From Wall Street to the White House: How Industry titans have shaped US presidential races through the years

In recent years, contributions from industry titans have significantly shaped US election outcomes. But how much is being raised, where does it go, and can it truly make or break an election?

Fundraising in the Founding Era

Money has long influenced American elections. In Money in Politics: Campaign Fundraising in the 2020 Presidential Election (2022), author Cayce Myers notes that George Washington spent £39 and 6 shillings – about $195 – on hard cider, punch, and wine for voters while seeking a seat in the Virginia House of Burgesses in 1757. The need for funds became increasingly important in US elections during the early 19th century.

In what is often considered the first modern presidential election, Andrew Jackson implemented the spoils system to reward campaign loyalists who helped him win in 1828.

By the late 19th century, concerns over the corrupting influence of money on politics grew. Campaign finance also emerged as a major issue during the 1904 presidential election, where Theodore Roosevelt faced well-financed Democratic opponent Alton Parker. The New York Times heavily criticised Roosevelt and his campaign manager, George Cortelyou, alleging that trusts were “buying” the president with their contributions. This criticism led to the Tillman Act of 1907, which imposed strict restrictions on corporations, banning them and national banks from contributing to any campaign, including state elections for US Senators.

Legislation in the latter half of the 20th century maintained limits on campaign finance. However, the 2000s marked a period of relaxation of these restrictions. The 2010 Citizens United v. Federal Election Commission decision overturned the previous ruling in Austin v. Michigan State Chamber of Commerce, which had upheld bans on independent expenditures by corporations. Additionally, the District of Columbia Circuit Court’s SpeechNow.org v. FEC (2010) ruled that limits on individual contributions to SpeechNow.org, as well as on the amounts the organisation could accept, were unlawful.

These rulings paved the way for the establishment of super Political Action Committees (PACs), or independent expenditure committees, which can raise unlimited funds from corporations, unions, associations, and individuals. They can also spend these funds freely to openly support or oppose political candidates.

At the same time, public financing of elections began to decline, with campaigns relying more on funds raised through private donations rather than income tax contributions. By 2012, both Barack Obama and his Republican challenger, Mitt Romney, decided to forgo public financing altogether.

Reflecting on the 2020 elections, Myers concluded, “The concern over union and corporate influence over elections dates back to the early twentieth century, but again the reality of campaign finance in 2020 is much the same as it was in 1910.”

Money in Modern Campaigns

Campaign funds are used to host rallies, open offices, hire staff, and advertise through both mass media and social media to engage voters. These funds can come from individual donors, PACs, and super PACs.

The first time that both presidential campaigns raised over a billion dollars was in 2012, in the run-up for elections between President Barack Obama and Republican Mitt Romney. This figure surged to $14.4 billion in the 2020 cycle.

For the 2024 elections, fundraising efforts are already substantial. A New York Times article reported that Kamala Harris’s fundraising committee, the Harris Victory Fund, raised an impressive $633 million from July 1 to September 30. On the other hand, Elon Musk, Miriam Adelson, and Dick Uihlein collectively contributed $220 million to groups supporting Donald Trump during the same months. Notable donors also include Netflix cofounder Reed Hastings, who gave $7 million to a PAC supporting Harris, and Linda McMahon, who donated $10 million to a pro-Trump super PAC.

Donor interests are heavily influenced by political policies, as seen with David and Charles Koch, the billionaire industrialists behind Koch Industries. They capitalised on the Supreme Court’s Citizens United v. FEC decision, which allowed for increased campaign spending, and invested significantly in the Republican Party, advocating for limited government, lenient immigration policies, free trade, and reduced corporate regulations – all the while managing a conglomerate with annual revenues of around $100 billion.

This influence is also evident in Trump’s strong backing from the oil and gas industries this election cycle, which benefit from his fossil fuel policies. Meanwhile, many in Silicon Valley, once supporters of Joe Biden’s liberal positions on wealth redistribution, abortion rights, LGBTQ+ rights, and immigration, have become frustrated with his tax policies and regulations, feeling increasingly pushed to the right.

According to the Washington Post, Trump has assured donors at fundraisers that he will implement favourable policies, such as cutting corporate taxes and approving oil permits. His changed stance on cryptocurrency also resonates with Silicon Valley, where many tech investors view crypto as vital for innovation and economic growth.

In contrast, Hollywood has consistently leaned Left. Both Bill and Hillary Clinton sought support from the entertainment industry during their campaigns, and Barack Obama also benefited from this sector in 2008. In the 2020 presidential elections, the entertainment industry contributed $104 million to Democrats, compared to just $13 million for Republicans, according to Open Secrets, a nonprofit focused on campaign finance. This trend is partly due to the belief that the arts thrive in environments that encourage individual expression and creativity, which many feel are better supported by liberal policies.

A Glimpse Ahead

“The presidential elections in the United States have now reached a new norm of the multibillion-dollar campaign” writes Myers. A recent report by American think tank, Pew Research Center, reveals significant public concern over campaign spending: 77 per cent believe there should be limits on the amount of money individuals and organisations can spend on political campaigns, while only 20 per cent support unrestricted spending. Undoubtedly, money serves as the key to entering the race – especially in America today.

Further Reading

Money in Politics: Campaign Fundraising in the 2020 Presidential Election by Cayce Myers