 days after the conventions, but both groups have posted some donor information on their Web sites. Boston 2004 lists 162 donors while the New York City host committee lists 85. Neither site reveals how much the donors gave, although the Boston host committee lists donors by minimum giving levels. 

Of the four double donors that gave at least $1 million to the Boston 2004 host committee, which earned them "Platinum Benefactor" status, only two-New Balance and the State Street Corporation, a money-management company-are based in Boston. 

Convention donors disagree with the notion that their contributions are intended to enhance their political influence. Microsoft spokeswoman Ginny Terzano said the company chose to give because of its role as a leading global software provider. The software giant will donate computers and technical support to the conventions, she said. 

"It takes a good quality product to put together a national convention," Terzano said. "These are conventions that will have a global audience." 

Microsoft, its political action committee and employees have contributed $11.4 million to federal candidates and party committees since 1999. During that time, 55 percent of Microsoft's money has gone to Republicans, although Democrats have collected 58 percent of the company's contributions in the 2004 election cycle. 

Microsoft spent three-plus years fighting antitrust proceedings brought by the Justice Department under President Clinton, and has its legislative eye trained on a number of issues. Most recently, it threw its support behind copyright protection legislation aimed at combating software piracy. 

"We really do see these [convention] efforts as a way to support our country's democratic process," Terzano said. "We see technology as playing an important part in the elections process." 

Boston 2004 spokeswoman Karen Grant said IBM's in-kind donation of more than $1 million in computer and technical support is an example of a firm helping to promote the city's commerce. After the convention the computer equipment will be given to Boston schools, she said. 

IBM is the "official hardware provider" of the Boston convention. The company also has contributed to the New York host committee. 

One group that won't likely be giving in-kind donations is the Altria Group. The parent company of Philip Morris and Kraft Foods is the tobacco industry's biggest political contributor and a double donor. The company, which gave at least $100,000 to the Boston host committee, is a major supporter of a bill that includes a $12 billion buyout of tobacco farmers over 10 years. The bill also would give the Food and Drug Administration the authority to regulate tobacco products. 

Altria has contributed $9.3 million in individual, PAC and soft money contributions since 1999. Of that, 78 percent has been given to Republicans. 

AT&T is a repeat double donor. The company contributed technical and wireless support to both conventions in 2000, said company convention spokesman Ray O'Connell. The company donated $500,000 each to the Boston and New York City host committees this year, he said. 

AT&T has given more than $9.7 million in individual, PAC and soft money contributions since 1999. Of that total, 57 percent has gone to Republicans. The company is at the center of the battle over how to revamp the nation's telecommunications laws, which Congress may do next year if it takes up the 1996 Telecommunications Act. One issue considered critical to AT&T is preserving the law's requirement that the Baby Bells, which dominate the local telephone market, share their lines with other companies to promote competition. 

O'Connell said AT&T has a "corporate citizen responsibility" to contribute to each convention because of the size of the company's market in New York City and Boston. He denied a link to the company's donations as a form of buying favors from influential lawmakers. 

"They might think that, but they'd be wrong," O'Connell said. 

Double donors are among the many organizations hosting special convention events in honor of lawmakers. Pharmaceutical giant Bristol-Myers Squibb, for example, is one of several big-money sponsors of a fete to honor Kennedy at Boston's Symphony Hall. The party is planned less than a week after Boston Mayor Menino launched a pilot program to allow city employees and retirees to buy prescription drugs from Canada. Kennedy is the ranking Democrat on the Senate Committee on Health, Education, Labor and Pensions. 

Bristol-Myers Squibb and other double donors, including Amgen, AstraZenega and Pfizer, are fighting similar drug reimportation proposals on Capitol Hill that are intended to lower prescription costs. 

Dual Donors: Contributions to Federal Candidates and Parties, 1999-2004* 
Note: This list originally included some companies who were donors to both conventions in 2000 but are not dual donors in 2004. It has been updated to reflect only dual donors to this year's conventions. 

*Figures include individual, PAC and soft money contributions to federal candidates and party committees (soft money contributions were banned following the 2002 elections). They do not include contributions to the convention host committees. Based on Federal Election Commission data downloaded July 5, 2004.