To Predict Losers In a Power Shift, Follow the Money
Pharmaceutical and oil companies had better beware if Democrats make major gains in the upcoming elections.
If Democrats win control of one or both chambers of Congress as many analysts expect, those and other industries could lose a raft of the legislative goodies they've garnered in recent years and also find themselves under congressional investigation.
Such are the spoils when power shifts in the federal legislature. Some groups that have been getting what they want from Congress for a long time won't anymore. Others that have failed repeatedly to get their agendas passed will succeed more often.
How can we guess the winners and losers? Just follow the money.
The best way to identify Democrats' friends and foes is to examine patterns of campaign contributions. Groups that have given much of their money to Democrats can be considered their true allies and will likely benefit from the items that Democrats push on Capitol Hill. Groups that have been delivering most of their campaign largesse to Republicans will probably see their druthers suffer under a more Democratic-leaning Congress.
Political scientists debate endlessly whether political money buys congressional action or if organized interests just naturally shower with cash the lawmakers and parties that champion their causes. What isn't in dispute is that fundraising is an excellent guide to who will receive the most attention in Congress -- both good and ill.
Democratic leaders have signaled, in campaign commercials and elsewhere, that they intend to attack pharmaceutical and oil companies in a variety of ways when Congress reconvenes. That isn't a surprise; neither industry has been very supportive of Democrats in recent years. Since 2002, drug firms have given about two-thirds of their donations and energy companies have given roughly three quarters of theirs to Republicans, according to the nonpartisan Center for Responsive Politics (CRP).
Other industries that would be wise to watch their backs if Democrats take over include insurers, electric utilities, manufacturers, chemical makers, home builders, general contractors, food processors, railroads and building material producers -- all of which gave 60 percent or more of their contributions to Republicans since 2002, according to the CRP's statistics.
Democrats are likely to play favorites as well. If they win, they will almost surely give high priority to the wishes of labor unions and trial lawyers, which have generally been dismissed by Republicans. The CRP classifies the political action committees of both as either solidly or strongly Democratic. Environmental groups, which work closely with Democrats, would also have a leg up.
Each party knows precisely who its strongest backers are and who are its greatest enemies.
That's why both Republicans and Democrats summoned their most reliable financial backers to separate meetings on Capitol Hill at the end of last month. Given the enormous stakes and potential peril of the midterm elections, party leaders pleaded for every spare nickel and by all accounts, donors coughed up plenty.
Before Congress left town, major donors had an absolutely crazed fundraising period. One labor lobbyist I know attended five fundraisers and receptions in a single night. A business lobbyist said he received seven faxed invitations to fundraising events within 20 minutes.