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Retailers Back Mostly GOP Candidates

The presidential election has been in the spotlight, but retailers focused on special issues have contributed generously to Congressional candidates.

WASHINGTON — House and Senate races have taken a backseat to the presidential race this year, but retail and specialty store chains focused on special issues have invested millions of dollars in supporting congressional candidates.

A great majority of retail political contributions have gone to Capitol Hill candidates who are viewed as friendly to business and largely favor Republicans.

The political action committee run by Wal-Mart Inc. leads apparel retailers in terms of political giving this election. The world’s largest company has contributed most of its $2.5 million this two-year election cycle to GOP candidates and PACs and has $108,790 left in its war chest, according to the Federal Election Commission. Wal-Mart spent $667,805 in the comparable election cycle of 2000.

But Wal-Mart and other retailers haven’t ignored Democrats. For example, Rep. Charles Rangel (D., N.Y.), a backer of many trade pacts, received $5,000 from Wal-Mart’s PAC, even though Rangel bucks retailers in opposing tax cuts and advocating an increase in the $5.15 an hour federal minimum wage.

Sears, Roebuck & Co.’s PAC comes in second among apparel retailers with $295,221 in contributions and $264,373 to spend. Sears’ political giving is well above the year 2000, when it wrote $109,330 in campaign checks.

A Sears spokesman attributed the boost in Sears’ PAC contributions to its government affairs staff working hard “to educate employees” about the ways of politics. Business PACs, including Sears, are typically filled with donations from executives and the ranks of managers.

“Public policy decisions made by elected officials have an impact on our ability to serve our customers and operate our business,” the spokesman said.

Some retailers choose not to have PACs or they keep a nominal amount in their political bank accounts.

Federated Department Stores, for example, hasn’t raised any money this election cycle, but used $3,000 of its PAC’s $8,428 cash on hand to give $1,000 to its hometown Cincinnati Republican Rep. Steve Chabot and $2,000 to GOP Ohio Sen. Mike DeWine. Federated officials have said having a PAC isn’t a priority.

The retail political agenda is varied and that means supporting politicians who favor expanding international trade and reforming laws to curb bankruptcies while opposing a national sales tax and increases in the minimum wage. The industry is also eager to see health care reform take shape, which would lower escalating employee benefit costs.

This story first appeared in the October 28, 2004 issue of WWD.  Subscribe Today.

Aside from where a candidate stands on retail issues, a spokeswoman for J.C. Penney Co. said congressional incumbents in positions of leadership in both parties or holding key committee posts carry weight in deciding where to place Penney’s PAC contributions. In addition, “the dynamics of a race,” in which a retail-friendly candidate may need more support, is a factor. Penney’s has made $133,984 in political contributions this election and has $112,676 left to give. In the 2000 election, the retailer’s PAC gave $237,209.

The amount of PAC contributions allowed is regulated by the FEC. A candidate can receive up to $5,000 from a PAC separately for primary and general elections.

Among candidates earmarked this election by retailers for PAC contributions in closely contested races include GOP Rep. Richard Burr from North Carolina, who is vying for the North Carolina Senate seat being vacated by Sen. John Edwards, Democratic presidential candidate Sen. John Kerry’s running mate. Burr supports tax cuts and has generally backed President Bush’s expansive trade policies, while Democratic opponent Erskine Bowles opposes tax breaks and Bush’s trade policies.

An example of an influential House incumbent getting retail PAC money is House Majority Leader Tom DeLay (R., Texas). DeLay’s job is to ensure there are enough GOP votes to pass party-backed legislation, such as a measure in 2001 repealing Clinton administration ergonomic Occupational Safety & Health Administration rules and President Bush’s $2 trillion tax cut bill.

While apparel retailers, like other businesses, generally steer the bulk of their contributions to Republicans, an exception this election is Gap, which gave 68 percent of its $34,143 to Democrats.

An example of a Democrat garnering retail industry support is Arkansas Sen. Blanche Lincoln, a member of the Senate Finance Committee that oversees trade legislation. Lincoln has raised $6 million in campaign funds, including contributions from Wal-Mart, Target Corp., The Limited, J.C. Penney and May Department Stores. GOP opponent state Rep. Jim Holt has raised $97,290.

A third of the 100-member Senate is up for reelection Tuesday, but there are several races for open seats or Republican-held seats, such as in Illinois, Oklahoma and Kentucky, that are considered so closely contested that Democratic victories could lead to the party claiming majority power in the chamber. The GOP majority in the House is considered less threatened. However, the expected high voter turnout is considered to be a wild card in forecasting dominance by either party in either chamber.

“Nobody knows how the election will turn out,” said Steve Pfister, senior vice president of government relations with the National Retail Federation, the lobbying arm of department and specialty stores.

The NRF’s PAC this election has contributed $190,850 to House and Senate candidates and has $32,142 left to spend. In contrast, in 2000, NRF PAC contributions were $165,000.

The Retail Industry Leaders’ Association, the lobbying arm of retail discount chains including Wal-Mart, has contributed $33,855 through its PAC and has $3,464 cash on hand. In 2000, the association spent $23,250 on political giving.