Wall St. Banks Halt Political Donations After Capitol Riot: Live Updates


JPMorgan Chase is halting all political donations from its PAC for six months.
Credit…Justin Lane/EPA, via Shutterstock

Big businesses often donate to both political parties and say that their support is tied to narrow issues of specific interest to their industries. That became increasingly fraught last week, after a pro-Trump mob stormed the Capitol and some Republican lawmakers tried to overturn Joseph R. Biden Jr.’s win in the presidential election.

A flurry of companies have since reviewed political giving via their corporate political action committees, according to the DealBook newsletter.

Some big banks are pausing all political donations:

  • Goldman Sachs is freezing donations through its PAC and will conduct “a thorough assessment of how people acted during this period,” a spokesman, Jake Siewert, told DealBook.

  • JPMorgan Chase is halting donations through its PAC for six months. “There will be plenty of time for campaigning later,” said Peter Scher, the bank’s head of corporate responsibility.

  • Citigroup is postponing all campaign contributions for a quarter. “We want you to be assured that we will not support candidates who do not respect the rule of law,” Candi Wolff, the bank’s head of government affairs, wrote in an internal memo.

Some companies are pausing donations to specific politicians. Marriott said it would pause donations from its PAC “to those who voted against certification of the election,” a spokeswoman told DealBook.

Blue Cross Blue Shield, Boston Scientific and Commerce Bancshares are taking a similar, targeted approach to donation freezes. The newsletter Popular Information is tracking the responses of these and other companies that donated to lawmakers who challenged the election result.

The suspensions coincide with the first quarter after a presidential election, which is typically light on fund-raising anyway. Efforts by some companies to pause PAC donations to all lawmakers — those who voted to uphold the election as well as those who sought to overturn it — are raising eyebrows. And companies can still give to “dark money” groups that don’t disclose their donors but often raise far more money than corporate PACs.

Corporate PACs aren’t the only groups under scrutiny. The Republican Attorneys General Association is taking heat following reports that a fund-raising arm, the Rule of Law Defense Fund, urged people to march on the Capitol. Several companies told DealBook that they were reviewing their support of the group, though none said they planned to cut ties. A representative for the association said that it and the Rule of Law Defense Fund “had no involvement in the planning, sponsoring or the organization of Wednesday’s event.”

Big corporate donors to the group, including Coca-Cola, Comcast and Walmart, said they would re-evaluate their contributions.

In other fallout, the P.G.A. of America said it would no longer hold its signature championship at the Trump National Golf Club in Bedminster, N.J.; the social app Parler, popular among conservatives as an alternative to Twitter, went dark this morning after Amazon cut it off from computing services; the payment processor Stripe banned the Trump campaign from using its services; YouTube blocked Steve Bannon’s podcast channel; and the debate continues over tech giants’ influence over public speech.

Banks are expecting heavy demand for the new round of loans, as the virus continues to surge and restrictions on activity are reintroduced.
Credit…Mohamed Sadek for The New York Times

The Paycheck Protection Program reopens this week, and underserved borrowers — including women-led businesses and those run by Black, Latino and Asian owners and other minorities — will be first in line to tap the new funds, The New York Times’s Stacy Cowley reports.

Starting Monday, a group of specially designated institutions known as community lenders, which specialize in working with Black- and minority-owned small businesses, will begin accepting applications for new loans. The government said larger financial institutions and banks would begin processing loans “shortly.”

Giving community lenders a head start is intended to address complaints that the aid was not distributed equitably the last time around. Here are more details about the new program.

  • Borrowers were previously limited to just one loan, but the new funding will be available to both first-time and returning borrowers. Businesses will be eligible for a second loan if they suffered a sales drop of 25 percent or more in at least one quarter of 2020, compared with the previous year.

  • Second loans will be restricted to businesses with no more than 300 employees; initial loans are available to larger companies, generally those with up to 500 workers.

  • The Small Business Administration, which manages the program, said it would begin accepting applications on Monday from community lenders seeking loans for first-time borrowers. On Wednesday, those lenders will be able to submit applications from people seeking second-round loans.

  • The S.B.A. will no longer approve loan applications instantaneously, a move that previously allowed some borrowers to receive their loan funds just hours after they applied. Now approvals will generally take at least one day.

In the hours and days after a mob of President Trump’s loyalists stormed the Capitol, the nation’s biggest tech companies began to shut down accounts that helped incite the rampage. In the days and weeks before the attack, President Trump had used his Twitter feed and Facebook page to spread the lie that he had won the November election. It was that falsehood that helped drive the mob from to the Capitol last Wednesday after a speech by the president.

Facebook said the risks were too great to allow the president’s posts. Twitter followed suit. The focus shifted to Parler, a favorite app for right-wing figures. Citing posts on Parler that encouraged violence and crime, Apple and Google removed the app from their app stores. Then Amazon told Parler it would stop hosting it.

For Big Tech, the events of the past week raised tricky questions about politics, free speech and radicalization of people online.

How Parler, a Chosen App of Trump Fans, Became a Test of Free Speech

The app has renewed a debate about who holds power over online speech after the tech giants yanked their support for it and left it fighting for survival. Parler was set to go dark on Monday.

Stripped of Twitter, Trump Faces a New Challenge: How to Command Attention

The president became a celebrity through television, but Twitter had given him a singular outlet for expressing himself as he is, unfiltered by the norms of the office.

Amazon, Apple and Google Cut Off Parler, an App That Drew Trump Supporters

The companies pulled support for the “free speech” social network, all but killing the service just as many conservatives are seeking alternatives to Facebook and Twitter.

Twitter Permanently Bans Trump, Capping Online Revolt

The president’s preferred megaphone cited “the risk of further incitement of violence.” It acted after Facebook, Snapchat, Twitch and other platforms placed limits on him.

Facebook Bars Trump Through End of His Term

Mark Zuckerberg, Facebook’s chief executive, said the risks of Mr. Trump using the service were too great, even as Twitter lifted its lock on the president’s account.

In Pulling Trump’s Megaphone, Twitter Shows Where Power Now Lies

The ability of a handful of people to control our public discourse has never been more obvious, our columnist writes.

  • U.S. stock indexes are set to open lower on Monday, with the S&P 500 pulling back from a record high, reversing some of the buoyancy in market sentiment from last week that seemed to defy the political turmoil in Washington.

  • Markets in Europe were lower. The benchmark Stoxx Europe 600 index was 0.3 percent lower on Monday, after rising 3 percent last week. The CAC 40 in France fell 0.5 percent, the DAX in Germany dropped 0.6 percent and the FTSE 100 in Britain was 0.5 percent weaker.

  • Shares in Twitter tumbled nearly 7 percent in premarket trading, after the social media company on Friday permanently banned President Trump, who had more than 88 million followers, citing “the risk of further incitement of violence.”

  • Last week, U.S. stock markets pushed higher after Democrats won two Senate seats in Georgia, clinching control of the upper house of Congress, increasing investors’ expectations of more fiscal spending. The markets continued rising even after a pro-Trump mob stormed the Capitol on Wednesday. Democrats, pointing to Mr. Trump’s inciting of the mob, have taken steps to remove Mr. Trump from the presidency.

  • The U.S. dollar gained against other major currencies on Monday, sending most commodity prices lower. Copper prices fell 0.6 percent and futures of West Texas Intermediate, the U.S. crude oil benchmark, dropped 0.8 percent.

  • In Britain, there were more signs of how the pandemic has split in the consumer economy. The number of passengers that traveled through Heathrow, Britain’s busiest airport, fell 73 percent last year. The company that runs the airport said lockdowns and border closures led to a loss of 58.8 million passengers. Meanwhile, shares in JD Sport, a clothing retailer, jumped 4.7 percent after the company said it expected earnings to be significantly higher than market expectations.

  • Shares in Boeing fell 2.3 percent in premarket trading following Saturday’s crash in Indonesia of a 737-500 series passenger carrying 62 people. The Sriwijaya Air flight fell into the Java Sea shortly after takeoff from Jakarta. No survivors are expected; investigators are still seeking the so-called black boxes.

  • Bitcoin fell to about $35,000 on Monday, down 17 percent from a record high of $41,962 reached on Friday. The cryptocurrency has surged substantially in recent weeks; just a month ago its price was below $20,000.

  • “Bitcoin’s parabolic rise is unsustainable in the near term,” Scott Minerd, the global chief investment Officer of Guggenheim Partners, an investment company, wrote on Twitter. “Vulnerable to a setback. The target technical upside of $35,000 has been exceeded. Time to take some money off the table.”

Nothing has stopped the stock market’s momentum over the last year: not the pandemic, not record unemployment and not the Capitol riot.

But don’t take that as a sign that the market is envisioning a calm and prosperous six months ahead, writes The New York Times’s Jeff Sommer. Instead, the rally simply reflects the greed of bullish investors. Here’s what’s fueling the high hopes:

  • Interest rates remain extraordinarily low, and the Federal Reserve and other central banks have said they are determined to keep short-term rates low. When rates are low, stocks and other risky assets are comparatively attractive.

  • The pandemic is the main cause of global economic troubles and it will eventually end. With vaccinations underway, Wall Street hopes that growth in most regions and sectors will surge later this year, along with rising corporate profits.

  • With Democrats sweeping the two contested Senate seats in Georgia, the chances of at least some further economic stimulus have increased. President-elect Joseph R. Biden Jr. will most likely be able to deliver more aid to people in need and to local governments, which is expected to increase economic growth.

  • Truly sweeping legislative changes will be difficult, if not impossible, given the Democratic Party’s razor-thin margin in the Senate and reduced majority in the House. Some increased spending is likely, but this slim grip on power implies that big tax increases on wealthy investors and rich corporations may not happen soon.

  • The election may have delivered something close to a Goldilocks alignment for the stock market. Mr. Biden’s cabinet picks so far suggest that he will govern as a centrist, and the market historically has fared well under Democratic presidents who do not have sweeping control of Congress. The possibility that the Biden administration will usher in a more efficient and inclusive government, with more spending and only moderate changes otherwise, is seen as a sweet outcome for stocks.





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