Elections May Shape Business' Future
Nov. 07, 2000
NEW YORK (AP) _ In industries from agriculture to autos, this year's election is about more than just choosing the nation's next president _ the results could shape the future of business.
Automakers fear government-mandated deadlines for developing costly technology to make cars more fuel efficient. Pharmaceutical companies are anxious about Medicare reform and prescription drug price controls. For telecommunications, the election could decide the rules for competition in the local and long distance markets.
The concern is evident in the surge in campaign donations: In the 1996 elections, donations from industry totaled $653.4 million, according to the nonpartisan Center for Responsive Politics. This election, donations had reached $841.8 million by June 30 and continue to soar, the group said.
``Business wants to make sure that no matter what happens on November 7, they've got friends in Congress who will listen to their concerns in the future,'' said Steven Weiss, a spokesman for the Center for Responsive Politics.
In many industries, those friends are Republicans. Executives bet a Bush administration and Republican Congress would be less likely to regulate commerce or pursue antitrust litigation.
``We have seen issue after issue where we get a larger number of the R's in favor of our view than the D's,'' said Floyd Kvamme, a partner in Kleiner Perkins Caufield & Byers, a high-tech venture capital firm in Silicon Valley.
In the technology sector, the allegiances are split. While Baby Bell local telephone companies expect a hands-off approach from Bush that would hasten their entry in more long-distance calling markets, companies seeking entry to local calling markets lean toward Gore with the belief government regulation is necessary to pry open networks owned by the Baby Bells.
``No matter who's elected, it will be good for some and bad for others,'' said Rex Mitchell, who tracks the telecommunications industry for BB&T Capital Markets in Richmond, Va.
There's a similar divide in agribusiness, said Bruce Babcock, director of the Center for Agricultural and Rural Development at Iowa State University.
Gore is seen as more likely to intervene in the pricing of grain and other staples, benefitting farmers but hurting big pork producers and others who count on cheap feed. Those major producers also are concerned about antitrust action that might be taken by a Gore administration as the industry continues to consolidate, he said.
But many in farm circles are hoping for a split, with one party in the White House and the other controlling Congress.
``A split is much better for farmers,'' Babcock said. ``The $60 million they received in direct aid in the last three years is the result of a bidding war between the parties to see which party can be more farmer friendly.''
The viewpoint is far more one-sided among pharmaceutical companies.
The drug makers fear Gore would pressure them to justify drug costs and push for Medicare reforms that would cut into profits.
In autos and energy, executives are concerned about a Gore administration they believe would limit exploration for oil in sensitive areas, and impose unreasonable and expensive mandates for fuel efficiency and emissions, analysts said.
``I'm just afraid a Gore administration would be so clever they would mandate everything,'' said Heinz Prechter, chairman of auto parts maker ASC Inc., based in Southgate, Mich., and a major fund-raiser for George W. Bush.
Ford Motor Co. Chairman William Clay Ford Jr. tempered his criticism: ``We have a good relationship with the current administration and I know the vice president's policies toward the auto industry,'' he said last week. ``In terms of being able to work with him and whether the overall industry would flourish, I have no qualms.''
The computer industry, meanwhile, has been walking a delicate line.
Its political organization, TechNet, is led by a pair of co-CEOs, one in charge of getting along with Democrats, the other in charge of Republicans.
Because the outcome Tuesday will likely be close, industries will be obliged to work with both major parties, said Nick Sargen, global market strategist for J.P. Morgan's private clients. Third parties are rarely taken into consideration because of their chances are considered slim.
``Whoever wins, it's going to be a razor-thin margin,'' Sargen said. ``So whatever legislation goes through, it has to be bipartisan legislation.''
On the Net:
Center for Responsive Politics: http://www.opensecrets.org/
Center for Agricultural and Rural Development: http://www.card.iastate.edu/