Atrios breathlessly reports on a "first of its kind" (!) study showing that "CEO political donations favor GOP." [Insert obligatory Casablanca reference here.]
The study, by professors from Harvard Law School [which is important because Harvard is Harvard and that makes anything better] and Tel-Aviv University, classifies a CEO as a Republican or a Democrat if they gave at least two-thirds of their campaign contributions to one party or the other. CEOs that distributed their contributions more evenly between the two major parties were classified as neutral.
The study is by Alma Cohen, Roberto Tallarita, Moshe Hazan and David Weiss, and is up at SSRN. They look at campaign contributions by "public-company CEOs during the 18-year period of 2000 - 2017."
Although the study claims to be politically neutral, including with respect to the issue of mandating corporate disclosure of political campaign spending, it's worth noting that Cohen and Tallarita are both proteges and co-authors of Lucian Bebchuk, and I strongly suspect their study will be deployed by Bebchuk and others to once again argue in favor of mandating corporate disclosure of political campaign contributions. Why Bebchuk and his proteges are so determined to help Democratic politicians defund Republicans continues to puzzle me, but so be it.
My principal reaction to the paper, however, is to ask "so what?" The interesting divide in American politics these days is not between "Republican" corporate elites and "Democrat" corporate elites, but between elites and non-elites. This was the principal focus of my recent Pound Lecture, of course, which you can view here. On a growing set of issues, the GOP base -- i.e., the people who joined the Tea Party and voted for Donald Trump -- are at odds with the Business Roundtable types about which the study is exclusively concerned.
Obviously, there are plenty of leftwing CEOs like Salesforce.com CEO Marc Benioff, for example, who promote progressive social activism. But we increasingly see nominally Republican CEOs with impeccable Business Roundtable credentials using their names and corporate muscle to campaign directly against GOP base-supported laws governing social issues.
In an important recent contribution to the legal literature on corporate activism, Tom Lin discusses in detail the widespread hostile reaction by major corporations to North Carolina’s so-called “Bathroom Law” and various early Trump administration initiatives. They serve as leading examples of what he calls “unprecedented contemporary corporate social activism.” I'd also mention a Francis Pileggi post from May 2016, in which he observed that:
Yesterday’s Wall Street Journal featured a front page article about an apparently increasing number of CEOs of public companies who use their companies’ resources, and wield their companies’ resources as a sword, to advocate in their official corporate capacities to advance their favorite social agendas–or to oppose legislation on social policies that they disfavor.
In other words, all the interesting action these days is taking place at the growing rift between CEOs who simultaneously are crony capitalists and social justice warriors on the one hand and the folks Joel Kotkin calls the American yeomanry.
So here's what I think is the interesting story: Yes, CEOs historically gave a lot of money to Republicans, which is not surprising in the slightest, because the Republicans were (slightly) more pro-big business and pro-rich people than the Democrats. The DC GOP elite have long been bought and paid for by corporate America. But what about the future? Trump's election infuriated large swaths of the Business Roundtable CEO community. Since Trump took office, the split has become even more obvious: How many of the CEOs in the study do you think support Trump's policy on the border wall, immigration, trade, etc.., let alone hot button social issues? Will lower taxes and reduced red tape be enough to keep CEOs in the Republican coalition? On these issues, the authors are silent.
To be sure, one almost might feel sorry for the corporate titans, who increasingly look homeless. Neither the Trump Base nor the progressive wing of the Democratic Party are particularly fond of them. I'd bet a lot of them were pondering Joe Biden until his history of being handsy caught up with him this week.
