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 About $47 million has been lavished on presidential candidates and
lawmakers and the political action committees that support them by
two dozen of the industry's top managers in the first 13 months of
this election season, according to a Reuters review of Federal
Election Commission filings. (For a list of the top givers see
http://tmsnrt.rs/1nlPYZv)
Most of the hedge fund support going to Cruz and Clinton has come
from a handful of people out of the two dozen managers studied.
Robert Mercer, co-chief executive of Renaissance Technologies, for
example, has given $11 million to Keep the Promise I, a Super PAC
that supports Cruz. Mercer is an enigmatic computer programmer who
is a powerful financial force in conservative politics.
Cruz wants to abolish the tax-collecting Internal Revenue Service,
slash income and payroll taxes and impose a new "business transfer
tax." Cruz's wife, Heidi Cruz, is a Goldman Sachs executive in
Houston.
Clinton’s main benefactor is billionaire George Soros, a long-time
patron of Democratic and humanitarian causes and chairman of Soros
Fund Management. Soros alone is responsible for $7.3 million of the
$11.7 million that has gone to Super PACs and other committees
supporting Clinton.
The hedge fund managers' spokespersons either declined to comment or
did not respond to queries from Reuters.
But Whitney Tilson, a hedge fund manager who runs Kase Capital, said
one reason fellow managers are spending more this election is Donald
Trump, the front-runner for the 2016 Republican presidential
nomination.
"There are some pretty heated emotions about Donald Trump," said
Tilson, who plans to support the Democratic Party nominee.
Trump, who says he is self-funding his campaign, supports closing a
loophole that lets some hedge fund managers pay less than the usual
income tax rate on performance fees they get known as "carried
interest." Clinton supports this, too.
The Managed Funds Association, an industry lobbying group, declined
to comment on policy aims under the next president.
BIG MONEY, LITTLE IMPACT
There are other worries, too, about a Trump presidency.After months
of campaigning and debates, Trump's economic and financial policy
positions are still sketchy or unknown.
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A Trump presidency could bring "tremendous uncertainty and
instability," said Gregory Wawro, a political science professor at
Columbia University.
Wawro speculated that Trump’s popularity with blue-collar and
middle-class voters could prompt the Republican Party to reassess an
approach to taxes and economic issues that has favored top earners
and major corporations in recent years.
The surge of hedge fund donations has had little effect on the
Republican race so far.
Cruz is running well behind Trump while U.S. Senator Marco Rubio of
Florida, who is seen by establishment Republicans as their best hope
to stop Trump winning the nomination, is a distant third.
Conservative Solutions, a Super PAC that backs Rubio, received $2.5
million from Paul Singer, the long-time Republican fundraiser who
runs Elliott Management, and another $2.6 million in contributions
from hedge fund manager Kenneth Griffin of Citadel Investment Group.
Two other Republican candidates with major hedge fund backing, New
Jersey Governor Chris Christie and former Florida Governor Jeb Bush,
have dropped out of the race.
Christie's Super PAC, America Leads, received about $3 million from
Steve Cohen of Point72 Asset Management, while Right to Rise, a PAC
that supports Bush, drew $450,000 in donations from managers
including Citadel's Griffin, David Tepper of Appaloosa Management
and Larry Robbins of Glenview Capital Management.
In the Democratic race, U.S. Senator Bernie Sanders has eschewed
donations from Wall Street. He has racked up a string of wins in
early state nominating contests with attacks on Wall Street and
calls for a more equitable distribution of the country's wealth.
Overall, hedge fund contributions to 2016 presidential candidates
and lawmakers and the PACs supporting them favored Republicans over
Democrats by about 3 to 2.
For a list of the top hedge fund donors in 2016:
http://tmsnrt.rs/1nlPYZv
(Additional reporting by Svea Herbst-Bayliss; Editing by Kevin
Drawbaugh and Ross Colvin)
[© 2016 Thomson Reuters. All rights
reserved.]
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