Invasion of the Hedge Funders: 6 Men Gave $10 Million to Presidential Super PACs in One Month

Friday, April 29, 2016
Paul Singer (photo: Jacob Kepler, Bloomberg/Getty Images)

By Will Tucker, Center for Responsive Politics

 

Hedge fund managers know something about when to hold and when to fold. Last month, they did more of the former when it came to political giving, holding steady with their pattern of making uber-contributions to presidential super PACs — even after the favored candidate of some of them dropped out of the race.

 

Wall Street dominates political giving. But it’s these donors, a much smaller subset of the securities sector, who play with the biggest money.

 

The month of March saw more big contributions to presidential super PACs from James Simons, Robert Mercer, Donald Sussman, Paul Singer, George Soros and Cliff Asness in particular. The six men — founders of investment companies that manage hedge funds, or high-risk private funds that often require seven-figure buy-ins from their investors — anted up a total of $9.5 million to presidentially focused super PACs for the month, bringing their total gifts to these groups to $33.5 million for the cycle.

 

Before the latest super PAC filings, which were due at the Federal Election Commission by midnight last night, the larger securities and investment industry — including not just hedge funds but commercial banks, brokerage firms and other industries —  had given $221 million to congressional and presidential campaigns and super PACs in the 2016 cycle.

 

By itself, the hedge fund industry had given almost $75 million.

 

Throughout the current presidential campaign season, hedge fund managers have steadily given to Priorities USA Action, the super PAC backing former Secretary of State Hillary Clinton; super PACs backing ultraconservative Sen. Ted Cruz (R-Texas); and more establishment-minded Republican super PACs like Conservative Solutions PAC, which supported Sen. Marco Rubio‘s (R-Fla.) White House bid.

 

In March, Simons led the pack with a $3.5 million contribution to Priorities USA Action. Simons founded Renaissance Technologies in 1982; he retired in 2009 but still plays a role there. Mercer, the co-CEO of Renaissance, has a distinctly different view of politics than Simons; in March, he gave another $2 million to support Sen. Ted Cruz (R-Texas).

 

Simons’ March gifts brought his contributions to outside spending groups in the 2016 cycle up to at least $9.3 million and Mercer’s to at least $16 million.

 

Simons’ recent contribution wasn’t enough for him to overtake George Soros — another hedge fund manager, though also largely retired — as Hillary Clinton’s biggest supporter by super PAC contributions, but he’s close. He’s nearly reached his 2012 record of $9.5 million total given, with $7 million going to Priorities USA and the rest to other super PACs benefiting Clinton. That includes $1 million to American Bridge 21st Century in March. Several places behind Simons sits Donald Sussman of Paloma Partners, who gave $1.5 million to Priorities last month and has now given the Clinton group $4 million in all.

 

The fact that hedge fund money continued to flood the presidential race after one of the donors’ favorite candidates — Rubio — dropped out would be surprising were it not for the anti-Donald Trump movement. For a group of Republican mega-donors, there’s still work to be done with their money — namely, the work of beating back Trump’s more-than-possible ascension to the Republican nomination.

 

Paul Singer gave another $500,000 to Our Principles PAC last month, the super PAC that has spent almost $15 million in independent expenditures against Trump. Singer has now broken $10 million in contributions this cycle; before March, his total given stood at $9.9 million, $1 million of which went to Our Principles. Singer had also made $5 million in contributions to Conservative Solutions, a $1 million contribution to the Senate Leadership Fund, and more than $1 million in contributions to American Unity PAC, a group that supports candidates who “support freedom for all Americans, regardless of their sexual orientation,” according to its website.

 

As OpenSecrets Blog has reported previously, Singer often appears to bring along with him a cadre of other hedge fund donors. Sure enough, last month, Cliff Asness of AQR Capital Management gave $1 million to Our Principles, his first contribution to the group. He’d previously — like Singer — chipped in to back Rubio to the tune of $1 million.

 

The March contributions are the latest evidence that super PACs are allowing a powerful industry to dominate political giving. To put the multimillion-dollar gifts in perspective, however, consider not just the naked wealth of the donors (Soros is worth an estimated $25 billion, for example; Singer, $2.2 billion) but also the multibillions in assets under management reported by the investment firms: Renaissance Technologies, the firm founded by Simons and now led by Mercer, has almost $72 billion in assets under management, according to Securities and Exchange Commission records; Singer’s firm Elliott Management has $46 billion under management. For Paloma Partners, Sussman’s firm, the figure is $7.5 billion.

 

The firms themselves often own a percentage of their hedge funds’ gross asset value, meaning that midway through the presidential contest, the hedge fund managers can give millions to super PACs and still say there’s more where that came from.

 

To Learn More:

Are Super PACs Becoming Captive to Hedge Funders? Six Give Nearly $10 Million to Presidential Groups in March Alone (by Will Tucker, Center for Responsive Politics)

Fracking Billionaires Give Record-Setting Donation to Ted Cruz (by Noel Brinkerhoff and Danny Biederman, AllGov)

Hedge Funds Accused of Screwing Americans out of Billions of Dollars in Taxes (by Noel Brinkerhoff and Danny Biederman, AllGov)

Rich Democrats Discover the Joy of Super PACs (by Noel Brinkerhoff, AllGov)

Super PACs Shove Aside Traditional Campaign Financing (by Noel Brinkerhoff and David Wallechinsky, AllGov)

SEC Chair Wants to Regulate Trillion-Dollar Hedge Fund Industry (by Noel Brinkerhoff, AllGov)

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