There are two things I know about - okay, three - the Republican Party, Corporations, and the US Senate. I’ve toiled in all three vineyards over a 40+ year career - most of it in the corporate world, to be honest. I’ve been involved in 35 GOP US Senate and House campaigns in 25 states; I was a corporate lobbyist for two decades, and I was a US Senate official and staff member for much of the 1990s.
So when I see a genuinely uninformed column or op-ed in a “newspaper of record,” such as the New York Times or, in this case, The Washington Post, I weigh in. Some of us know much more about the relationship between corporations and the Republican and Democratic Parties than does the insipid and shallow musings of Catherine Rempel, a “journalist” (this is your reminder that journalism doesn’t actually qualify as a “profession”) from a once-respected publication.
Rempel has authored two interesting pieces in the Washington Post recently. First, an op-ed extolling that Republicans, somehow, are just discovering that capitalism is more than about tax cuts (demonstrating her ignorance of both), and further reporting on a massive conference call involving over 100 “major corporations” (CEO’s, reportedly) who have somehow figured out that fighting “controversial state voting bills” is more profitable than working with Republicans on tax cuts.
She really said that. You know, the same Republican Party that dramatically reduced corporate income tax rates from a top rate of 35% to 21% and allowed them to repatriate dollars from foreign investments to invest in. . . the United States of America. That has resulted in, just by one measure, an increase in the Dow Jones Industrial Average by more than 12,000 points over the Trump presidency.
I would love to see just one credible “study” or non-partisan analysis by anyone that shows that opposition to Georgia’s or anyone else’s election reform laws increases corporate profitability, especially compared to corporate tax rate reductions. But I won’t - they don’t exist. Pardon my French, but that’s merde. How many Americans are clamoring for corporations to engage in electoral politics? Here’s a Gallup survey from early 2016, and tell me why you think it has dramatically changed?
What are we to make of all this? Are the Republican Party and its leaders in Congress now “at war” with major public corporations? And what does that mean, actually, if it is true? I hate to disappoint the vapid Ms. Rempell, but it is not anywhere near as simple as her mind appears to be.
The Republican and Democratic party relationships with corporations are complex and nuanced. It starts with understanding why corporations would even care about such relationships. With the continuing growth and influence of federal agencies, policies, and regulations over companies and entire industries, corporations need relationships with policymakers and regulators. Why? So they can try to influence those policies and regulations in a way that won’t hurt them, and could actually advantage them.
I spent 22 years in the consumer product industry, most of it at a Fortune 250 iconic manufacturer in which I still own stock. I largely established and managed the government affairs operation for that company, which operated at one time in as many as 14 states and a handful of countries, such as Australia, Canada, Mexico, and Denmark. I built relationships not with political parties, but public officials from both sides of the aisle, at all levels, from foreign embassies to county zoning offices. I even made personal political campaign donations to members of Congress, Democratic and Republican, and a few state legislators, along with mayors and city council candidates (all in the US since foreign campaign contributions are illegal most everywhere).
Why? Because I wanted fair regulatory and public policy outcomes that allowed my company to compete on a level playing field, and I showed appreciation (personal and company political action committee campaign contributions) when they did. There’s nothing wrong with that. It is all publicly disclosed information. You can easily find out whose federal campaigns or PACs I contributed to, for example.
This is not uncommon. Most heavily regulated companies (and nearly every publicly traded entity and not a few private ones are heavily regulated) operate this way. The larger ones have lobbying offices in DC, or perhaps hire lobbying firms, and even smaller companies rely on non-profit trade associations to represent their interest in federal legislation and regulatory activity. You know, organizations like the National Federation of Independent Business, the National Restaurant Association, the National Association of Manufacturers, the Food Marketing Institute, and no shortage of others, state and federal. Even association executives have their own association.
Here’s the deal. A few years ago, with the rise of the millennial generation’s buying power and size, not to mention their entry into the workforce, CEO’s and corporate leaders bought into the notion that they needed to cater to them, recruit them, capture their dollars, and appease their whims. They discovered that many of them wanted to work for companies that operated in a “socially responsible” manner. Thus, the advent of corporate “social responsibility” operations, which has become its own profession, if not industry. Some CEOs went so far as to push for replacing as many “Boomers” on their workforce as possible with “Millenials” as a way to stay relevant with the emergent generation. They created affinity groups for LGBTQ+ workers; African-Americans; Women; Hispanics; name your category. They not only listened, but they empowered them.
That is how you get a modern-day Coca-Cola, with racial quotas on hiring outside legal firms and companies weighing in on “bathroom bills” in North Carolina and Texas, not to mention pressuring Major League Baseball to move its annual All-Star game, based on false misrepresentations.
What’s this got to do with the Republican Party? Not a lot, actually. This isn’t about partisanship. Corporations will turn to whatever legislators are in power to influence legislative and regulatory outcomes. Their political contributions have always shifted to whichever party is in power. That’s not changing.
They’re about the money; profitability. That’s all. And if they thought being “woke” on issues not relevant to their company operations and profitability would help, they may be in for a big surprise. I think we’ll likely see less “wokeness” from most (not all - Big Tech is hopelessly woke) corporations given the likely backlash to result from Commissioner Rob Manfred’s banal decision to move the All-Star game.
Senate GOP leader Mitch McConnell warned corporations last week not to engage in cultural-political issues while making sure they knew that their political contributions were still welcome. It was actually friendly advice, if not a warning shot. A few companies have withdrawn or pulled back from political contributions over the post-election integrity issues from 2020, especially the Capitol riots of January 6th. Corporations do not like controversy, and they tend to run and hide when confronted with it.
Here’s the thing. Their corporate PAC contributions don’t differ that much between Democrats and Republicans (chart courtesy of opensecrets.gov, which also includes a few union PACs). And they give to both sides; Coca-Cola’s PAC, for example, in 2020 gave 59% of its contributions to Democrats. That should surprise no one.
So when partisan “journalists” like Catherine Rempel push some phony narrative that Corporations are abandoning Republicans, rest assured that she and her newspaper know absolutely nothing about the way the corporate political world works. Chances are, they’re being fed a false narrative from Democratic spinmeisters as a way to divide corporate contributors from giving to Republicans, or at least making them think twice. It’s just not real. And it is not changing anytime soon.
Corporations have a push-pull, even at times frustrating relationship with members of Congress, and Presidents, from both parties. They generally like the way Republicans fight on big-picture issues, such as taxes and regulations. Most loved the regulatory strategy (no new regulations, and actually paring back regulations) of the Trump Administration. They absolutely loved the corporate tax rate decreases and other reforms. But they also enjoy working with Democrats who can be great champions on local issues, such as intervening to the Environmental Protection Agency’s regional office to clean up a superfund site where they want to buy or build something. And when corporations actually want some regulation, they often find Democrats more willing partners than Republicans. They’re just better at that sort of thing, more often than not.
Ignore the media narratives that corporations are “at war” or turning away from Republicans. Sure. Until they need them. Like, on Joe Biden’s and the Democrats massive new tax increases, including on corporations of all shapes and sizes, to fund their big-spending plans. We’ll see how long that narrative lasts.