Sweet Deal: Corporations Get $760 from the Government for Every Dollar They Spend on Elections


The 2012 and 2014 elections were the most expensive in American history and were financed largely by corporate money. So why are American companies so eager to put up so much cash for political influence? Because it pays. A lot.

A report issued last month by the Sunlight Foundation, a government accountability group, found that for every dollar the nation’s most politically active companies spent on political influence, they received $760 from the government in the form of federal business and support. In total, the yearlong study reported that 200 of the country’s top campaign donors spent $5.8 billion on political lobbying and campaign contributions between 2007 and 2012 and received a whopping $4.4 trillion in return.

By contrast, the federal government paid the nation’s 50 million social security recipients $4.3 trillion during the same time period.

The study examined the political spending of the 200 companies during the 2008, 2010 and 2012 election cycles. The $4.4 trillion that these companies received for their efforts represents two-thirds of the $6.5 trillion that American taxpayers contributed to the U.S. treasury.

“Welcome to the world of ‘Fixed Fortunes,’” the study explains. “A seemingly closed universe where the most persistent and savvy political players not so mysteriously have the ability to attract federal dollars regardless of who is running Washington.”

The Supreme Court’s Citizens United decision opened the floodgates for corporate money to enter Washington. Campaign spending in the 2012 elections was unprecedented, totaling an astounding  $6.3 billion, according to the Center for Responsive Politics. Spending on the 2014 elections, at $4 billion, made it the most expensive midterm election in history.

In the Citizens United case, the Supreme Court ruled in their majority decision that corporate spending on federal elections would not “give rise to corruption or the appearance of corruption.” The Sunlight Foundation’s study tested the Supreme Court’s conclusion and instead found that political spending is just about the best investment a company can make in America.

Of the 200 companies studied, the report identified 29 companies that received 1,000 times more federal money than they spent on campaign contributions and political lobbying. Meanwhile, 102 companies received at least 10 times more money than they invested in politics and 138 of the companies saw a financial return that was greater than their investment.

Banks were the biggest beneficiaries of Washington policies due to the enormous bailouts that helped Wall Street weather the 2008 recession, even while many homeowners suffered due to the reckless banking and investment practices that caused the collapse. Weapons manufacturer Lockheed Martin, which spent $8.4 in contributions and $84.1 in lobbying, received $332 billion in federal business and support, making it the largest recipient of federal business. The pharmaceutical company McKesson and the wealth management firm Carlyle Group also made the list.

The report found that out of the $3 trillion in contracts the federal government issued for goods and services, the top 200 political contributors received one-third of that money.

Other financial benefits are harder to quantify, the report admits. For instance, many companies save by influencing trade agreements, labor and environmental regulations and tax codes.

For instance, the report cites tax provisions that save health insurance companies and healthcare providers tens of billions of dollars. Meanwhile, WalMart, the company that put out food bins in its break rooms this holiday season to be donated to its low-wage workers, acknowledged in a filing with the SEC that a reduction in the federal food stamp program could negatively impact the company’s $476 billion yearly earnings.

The report concludes:

More than seven years after Washington passed the first measures to stimulate the economy as the housing bubble started to burst, more and more Americans are living on less and less, without as much savings and other assets to fall back on in hard times. Washington policies that have restored corporate profits and made the stock market boom have left much of the country behind. Perhaps that’s why a whole host of polls, from networks and news organizations and nonprofit groups, show large majorities of Americans, year after year, saying that the country is on the wrong track.

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