High-Tech Doles Dollars to Pols

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High-Tech Doles Dollars to Pols

By Neil Munro
Staff Writer

Computer and software firms spent $19.9 million on behind-the-scenes lobbying in 1995 and 1996, and donated a record $7.3 million to political candidates, roughly 50 percent more than the industry donated in 1991 and 1992, according to a new report by a watchdog group.

However, the total of $27.2 million "is a conservative estimate," said Sarah Remes, an analyst who authored the report for the Washington-based Center for Responsive Politics, a nonpartisan group that analyzes campaign spending and the influence of money in politics.

The Aug. 25 report, titled "High-Tech Influence; Computer Companies and Political Spending," is based on financial data sent by executives and companies to the Federal Elections Commission.

But the data understates the high-tech industry's spending on federal lobbying because some spending is deliberately underestimated by executives or does not have to be reported, Remes said.

For example, companies don't report their spending on policy-related lawsuits or their donations to nonprofit groups or associations that try to influence legislation. These groups include the Business Software Alliance, based in Washington, and Technology Network, formed in Palo Alto, Calif., this summer by Silicon Valley companies. The group's two chairmen are John Doerr, a partner in the investment firm of Kleiner Perkins Caufield & Byers, and Jim Barksdale, president of Netscape Communications Corp., Mountain View, Calif.

Companies do not have to report lobbying expenses if their executives spend less than 20 percent of their time lobbying government officials. Also, executives do not have to report their professional occupation when making a donation of less than $200 to a candidate, preventing analysts from gauging which industry they represent.

Companies do not have to report spending in state and local legislative battles. Thus the industry's federal campaign reports do not include the $40 million that was raised in an alliance with the biotech industry to defeat a California state ballot initiative intended to ease lawsuits against high-tech companies.

The growing spending levels demonstrate that "we have clearly seen an industry that is coming of age, that is now increasing its presence in Washington," said Bob Cohen, vice president of communications at the Information Technology Association of America. The Arlington, Va.-based group represents companies such as Microsoft Corp., IBM Corp. and AT&T Corp.

In the early 1990s, "companies thought they could solve their problems on their own and wouldn't need a presence in Washington," Cohen said. But high-tech executives now realize they need to act as an industry during legislative debates over encryption, online taxes, immigration and other issues, he said.

Remes' report does not include donations by the publishing, TV or telecommunications industries, whose political agendas sometimes coincide - or collide - with the agenda of the software and computer industry.

For example, the center's data shows that the 10 major telecommunications companies spent $42 million on lobbying and $11 million on campaign donations in 1995 and 1996 to help them win various battles over telecommunications deregulation and other issues, such as digital copyrights and liability, that can significantly hurt or help the computer industry.

The $7.25 million donated by industry in 1995 and 1996 was evenly split between Republican and Democrat candidates for the White House and Congress. The total included $770,748 given by political action committees, $3.2 million given to the political party headquarters as "soft money," and $3.27 million donated by industry executives to candidates of their choice.

In comparison, the industry only donated $4.8 million during the two years leading up to the 1992 election.

Among the major funding sources are Microsoft Corp., which generated $235,584 for political candidates and spent $1.14 million on lobbying. IBM executives gave $88,639 to candidates, and while the company spent $4.88 million on lobbying.

Much of lobbying money goes to independent lobbyists and law firms. For example, Microsoft's $1.14 million in lobbying expenses includes $292,000 given to the Washington-based law firm of Preston, Gates, Ellis & Rouvelas Meeds, and $120,000 given to Grover Norquist, head of the Washington-based group, Americans for Tax Reform. Norquist, who is an influential figure in the Republican Party, said the money was for "strategic advice." However, Norquist has lobbied for
encryption-decontrol bills supported by Microsoft and many other high-tech companies.

Of the $4.88 million spent on lobbyists by IBM Corp., $60,000 went to the Washington-based firm of Podesta Associates, whose president, John Podesta, left the firm last year to become a senior aide to Vice President Al Gore.

Among the politicians who received significant shares of industry's campaign donations were Rep. Tom Davis, R-Va., and Sen. John Warner, R-Va. Davis received $39,532, while Warner received $66,400. Both politicians got the money from the many information technology companies based in Northern Virginia, said Remes.

"It is impossible to prove any link," between donations and politicians' votes, said Remes. But, "in general, the people who sponsored bills that the industry likes, get the money," she said.

Lobbying Expenditures 1995-96
IBM $ 4.9 million Texas Instruments $ 3.6 million EDS $ 1.8 million Microsoft $ 1.1 million Netscape $ 960,000 Business Software Alliance $ 860,000 Intel $ 600,000 Oracle $ 600,000 Software Publishers Association $ 600,000 Sun Microsystems $ 600,000

Top 5 Senate Recipients of High-Tech Contributions
Kay Bailey Hutchison, R-Texas $171,649
Phil Gramm, R-Texas $163,050
John Warner, R-Va. $66,400
Edward Kennedy, D-Mass. $64,599
John Kerry, D-Mass. $62,224
Source: Center for Responsive Politics, Washington, D.C.

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