Infotech Ponies Up $100 Million For Elections

The infotech industry's donations are overshadowed by other groups

The infotech industry's political donations may reach $100 million by Nov. 5, but that's still only a small share of the blizzard of bucks pelting political candidates.


Overall, business interests have donated at least $242 million from January 1995 to June 1996, according to data collected by the Federal Election Commission. During this period, congressional candidates and incumbents raised $447 million, 58 percent of which came from individual donations. By Election Day, the two presidential candidates may have raised another $800 million -- roughly three times as much as was spent in 1992 -- from companies and individuals, according to the nonprofit Center for Responsive Politics.

During the 18-month period ended June 30, the communications, electronics and entertainment industries donated $24 million to political players, far less than the $60 million donated by the real estate, financial and insurance industries or the $35 million donated by labor, according to statistics gathered by the center, based in Washington.

The center used funding information provided to the Federal Election Commission by incumbents, political candidates and parties. The funding includes money provided by individuals and by Political Action Committees to congressional and presidential candidates and to all political parties. The parties spend their share of the money to win critical races at all levels of government.

Of the infotech industry's $24 million, $9.2 million was given by phone companies, $2.3 million was given by computer-makers, software and online companies, and $7.4 million was given by the entertainment industry, including cable TV companies, according to funding data. However, the infotech industry's overall spending on politics is greater than the data shows.

One factor that underplays the industry's role is the difficulty of identifying donations from citizens working in the infotech industry. Based on previous elections, people working in the infotech industry may have donated another $7.2 million, bumping up infotech's contributions to $31.2 million by June, said Ryan McPherson, an analyst at the center.

Also, the industry has funded a political campaign in California against Proposition 211, a lawyer-drafted measure that would expose companies to more stock-fraud lawsuits. To defeat Proposition 211, infotech companies and executives may give $40 million to allied anti-211 organizations, such as Taxpayers Against Frivolous Lawsuits, a public policy organization based in Sacramento, Calif.

Also, the Election Commission has not received information on donations since June. Data from previous elections shows that at least half of the money is given in the last few months before the November elections, perhaps doubling infotech's contribution to $60 million, he said.

This estimate of $60 million, plus roughly $40 spent against Proposition 211, yields an estimate of $100 million for infotech's political spending in 1995 and 1996.

Moreover, money is not the only political gift. Both President Bill Clinton and Republican presidential candidate Bob Dole have eagerly tried to burnish their credentials with endorsements from executives in the fast-growing industry. In return, Dole has endorsed a relaxation of controls on the export of encryption technology, while both Dole and Clinton have criticized Proposition 211.

Nonetheless, even if the funding data understates infotech's contribution, it also understates donations from other sectors. For example, the AFL-CIO alliance of trade unions announced it will buy $35 million of anti-Republican TV and radio commercials.

Apart from labor, which gives 90 percent of its donations to Democrats, most businesses have donated the bulk of their money to Republicans. For example, the communications, electronics and entertainment industry donated $13 million of its $24 million to the GOP, while the energy and natural resources industries donated $17 million of its $21 million to the GOP.

However, corporations "want to make sure they cover their bets," said Candice Nelson, an associate professor of political science at American University in Washington. "It's a strategy that makes sense," partly because it's hard to predict winners in future elections, and also because companies donate heavily to local politicians, regardless of their party, she said.

The GOP gained extra funding once it took over Congress in 1994, largely because many of the PACs switched their financial support to Republican leaders and committee chairmen. Donations by all 4,030 PACs rose to $126.5 million between January 1995 and June 1996, up $17 million over the same period in 1993 and 1994, according to data from the Election Commission.

For example, the PAC operated by the Vienna, Va.-based Professional Services Council donates roughly $4,000 per year to local politicians, such as Rep. James Moran, D-Va., and Rep. Tom Davis, R-Va., said council director Bert Concklin. The council, whose membership includes 130 infotech companies such as San Diego-based Science Applications International Corp., does not give money to Sen. Paul Sarbanes, D-Md., because he is "not sympathetic or responsive to most business interests," said Concklin.

The PSC coordinates its political donations with its member companies who collectively donate up to $100,000 a year to political candidates, said Concklin.


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