Party favors

The Minneapolis-St.Paul 2008 Host Committee, for instance, which expects to raise $58 million for the Republican festivities in September, has disclosed the names of 53 donors. All but two of them are for-profit businesses. These corporations have spent $63 million on campaign contributions since 2005, while doling out some $449 million to wield influence in Washington during the same time period, according to the CFI report.

"These are big players in the quest for influence in Washington," says Steve Weissman, associate director for policy at the CFI, who co-authored the report. "And they’re willing to put up big money in terms of campaign contributions and lobbying expenditures to get what they want."

A recent survey by the Minnesota Independent of all 53 Republican donors found that just eight were willing to disclose the size of their contributions to the party convention. The donations range from $6 million from telecom giant Qwest to $50,000 from Kraft Foods.

The 2002 McCain-Feingold campaign finance act was supposed to eliminate the unlimited flow of corporate contributions to political parties. But while such "soft money" contributions are now prohibited to the parties themselves, fundraising intended for presidential conventions remains an exception.

"What this becomes is the loophole that you can drive your Mack truck through for corporate influence," says David Schultz, a political science professor at Hamline University and an expert on campaign-finance laws. "This becomes a great way, potentially, for Republicans to be able to do quid pro quos in terms of taking special interest money. Democrats can do it too, of course."

Spending on conventions has skyrocketed in recent years. In 1980 just $1 million was raised to support the festivities, while four years ago that figure had mushroomed to $142 million. This year convention planners are expected to pull in $110 million in contributions.

AFLAC, for instance, the for-profit health insurance company, is a donor to both the Republican and Democratic conventions, although the size of the company’s contributions have not been disclosed. The corporation spent $12.6 million over the last four years to lobby Congress and the White House on issues such as pressuring Japan to loosen restrictions on its health-insurance market and fighting regulation of prescription drug prices. AFLAC also contributed more than $3 million to federal candidates during that time period, according to the Center for Responsive Politics.

Anheuser-Busch is another corporate supporter of both presidential conventions. The brewing behemoth is also an outsized player inside the Beltway, providing $2.6 million in campaign contributions during the last two election cycles and spending $10.4 million on lobbying efforts. Among the company’s areas of interest: loosening international trade regulations and fighting restrictions on alcohol advertising.

Contributions to the host committees are tax-deductible, owing to the groups’ nonprofit status. In addition, these expenditures–unlike campaign donations–do not have to be disclosed until 60 days after the conventions, when interest in the party gatherings has long since flagged. The Federal Elections Commission has justified these lax regulations by arguing that such contributions are “motivated by a desire to promote the convention city and not by political considerations.”

But the CFI’s Weissman says that this is a naive argument unsupported by the financial facts. Roughly a quarter of the donors, for instance, are contributing to both party conventions. In addition, barely a third of the contributors for each convention are based in the home states of this year’s political gatherings. In the case of Minnesota, just 22 of the corporate donors are located in the state, while only four of the companies have not been active lobbyists and campaign contributors at the federal level. "If the aim is civic promotion, it doesn’t make sense to be giving as much in the non-headquarters city," argues Weissman.

The CFI report calls on Barack Obama and John McCain, both of whom have garnered reputations as political reformers, to use their influence to bring greater accountability to the convention fundraising process. In a statement released to the Los Angeles Times, the Obama campaign indicated that he is interested in closing the corporate money loophole. “Moving forward, one of Sen. Obama’s reform priorities will include changes in the way party conventions are funded to assure they can be run without dependence on soft money,” spokesman Hari Sevugan said.