U.S. elections: Donations for Trump and Harris

The financing of the U.S. elections’ donations can take time to understand. Unlike in different countries, this phenomenon plays a fundamental role in shaping American politics for the next four years.

Companies engaged in donations for the U.S. elections

In most democratic countries, political campaigns last much shorter. It means that political parties can raise funds for themselves, but they are not as significant as what’s happening in the United States.

Check out comparative analysis between Democrats and Republicans!

The U.S. elections’ donations can reach staggering amounts. Both Democrats and Republicans are well aware of the importance of these donations. They provide a space for lobbying and significant profits for the highest contributors when “their” candidate reaches the White House at the end of the elections.

According to the Open Secrets website, which monitors money flows in U.S. politics, several hedge funds invested in one of the candidates. For example, Citadel LLC donated over 75 million dollars to Republicans, while the venture capital company Greylock Partners contributed approximately 21 million. Companies heavily involved in U.S. election donations include media titan Bloomberg, crypto exchange Coinbase, crypto project Ripple, and even the University of California.

READ MORE: How does the U.S. Government protect the American EV industry?

Tech giants involved

Everyone who is interested in the trading and financial situation in the United States knows which companies play the biggest role in shaping the American economy. Tech and AI equities are essential for the market and for the U.S. elections’ donations. Plenty of them are listed on NASDAQ, which associates 100 tech American companies.

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The most recognizable supporter of Donald Trump is Elon Musk. Users of X (the social media platform formerly known as Twitter) can notice Musk’s strong appreciation for the Republicans. If Trump wins the U.S. elections, Elon Musk and his other companies, such as Tesla, will probably benefit.

Kamala Harris can count on the support of significant tech companies, some of which are visible in official donations. Alphabet Inc. contributed about 9 million dollars to the Democratic campaign. LinkedIn co-founder and a member of the Microsoft board, Reid Hoffman, donated 7 million to Harris’ race to the White House. Other notable Democratic supporters in the tech industry are Netflix and Disney.

U.S. elections: How do donations work?

Donations for the U.S. election campaigns can come from various sources:

Individual donations: These are the most common (yet not the most influential) source of campaign funding. U.S. citizens can contribute up to 3,300 dollars per candidate per election cycle. Although there are caps on individual contributions, this money is critical for financing activities such as advertising, staff salaries, and travel costs.

Corporate donations: Corporations cannot directly donate to candidates in federal elections. However, they can contribute through other avenues, such as forming Political Action Committees (PACs) or funding outside groups that indirectly support a candidate or cause through advertisements or advocacy campaigns.

Self-financing: Some candidates opt to use their own personal wealth to support their campaigns. By injecting personal funds, candidates demonstrate commitment to their platform and maintain greater control over their message to the supporters. Wealthier candidates often use this strategy to avoid reliance on outside donors. People can primarily associate Donald Trump with such activities, but the former POTUS is not the only candidate using his funds.

What are PACs?

Political Action Committees (PACs) are organizations created to raise and spend money to elect or undermine political candidates. PACs represent businesses, labor unions, or ideological interests and operate under specific regulations set by the Federal Election Commission (FEC).

A PAC can collect contributions from individuals, but the amount is capped at 5,000 dollars per donor per year. In turn, PACs can contribute up to 5,000 dollars per candidate per election and often support several candidates who align with their goals or interests.

There are two primary types of PACs – connected and non-connected. Connected PACs are tied to specific organizations, like corporations or unions, and can only raise money from members of that organization. Non-connected PACs, however, can ask for donations from the general public.

Does more money equal more chances to win?

At the beginning of September, Kamala Harris’ staff announced two vital pieces of information. First, the Democratic candidate raised 361 million dollars in August, compared to 130 million dollars collected by Trump last year. Moreover, after the first presidential debate, the Democrats recorded a staggering 47 million in 24 hours, presumably showing Harris’s support.

Could this money be the game-changer in her run for the presidency?

While raising significant funds can boost a campaign’s visibility, more money doesn’t always guarantee victory in U.S. elections. Donations can be helpful, but there have been notable instances where well-funded candidates have lost, proving that cash alone isn’t a deciding factor.

For example, in the 2016 U.S. presidential election, Hillary Clinton’s campaign significantly outspent Donald Trump’s. Yet, she did not win the presidency. Trump’s victory highlighted that, although money plays an important role in getting a candidate’s message out, factors like voter sentiment, political strategy, and media attention can outweigh the impact of donations.