Private equity and venture capital professionals have donated more than $8.2 million to a “super” political action committee (PAC) supporting Mitt Romney’s candidacy for president, according to US Federal Election Commission documents as of 31 May.
At least 71 individuals who have donated to the ‘Restore Our Future’ super PAC declare firms with private equity or venture capital businesses as their “employer/occupation” in donation documents, according to a Private Equity International analysis of the filings. Donors include industry luminaries such as Henry Kravis of Kohlberg Kravis Roberts, who pitched in $100,000; Richard Boyce of TPG Capital, who donated $300,000; and Steven Webster of Avista Capital, who donated $1 million, according to filings.
Most of the private equity firms contacted for this story declined to comment. Restore Our Future does not comment on its donor list or fundraising strategy, a spokesperson told Private Equity International.
Blackstone as a firm does not support candidates for the presidency.
The Blackstone Group
Firms that did respond to inquiries regarding donations took a similar line to that of The Blackstone Group, which issued the following statement in response to a question about senior managing director Prakash Melwani’s $100,000 contribution to the PAC: “Blackstone as a firm does not support candidates for the presidency. It does not contribute to campaigns or candidates or independent PACs. Contributions made by firm professionals are made in their personal capacity, and are not guided by the firm or reflect the firm’s viewpoint.”
As is the case with many private equity firms, Blackstone’s leadership team includes individuals known to support both Democrats and Republicans. Chairman Stephen Schwarzman reportedly hosted a fundraiser for the Romney campaign. Meanwhile, firm president Tony James is a noted supporter of President Barack Obama’s reelection.
However, although it would be impossible to prove that the PE/VC industries favour one candidate over the other, it should be noted that filings for Priorities US Action – a comparable super PAC supporting Obama’s reelection – revealed only two donations from individuals whose employers are private equity or venture capital firms. Those donations totaled $101,000.
The emergence of the super PAC
Super PACs emerged as an important element in the 2012 election because of a pair of US Supreme Court rulings in 2010 that eliminated limits on certain types of political donations from unions, corporations or individuals.
If we coordinate in any way whatsoever, we go to the big house.
Officially known as ‘independent expenditure-only committees”, super PACs are political entities regulated by the FEC that advocate the election or defeat of clearly identified federal candidates. However, they cannot be directly affiliated to those candidates’ campaigns.
It’s an important distinction. Individuals are legally prevented from donating more than $2,500 to Romney’s official campaign committee. However, because Restore Our Future does not take direction from Romney or his campaign, there are no limits.
Super PACs are prohibited from making expenditures “in concert or cooperation with, or at the request or suggestion of, a candidate, the candidate's campaign or a political party,” according to the FEC’s website.
“I’m not allowed to communicate with a super PAC in any way, shape or form. My goodness, if we coordinate in any way whatsoever, we go to the big house,” Romney said in December.
The formation of Restore Our Future, and other super PACs, has enabled private equity professionals to show a greater level of financial support for Romney’s campaign than they could have in 2008, when he failed to emerge as the Republican candidate in the primaries.
We're big boys and girls, and we should be able to take that.
A GP contributor to Restore Our Future
After four years under the Obama administration, many industry sources have become weary of policies and attitudes considered to be antagonistic toward the business community. The conversation surrounding private equity and its role in the economy has become a defining characteristic of the presidential campaign in recent months, with the Obama campaign targeting Romney’s background as the head of Bain Capital.
“We’re big boys and girls, and we should be able to take that,” said one GP who contributed to Restore Our Future. “I’m more concerned that the policies that have contributed to this work are only going to get worse … Even though I’m normally a Democrat, and voted for Obama in 2008, I think the direction of country … is highly problematic right now.”
While some studies have shown the attacks on Bain to be effective with voters in battleground states, the President’s campaign and pro-Obama super PACs have struggled to raise money at the same clip as Romney and Restore Our Future. Some media sources have attributed this to declining support for the President in the business and financial community.