Inequality and Stratification by Robert A. Rothman

Author:Robert A. Rothman [Rothman, Robert A.]
Language: eng
Format: epub
Tags: Social Science, Sociology, General
ISBN: 9780132695312
Google: i-ztAAAAMAAJ
Publisher: Prentice Hall
Published: 1999-01-15T05:12:33+00:00

Corporate PACs. Campaign financing reform legislation in the 1970s endorsed Political Action Committees (PACs) designed to encourage smaller donors to pool their money and thus have more influence than they could have individually. Any group or organization can form a PAC, and most major class-, race-, and gender-based interest groups originate them to compete in the political process. Corporations or unions cannot contribute directly to PACs, but they can organize them and facilitate contributions by their members. Each PAC is limited to donations of $5,000 per candidate per election. More than 4,000 PACs are registered with the Federal Election Commission (FEC), and they account for one-third of all contributions. PACs are thus a critical source of funds for politicians. PACs support the pluralist model to the extent that the needs of major groups in society are represented.

PAC contributions are distributed in different ways. Sometimes they are used to bolster the candidacy of a specific individual or a particular party, based on the belief that they will pursue a specific political agenda once in office. Business leaders, for example, tend to favor the Republican party because they anticipate more favorable treatment from them. However, PACs are usually much more pragmatic; they tend to target incumbents because nine out of ten typically retain their seats, and more often than not money is spread among all major candidates to ensure supporting the candidate who eventually wins. To illustrate, the largest corporate PACs in a recent election distributed 53 percent of their money to Republicans and 47 percent to Democrats (Clawson, Neustadtl, and Scott, 1992). In that way contributors guarantee themselves access to whoever is the office holder. It is very simple; “The PAC gives you access. It makes you a player,” explains the chair of a business PAC.

Corporations are aware that they cannot ordinarily prevent legislation that is popular, even if it is detrimental to their interests. For example, things like corporate taxes, occupational safety, and clean air are too popular with American voters to ever be eliminated entirely. Rather, the usual goal of corporate PACs is to win special benefits for their particular company or industry (Case Study). They seek to weaken legislation that is costly or cumbersome or win exemptions, extensions, or exclusions from laws that they cannot prevent. Such exemptions are often hidden or buried in obscure sections of bills and thus escape public scrutiny. A 1986 law increasing corporate tax rates stands as a classic example of how corporate welfare works. The law was more than 800 pages long, and Section 739, subsection J, paragraph iii, contained an exemption that limited the tax liability of one company. The firm was identified only as “a corporation incorporated on June 13,1917, which has its principal place of business in Bartlesville, Oklahoma” (Clawson, Neustadtl, and Scott, 1992: 91).1

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