Be Careful With Campaign Contribution Data

A commenter pointed to this OpenSecrets.org page, which seems to report that 70.8% of all federal contributions (not independent expenditures) in 2007-2008 came from business, and only 2.7% from labor (though put together the Democrats still got more than Republicans, both looking at total money and at PAC money; that’s relevant to the original post that prompted the comment).

But the prominent labels are misleading, as the text of the page itself acknowledges:

[B]usiness contributions tend to be overstated. Because CRP uses employer/occupation information to categorize donors, and because just about everyone works for a business, contributions from members of labor unions and ideological groups are often classified under business.

Recall that federal law doesn’t allow direct contributions by corporations and unions (Citizens United is unlikely to change that, I think; but in any event, such direct corporate and union contributions weren’t allowed in 2007-2008). It does allow contributions by PACs, but the bulk of the contributions were from individuals. When you contribute to a federal campaign, you have to list your employer, and the aggregate data on contributions by economic sector focuses on the status of that employer. So if you’re a loyal UAW member who works for Ford, your contribution will be attributed to Ford, and be listed under the automotive subsector of the business sector — not to the union. Likewise, if you work for IBM but are contributing based on your ideological predispositions (e.g., you support pro-choice candidates, or environmentalist candidates, or pro-Obamacare candidates), that too would be counted as a business sector contribution.

So read the fine print carefully on such reports, and keep in mind that “business” contributions are generally not contributions by corporations (which are forbidden) or by corporate PACs (which are limited) — they are contributions by individuals who happen to work for businesses, some of whom are contributing to support the interests of their business and some of whom aren’t.