A campaign advertisement against California's Proposition Six, which would have abolished a state gas tax that pays for road and bridge construction. The No campaign got US$25,000 from an American subsidiary of WSP Global, a Montreal engineering and design firm.
The American subsidiaries and employees of at least 17 Canadian companies gave more than US$2-million in U.S. political donations over the past two years, helping bankroll Super PACs and candidates in one of the most toxic midterm election campaigns in American history.
The corporations that took part ranged from a major oil and gas company to Bay Street banks to an online gambling firm.
Their contributions went to a Super PAC running attack ads that demonized Latin American asylum seekers and labelled universal health care a “radical” idea; to a group accused of using dirty campaign tactics in one city-level race; and to nearly every congressional leader from both parties.
Some of the donations came straight from corporate treasuries. Others came from company-run political action committees: These are groups set up by businesses to collect money from their employees and direct it to political candidates.
The donations tie Canadian firms to incendiary, hyperpartisan political campaigning they would likely never support north of the border. And they come amid an explosive debate in Washington about foreign influence over the electoral process.
An attack ad by the Congressional Leadership Fund targets Pennsylvania Democrat Conor Lamb. The ad calls him a 'sheep' of then Democratic House Minority Leader Nancy Pelosi, a frequent target of Republican supporters' attack ads.
Foreigners are banned from donating to U.S. candidates and political groups, or from directing where donations go – meaning U.S. citizens at their subsidiary companies must handle the actual cheque-writing. But U.S. officials fear this is not enough to protect the system from corporate leaders in other countries swaying U.S. politics.
“It all comes down to whose interests are being pursued when the money is being handed out. Is it the interests of U.S. citizens who are trying to exercise their First Amendment rights?” said Ellen Weintraub, a member of the U.S. Federal Election Commission, referencing the section of the Constitution that protects free speech. “Or are the U.S. citizens being held up as a fig leaf when, really, it’s a foreign corporate or government agenda that’s being pursued?”
A package of proposed ethics reforms unveiled on Friday by House Democrats contains provisions clamping down on some of these contributions. The For the People Act would ban companies with 20 per cent or more of their voting shares owned by foreigners from spending money in campaigns.
“People are right to be very nervous about the way money has been finding its way from foreign entities … into our elections,” Congressman John Sarbanes, the bill’s primary author, said at the Capitol.
The Globe and Mail tallied donations from Canadian-controlled U.S. companies and their political action committees for the most recent election cycle – comprising the past two years – using Federal Election Commission data, some of which was collated by the Center for Responsive Politics, a research group that tracks campaign finance.
The largest direct corporate contributions to American Super PACs by a Canadian-owned business came from the U.S. unit of Encana Corporation. The Calgary oil and gas company’s U.S. subsidiary made two US$100,000 donations to the Congressional Leadership Fund, in July, 2017, and June, 2018. It also gave US$100,000 to the Senate Leadership Fund. Both are Republican groups that ran attack ads against Democrats in a bid to preserve the GOP congressional majority.
One Congressional Leadership Fund ad that aired in Iowa warned that “criminal illegal immigrants” would descend on the state if voters sent a Democrat to Congress, superimposing an image of a caravan of Latino migrants over a tornado tearing across farm country. Another spot in California accused “radical environmental regulations” of hurting small businesses. A third shown in Texas described policies to expand health-care coverage as “radical.”
A Congressional Leadership Fund ad juxtaposes images of migrants with a tornado. The ad targets Abby Finkenauer, an Iowa Democrat elected to the U.S. House of Representatives in November's midterms.
Another ad targets 'radical environmental regulations' and singles out Katie Hill, a California Democrat who also won election last fall.
Encana did not respond to questions on why it made the donations. The Republicans have generally favoured looser environmental regulations and the construction of oil and gas pipelines.
U.S. subsidiaries of the Stars Group, a Toronto online gambling outfit that runs PokerStars, also donated corporate money to the Congressional Leadership Fund, writing a US$50,000 cheque in October, 2017. Stars further gave US$50,000 to Our Atlantic City, a Super PAC that backed the successful mayoral bid of Frank Gilliam in the New Jersey gambling mecca, and US$25,000 to 35th Inc., a group supporting the Senate candidacy of Republican Patrick Morrisey in West Virginia.
Our Atlantic City was accused during the mayoral race of backing an operation that delivered ballots premarked for Democratic candidates to voters, and attracted controversy for a Facebook video that tenuously tried to link one of Mr. Gilliam’s opponents to an alleged heroin dealer.
The Stars Group, which declined to comment for this story, has a partnership with Atlantic City’s Resorts Casino Hotel to offer online sports betting and casino gambling. One Stars vice-president, Nicholas Menas, had a spot on Mr. Gilliam’s transition team. Stars is also expanding into several more states, including West Virginia.
Sleepy Creek Lands LLC, one of the holding companies for a Florida cattle ranch owned by auto-parts magnate Frank Stronach, gave US$25,000 to New Republican PAC, a group backing Rick Scott’s Senate campaign. The Stronach Group did not respond to a request for comment.
The most generous political action committee run by a Canadian-owned firm was that of WSP Global, a Montreal engineering and design company, which spent US$307,000.
Its largest single donation was US$25,000 to the campaign against Proposition Six, a referendum that would have abolished a California gas tax that pays for road and bridge construction. The group No On Prop 6’s ads warned that repealing the tax would “attack the safety” of the state’s highways and “put lives at risk” from crumbling infrastructure.
“WSP has a long history of supporting candidates and measures that invest in infrastructure,” said Jayanti Menches, a senior vice-president in WSP’s New York office, adding that decisions on campaign contributions were made exclusively by U.S. employees.
A screengrab from WSP Global's ads against Proposition Six in California.
Other Canadian companies with U.S. units running PACs included Toronto-Dominion Bank (US$233,000), CGI Group Inc. (US$194,000), Bank of Montreal (US$179,000), Manulife Financial Corp. (US$163,000), Resolute Forest Products (US$109,700), Barrick Gold Corp. (US$80,500), Royal Bank of Canada (US$59,000), Sun Life Financial Inc. (US$56,000) and Bombardier Inc. (US$45,500.)
U.S. employees of Canadian-controlled firms also made donations directly, without going through company committees. By far, the biggest individual spender was Robert Reynolds, the American chief executive of Putnam Investments, a Boston-based subsidiary of Winnipeg’s Great-West Lifeco and Montreal’s Power Financial Corporation. Mr. Reynolds gave more than US$1.2-million to Republican groups, including the Congressional and Senate Leadership Funds.
Jon Goldstein, a spokesman for Putnam, said donations from Mr. Reynolds and the company’s PAC (US$50,000) were meant to support candidates who favour “rapid economic growth” and oppose “excessive regulation.” The GOP has cut corporate taxes and last year slashed regulations on the financial sector by rolling back parts of the Dodd-Frank regulations meant to avoid a repeat of the 2008 financial crisis.
Asked whether Mr. Reynolds and the company agreed with the Congressional Leadership Fund’s more inflammatory assertions – painting immigrants as criminals, for instance – he wrote in an e-mail: “The support of any political organization or candidate is not an indication that we agree with all views expressed, including advertising campaign messages.”
Seth Kursman, a Resolute vice-president who helps run the pulp and paper company’s PAC, argued that fears of foreign influence on the U.S. system are unfounded, at least in the case of his business. Resolute’s PAC donations are made for the benefit of American workers, he says, and decisions on who to support are taken by a committee made up of representatives from the company’s American mills.
“The employees who are giving this, and the interests they are protecting, are U.S.,” said Mr. Kursman, who is himself American. “It’s our American employees who are contributing the dollars and it’s not a group of Canadians sitting around the table who are deciding where that money is going, either.”
But Brendan Fischer of the Campaign Legal Center, a Washington-based campaign-finance advocacy group, contends that foreign owners still hold sway indirectly.
“Any U.S. national working for a foreign corporation is going to know which candidates the foreign owners want to support and what policies they back,” he said.
The Canadian companies, for their part, face another ethical problem: the fact that their corporate empires are sometimes backing political tactics they would not countenance back home.
Richard Leblanc, a York University expert on corporate governance and ethics, said that – even if the campaigns themselves are several steps removed from a Canadian head office – the companies should be concerned about their brands being tied to incendiary political messaging.
“The parent company is responsible for the conduct and actions of the subsidiary,” he said. “It’s a matter of reputational risk and internal controls. The question should be: ‘Do we want to be associated with this, in a situation where we don’t control the content?'"
Direct corporate contributions – total: US$455,000
EnCana Corporation
Total: US$300,000
Major recipients: Congressional Leadership Fund (US$200,000), Senate Leadership Fund (US$100,000)
Did not respond to a request for comment
The Stars Group
Total: US$125,000
Major recipients: Congressional Leadership Fund (US$50,000), Our Atlantic City (US$50,000), 35th Inc. (US$25,000)
Declined to comment
Sleepy Creek Lands LLC
Total: US$25,000
Major recipients: New Republican PAC (US$25,000)
Did not respond to a request for comment
CGI Group
Total: US$5,000
Recipient: Grow WV (US$5,000)
Did not respond to a request for comment
WSP Global
US$500 to New York Building Congress Inc.
Donations via company political action committees – total: US$1,570,287.66
WSP Global
Total: US$307,000
Major recipients: No on Prop 6 (US$25,000), Pennsylvania Future Fund (US$20,000), Michigan gubernatorial candidate Gretchen Whitmer (US$10,000), Pittsburgh Mayor Bill Peduto (US$10,000), Allegheny County head Rich Fitzgerald (US$10,000)
“WSP has a long history of supporting candidates and measures that invest in infrastructure. A strong infrastructure furthers economic growth in the communities where we live and work,” Jayanti Menches, a senior vice-president in WSP’s New York office, wrote in an e-mail. “All of these decisions are made by U.S. employees.”
TD Bank
Total: US$233,000
Major recipients: Mark Warner (US$9,000), Mike Crapo (US$6,500) and Pat Toomey (US$5,500), members of the Senate banking committee; Bruce Poliquin (US$8,500), member of the House financial services committee
Declined to comment
CGI Group
Total: US$194,000
Major recipients: Republican Party of Massachusetts (US$10,000); Rich Cordray and Mike Dewine, rivals for the Ohio governorship (US$7,500 each); Pennsylvania Governor Tom Wolf US($6,000); Senator Tim Kaine (US$6,000)
Did not respond to a request for comment
Bank of Montreal
Total: US$179,000
Major recipients: Patrick McHenry (US$8,700), Tom Emmer (US$7,000), Andy Barr (US$6,400), Randy Hultgren (US$4,500), members of the House financial services committee; Heidi Heitkamp (US$7,500), Joe Donnelly (US$7,000), Jon Tester (US$4,710) Mike Crapo (US$3,500), members of the Senate banking committee
Paul Gammal, a BMO spokesman, pointed to his bank’s policy on political donations. Contributions are meant to “support candidates or political committees that align to [company] priorities not the political preferences or priorities of senior management,” it says.
Manulife
Total: US$163,000
Major contributions: Congressmen Richard Neal (US$10,000), Bill Huizenga (US$8,000), Kevin Brady (US$7,500) and Stephen Lynch (US$6,000)
Declined to comment
Resolute Forest Products
Total: US$109,700
Major recipients: American Forest and Paper Association (US$7,000); Senator Johnny Isakson (US$6,500); Congressmen Chuck Fleischmann (US$6,000) and Kevin Brady (US$5,000)
Seth Kursman, a Resolute vice-president who helps run the company’s PAC, says campaign donations are “part of how you develop relations.” Over the last two years, he says, his company’s outreach to members of Congress has helped rally legislators against the proposed Border Adjustment Tax, which was ultimately left out of the Republican tax plan last year, and the Trump administration’s tariffs on newsprint.
“Certainly, you’re going to be more likely to give to people who share our opinion on issues. We’re also going to look at factors like: Who represents us, are they an incumbent or not, what are their positions of leadership, how much can they influence Congress and the Senate?” he said.
Barrick Gold
Total: US$80,500
Major recipients: Congressman Mark Amodei (US$10,000), Senator Dean Heller (US$5,000), Congresswoman Dina Titus (US$5,000), all politicians in Nevada, where Barrick operates the Goldstrike and Cortez mines; Hellerhighwater PAC (US$7,500), a group run by Mr. Heller to raise funds for other Republicans; Denali Leadership PAC (US$5,000); National Mining Association (US$5,000).
Acknowledged the comment request but did not respond to questions
Royal Bank
Total: US$59,000
Major recipients: Mike Crapo (US$5,000) and Sherrod Brown (US$5,000), the highest-ranking members of the Senate banking committee
Catherine Hudon, a Royal Bank spokeswoman, pointed to a statement on RBC’s website outlining the company’s policies on political contributions. Donations from the bank’s PAC are directed to candidates who support a “fair, transparent and competitive U.S. financial marketplace,” it said.
Sun Life
Total: US$56,000
Major recipients: Congressman Joe Kennedy III (US$5,400) and Senator Angus King (US$4,700)
Devon Portney Fernald, a spokeswoman in Sun Life’s U.S. office, said the company’s PAC “focused primarily on candidates and members of Congress in areas where our U.S. employees live and work.”
Daniel Flaherty of Massachusetts Financial, a Sun Life subsidiary, said his company’s PAC doesn’t consult with its corporate parent when making donations. The PAC gives to legislators that “support policy positions important to our clients and to our industry,” he said.
Power Financial Corporation
Total: US$52,000
Major recipients: Congressman Kevin Brady (US$1,500), Senator Tim Scott (US$1,500)
Donations are meant to support candidates who favour “rapid economic growth” and oppose “excessive regulation,” said Jon Goldstein, a spokesman for Power Corporation’s U.S. subsidiary Putnam Investments.
EnCana
Total: US$50,000
Major recipients: Senator John Barrasso in Wyoming (US$7,500); Texas State Senator Robert Nichols (US$5,000); Christi Craddick, a member of the Texas commission that regulates oil and gas (US$5,000); Congressman Mike Conaway (US$4,500)
Did not respond to a request for comment
Bombardier
Total: US$45,500
Major recipients: Senator Joe Manchin (US$6,000), Congressman Ron Estes (US$6,000)
Bombardier Spokesman Simon Letendre said the company’s PAC makes donations to ensure the interests of its U.S. employees “are taken into account” and to “dialogue” with American politicians. Decisions on who exactly to support are made by the U.S. employees of the company who sit on the PAC’s board, he said.
“The Bombardier PAC generally supports candidates running in communities where our operations are located, and candidates who understand the importance of transportation and other issues relevant to the company and its employees,” he said in a statement.
IBI Group
Total: US$14,242
Major recipients: Cornell Robertson, county engineer in Columbus, Ohio (US$1,250) Nearly all contributions went to county engineers in Ohio – local officials who oversee infrastructure building.
Acknowledged the comment request, but did not answer questions
Canadian National Railway
Total: US$12,500
Major recipients: Congressmen Rodney Davis (US$4,000) and Jeff Denham (US$2,000)
Jonathan Abecassis, a CN spokesman, said the company has “a responsibility to participate in public debate … on issues that may have an impact on our business goals and matters that may affect the communities where we operate.” He added that CN “strictly respects the law” when it makes contributions.
Nutrien Ltd.
Total: US$8,000.
Major recipients: Congressmen Jim Jordan (US$2,000) and Walter Jones (US$2,000); Senators John Barrasso (US$1,500) and Thom Tillis (US$1,500)
Did not respond to a request for comment
Canadian Solar
Total: US$4,000
Major recipients: Texas State Senator Kelly Hancock (US$2,000); Congress members Nancy Pelosi (US$1,000) and Kevin McCarthy (US$1,000)
Did not respond to a request for comment
Adrian Morrow