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Tech industry split in its political donations

President Bush and Sen. Kerry are both getting tech money

By Grant Gross
August 20, 2004 12:00 PM ET

IDG News Service - The IT industry has two horses in the U.S. presidential race this year.

In a down year for tech industry contributions to political groups, employees from computer and Internet companies and political action committees (PAC) have contributed just over $1.6 million to President George Bush as of Wednesday and almost that same amount to Democratic challenger Sen. John Kerry (D-Mass.).

As of July 5, employees and PACs from computer and Internet companies had donated $14.8 million to political parties and candidates for U.S. federal offices during the 2004 election cycle, with the industry ranking 14th on the top industries list. Republicans received 51% of the money.

U.S. law prohibits corporations from directly contributing to political campaigns, but many tech companies give money through PACs, and IT employees are active contributors.

Perhaps not surprisingly, tech industry donations have slipped from the $39.6 million given during the 2000 U.S. elections and the $26.7 million in 2002.

While some of that drop may be due to the end of the dot-com boom, Rick White sees another cause for the decline. In 2002, Congress passed the McCain-Feingold campaign finance reform law, banning most forms of so-called unregulated "soft money" donations. That ban has had a bigger effect on donations than the dot-com bust, said White, president and CEO of the TechNet coalition.

Soft money was unregulated money given for "party building" activities with no legal limits. A U.S. Federal Elections Commission rule in 1987 opened the door for this type of donation, often employed by corporations or unions, which are normally prohibited from donating directly to candidates.

In the 2000 election cycle, $20.4 million of the computer and Internet industry's donations came in the form of soft money. "It was easy for the tech community to write some big soft-money checks," White said.

It's worth noting, however, that computer and Internet companies are still ahead of the pace for political donations for any cycle before 2000. During the 1996 presidential year, the industry contributed just $9.4 million to candidates and political groups, ranking just 31st on Opensecrets' top industries list.
The industry's involvement in politics since 2000 comes from a sense of "civic responsibility," said White, a Republican congressman from Washington state during the late 1990s. "It's your job [to get involved] when you get to the point where you're contributing a lot of wealth to the economy."
Many tech companies with PACs or employees contributing to candidates have little to say about their reasons for doing so or what they expect for their contributions. Representatives of Electronic Data Systems Corp., EMC Corp., Siebel Systems Inc. and Hewlett-Packard Co., all on the top 10 list of contributors, either declined to comment or failed to return phone calls or e-mail seeking comment on their donations.

Reprinted with permission from Story copyright 2014 International Data Group. All rights reserved.
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