Should Corporations Donate to the Political Process?



Christine and Tom DeLay, with the Hammer Cake

I ran into Tom DeLay and his wife Christine at an event earlier this year in your Nation’s Capital. Before he was indicted for “criminal conspiracy,” allegedly moving money from corporate donations to Texas political races.

Having studied the man in the flesh a number of times over the years, I believe the charges are most unlikely. The facts alone point to his innocence.

Nevertheless, with such a public political indictment, throw ‘innocent until proven guilty’ out the window — the accused must be proved innocent. And even then, the headlines will have moved on to fresh kill. Only bleeding is allowed above the fold.

For the innocent individual, political hardball can be devastating. Ray Donovan, the smeared Reagan nominee, after his exoneration asked, “Where do I go to get my reputation back?”

So too for the corporation: Where do you get your brand back? If your company is aligned with a political loser(or worse), is your brand damaged goods?

Given those realities, Your Business Blogger has to ask: Should corporations even make political donations?

Let’s start at the beginning of this funding cycle. Not at the end user — the politician — but with the goal of the corporation.

The purpose of a corporation is to maximize shareholder wealth — it’s nice if the corporate citizen increases the stakeholder well being, but that’s not the job of the for-profit enterprise.

Political contributions should be a board-level policy where donations are made only if the corporation’s interest is advanced. Not to advance the agendas of individuals in the company.

For example, Starbucks donates 100% of its political contributions to the Democratic Party, supporting the Kerry campaign in particular.

I would submit that Starbucks should only make donations as an investment in the continuation of the corporation’s goals. And not the personal worldview of Starbucks Chairman Howard Schultz. Unless the corporation is the extended playground of the founder. Which may well be the case.

Here’s why. A Congressman will get some 150 personal phone calls each day. Some he takes immediately, some tomorrow, some delegated, some ducked.

The unwritten cascade: Friends First, Horrendous Enemies second, constituents third. A known donor to a competitor’s campaign would have his call returned with a lack of urgency not seen with the above-mentioned group. Interns make those returned calls. Next week. Maybe.

(One politico had code words for his donors. Any large contributor was known as “A Great American.” Those calls were put through fast.)

If you are not a constituent, money does buy you — well, maybe not love, but at least a returned phone call.

If a company board recognizes a real corporate need to influence a political issue, through interest or association groups, follow these rules:

Corporations should donate only to winners in the political process.

Corporations should never donate to underdogs. Losers get the company nothing, not even good will.

Corporations should donate to both political candidates (through interest groups) only when both are in a statistical tie.

Individuals can, of course, make their own decisions. But this should not involve the Company kitty.

Starbucks Howard Schultz and George Soros have not separated the private personal from the public business. For example, individuals can care and contribute deeply on both sides of abortion.

However, the abortion issue should not be funded by corporations unless they benefit from that industry, such as Planned Parenthood Clinics.

Corporations making charitable donations will be covered in upcoming posts. (The answer may surprise.)

# # #

Captain’s Quarter’s reviews the weak case.

Right Wing NutHouse has hunting Repubwicans.

GOPBloggers advocates full disclosure of funding.

The StakeHolder sees nothing amiss.

Sacred Monkeys reports the Texas Democrats have been hit hard.

Legal Fiction doesn’t care for DeLay but has questions.

Michelle Malkin has overview.

See Mudville Gazette at Open Post.

The Political Teen has video.

Outside the Beltway has blogger reaction.

Update 25 Oct: Brand Autopsy has more on Starucks.

Update 17 Jan 2006 The Window Manager has more on movies.


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1 Response

  1. Good post and thanks for the link. Another reason to go to Petes.

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