A woman walks past JPMorgan Chase & Co’s international headquarters on Park Avenue in New York.
Andrew Burton | Reuters
JPMorgan Chase will resume making political donations to U.S. lawmakers, but not donations to Republican Congressmen who voted to overturn President Joe Biden’s election victory, according to an internal memo on Friday that Reuters saw.
The bank was among many companies that paused political donations after the deadly January 6 riots in the Capitol when supporters of former President Donald Trump tried to prevent Congress from confirming the election.
Just hours later, 147 Republicans, the vast majority of them in the House of Representatives, voted to overturn the Electoral College results that Trump falsely claimed were tainted by fraud.
According to a review, the country’s largest lender will resume donations this month through its Political Action Committee (PAC) but will continue to freeze donations to a “handful” of the 147 lawmakers it previously supported, the bank said.
The break will last until the 2021-2022 election cycle, which will also include the mid-term elections in November. After that, JPMorgan will examine whether the contributions to the affected legislators should be resumed individually, it said.
“This was a unique and historic moment when we believe the country needed our elected officials to put aside strong differences and demonstrate unity,” the bank wrote of the January 6 vote to confirm Biden’s victory .
JPMorgan noted that its PAC is an important tool for engaging in the political process in the United States. PACs are political committees organized to raise funds to support election candidates or, in some cases, to protest against them.
“Democracy inherently requires active participation, compromise and dealing with people with opposing views. That is why government and business must work together,” wrote JPMorgan.
As part of its revised spending strategy, the bank will also expand donations beyond lawmakers who oversee financial affairs to those engaged in matters that the bank considers “moral and economic imperatives for our country” such as reform.
Since the initial backlash in January, companies have grappled with how to resume PAC spending, which lobbyists see as important in gaining access to policy makers without other stakeholders, including their employees, who fund the PACs to alienate.
Other large financial firms that stopped donating have slowly resumed spending. Morgan Stanley’s PAC resumed donations to some lawmakers in February, while the American Bankers Association PAC, one of the largest in the country, also resumed donations, federal data shows.
While JPMorgan does not name a legislator in its memo, there is a risk that the bank’s new policies will discourage some Republicans from taking control of banking policy, some of whom are already angry with their active stance on issues such as climate change and racial justice.
According to the Center for Responsive Politics (CRP), JPMorgan’s PAC gave nearly $ 1 million to federal candidates and committees supporting candidates during the 2019-2020 election cycle.
Of the $ 600,300 it gave federal candidates, nearly 60% went to Republicans and the rest to Democrats, according to CRP data, a mix that is likely to tilt further to the left as the bank covers a wider range of social and economic issues supports supports.
Commercial banks as a whole have increased policy spending in recent years, spending $ 14.6 million on federal candidates in the 2020 cycle, the second highest amount since 1990, the data shows.
After the 2008 financial crisis, that mix favored Republicans, but in recent years banks have increased spending on Democrats to rebuild bipartisan support in Congress.